SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996 OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________________ to
---------------
Commission File Number 0-20707
COLONIAL REALTY LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Delaware 63-1098468
(State of organization) (I.R.S. employer
identification no.)
2101 Sixth Avenue North 35203
Suite 750 (Zip Code)
Birmingham, Alabama
(Address of principal
executive offices)
Registrant's telephone number, including area code: (205)
250-8700
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on
which registered
Not applicable Not applicable
Securities registered pursuant to Section 12(g) of the Act:
None
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 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 of 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. | |
Documents Incorporated by Reference
None.
<PAGE>
PART I
Item 1. Business.
As used herein, the terms "CRLP" and "Operating Partnership" include
Colonial Realty Limited Partnership, a Delaware limited partnership, and its
subsidiary and other affiliates (including Colonial Properties Services Limited
Partnership) or, as the context may require, Colonial Realty Limited Partnership
only. As used herein, the term "Company" includes Colonial Properties Trust, an
Alabama real estate investment trust, and one or more if its subsidiaries and
other affiliates (including Colonial Properties Holding Company, Inc., CRLP,
Colonial Properties Services Limited Partnership and Colonial Properties
Services, Inc.) or, as the context may require, Colonial Properties Trust only.
CRLP is the Operating Partnership of the Company, which is one of the
largest owners, developers and operators of multifamily, retail and office
properties in the southeastern United States. It is a fully-integrated real
estate company, whose activities include ownership of a diversified portfolio of
73 properties located in Alabama, Florida, Georgia, and South Carolina,
development of new properties, acquisition of existing properties, build-to-suit
development, and the provision of management, leasing, and brokerage services
for commercial real estate. CRLP currently owns 42 multifamily apartment
communities containing a total of 13,617 apartment units (the "Multifamily
Properties"), 21 retail properties containing a total of approximately 5.6
million square feet of retail space (the "Retail Properties"), 10 office
properties containing a total of approximately 1.0 million square feet of office
space (the "Office Properties"), and certain parcels of land adjacent to 5 of
these properties (the "Land"). (The Multifamily Properties, the Retail
Properties, the Office Properties and the Land are referred to collectively as
the "Properties"). As of December 31, 1996, the Multifamily Properties that had
achieved stabilized occupancy, the Retail Properties, and the Office Properties
were 94.8%, 93.8% and 97.4% leased, respectively.
CRLP's executive offices are located at 2101 Sixth Avenue North, Suite
750, Birmingham, Alabama, 35203 and its telephone number is (205) 250-8700. CRLP
was formed in Delaware on August 6, 1993.
Formation of the Company
The Operating Partnership was formed to succeed to substantially all of
the interests of Colonial Properties, Inc., an Alabama corporation ("Colonial"),
its affiliates and certain others in a diversified portfolio of multifamily,
retail, and office properties located in Alabama, Florida, and Georgia and to
the development, acquisition, management, leasing, and brokerage businesses of
Colonial.
On September 29, 1993, (i) the Company consummated an initial public
offering (the "IPO") of 8,480,000 of its common shares of beneficial interest,
$.01 par value per share ("Common Shares"), (ii) the Operating Partnership
assumed ownership of 36 Properties (or interests therein) held by Thomas H.
Lowder, James K. Lowder, Robert E. Lowder, and their mother, Catherine Lowder
(the "Lowder family"), and third-party partners of the Lowder family, and the
operating businesses of Colonial, (iii) the Company transferred the net proceeds
from the IPO through Colonial Properties Holding Company, Inc. to the Operating
Partnership, in exchange for 8,480,000 units of limited partnership interest in
the Operating Partnership ("Units"), (iv) the Operating Partnership repaid
approximately $150.2 million of indebtedness and prepayment penalties associated
therewith secured by certain of the Properties, and (v) the Operating
Partnership established a $35.0 million line of credit with SouthTrust Bank,
which has since been increased to $125.0 million, to fund development activities
and property acquisitions and for general corporate purposes (collectively, the
"Formation Transactions"). On October 28, 1993, the underwriters of the IPO
exercised an over-allotment option to purchase an additional 686,200 shares.
Recent Developments
Since the Company's IPO, CRLP has significantly expanded its portfolio
of Properties and its operating businesses. Acquisitions by CRLP of new
properties represent a total investment of $573.1 million. CRLP has also
completed the expansion of four multifamily properties since the IPO, adding a
total of 728 units to the multifamily portfolio. CRLP currently has seven active
expansion and development projects in progress for Multifamily Properties
(including additional phases of two existing Multifamily Properties) and major
expansions of the CRLP's Macon Mall and Montgomery Promenade Retail Properties.
The following is a summary of CRLP's acquisition and development
activity in 1996.
Acquisition Activity
CRLP acquired three retail shopping centers in central Florida and one
regional mall in South Carolina containing approximately 1.1 million leasable
square feet for a total purchase price of approximately $90.0 million. CRLP
spent $4.3 million to acquire tenant-owned space and underlying land at an
existing retail center.
CRLP also acquired five multifamily properties in Alabama and two
multifamily properties in Georgia containing 1,505 units for a total purchase
price of approximately $79.0 million.
Development Activity
During 1996 CRLP constructed 873 new apartment units in six multifamily
communities (three of which were completed during the year) and acquired land on
which it intends to develop two additional multifamily communities during 1997.
The aggregate cost of this multifamily development activity was $68.2 million.
As of December 31, 1996, CRLP has 1,216 apartment units in six multifamily
communities under development and expansion. Management anticipates that two of
the multifamily projects will be completed during the first half of 1997 and
three others will be completed during the second half of the year. The remaining
multifamily project will be completed during the first half of 1998. Management
expects to invest approximately $31.8 million over these periods to complete
these projects.
During 1996 CRLP also continued the 422,000 square foot expansion of
its regional mall in Macon, Georgia and began a 225,000 square foot expansion of
a community shopping center in Montgomery, Alabama. The aggregate cost of this
retail development activity was $31.6 million. The Macon Mall expansion was
completed and opened during February 1997, and management anticipates completing
its Montgomery project during the last half of 1997. Management expects to
invest approximately $19.8 million during 1997 to complete these projects.
The table below provides an overview of CRLP's acquisition and
development activity during 1996:
<TABLE>
Summary of Recent
Acquisition and Development
Activity
<CAPTION>
Completion or Cost or
Anticipated Type of Units(M) Anticipated
Completion Name of Property GLA (R) Cost (in
Date Property Location (1) (2) Thousands (3)
- -------------- -------------------- ----------- ------ ------- ------------
<S> <C> <C> <C> <C> <C>
Acquisitions:
2nd Qtr 96 Ashford Place Mobile, AL M 168 $ 6,400
2nd Qtr 96 Pointe West Mobile, AL M 104 4,700
2nd Qtr 96 Spring Creek Macon, GA M 296 14,400
2nd Qtr 96 Crowne Chase Birmingham, AL M 244 13,700
2nd Qtr 96 Crowne Point Birmingham, AL M 392 23,100
2nd Qtr 96 Crowne Ridge Birmingham, AL M 125 7,200
3rd Qtr 96 Barrington Club Macon, GA M 176 9,500
3rd Qtr 96 Briarcliffe Mall Myrtle
Beach, SC R 488,000 42,800
3rd Qtr 96 Winter Haven Orlando,
(expansion) FL R 22,000 4,300
4th Qtr 96 Bardmoor Village St.
Petersburg, FL R 158,000 11,900
4th Qtr 96 Island Walk Orlando, FL R 222,000 17,200
4th Qtr 96 Wekiva River Walk Orlando, FL R 209,000 18,100
Developments:
1st Qtr 96 McGehee Place V
(expansion) Montgomery, AL M 16 800
4th Qtr 96 Inverness Lakes
(expansion) Mobile, AL M 180 9,500
4th Qtr 96 Colonial Grand at Birmingham,
Galleria (expansion) AL M 160 8,700
1st Qtr 97 Riverchase III
(expansion) Tampa, FL M 276 14,900
1st Qtr 97 Colonial Grand at
Heathrow Orlando, FL M 312 20,400
1st Qtr 97 Colonial Grand at
Bayshore Bradenton, FL M 212 11,600
4th Qtr 97 Colonial Village at Birmingham,
Inverness (expansion AL M 84 4,100
4th Qtr 97 Colonial Grand at
Bayshore II
(expansion) Bradenton, FL M 164 9,100
4th Qtr 97 Colonial Grand at
Wesleyan Macon, GA M 240 12,800
2nd Qtr 98 Colonial Grand at
Hunter's Creek Orlando, FL M 496 33,000
1st Qtr 97 Macon Mall (expansion)Macon, GA R 422,000(4) 52,000
4th Qtr 97 Montgomery Promenade Montgomery,
(expansion) AL R 225,000(5) 7,000
--------
Total $357,200
========
<FN>
(1) M refers to Multifamily Properties and R refers to Retail Properties.
(2) Units (in this table only) refers to multifamily apartment units and
GLA refers to gross leasable area of retail space.
(3) Amounts in thousands.
(4) Includes 249,000 square feet of GLA and 173,000 square feet of space owned
by an anchor.
(5) Includes 95,000 square feet of GLA and 130,000 square feet of space
owned by an anchor.
</FN>
</TABLE>
<PAGE>
Multifamily Property Acquisitions
Spring Creek Apartments--On April 1, 1996, CRLP acquired Spring Creek
Apartments, a 296-unit luxury multifamily community in Macon, Georgia at a
purchase price of $14.4 million which was financed through an advance on CRLP's
unsecured line of credit. Spring Creek was constructed in two phases completed
in 1992 and 1994. The development consists of 33 two-story buildings and a
separate clubhouse on approximately 27 acres of land. Amenities include two
swimming pools, a fitness center, and racquetball and tennis courts.
Crowne Chase Apartments--On April 15, 1996, CRLP acquired Crowne Chase
Apartments, a 244-unit luxury multifamily community in Birmingham, Alabama.
Crowne Chase was acquired for a purchase price of $13.7 million which was
financed through an advance on CRLP's unsecured line of credit. The development,
which was constructed in 1994, consists of 16 two-story buildings and a separate
clubhouse on approximately 20.3 acres. Amenities include a fitness center, a
swimming pool with sauna, lighted tennis courts, and breathtaking landscaping
and waterscaping.
Crowne Point Apartments--On May 10, 1996, CRLP acquired Crowne Point
Apartments, a 392-unit complex comprising 26 two-story buildings in a suburb of
Birmingham, Alabama. The buildings were constructed in two phases in 1987 and
1991. Crowne Point was acquired for a purchase price of $23.1 million which was
financed through the assumption of a mortgage with a balance of $12.4 million,
which bears interest at 8.0%, and an advance on CRLP's unsecured line of credit.
Crowne Point's amenities include a recreational building, two swimming pools, a
clubhouse with an exercise room, and lighted tennis courts.
Pointe West Apartments and Ashford Place Apartments--On April 1, 1996,
CRLP acquired Pointe West Apartments in Mobile, Alabama. Pointe West was
completed in 1981 and consists of 104 units in 14 two-story buildings with a
separate clubhouse on approximately 7.6 acres of land.
Also on April 1, 1996, CRLP acquired Ashford Place Apartments in
Mobile, Alabama. Ashford Place was completed in 1983 and consists of 168 units
in 11 two-story buildings with a separate clubhouse on approximately 8.8 acres
of land.
Both properties offer a swimming pool, exercise room, a fireplace in
each unit, and controlled access parking. Pointe West also offers covered
parking to its residents. The combined purchase price of approximately $11.1
million for Ashford Place and Pointe West was paid through the issuance of
182,804 limited partnership units at $24.00 per unit, the assumption of
approximately $6.4 million of indebtedness at an interest rate of 7.125%, and
payment of other acquisition costs estimated at approximately $330,000.
Crowne Ridge Apartments--On May 10, 1996, CRLP acquired Crowne Ridge
Apartments, located in a suburb of Birmingham, Alabama. Crowne Ridge consists of
125 units in eight two-story buildings which were built in 1992. The purchase
price of $7.2 million was financed through CRLP's assumption of a mortgage with
a balance of $3.8 million which bears interest at 8.06% and through an advance
on CRLP's line of credit. Crowne Ridge's amenities include a clubhouse with an
exercise room, a swimming pool, and extensive landscaping.
Barrington Club Apartments--On September 13, 1996, CRLP acquired
Barrington Club Apartments, a 176-unit luxury multifamily community in Macon,
Georgia. Barrington Club was acquired for a purchase price of $9.5 million which
was financed through an advance on CRLP's unsecured line of credit. The
development, which was completed earlier this year, consists of eight two- and
three-story buildings and a separate clubhouse on approximately 14 acres of
land. Amenities include a swimming pool, a fitness center, tennis courts, and a
playground. The property is located in the Barrington Hall, a 650-acre Planned
Unit Development, which includes a golf club with an 18-hole course, estate
homes, and single family homes. Residents of Barrington Club Apartments have
golf privileges at the club.
CRLP intends to continue to pursue acquisitions in the southeastern
United States that meet CRLP's acquisition criteria for property quality, market
strength and investment return.
Completed Multifamily Expansions
McGehee Place V Apartments--CRLP completed the 16-unit expansion of
McGehee Place Apartments in Montgomery, Alabama in May 1996 at a total cost of
$0.8 million, including land acquisition costs funded through advances under
CRLP's line of credit. CRLP expects to complete lease-up of this completed
expansion during the first quarter of 1997.
Colonial Grand at Galleria--CRLP completed the 160-unit expansion of
Colonial Grand at Galleria located in Birmingham, Alabama in October 1996 at a
total cost of $8.7 million including land acquisition costs funded through
advances under CRLP's line of credit. CRLP expects to complete lease-up of this
completed expansion during the second quarter of 1997.
Inverness Lakes Apartments--CRLP completed the 180-unit expansion of
Inverness Lakes Apartments located in Mobile, Alabama in September 1996 at a
total cost of $9.5 million including land acquisition costs, which were funded
through advances under CRLP's line of credit. CRLP expects to complete lease-up
of this completed expansion during the first quarter of 1997.
Continuing Multifamily Expansion and Development Activity
Riverchase III--CRLP continued construction on a 276-unit expansion of
Riverchase III Apartments located in Tampa, Florida. The community amenities
will include a clubhouse, a swimming pool, an exercise center, an air
conditioned racquetball court, tennis courts, and laundry facilities. Project
development costs, including land acquisition costs, are expected to total $14.9
million and will be funded through advances on CRLP's line of credit. CRLP
expects to complete construction in the first quarter of 1997 and to complete
lease-up during the second quarter of 1998.
Colonial Grand at Bayshore--CRLP continued construction on a 212-unit
development located in Bradenton, Florida. The new community will offer a
variety of amenities, including a club house, an exercise center, a swimming
pool overlooking a five-acre lake, tennis and basketball courts, a children's
playground, tenant garages, and storage units. Project costs, including land
acquisition costs, are expected to total $11.6 million and will be funded
through advances on CRLP's line of credit. CRLP expects to complete construction
in the second quarter of 1997 and to complete lease-up during the third quarter
of 1997.
Colonial Grand at Heathrow--CRLP continued construction on a 312-unit
development located in Heathrow (Orlando), Florida. CRLP acquired the land (30
acres) in December 1994 at a cost of $2.2 million. The new development will be
located adjacent to Heathrow International Business Center and Heathrow Country
Club. The new apartment community will offer a variety of amenities, including a
clubhouse with conference and computer rooms, an exercise center, tennis and
basketball courts, a swimming pool, and laundry facilities. Project development
costs, including land acquisition costs, are expected to total $20.4 million and
will be funded through advances on CRLP's line of credit. CRLP expects to
complete construction in the first quarter of 1997 and to complete lease-up
during the second quarter of 1997.
New Multifamily Expansion and Development Activity
Colonial Village at Inverness--CRLP began construction on an 84-unit
expansion of Colonial Village at Inverness located in Birmingham, Alabama during
the third quarter of 1996. Project development costs, including land acquisition
costs, are expected to total $4.1 million and will be funded through advances on
CRLP's line of credit. CRLP expects to complete construction in the fourth
quarter of 1997 and to complete lease-up during the first quarter of 1998.
Colonial Grand at Bayshore II--CRLP began construction on a 164-unit
expansion to this development located in Bradenton, Florida. CRLP acquired the
land (12.5 acres) at a cost of $1.0 million pursuant to an option acquired at
the time CRLP purchased the land for the existing Colonial Grand at Bayshore
development in November 1995. This expansion phase will offer the same amenities
as the existing community. Project development costs, including land acquisition
costs, are expected to total $9.1 million and will be funded through advances on
CRLP's line of credit. CRLP expects to complete construction in the fourth
quarter of 1997 and to complete lease-up during the second quarter of 1998.
Colonial Grand at Wesleyan--CRLP began construction on a 240-unit
development located in Macon, Georgia. CRLP acquired the land (49.8 acres) at a
cost of $1.4 million, which was determined pursuant to an option acquired at the
time of the Company's IPO in September 1993. The new community will offer a
variety of amenities, including a clubhouse, an exercise center, a swimming
pool, tennis courts, and storage units for rent. Project development costs,
including land acquisition costs, are expected to total $12.8 million and will
be funded through advances on CRLP's line of credit. CRLP expects to complete
construction in the fourth quarter of 1997 and to complete lease-up during the
second quarter of 1998.
Colonial Grand at Hunter's Creek--CRLP began construction on a 496-unit
development located in Orlando, Florida. CRLP acquired the land (36 acres) at a
cost of $4.0 million. The new apartment community will offer a variety of
amenities, including a swimming pool and spa, an exercise room, enclosed
garages, tennis courts, and a car wash. Project development costs, including
land acquisition costs, are expected to total $33.0 million and will be funded
through advances on CRLP's line of credit. CRLP expects to complete construction
in the second quarter of 1998 and to complete lease-up during the first quarter
of 1999.
Retail Property Acquisitions
Briarcliffe Mall--On July 1, 1996, CRLP acquired Briarcliffe Mall, a
488,000 square foot regional mall in Myrtle Beach, South Carolina, for a
purchase price of $42.8 million. The mall includes a 50,745 square foot J.C.
Penney, an 84,000 square foot K-Mart, and two Belk's stores, one having 58,000
square feet and the other having 61,000 square feet under a ground lease. The
mall was constructed in 1986 and was 96% leased at December 31, 1996. The
acquisition includes approximately 9 acres of land adjacent to the mall property
which is available for expansion. CRLP used proceeds from its July 1996 debt
offering to fund $41.6 million of the acquisition price and issued 48,905
limited partnership units valued at $1.2 million. The units have been allocated
to the expansion land portion of the acquisition and as such will not be
eligible to receive distributions for 24 months after closing.
Wekiva River Walk--On October 1, 1996, CRLP acquired Wekiva River Walk
Shopping Center, a 209,000 square foot shopping center in Orlando, Florida, for
a purchase price of $18.1 million. The center includes a 58,000 square foot
Goodings Supermarket, a 36,000 square foot Beall's Department Store, a 26,000
square foot United Artists Cinema, and ground leases for NationsBank and Barnett
Bank. The center includes approximately 34,000 square feet of vacant in-line
shop space the Company anticipates using to enhance the center's performance.
The center was built in 1990 and was 84% leased at December 31, 1996.
Bardmoor Village--On October 1, 1996, CRLP acquired Bardmoor Village
Shopping Center, a 158,000 square foot shopping center in St. Petersburg,
Florida, for a purchase price of $11.9 million. The center includes a 66,000
square foot Publix Super Market, a 36,000 square foot Craft Depot, a 10,000
square foot Eckerd Drug Store, and a ground lease for First Union Bank. The
center was built in 1981, renovated and expanded in 1991, and was 99% leased at
December 31, 1996.
Island Walk--On October 1, 1996, CRLP also acquired Island Walk
Shopping Center, a 222,000 square foot shopping center in Orlando, Florida, for
a purchase price of $17.2 million. The center includes a 108,000 square foot
K-mart and a 56,000 square foot Publix Super Market. The center was built in two
phases with the first phase completed in 1993 and the second phase in 1995. The
center was 95% leased at December 31, 1996. In the acquisition of this property
CRLP assumed an existing mortgage of $10.4 million that matures in October 2001
and bears an interest rate of 8.8%.
Retail Expansion Activity
Macon Mall--On February 12, 1997, CRLP completed its 422,000 square
foot expansion of Macon Mall, a super regional mall located in Macon, Georgia.
The mall expansion will include new anchor tenants Parisian, Inc. and Dillard
Department Stores, Inc. together with 50 specialty shops, which have joined
existing department stores including Macy's Primary Real Estate, Inc.,
Belk-Matthews Company of Macon, Georgia, a Georgia Corporation, Sears, Roebuck
and Company and J.C. Penney Company, Inc. Macon Mall now contains approximately
1,431,000 square feet of retail shopping space. The project expansion costs
totaled approximately $52 million and were funded through advances on CRLP's
line of credit. CRLP expects to complete lease-up of this expansion during the
first quarter of 1998.
Montgomery Promenade--CRLP began the 225,000 square foot expansion of
Montgomery Promenade, a power center containing approximately 210,000 square
feet located in Montgomery, Alabama. The expansion, which will be known as
Montgomery Promenade North, will increase the shopping center to 435,000 square
feet of leasable area and will include a 130,000 square foot tenant-owned Home
Depot. Montgomery Promenade is anchored by Winn Dixie Market Place, Stein Mart,
Michael's Arts & Crafts, Goody's, Books-A-Million, and K & B Drugs. Project
expansion costs are expected to total approximately $7 million and will be
funded through advances on CRLP's line of credit. CRLP expects to complete
construction in the fourth quarter of 1997 and to complete lease-up during the
first quarter of 1998.
Financing Activity
In January 1996 the Company completed a public offering of 4.6 million
Common Shares at a price of $24.625 per share. The $106.6 million proceeds of
this offering, net of offering costs of $6.6 million, were used to fund
acquisition and development activity, repay the balances outstanding under
CRLP's revolving credit agreements, and to repay the $8.2 million balance
outstanding under a mortgage loan.
In July 1996 CRLP completed a public issuance of senior, unsecured debt
securities totaling $130.0 million. The securities were issued in two series of
$65 million each requiring semi-annual payments of interest only. One series,
which matures in July 2001, bears interest at 7.50% and was priced at a spread
of 95 basis points over the five-year treasury bond rate, resulting in an
original issue discount of $145,383. The other series, which matures in July
2006, bears interest at 8.05% and was priced at a spread of 128 basis points
over the ten-year treasury bond rate, resulting in an original issue discount of
$288,410.
In July 1996 the Company refinanced loans collateralized by five of the
Company's multifamily properties and representing a total of approximately $53.0
million in outstanding indebtedness. The loans are financed through tax-exempt
bonds which are credit enhanced by Fannie Mae. The loans, which bear interest at
a weekly variable interest rate, require monthly interest payments through June
2006 and principal and interest payments from July 2006 through June 2026. The
weighted average interest rate of these five loans was 3.42% at December 31,
1996.
In December 1996 CRLP completed a public issuance of unsecured
medium-term debt securities totaling $50.0 million. The securities mature in
December 2003 and bear interest at 7.05% which, at the time of issuance, equated
to a spread of 90 basis points over the seven-year treasury bond rate.
In January 1997 CRLP completed an additional issuance of unsecured
medium-term debt securities also totaling $50.0 million. These securities mature
in January 2003 and bear interst at 7.16% which, at the time of issuance,
equated to a spread of 80 basis points over the six-year treasury bond rate.
In January 1997 the Company completed a public offering of 1.5 million
Common Shares at a price of $29.875 per share. The $43.4 million proceeds of
this offering, net of offering costs of $1.4 million, were used to fund
acquisition and development activity, repay the balances outstanding under
CRLP's revolving credit agreement, and to repay $24.5 million outstanding under
four mortgage loans.
Business Strategy
The general business strategy of the Company and CRLP is to generate
stable and increasing cash flow and portfolio value for its shareholders. The
Company and CRLP (and their predecessor) have implemented this strategy
principally by (i) realizing growth in income from their existing portfolio of
properties, (ii) developing, expanding, and selectively acquiring additional
multifamily, retail, and office properties in growth markets located in the
southeastern United States, where CRLP has first-hand knowledge of growth
patterns and local economic conditions, (iii) managing their own properties,
which has enabled them to better control operating expenses and establish
long-term relationships with their retail and office tenants, (iv) maintaining
the Company's third-party property management business, which has increased cash
flow and established additional relationships with tenants, and (v) employing a
comprehensive capital maintenance program to maintain properties in first-class
condition. CRLP's business strategy and the implementation of that strategy are
determined by CRLP's partners and may be changed from time to time.
Financing Strategy
CRLP intends to maintain a ratio of debt to total market capitalization
(i.e., the total debt divided by the market value of issued Units plus total
debt) of approximately 50% or less. At December 31, 1996, after considering the
effect of the January 1997 debt offering and the Company's equity offering,
CRLP's total debt included fixed-rate debt of $426.7 million, or 86.9%, and
floating-rate debt of $64.5 million, or 13.1%. CRLP has obtained interest rate
protection for $17.8 million of the floating-rate debt.
CRLP may from time to time reevaluate its borrowing policies in light
of then current economic conditions, relative costs of debt and equity capital,
market values of properties, growth and acquisition opportunities and other
factors. CRLP may modify its borrowing policy and may increase or decrease its
ratio of debt to total market capitalization. To the extent that the partners of
CRLP determine to seek additional capital, CRLP may raise such capital through
additional equity offerings by the Company, debt financings, or retention of
cash flow (subject to provisions in the Code requiring the distribution by a
REIT of a certain percentage of taxable income and taking into account taxes
that would be imposed on undistributed taxable income) or a combination of these
methods.
Property Management
CRLP is experienced in the management and leasing of multifamily,
retail, and office properties and believes that the management and leasing of
its own portfolio has helped the Properties maintain consistent income growth
and has resulted in reduced operating expenses from the Properties. This also
allows CRLP to establish additional relationships with tenants who may require
additional retail or office space and to identify potential acquisitions.
Operational Structure
Multifamily Division--The multifamily division of CRLP is responsible
for all aspects of CRLP's multifamily operations, including day-to-day
management and leasing of the 42 Multifamily Properties, as well as development
and acquisition of additional multifamily properties. The multifamily division
also is responsible for the provision of third-party management services for
apartment communities in which CRLP does not have an ownership interest.
Retail Division--CRLP's retail division is responsible for all aspects
of CRLP's retail operations, including the provision of management and leasing
services for the 21 Retail Properties, as well as the development and
acquisition of additional retail properties. The retail division also is
responsible for the provision of third-party management services for retail
properties in which CRLP does not have an ownership interest and for brokerage
services in other retail property transactions. The retail division has regional
offices in Huntsville and Montgomery, Alabama and Orlando, Florida and satellite
leasing offices in two cities in central Florida.
Office Division--CRLP's office division is responsible for all aspects
of CRLP's commercial office operations, including the provision of management
and leasing services for the 10 Office Properties, as well as the development
and acquisition of additional office properties. The office division also is
responsible for the provision of third-party management services for office
properties in which CRLP does not have an ownership interest and for brokerage
services in other office property transactions.
Employees
CRLP employs approximately 560 persons, including on-site property
employees who provide services for the Properties that CRLP owns and/or manages.
Tax Status
CRLP has no provision for income taxes since all taxable income or loss
or tax credits are passed through to the partners. The Company has made an
election to be taxed as a REIT under Sections 856 through 860 of the Internal
Revenue Code of 1986, as amended (the "Code"), commencing with its taxable year
ending December 31, 1993. If the Company qualifies for taxation as a REIT, the
Company generally will not be subject to Federal income tax to the extent it
distributes at least 95% of its REIT taxable income to its shareholders. Even if
the Company qualifies for taxation as a REIT, the Company may be subject to
certain state and local taxes on its income and property and to federal income
and excise taxes on its undistributed income.
<PAGE>
Item 2. Properties.
General
The 73 Properties consist of 42 Multifamily Properties, 21 Retail
Properties, and 10 Office Properties, as described in more detail below.
Thirty-five of the Properties were acquired in connection with the Formation
Transactions, 19 Properties and one additional phase of an existing Property
were acquired during 1994, six Properties were acquired during 1995, and 11
Properties were acquired in 1996. Also, two new multifamily communities are
currently being developed by CRLP.<TABLE>
Summary of Properties
<CAPTION>
Percent
of
Total Total Percentage
Units/ 1996 1996 Occupancy
Number GLA/ Property Property at
Type of of NRA Revenue Revenue Dec. 31,
Property Properties (1) (2) (2) 1996 (3)
- ----------------- --------- -------- ------------ ----------- ----------
<S> <C> <C> <C> <C> <C>
Multifamily 42 13,617 $ 80,915,000 59.2% 94.8%
Retail 21 5,646,000 45,775,000 33.5% 93.8%
Office 10 1,009,000 10,061,000 7.3% 97.4%
---- ------------ -------
Total 73 $136,751,000 100.0%
==== ============ =======
<FN>
(1)Units (in this table only) refers to multifamily apartment units, GLA refers
to gross leasable area of retail space and NRA refers to net rentable area of
office space. Information is presented as of December 31, 1996.
(2)Includes CRLP's proportionate share of revenue from those Office Properties
accounted for under the equity method.
(3)Excludes 2,734 units of expansion phases of six Multifamily Properties that
had not achieved stabilized occupancy as of December 31, 1996.
</FN>
</TABLE>
Multifamily Properties
The 42 Multifamily Properties contain a total of 13,617 garden-style
apartments and range in size from 104 to 1,080 apartment units. Sixteen of the
Multifamily Properties were acquired by CRLP in connection with the Formation
Transactions, 17 Properties and one additional phase of an existing Property
were acquired during 1994 from third parties, and seven Properties were acquired
during 1996. Also, two new communities were being developed by CRLP during 1996.
Twenty-three Multifamily Properties (containing a total of 8,621 apartment
units) are located in Alabama, 13 Multifamily Properties (containing a total of
3,846 apartment units) are located in Florida and six Multifamily Properties
(containing a total of 1,150 apartments units) are located in Georgia. Each of
the Multifamily Properties is established in its local market and provides
residents with numerous amenities, including a swimming pool, jacuzzi,
clubhouse, laundry room, tennis court(s), and/or a playground.
<PAGE>
The following table sets forth certain additional information
relating to the Multifamily Properties as of and for the year ended December 31,
1996.
<TABLE>
Year Number Approximate
Multifamily Completed of Rentable Area Percent
Property (1) Location (2) Units(3) (Square Feet) Occupied
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Ashford Place Mobile 1983 168 146,000 98.2%
CV at Rocky Ridge Birmingham 1984 226 235,000 96.9%
Colony Park Mobile 1975 201 144,000 88.1%
CG at Galleria Woods Birmingham 1994 244 260,000 93.4%
CG at Mountain Brook Birmingham 1987/91 392 393,000 94.6%
CV at Cahaba Heights Birmingham 1992 125 131,000 99.2%
Grande View
Towers Huntsville 1990 308 323,000 97.4%
CV at Inverness Birmingham 1986/87/90 502 395,000 88.2%
Huntleigh Woods Mobile 1978 233 199,000 98.3%
Inverness Mobile 1983/96 366 371,000 (7)
McGehee Place Montgomery 1986/95 468 387,000 (7)
CV at Monte D'Oro Birmingham 1977 200 296,000 100.0%
Patio Auburn 1966/83/84 240 179,000 99.2%
Pointe West Mobile 1981 104 114,000 97.1%
CG at Galleria Birmingham 1986/96 1,080 1,100,000 (7)
Rime Village-
Huntsville Huntsville 1987/94 736 809,000 92.3%
CG at Riverchase Birmingham 1984/91 468 746,000 97.9%
Ski Lodge I Birmingham 1972/73/76 648 549,000 94.8%
Ski Lodge II Birmingham 1979/86 644 511,000 97.4%
Ski Lodge III Birmingham 1984 554 502,000 95.3%
Ski Lodge
Tuscaloosa Tuscaloosa 1976/92 304 273,000 96.4%
Vieux Carre Montgomery 1971/74/78 250 222,000 82.0%
Willow Bend Montgomery 1984 160 151,000 93.8%
------ ------- -----
Subtotal - Alabama (23 Properties) 8,621 8,436,000 94.7%
------ ------- -----
CG at Kirkman Park Orlando 1991 370 337,000 98.4%
Carrollwood Tampa 1966 244 286,000 98.0%
CG at Bayshore Bradenton 1996 148 203,000 (7)
CG at Heathrow Orlando 1996 280 370,000 (7)
Pelican Pointe Bradenton 1992 340 292,000 90.3%
Plantation Gardens Sarasota 1991 248 252,000 99.6%
Polos Gainesville Gainesville 1989/93/94 560 487,000 97.7%
Polos Pointe Vedra Jacksonville 1988 240 212,000 88.8%
Polos West Orlando 1991 200 169,000 99.5%
Riverchase Tampa 1991 392 431,000 (7)
CV at Lake Mary Orlando 1991/95 504 431,000 94.6%
Sunchase Bradenton 1986 168 135,000 94.1%
Willowtree Pensacola 1983 152 116,000 95.4%
------- -------- -----
Subtotal - Florida (13 Properties) 3,846 3,721,000 95.7%
------- -------- -----
Barrington Club Macon 1966 176 201,000 92.6%
North Ingle Villas Macon 1983 140 133,000 86.4%
Somerset Place Savannah 1986 120 108,000 93.3%
Somerset Wharf Savannah 1986/87 178 151,000 94.4%
Spring Creek Macon 1992/94 296 328,000 97.6%
Stockbridge Manor Stockbridge 1993/94 240 267,000 92.5%
------- -------- -----
Subtotal - Georgia (6 Properties) 1,150 1,188,000 93.5%
------- -------- -----
TOTAL (42 Properties) 13,617 13,345,000 94.8%
======= ======== =====
<PAGE>
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Average Percent of
Rental Total 1996 Total 1996
Rate Property Property
Per Unit Revenue Revenue (4)
- ------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Ashford Place $ 471 $ 702,000 (6) 0.5%
CV at Rocky Ridge 584 1,544,000 1.1%
Colony Park 379 833,000 0.6%
CG at Galleria Woods 654 1,268,000 (6) 0.9%
CG at Mountain Brook 633 1,702,000 (6) 1.2%
CV at Cahaba Heights 685 573,000 (6) 0.4%
Grande View
Towers 568 2,017,000 1.5%
CV at Inverness 539 2,908,000 2.1%
Huntleigh Woods 416 1,129,000 0.8%
Inverness 555 2,035,000 1.5%
McGehee Place 543 2,622,000 1.9%
CV at Monte D'Oro 636 1,477,000 1.1%
Patio 398 1,063,000 0.8%
Pointe West 580 541,000 (6) 0.4%
CG at Galleria 622 6,532,000 4.8%
Rime Village-
Huntsville 577 4,616,000 3.4%
CG at Riverchase 738 3,722,000 2.8%
Ski Lodge I 404 3,186,000 2.4%
Ski Lodge II 407 3,043,000 2.3%
Ski Lodge III 431 2,776,000 2.0%
Ski Lodge
Tuscaloosa 400 1,428,000 1.0%
Vieux Carre 478 1,305,000 1.0%
Willow Bend 548 979,000 0.7%
------ ------- -----
Subtotal - Alabama 533 48,001,000 35.2%
------ ------- -----
CG at Kirkman Park 735 3,363,000 2.5%
Carrollwood 773 2,158,000 1.6%
CG at Bayshore 723 177,000 0.1%
CG at Heathrow 783 743,000 0.5%
Pelican Pointe 659 2,392,000 1.7%
Plantation Gardens 767 2,215,000 1.6%
Polos Gainesville 701 4,534,000 3.3%
Polos Pointe Vedra 654 1,808,000 1.3%
Polos West 617 1,439,000 1.1%
Riverchase 567 1,598,000 1.2%
CV at Lake Mary 610 3,703,000 2.7%
Sunchase 604 1,100,000 0.8%
Willowtree 475 846,000 0.6%
------ ------- -----
Subtotal - Florida 670 26,076,000 19.0%
------ ------- -----
Barrington Club 654 387,000 (6) 0.3%
North Ingle Villas 551 846,000 0.6%
Somerset Place 621 873,000 0.6%
Somerset Wharf 601 1,250,000 0.9%
Spring Creek 612 1,647,000 (6) 1.2%
Stockbridge Manor 661 1,835,000 1.4%
------ ------- -----
Subtotal - Georgia 620 6,838,000 5.0%
------ ------- -----
TOTAL (42 Properties) $579 $ 80,915,000 59.2%
======= ======== =====
<FN>
(1)All Multifamily Properties are 100% owned by CRLP. In the listing of
Multifamily Property names, CG has been used as an abbreviation for Colonial
Grand and CV as an abbreviation for Colonial Village.
(2)Year initially completed and, where applicable, year(s) in which additional
phases were completed at the Property.
(3)Units (in this table only) refers to multifamily apartment units. Number of
Units includes all apartment units occupied or available for occupancy at
December 31, 1996.
(4)Percent of Total 1996 Property Revenue represents the Multifamily Property's
proportionate share of all revenue from the 73 Properties.
(5)Represents weighted average rental rate per unit of the 42 Multifamily
Properties at December 31, 1996.
(6)Represents revenues from the date of CRLP's acquisition of this Property in
1996 through December 31, 1996.
(7)Expanded or newly developed property currently undergoing lease-up.
</FN>
</TABLE>
The following table sets forth the total number of apartment units,
percent leased and average base rental rate per apartment unit as of the end of
each of the last five years for the Multifamily Properties:
<TABLE>
Average Base
Number Percent Rental Rate
Year-End of Units(1) Leased(2) Per Unit
<S> <C> <C> <C>
December 31, 1996 13,617 94.8% $579
December 31, 1995 11,239 95.7% $552
December 31, 1994 10,972 96.0% $531
December 31, 1993 3,618 96.7% $510
December 31, 1992 3,618 94.9% $472
<FN>
(1)Units (in this table only) refers to multifamily apartment units owned at
year end.
(2)Represents weighted average occupancy of the Multifamily Properties that had
achieved stabilized occupancy at the end of the respective period.
</FN>
</TABLE>
<PAGE>
Retail Properties
The 21 Retail Properties contain a total of approximately 5.6 million
square feet (including space owned by anchor tenants). Eight of the Retail
Properties are located in Alabama, 10 are located in Florida, two are located in
Georgia, and one Retail Property is located in South Carolina. The Retail
Properties consist of five enclosed regional malls (Briarcliffe Mall, Gadsden
Mall, Macon Mall, River Oaks Center, and Village Mall), two power centers, and
14 neighborhood shopping centers. Nine of the 21 Retail Properties were
originally developed by Colonial (two Retail Properties were acquired in 1994,
six were acquired in 1995, and four were acquired in 1996), and all of them are
now managed by CRLP.
The following table sets forth certain information relating to the
Retail Properties as of and for the year ended December 31, 1996.
<TABLE>
Retail Properties
<CAPTION>
Gross
Leasable
Year Area Number
Retail Completed (Square Of
Property (1) Location (2) Feet) (3) Stores
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama:
River Oaks Decatur 1979/89 494,000 65
81,000 (6)
Gadsden Mall Gadsden 1974/91 492,000 66
Village Mall Auburn 1973/84/89 399,000 65
Montgomery
Promenade Montgomery 1990 165,000 30
44,000 (6)
McGehee Place Montgomery 1986 55,000 14
50,000 (6)
Bellwood Montgomery 1988 37,000 14
50,000 (6)
Old Springville Birmingham 1982 64,000 14
Olde Town Montgomery 1978/90 39,000 19
Other -
------------ --------------
Subtotal-Alabama (8 Properties) 1,970,000 287
------------ --------------
Florida:
University Park
Plaza Orlando 1986/89 399,000 42
Country Lake Orlando 1990 217,000 27
Burnt Store Sq. Punta Gorda 1990 199,000 22
Winter Haven Orlando 1986 197,000 18
Northdale Court Tampa 1984 193,000 29
55,000 (6)
Bear Lake Orlando 1990 125,000 22
Paddock Park Ocala 1984 87,000 19
Bardmoor Village St. Petersburg 1981 158,000 27
Island Walk Orlando 1993/95 222,000 23
Wekiva River Walk Orlando 1990 209,000 23
------------ --------------
Subtotal-Florida (10 Properties) 2,061,000 252
------------ --------------
Georgia:
Macon Mall Macon 1975/88 507,000 115
510,000 (6)
Britt David Columbus 1990 110,000 11
------------ --------------
Subtotal-Georgia (2 Properties) 1,127,000 126
------------ --------------
South Carolina:
Briarcliffe Mall Myrtle Beach 1986 488,000 75
------------ --------------
Subtotal-South Carolina (1 Property) 488,000 75
------------ -------------
TOTAL (21 Properties) 5,646,000 740
============ ==============
<PAGE>
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Average
Base
Rent
Per Total Percent Of
Total Leased 1996 Retail Total 1996
Percent Annualized Square Property Property
Leased (3) Base Rent Foot (4) Revenue Revenue (5)
----------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Alabama:
River Oaks 91.8% $ 3,326,000 $ 14.84 $ 4,612,000 3.4%
Gadsden Mall 95.1% 2,615,000 13.38 4,021,000 2.9%
Village Mall 98.5% 2,665,000 12.91 3,801,000 2.8%
Montgomery
Promenade 100.0% 1,574,000 14.78 2,055,000 1.5%
McGehee Place 97.4% 538,000 11.34 616,000 0.5%
Bellwood 100.0% 380,000 10.76 485,000 0.4%
Old Springville 91.9% 401,000 8.40 461,000 0.3%
Olde Town 100.0% 365,000 9.26 403,000 0.3%
Other 191,000 (8) 0.1%
------------------------------------------------ -------
Alabama 95.6% 11,864,000 13.11 16,645,000 12.2%
------------------------------------------------ -------
Florida:
University Park
Plaza 97.7% 2,767,000 13.61 3,849,000 2.8%
Country Lake 96.3% 1,296,000 12.15 1,631,000 1.2%
Burnt Store Sq. 90.2% 1,254,000 11.67 1,593,000 1.2%
Winter Haven 82.7% 1,139,000 9.77 1,135,000 0.8%
Northdale Court 83.1% 1,389,000 9.68 2,033,000 1.5%
Bear Lake 85.5% 871,000 12.84 1,205,000 0.9%
Paddock Park 96.0% 640,000 11.69 831,000 0.6%
Bardmoor Village 98.9% 1,360,000 14.34 473,000 (7) 0.3%
Island Walk 95.1% 1,843,000 15.12 516,000 (7) 0.4%
Wekiva River Walk 83.6% 1,781,000 13.17 650,000 (7) 0.5%
------------------------------------------------ -------
Florida 91.5% 14,340,000 13.97 13,916,000 10.2%
------------------------------------------------ -------
Georgia:
Macon Mall 93.3% 5,972,000 20.13 10,821,000 7.9%
Britt David 100.0% 807,000 6.37 936,000 0.7%
------------------------------------------------ -------
Georgia 94.5% 6,779,000 18.18 11,757,000 8.6%
------------------------------------------------ -------
South Carolina:
Briarcliffe Mall 96.0% 4,075,000 15.69 3,457,000 (7) 2.5%
------------------------------------------------ -------
South Carolina 96.0% 4,075,000 17.34 3,457,000 2.5%
------------------------------------------------- -------
TOTAL 93.8% $ 37,058,000 $ 14.66 $ 45,775,000 33.5%
================================================= =======
<FN>
(1)All Retail Properties are 100% owned by CRLP.
(2)Year initially completed and, where applicable, year(s) in which the Property
was substantially renovated or an additional phase of the Property was
completed.
(3)Total GLA includes space owned by anchor tenants, but Percent Leased excludes
such space.
(4)Includes specialty store space only.
(5)Percent of Total 1996 Property Revenue represents the Retail Property's
proportionate share of all revenue from the 73 Properties.
(6)Represents space owned by anchor tenants.
(7)Represents revenues from the date of CRLP's
acquisitions of the Property in 1996 through December 31, 1996.
(8)Represents revenues from Meadowbrook Mini-Storage, a mini-warehouse rental
storage facility containing 295 rental warehouse units, which the Company
sold in November 1996.
</FN>
</TABLE>
<PAGE>
The following table sets forth the total gross leasable area, percent
leased and average base rent per leased square foot as of the end of each of the
last five years for the Retail Properties: <TABLE>
Gross Average
Leasable Area Percent Base Rent Per
Year-End (Square Feet) Leased Leased Square
(1) Foot (2)
<S> <C> <C> <C>
December 31, 1996 4,856,000 93.8% $14.66
December 31, 1995 3,758,000 93.1% $13.23
December 31, 1994 2,467,000 95.8% $12.61
December 31, 1993 2,158,000 95.0% $12.27
December 31, 1992 2,148,000 93.5% $11.50
<FN>
(1)Excludes 790,000 square feet of space owned by anchor tenants.
(2)Average base rent per leased square foot is calculated using specialty store
year-end base rent figures.
</FN>
</TABLE>
The following table sets out a schedule of the lease expirations for
leases in place as of December 31, 1996, for the Retail Properties:
<TABLE>
Percent of
Total Annual
Base Rent
Net Rentable Represented
Year of Number of Area Of Annualized by Expiring
Lease Tenants with Expiring Leases Base Rent of Leases
Expiration Expiring Leases(Square Feet)(1) Expiring Leases(1)(2) (1)
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1997 105 242,000 $ 2,896,000 7.8%
1998 123 361,000 3,873,000 10.5%
1999 133 468,000 4,537,000 12.2%
2000 106 589,000 5,083,000 13.7%
2001 75 201,000 2,748,000 7.4%
2002 36 127,000 1,450,000 3.9%
2003 30 98,000 1,359,000 3.7%
2004 34 429,000 2,530,000 6.8%
2005 30 138,000 1,960,000 5.3%
2006 38 426,000 3,410,000 9.2%
2007-2014 30 1,372,000 7,212,000 19.5%
======== ===================================== ==============
740 4,451,000 $ 37,058,000 100.0%
======== ===================================== ==============
<FN>
(1)Excludes 790,000 square feet of space owned by anchor tenants and 405,000
square feet of space not leased as of December 31, 1996.
(2)Annualized base rent is calculated using base rents as of December 31, 1996.
</FN>
</TABLE>
The following is a brief description of certain of the Retail
Properties.
Macon Mall--Macon Mall is a super-regional mall with approximately
1,431,000 square feet of rental space (including the recently completed
expansion) located in Macon, Georgia, approximately 100 miles south of Atlanta,
Georgia and serving a trade area of more than 650,000 people. Colonial developed
Macon Mall in 1975, completely renovated its interior in 1988, and completed a
422,000 square foot expansion of the mall in February 1997. As of December 31,
1996, the mall was 93.3% leased to a total of 115 tenants. Parisian, Dillard's,
Macy's, Sears, Belk Matthews and J.C. Penney are the anchor department stores.
As of February 28, 1997, J.C. Penney occupied approximately 169,000 square feet
(approximately 11.8% of the gross leasable area) pursuant to a lease which
expires in August 2000 and Parisian occupied 102,000 square feet (approximately
7.2% of the gross leasable area) pursuant to a lease which expires in March
2017. J.C. Penney has five options to extend the lease for five years each. Each
of Dillard's, Macy's, Sears, and Belk Matthews owns its store. In the opinion of
CRLP, Macon Mall is adequately covered by insurance.
The following table sets out a schedule of the lease expirations for Macon
Mall beginning with 1997. Leases accounting for approximately 11.6% of the
leased space (all of which is specialty space) in the Macon Mall will exprire on
or before December 31, 1997. <TABLE>
Percent of
Total Annual
Net Rentable Base Rent
Year of Number of Area Of Annualized Represented
Lease Tenants with Expiring Leases Base Rent of by Expiring
Expiration Expiring Leases (Square Feet)(1) Expiring Leases(1)(2) Leases(1)
- --------------------------------------------------------------------------------
<C> <C> <C> <C> <C>
1997 20 53,000 $ 749,000 12.5%
1998 15 42,000 753,000 12.6%
1999 15 32,000 679,000 11.4%
2000 17 216,000 1,282,000 21.5%
2001 6 12,000 284,000 4.8%
2002 6 7,000 210,000 3.5%
2003 6 21,000 209,000 3.5%
2004 2 6,000 130,000 2.2%
2005 15 33,000 843,000 14.1%
2006 12 32,000 796,000 13.3%
2007-2014 1 2,000 37,000 0.6%
======== ======================================= ==============
115 456,000 $ 5,972,000 100.0%
======== ======================================= ==============
<FN>
(1) Excludes 510,000 square feet of space owned by anchor tenants and 51,000
square feet of space not leased as of December 31. 1996.
(2) Annualized base rent is calculated using a specialty store base rent as of
December 31, 1996.
</FN>
</TABLE>
The aggregate tax basis of depreciable real property of Macon Mall for
Federal income tax purposes was $21,511,000 as of December 31, 1996. The
aggregate tax basis of depreciable personal property associated with the
Property for Federal income tax purposes was $996,000 as of December 31, 1996.
Depreciation and amortization are computed on a straight-line method or
appropriate accelerated methods over the estimated useful life of the Property's
assets, which range from seven to 40 years. The current realty tax rate for
Macon Mall is $41.30 per $1,000 of assessed value. The aggregate real estate tax
obligation of Macon Mall for 1996 was $786,000, or approximately $1.18 per
square foot of taxable building area.
A 336,457 square foot portion of the land underlying Macon Mall is
subject to a ground lease that expires in 2071. The ground lease requires ground
rent payments of $24,000 each year and is subject to a one-time adjustment per
the wholesale index in the year 2000.
River Oaks Center--River Oaks Center is a 575,000 square foot regional
mall located in Decatur, Alabama. Parisian, J.C. Penney, Sears, Castner Knott,
and Rogers are the anchor tenants. The mall was originally developed in 1979 and
renovated in 1989. CRLP acquired the mall in 1995.
Gadsden Mall--Gadsden Mall is a 492,000 square foot regional mall
located in Gadsden, Alabama, approximately 60 miles northeast of Birmingham,
Alabama. J.C. Penney, Sears, McRae's, and Belk's are the anchor tenants. The
mall was expanded in 1990 to allow Belk's to relocate and expand within the mall
with its newest prototype store and to allow J.C. Penney the opportunity to move
to the mall from its downtown location. In addition, the interior of the mall
was totally renovated, including the addition of a food court. McRae's, an
anchor tenant, exercised a one-time option in August 1994 to extend its initial
lease term to July 2014 and completed a major renovation of its store at a cost
of approximately $2 million.
Briarcliffe Mall--Briarcliffe Mall is a 488,000 square foot regional
mall located in Myrtle Beach, South Carolina. J.C. Penney, K-Mart, and two
Belk's stores are the anchor tenants. The mall was originally developed in 1986
and acquired by CRLP in 1996.
Village Mall--Village Mall is a 399,000 square foot regional mall
located in Auburn, Alabama, which is approximately 55 miles east of Montgomery,
Alabama and 45 miles northwest of Columbus, Georgia. Anchored by Gayfer's
(Mercantile), Sears, and J.C. Penney, it is the only enclosed mall in east
central Alabama. Originally built in 1973, the mall was expanded to its current
size in 1984 with the addition of J.C. Penney and approximately 60,000 square
feet of specialty shops. An extensive renovation of the interior in 1989
included the creation of a food court.
University Park--University Park is a 399,000 square foot power center
located in Orlando, Florida. The anchor tenants are Beall's, Stein Mart, Baby
Superstore, Waccamaw, Albertson's, and Books-A-Million. The shopping center was
constructed in two phases, with Phase I and Phase II opening in 1986 and 1989,
respectively.
Office Properties
The 10 Office Properties contain a total of approximately 1.0 million
rentable square feet. Nine of the Office Properties are located in Alabama
(representing 93% of the office portfolio's net rentable square feet) and one is
located in Orlando, Florida. The Office Properties range in size from
approximately 25,000 square feet to 227,000 square feet. Four of the Office
Properties were developed by Colonial, and Colonial acquired the other six
Properties at various times between 1980 and 1990. All of the Office Properties
are now managed by CRLP.
<PAGE>
The following table sets forth certain additional information
relating to the Office Properties as of and for the year ended December 31,
1996.
<TABLE>
Net
Rentable
Year Area
Office Completed Square Percent
Property (1) Location (2) Feet Leased
- ---------------------------------------------------------- -----------------
<S> <C> <C> <C> <C>
Alabama:
Interstate Park Montgomery 1982-85/89 227,000 95.5%
International Park Birmingham 1987/89 222,000 100.0%
Energen Plaza Birmingham 1982 168,000 99.6%
AmSouth Center Huntsville 1990 157,000 93.4%
P&S Building Gadsden 1946/76/91 40,000 100.0%
250 Commerce St Montgomery 1904/81 35,000 100.0%
Anderson Block (5) Montgomery 1981/83 34,000 96.1%
Land Title Bldg. Birmingham 1975 30,000 100.0%
Whitesburg Bldg. Huntsville 1974 25,000 100.0%
----------------------------------
Subtotal-Alabama (9 Properties) 938,000 97.6%
----------------------------------
Florida:
University Park
Plaza Orlando 1985 71,000 95.5%
----------------------------------
TOTAL (10 Properties) 1,009,000 97.4%
==================================
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Average
Base
Rent
Per Total Percent Of
Total Leased 1996 Office Total 1996
Annualized Square Property Property
Base Rent Foot Revenue (3) Revenue (4)
------------------------------------------------------------
<S> <C> <C> <C> <C>
Alabama:
Interstate Park $ 2,760,000 $ 12.92 $ 2,868,000 2.1%
International Park 3,282,000 14.86 1,029,000 0.8%
Energen Plaza 2,366,000 14.40 1,430,000 1.0%
AmSouth Center 2,538,000 17.36 2,849,000 2.0%
P&S Building 178,000 4.50 144,000 0.1%
250 Commerce St 364,000 10.35 361,000 0.3%
Anderson Block (5) 333,000 10.33 124,000 0.1%
Land Title Bldg. 382,000 12.82 139,000 0.1%
Whitesburg Bldg. 205,000 16.61 322,000 0.2%
---------------------------------------------- -------
Alabama 12,408,000 13.88 9,266,000 6.7%
---------------------------------------------- -------
Florida:
University Park
Plaza 894,000 12.83 795,000 0.6%
---------------------------------------------- -------
TOTAL $ 13,302,000 $ 13.80 $ 10,061,000 7.3%
============================ =============== =======
<FN>
(1)All Office Properties are 100% owned by CRLP with the exception of
International Park, which consists of three buildings and is 37.5% owned by
CRLP for buildings 1900 and 2100 and is 25% owned by CRLP for building 2000;
Energen Plaza, which is 50% owned by CRLP; and Anderson Block and Land Title
Building, which are each 33.33% owned by CRLP.
(2)Year initially completed and, where applicable, most recent year in which the
Property was substantially renovated or in which an additional phase of the
Property was completed.
(3)Total 1996 Office Property revenue is CRLP's share (based on its percentage
ownership of the property) of total Office Property revenue.
(4)Percent of Total 1996 Property Revenue represents the Office Property's
proportionate share of all revenue from the 73 Properties.
(5)CRLP has a leasehold interest in this Property.
</FN>
</TABLE>
<PAGE>
The following table sets out a schedule of the lease expirations for leases
in place as of December 31, 1996, for the Office Properties (including all lease
expirations for partially-owned Properties). <TABLE>
Annualized Percent of
Net Rentable Base Rent of Annual Base
Year of Number of Area Of Expiring Rent Represented
Lease Tenants with Expiring Leases Leases by Expiring
Expiration Expiring Leases (Square Feet)(1) (1)(2) Leases (1)
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1997 61 180,000 $ 2,281,000 17.2%
1998 26 225,000 3,129,000 23.5%
1999 41 292,000 4,155,000 31.2%
2000 15 101,000 1,400,000 10.5%
2001 14 86,000 880,000 6.6%
2002 3 18,000 283,000 2.1%
2005 2 56,000 1,063,000 8.0%
2007 1 6,000 111,000 0.9%
========= ================= ================= ===============
163 964,000 $ 13,302,000 100.0%
========= ================= ================= ===============
<FN>
(1)Excludes 45,000 square feet of space not leased as of December 31, 1996.
(2)Annualized base rent is calculated using base rents as of December 31,
1996.
</FN>
</TABLE>
The following sets forth the net rentable area, total percent leased
and average base rent per leased square foot for each of the last five years for
the Office Properties: <TABLE>
Net Average Base
Rentable Area Total Rent Per Leased
Year-end (Square Feet) Percent Leased Square Foot (1)
<S> <C> <C> <C>
December 31, 1996 1,009,000 97.4% $13.80
December 31, 1995 1,009,000 94.0% $13.52
December 31, 1994 1,009,000 95.0% $12.99
December 31, 1993 1,007,000 93.7% $13.05
December 31, 1992 1,007,000 94.1% $12.99
<FN>
- -----------------
(1)Average base rent per leased square foot is calculated using base rents as of
December 31 for each respective year.
</FN>
</TABLE>
<PAGE>
The following is a brief description of certain of the Office
Properties.
Interstate Park--Interstate Park is a master planned suburban office
park located in east Montgomery, Alabama containing a total of 227,000 rentable
square feet. The Property consists of the Interstate Park Center, a four-story
building completed in 1989 containing a total of 78,000 rentable square feet,
and the Interstate Buildings 100 through 600, which were constructed between
1982 and 1985 and which contain a total of 149,000 rentable square feet. The
Property's major tenants include affiliates of The Colonial Company, including
Lowder Construction Company, Inc., Colonial Mortgage Company; Goodwyn Mills &
Cawood; CACI; Webb Crumpton, and the Alabama Housing Finance Authority.
Historical Rehabilitation Properties--Anderson Block (in which CRLP has
only a 33.3% interest) and 250 Commerce Street are historic buildings located in
Montgomery, Alabama which have been renovated to Class A office space. The two
Properties benefit from their presence on the National Historic Register and
from their prime locations in Montgomery's downtown financial district. Both
Properties were originally constructed as warehouses in the late 1800s/early
1900s and later underwent complete renovation in the early 1980s. The Colonial
BancGroup, Inc. occupies approximately 43% of 250 Commerce Street, with the
remainder leased to smaller tenants. Anderson Block leases its entire space to
seven separate tenants.
Energen Plaza--Energen Plaza is a 12-story Class A office building
located in the downtown central business district of Birmingham, Alabama
containing a total of 168,000 rentable square feet and in which CRLP owns a 50%
interest. The building was constructed in 1982 and includes a four-level parking
garage with 417 parking spaces. It is the headquarters building for Energen
Corp. (the parent company of Alabama Gas Corporation) and for CRLP, which
occupies 18,000 square feet. The remainder of the Property is leased to Gorham &
Waldrep (a law firm) and to other smaller tenants.
International Park--International Park is a 100-acre master planned
office park located 15 minutes south of Birmingham in the Highway 280/Southeast
suburban submarket. The Property consists of three separate office buildings
(the 1900, 2000 and 2100 Buildings) which contain a total of 222,000 rentable
square feet. CRLP owns 37.5% of the 1900 Building, 25% of the 2000 Building and
37.5% of the 2100 Building in partnership with BE&K, an international design
engineering and construction company, and other partners. The 1900 Building was
constructed in 1987 and contains 65,000 rentable square feet. Its largest
tenants include Hoar Construction, A.B. Shopping Centers and Innovative
Healthcare. The 2000 Building was built in 1987, contains 129,000 rentable
square feet and is solely occupied by BE&K. The most recently constructed
building, the 2100 Building (completed in 1989), contains 28,000 rentable square
feet and also is solely occupied by BE&K.
AmSouth Center--AmSouth Center is an 11-story Class A office building
located in downtown Huntsville, Alabama. Constructed in 1990, the Property
contains a total of 157,000 rentable square feet and has an attached six-story
parking deck with 424 parking spaces. The building is anchored by AmSouth Bank.
Other major tenants include New York Life; Watson, Gammons & Fees; the Tennessee
Valley Authority; and the law firms of Sirote & Permutt and Bradley, Arant, Rose
& White.
Undeveloped Land
CRLP owns seven undeveloped land parcels consisting of approximately
61.0 acres (collectively, the "Land"). These parcels are adjacent to five of the
Properties and are suitable for potential expansion at those Properties. The
Land suitable for expansion is located adjacent to a Multifamily Property and
four Retail Properties. Land adjacent to Multifamily Properties typically will
be considered for potential development of another phase of an existing
Multifamily Property if CRLP determines that the particular market can absorb
additional apartment units. CRLP currently owns one such parcel. For expansions
at Retail Properties, CRLP owns parcels both contiguous to the boundaries of
Retail Properties, which would accommodate expansion of the mall or shopping
center, and outparcels which are suitable for restaurants, financial
institutions or free standing retailers. CRLP owns six such parcels.
Options to Acquire Additional Land -- In addition to the Land, CRLP has
options to acquire certain additional land parcels owned by the Lowder family
(collectively, the "Option Parcels"). The name, location, proposed use and
acreage of each Option Parcel is as follows:
<TABLE>
<S> <C> <C> <C>
Site Name Location Proposed Use Acres
North Macon (Wimbleton
Forest)..................Macon, GA Retail 87.9
Altamonte Crossing.......Altamonte Retail 2.6
Springs, FL
Bellwood Commercial......Montgomery, AL Retail 1.1
Osprey (Sarasota)........Sarasota, FL Mixed Use 73.9
Interstate Park..........Montgomery, AL Office 11.3
Bellwood Office..........Montgomery, AL Office 4.9
Huntsville Research Park Huntsville, AL Office 9.8
</TABLE>
Each option has a term of five years from the date of the closing of
the Company's IPO, subject to earlier termination if the Company elects not to
exercise a right of first opportunity on a proposed sale of such Option Parcel
by the Lowder family. The Company also has a five-year right of first
opportunity with respect to each Option Parcel beginning on the expiration date
of the option term (if the option is not exercised).
Property Markets
The table below sets forth certain information with respect to the
geographic concentration of the Properties as of December 31, 1996.
<TABLE>
Geographic Concentration of Properties
<CAPTION>
Percent
Total Of Total
Units GLA NRA 1996 Property 1996 Property
State (Multifamily)(1)(Retail)(2) (Office)(3) Revenue Revenue
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Alabama 8,621 1,970,000 938,000 $ 73,912,000 54.1%
Florida 3,846 2,061,000 71,000 40,787,000 29.8%
Georgia 1,150 1,127,000 -0- 18,595,000 13.6%
South Carolina -0- 488,000 -0- 3,457,000 2.5%
-------------------------------------------------- --------
Total 13,617 5,646,000 1,009,000 $ 136,751,000 100.0%
================================================== ========
<FN>
(1) Units (in this table only) refers to multifamily apartment units.
(2) GLA refers to gross leaseable area of retail space.
(3) NRA refers to net rentable area of office space.
</FN>
</TABLE>
CRLP believes that the demographic and economic trends and conditions
in the markets where the Properties are located indicate a potential for
continued growth in property net operating income. The Properties are located in
a variety of distinct submarkets within Alabama, Georgia, South Carolina, and
Florida; however, Birmingham, Alabama, Orlando, Florida, Huntsville, Alabama,
Macon, Georgia, Montgomery, Alabama, Tampa, Florida, and Sarasota/Bradenton,
Florida are the Company's primary markets. CRLP believes that these seven
markets, which are characterized by stable and increasing population and
employment growth, should continue to reflect a steady demand for multifamily,
retail, and office properties.
<PAGE>
Mortgage Financing
Certain of the Properties are subject to mortgage indebtedness. The
Properties whose financial results are consolidated in the financial statements
of CRLP are subject to existing mortgage indebtedness and other notes payable in
an aggregate amount as of December 31, 1996, of approximately $506.4 million
carrying a weighted average interest rate of 7.45% and a weighted average
maturity of 8.5 years. The mortgage indebtedness on the Properties as of
December 31, 1996, is set forth in the table below:<TABLE>
Principal
Interest Balance (as of
Property (1) Rate 12/31/96)
- --------------------------------------------------------------------
<S> <C> <C>
Multifamily Properties:
CG at Kirkman Park 7.900% $ 12,535,549
Ashford Place 7.125% 3,420,517
CV at Rocky Ridge 5.900% 6,000,000
7.625% 1,418,333
CG at Galleria Woods 6.875% 7,395,088
CG at Mountain Brook 8.000% 12,261,239
CV at Cahaba Heights 8.060% 3,772,907
Grande View Towers 7.500% 9,952,418
CV at Inverness 5.960% (4) 9,900,000
Huntleigh Woods 9.500% 3,022,034
Inverness Apartments 5.900% 4,000,000
7.625% 1,741,667
CV at Monte D'Oro 8.750% 5,314,434 (8)
Pointe West 7.125% 2,880,971
Polos West 7.450% 5,777,805
CG at Galleria 4.150% 22,400,000
Rime Village-Huntsville 4.150% 12,775,000
CG at Riverchase 7.150% 9,197,454
Ski Lodge I 9.500% 7,899,217 (8)
Ski Lodge II 9.500% 9,082,891 (8)
Ski Lodge III 5.450% 10,300,000
Ski Lodge-Tuscaloosa 9.500% 4,827,530
Somerset Place 5.960% (4) 4,500,000
Somerset Wharf I 5.960% (4) 3,400,000
Vieux Carre 9.750% 5,158,370
Willow Bend 5.900% 3,330,000
7.625% 1,666,667
Retail Properties:
Bellwood 10.125% 2,995,931
Island Walk 8.800% 10,406,672
Montgomery Promenade 9.250% 10,810,000
Olde Town 10.000% 1,676,561 (8)
Office Properties:
Interstate Park 8.500% 4,731,993
Whitesburg Building 10.250% 1,282,470
Other debt:
Land Loan 7.220% 700,000
6 Mortgages 8.870% 61,520,000
Line of Credit 7.000% (10) 48,815,000 (8)
Unsecured Senior Notes 7.500% 64,854,617
Unsecured Senior Notes 8.050% 64,711,590
Medium Term Notes 7.050% 50,000,000
================
TOTAL $ 506,434,925
================
<PAGE>
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Anticipated
Annual Debt
Service Estimated
(1/1/97- Maturity Balance Due
Property (1) 12/31/97) Date (2) on Maturity
----------------------------- -------------------------------------------------
<S> <C> <C> <C>
Multifamily Properties:
CG at Kirkman Park $ 1,133,819 03/15/98 $ 12,360,767
Ashford Place 282,876 11/01/24 10,065
CV at Rocky Ridge 354,000 08/01/02 (3) 6,000,000
188,656 08/01/02 (3) 841,667
CG at Galleria Woods 645,716 07/15/99 7,035,235
CG at Mountain Brook 1,134,422 01/10/00 11,742,632
CV at Cahaba Heights 377,274 05/10/00 3,494,138
Grande View Towers 882,571 11/15/98 9,685,749
CV at Inverness 347,492 06/15/26 (5) 9,900,000
Huntleigh Woods 315,823 05/01/02 2,827,436
Inverness Apartments 236,000 07/31/02 (6) 4,000,000
208,454 07/31/02 (7) 1,234,167
CV at Monte D'Oro 78,115 (8) 12/01/99 5,309,917 (8)
Pointe West 245,649 05/01/22 20,354
Polos West 569,276 12/05/03 4,526,555
CG at Galleria 786,240 06/15/26 (5) 22,400,000
Rime Village-Huntsville 448,404 06/15/26 (5) 12,775,000
CG at Riverchase 769,969 12/31/98 8,967,396
Ski Lodge I 124,978 (8) 06/01/99 7,893,013 (8)
Ski Lodge II 143,705 (8) 06/01/99 9,075,757 (8)
Ski Lodge III 656,655 03/01/15 (9) 900,000
Ski Lodge-Tuscaloosa 504,514 05/01/02 4,516,671
Somerset Place 157,952 06/15/26 (5) 4,500,000
Somerset Wharf I 119,340 06/15/26 (5) 3,400,000
Vieux Carre 533,605 06/01/01 4,993,827
Willow Bend 196,472 07/31/02 (6) 3,330,000
197,937 07/31/02 (7) 1,179,167
Retail Properties:
Bellwood 324,826 01/01/99 2,948,518
Island Walk 1,059,697 10/01/01 7,340,184
Montgomery Promenade 999,924 07/01/00 10,810,000
Olde Town 29,359 (8) 03/01/98 1,671,772 (8)
Office Properties:
Interstate Park 643,440 08/01/03 2,648,144
Whitesburg Building 160,494 09/01/01 1,109,612
Other debt:
Land Loan 84,332 09/30/98 648,778
6 Mortgages 545,681 02/05/05 61,520,000
Line of Credit 267,913 (8) 12/18/98 (11) 64,085,000 (8)
Unsecured Senior Notes 4,875,000 07/15/01 65,000,000
Unsecured Senior Notes 5,232,500 07/15/06 65,000,000
Medium Term Notes 3,525,000 12/15/03 50,000,000
=============== ================
TOTAL $ 29,388,080 $ 495,701,521
=============== ================
<FN>
- ----------------
(footnotes presented on the next page)
<PAGE>
(1)As noted in the table, certain Properties were developed in phases and
separate mortgage indebtedness may encumber each of the various phases. In
the listing of property names, CG has been used as an abbreviation for
Colonial Grand and CV as an abbreviation for Colonial Village.
(2)All of the mortgages can be prepaid at any time, subject to prepayment
penalties calculated typically on a yield maintenance basis, except for the
mortgages encumbering Colonial Village at Rocky Ridge, Inverness Apartments,
Willowbend, and Colonial Grand at Riverchase, which are closed to prepayment
for varying lengths of time.
(3)The maturity date noted represents the date on which credit enhancement
expires for the tax-exempt municipal bonds put in place as part of the
original financing for the Property. The stated maturity date for the loans
is August 1, 2007.
(4)Represents the maximum interest rate payable by CRLP for the next year and
nine months on these loans as the result of an interest rate protection
agreement entered into by CRLP. The loans (which are financed through
tax-exempt bonds) secured by these Properties (or phases thereof) bear
interest at a variable rate, determined weekly at the rate necessary to
produce a bid in the process of remarketing the bonds equal to par plus
accrued interest, based on comparable issues in the market. The interest rate
for these debt obligations as of December 31, 1996, was 4.05% for these
Properties.
(5)These loans are financed through tax-exempt bonds which are credit enhanced
by Fannie Mae. The loans, which bear interest at a weekly variable interest
rate, require monthly interest payments through June 2006 and principal and
interest payments from July 2006 through June 2026. The weighted average
interest rate of these five loans was 3.42% at December 31, 1996.
(6)The maturity date noted represents the date on which credit enhancement
expires for the tax-exempt municipal bonds put in place as part of the
original financing for the Property. The stated maturity date for the loans
is August 1, 2022.
(7)The maturity date noted represents the date on which credit enhancement
expires for the tax-exempt municipal bonds put in place as part of the
original financing for the Property. The stated maturity date for the loans
is August 1, 2010.
(8)The principal balances outstanding on these loans were repaid in January and
February 1997 with proceeds from the January 1997 debt and equity offerings.
The amounts presented for anticipated annual debt service for these loans
represent the principal and interest paid during January and February 1997
(excluding the final principal balance paid). The amounts presented for
estimated balance due on maturity for these loans represent the outstanding
balances that were repaid in January and February 1997.
(9)The maturity date noted represents the date on which the credit enhancement
expires for the tax-exempt municipal bonds put in place as part of the
original financing for the Property. The stated maturity date for the loan is
March 1, 2015.
(10) This loan bears interest at a variable rate, based on LIBOR plus a spread
determined by certain capitalization and coverage ratios that ranges from 100
to 150 basis points.
(11) This credit facility has a term of two years beginning in December 1996 and
provides for a one-year amortization in the event of non-renewal.
</FN>
</TABLE>
In addition to the foregoing mortgage debt, the four Properties in
which CRLP owns partial interests (and which therefore are not consolidated in
the financial statements of CRLP) also are subject to existing mortgage
indebtedness. CRLP's pro-rata share of such indebtedness as of December 31,
1996, was $7,283,000 which carried a weighted average interest rate of 8.9%. The
maturity dates of these loans range from February 28, 1997 to July 17, 2000, and
as of December 31, 1996, the loans had a weighted average maturity of 1.1 years.
Item 3. Legal Proceedings.
Neither CRLP nor the Properties are presently subject to any material
litigation nor, to CRLP's knowledge, is any material litigation threatened
against CRLP or the Properties, other than routine litigation arising in the
ordinary course of business which is expected to be covered by liability
insurance.
Item 4. Submission of Matters to a Vote of Security
Holders.
No matters were submitted to CRLP's unit holders during the fourth
quarter of 1996.
<PAGE>
PART II
Item 5. Market for Registrant's Common Equity and
Related Shareholder Matters.
There is no established public trading market for the Units. As of
March 10, 1997, there were 28 holders of record of Units.
CRLP has made consecutive quarterly distributions since its formation
in the third quarter of 1993. The current indicated annual distribution rate is
$2.08 per Unit ($.52 per Unit per quarter). CRLP's ability to make distributions
depends on a number of factors, including its net cash provided by operating
activities, capital commitments and debt repayment schedules. Holders of Units
are entitled to receive distributions when, as and if declared by the Board of
Directors of CPHC, its general partner, out of any funds legally available for
that purpose.
The following table sets forth the distributions per Unit paid by CRLP
during the periods noted:
<TABLE>
<S> <C>
Calendar Period Distribution
1997:
First Quarter................ $ .520
1996:
First Quarter................ $ .500
Second Quarter............... $ .500
Third Quarter................ $ .500
Fourth Quarter............... $ .500
1995:
First Quarter................ $ .475
Second Quarter............... $ .475
Third Quarter................ $ .475
Fourth Quarter............... $ .475
</TABLE>
Item 6. Selected Financial Data.
The following table sets forth selected financial and operating
information on a historical basis for CRLP (and, for periods prior to the
Company's IPO, the Colonial Group) for each of the five years ended December 31,
1996. The historical operating data for the year ended December 31, 1992, has
been derived, and the historical operating data for the year ended December 31,
1993, has been partially derived, from the historical financial statements of
the Colonial Group, whose real estate interest were acquired in connection with
the formation of CRLP in 1993. The "Colonial Group" consists of Colonial
Properties, Inc., Equity Partners Joint Venture, Colonial Properties Management
Association, and certain real estate interests of Thomas H. Lowder, Robert E.
Lowder, James K. Lowder, Catherine K. Lowder and the Bellwood Trust.
<TABLE>
Dollar amounts in thousands, except
share data 1996 1995 1994
-------------------------------
<CAPTION>
<S> <C> <C> <C>
OPERATING DATA
Total revenue ......................... $ 134,881 $ 111,437 $ 63,958
Expenses:
Depreciation and amortization ..... 23,533 20,615 13,060
Other operating expenses .......... 46,819 42,282 24,011
Income from operations ................ 64,529 48,540 26,887
Interest expense ...................... 24,584 23,972 10,820
Other income (expense), net ........... 1,104 674 582
Income (loss) before gains from sales
of property, and extraordinary items . 40,580 25,067 16,528
Net income (loss) ..................... 40,538 25,242 16,650
Per unit:
Net income ........................ 1.58 1.28 1.17
Distributions ..................... 2.00 1.90 1.73
BALANCE SHEET DATA
Land, buildings, and equipment, net ... $ 801,798 $ 624,514 $ 555,577
Total assets .......................... 947,947 681,297 603,135
Total debt ............................ 506,435 354,100 344,234
OTHER DATA
Total properties (at end of period) ... 73 61 55
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
1993 (1) 1992
------------------------------
OPERATING DATA
<S> <C> <C>
Total revenue ......................... $ 42,629 $ 35,046
Expenses:
Depreciation and amortization ..... 7,874 6,449
Other operating expenses .......... 16,777 14,788
Income from operations ................ 17,978 13,809
Interest expense ...................... 12,772 14,509
Other income (expense), net ........... (1,697) (80)
Income (loss) before gains from sales
of property, and extraordinary items . 3,509 (780)
Net income (loss) ..................... (3,775) (215)
Per unit:
Net income ........................ -0- -0-
Distributions ..................... -0- -0-
BALANCE SHEET DATA
Land, buildings, and equipment, net ... $ 236,058 $ 139,665
Total assets .......................... 290,925 156,560
Total debt ............................ 110,432 167,275
OTHER DATA
Total properties (at end of period) ... 36 23
<FN>
(1) Increases (decreases) for 1993 compared to 1992 relate primarily to
Colonial's formation as a public REIT on September 29, 1993.
</FN>
</TABLE>
<PAGE>
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
General
The following commentary should be read in conjunction with the
Consolidated Financial Statements and Notes to Consolidated Financial Statements
appearing elsewhere in this report. Historical results and trends which might
appear should not be taken as indicative of future operations.
Any statement contained in this report which is not a historical
fact, or which might be otherwise considered an opinion or projection concerning
CRLP or its business, whether express or implied, is meant as and should be
considered a forward-looking statement as that term is defined in the Private
Securities Litigation Reform Act of 1996. Forward-looking statements are based
upon assumptions and opinions concerning a variety of known and unknown risks,
including but not necessarily limited to changes in market conditions, the
supply and demand for leasable real estate, interest rates, increased
competition, changes in governmental regulations, and national and local
economic conditions generally, as well as other risks more completely described
in CRLP's filings with the Securities and Exchange Commission. If any of these
assumptions or opinions prove incorrect, any forward-looking statements made on
the basis of such assumptions or opinions may also prove materially incorrect in
one or more respects.
Results of Operations--1996 and 1995
The Operating Partnership reported net income of $40.5 million for
1996 compared to $25.2 million for 1995. On a per Unit basis, net income was
$1.58 for 1996 compared to $1.28 for 1995. Net income increased during 1996 when
compared to 1995 primarily due to the acquisition of 17 properties during 1995
and 1996, the completion and placement in service during 1995 and 1996 of five
properties developed or expanded by the Operating Partnership, and the
operations of several properties whose development was in various stages of
completion during 1995 and 1996.
Revenue--Total revenue increased by $23.4 million, or 21.0%, for 1996 when
compared to 1995, primarily due to an increase in rent revenue, which increased
by $23.2 million, or 21.7%, during the same period. Of this increase, $21.2
million represents rent revenues generated by the properties acquired/placed in
service during 1995 and 1996. The $2.0 million remainder of the increase in
rental revenue primarily represents increases in rental rates charged for
existing space. Other revenue increased $0.2 million, or 5.8%, for 1996 when
compared to 1995. This increase is partially attributable to $0.5 million of
other revenues generated by the properties acquired/placed in service during
1995 and 1996. Other revenue also decreased $0.5 million during 1996 compared to
1995 due to one-time revenues received from lease cancellations during the
second quarter of 1995. The remainder of the increase in other revenue of $0.2
million represents increases in other revenues at existing properties.
Operating Expenses--Total operating expenses increased by $7.5 million, or
11.9%, for 1996 when compared to 1995. Of this increase, $9.4 million represents
operating expenses of the properties acquired/placed in service during 1995 and
1996. Operating expenses also decreased by $1.9 million due to the resolution of
certain state tax contingencies and the resulting reduction in related reserves.
Other Income and Expenses--Interest expense reflected a net increase of $0.6
million, or 2.6%, for 1996 when compared to 1995. Interest expense increased
$5.3 million due to an increase in indebtedness, which was incurred to finance
acquisition and development activity. Interest expense also decreased by $1.9
million, which represents interest savings on two mortgages and one revolving
credit agreement that were repaid through a portion of the Operating
Partnership's issuance of limited partnership units in January 1996. Interest
expense also decreased by $2.8 million due to the capitalization of $3.7 million
in interest on construction expenditures during 1996 compared to $0.9 million
capitalized during 1995.
Results of Operations--1995 and 1994
The Operating Partnership reported net income of $25.2 million for
1995 compared to $16.7 million for 1994. On a per Unit basis, net income was
$1.28 for 1995 compared to $1.17 for 1994. Net income increased during 1995 when
compared to 1994 primarily due to the acquisition of 26 properties during 1994
and 1995, the completion and placement in service during 1995 of two properties
developed or expanded by the Operating Partnership, and the operations of
several properties whose development was in various stages of completion during
1994 and 1995.
Revenue--Total revenue increased by $47.5 million, or 74.2%, for 1995 when
compared to 1994, primarily due to an increase in rent revenue, which increased
by $44.9 million during the same period. Of this increase, $39.9 million
represents rent revenues generated by the properties acquired/placed in service
during 1994 and 1995. The $5.0 million remainder of the increase in rental
revenue primarily represents increases in rental rates charged for existing
space. Other revenue increased $2.6 million, or 150.2%, for 1995 when compared
to 1994. This increase is attributable primarily to $1.5 million of other
revenues generated by the properties acquired/placed in service during 1994 and
1995 and $0.5 million received from lease cancellations during the second
quarter of 1995.
Operating Expenses--Total operating expenses increased by $25.8 million, or
69.7%, for 1995 when compared to 1994. Of this increase, $21.2 million
represents operating expenses of the properties acquired/placed in service
during 1994 and 1995. General and administrative expenses increased by $2.3
million, or 65.1%, during 1995 when compared to 1994 due to administrative
expenses associated with the properties acquired/placed in service during 1994
and 1995, an increase in reserve for contingencies, and a general increase in
administrative expenses.
Other Income and Expenses--Interest expense increased $13.2 million, or 121.2%,
for 1995 when compared to 1994. This increase is attributed primarily to
properties acquired/placed in service during 1994 and 1995 that were financed
through advances under CRLP's lines of credit and the assumption of debt. The
financing of these properties increased interest expense by $13.3 million for
1995 over 1994. The Company capitalized interest on its development projects
during the construction period, which reduced interest expense by $0.9 million
in 1995, compared to $0.3 million capitalized in 1994.
Liquidity and Capital Resources
During 1996 CRLP invested approximately $273.1 million through
acquisition and development of properties. This acquisition and development
activity added to CRLP's multifamily and retail property holdings. CRLP financed
this property investment through proceeds from the issuance of limited
partnership units and debt totaling approximately $286.6 million during 1996,
net of offering costs, advances on its bank line of credit and cash from
operations. CRLP also used proceeds from these sources of funds to repay $42.6
million outstanding on two mortgage loans and to reduce its outstanding
revolving credit balances by $21.9 million.
Acquisition Activities--During 1996 CRLP added 1,505 apartment units through its
acquisition of seven multifamily communities at an aggregate cost of $79.0
million. CRLP also added 1.1 million square feet of retail leasable area through
its acquisition of three community shopping centers and one regional shopping
mall and purchased tenant-owned space and the underlying land at an existing
retail center. CRLP completed these retail acquisitions at an aggregate cost of
approximately $94.3 million.
Development Activities--During 1996 CRLP constructed 873 new apartment units in
six multifamily communities (three of which were completed for development
during the year) and acquired land on which it intends to develop two additional
multifamily communities during 1997. The aggregate investment during 1996 in
this multifamily development activity was $68.2 million. As of December 31,
1996, CRLP has 1,216 apartment units in six multifamily communities under
development and expansion. Management anticipates that two of the multifamily
projects will be completed during the first half of 1997 and three others will
be completed during the second half of the year. The remaining multifamily
project will be completed during the first half of 1998. Management expects to
invest approximately $31.8 million over these periods to complete these
projects.
During 1996 CRLP also continued its 423,000 square foot expansion of
its regional mall in Macon, Georgia and began a 225,000 square foot expansion of
a community shopping center in Montgomery, Alabama. The aggregate investment in
this retail development activity was $31.6 million. The Macon Mall expansion was
completed and opened during February 1997, and management anticipates completing
its Montgomery project during the last half of 1997. Management expects to
invest approximately $19.8 million during 1997 to complete these projects.
Financing Activities--CRLP funded a portion of this investment in acquisition
and development by raising capital. In January 1996 the Company completed a
public offering of 4.6 million common shares of beneficial interest at a price
of $24.625 per share. The $106.6 million proceeds of this offering, net of
offering costs of $6.6 million, were used to fund acquisition and development
activity, repay the balances outstanding under CRLP's revolving credit
agreements, and to repay the $8.2 million balance outstanding under a mortgage
loan.
CRLP also funded its investment in acquisition and development by
incurring additional debt. During 1996 notes and mortgages payable increased
$152.3 million to total $506.4 million at December 31, 1996. During the year
CRLP borrowed $220.0 million through the public issuance of debt securities and
through debt assumed in property acquisitions. During the year CRLP also reduced
the principal outstanding on its notes and mortgages payable by $45.8 million
(including $42.6 million on mortgage loans that were extinguished) and reduced
its outstanding revolving credit balances by $21.9 million.
In July 1996 CRLP completed a public issuance of senior, unsecured
debt securities totaling $130.0 million. The securities were issued in two
series of $65 million each requiring semi-annual payments of interest only. One
series, which matures in July 2001, bears interest at 7.50% and was priced at a
spread of 95 basis points over the five-year treasury bond rate, resulting in an
original issue discount of $145,383. The other series, which matures in July
2006, bears interest at 8.05% and was priced at a spread of 128 basis points
over the ten-year treasury bond rate, resulting in an original issue discount of
$288,410.
In July 1996 CRLP refinanced loans collateralized by five of CRLP's
multifamily properties and representing a total of approximately $53.0 million
in outstanding indebtedness. The loans are financed through tax-exempt bonds
which are credit enhanced by Fannie Mae. The loans, which bear interest at a
weekly variable rate, require monthly interest payments through June 2006 and
principal and interest payments from July 2006 through June 2026. The weighted
average interest rate of these five loans was 3.42% at December 31, 1996.
In December 1996 CRLP completed a public issuance of unsecured
medium-term debt securities totaling $50.0 million. The securities mature in
December 2003 and bear interest at 7.05% which, at the time of issuance, equated
to a spread of 90 basis points over the seven-year treasury bond rate.
In January 1997, subsequent to year-end, CRLP completed an additional
issuance of unsecured medium-term debt securities also totaling $50.0 million.
These securities mature in January 2003 and bear interst at 7.16% which, at the
time of issuance, equated to a spread of 80 basis points over the six-year
treasury bond rate.
In January 1997 the Company also completed a public offering of 1.5
million common shares of beneficial interest at a price of $29.875 per share.
The $43.4 million proceeds of this offering, net of offering costs of $1.4
million, were used to fund acquisition and development activity, repay the
balances outstanding under CRLP's revolving credit agreement, and to repay $24.5
million outstanding under four mortgage loans.
At December 31, 1996, after considering the effect of the January
1997 debt and equity offerings, CRLP's total debt included fixed-rate debt of
$426.7 million, or 86.9%, and floating-rate debt of $64.5 million, or 13.1%.
CRLP has obtained interest rate protection for $17.8 million of the
floating-rate debt, which limits this debt to an interest rate of 5.96% through
September 30, 1998.
At December 31, 1996, CRLP has one unsecured bank line of credit,
which provides for borrowings up to $125 million, bears interest at LIBOR plus
100 to 150 basis points, has a term of two years beginning in December 1996, and
provides for a one-year amortization in the case of non-renewal. As of December
31, 1996, after considering the effect of the January 1997 debt and equity
offerings, the balance outstanding on CRLP's line of credit was $0.5 million.
Management intends to maintain CRLP's strength through
diversification, while continuing to pursue acquisitions that meet CRLP's
acquisition criteria for property quality, market strength, and investment
return. Management expects to use its line of credit agreement to fund its
investment in acquisition and development activities and plans to continue to
replace significant borrowings under the bank line of credit with funds
generated from the sale of additional securities, including sales of Units to
CPHC in connection with public offerings of securities by the Company, and/or
permanent financing, as market conditions permit. Management believes that these
potential sources of funds, along with the possibility of issuing Units in
exchange for properties, will provide CRLP with the means to finance additional
acquisitions and development.
Cash and equivalents increased by $1,755,000 during 1996. Management
anticipates that its net cash provided by operations and its existing cash
balances will provide the necessary funds on a short- and long-term basis to
cover its operating expenses, interest expense on outstanding indebtedness,
recurring capital expenditures, and distributions to Unit holders. Management
does not anticipate any significant costs associated with Year 2000 software
requirements.
Inflation--Substantially all of the leases at the retail properties provide for
pass-through to tenants of certain operating costs, including real estate taxes,
common area maintenance expenses, and insurance. Leases at the multifamily
properties generally provide for an initial term of six months or one year and
allow for rent adjustments at the time of renewal. Leases at the office
properties typically provide for rent adjustment and pass-through of certain
operating expenses during the term of the lease. All of these provisions permit
CRLP to increase rental rates or other charges to tenants in response to rising
prices and, therefore, serve to minimize CRLP's exposure to the adverse effects
of inflation.
<PAGE>
Item 8. Financial Statements and Supplementary Data.
The following financial statements are filed as a part of this report:
Report of Independent Accountants
Financial Statements:
Consolidated Balance Sheets as of December 31, 1996 and 1995
Consolidated Statements of Income for the years ended December
31, 1996, 1995, and 1994
Consolidated Statements of Partners' Capital for the years ended
December 31, 1996, 1995, and 1994
Consolidated Statements of Cash Flows for the years ended
December 31, 1996, 1995, and 1994
Notes to Consolidated Financial Statements
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
Colonial Properties Holding Company, Inc.
We have audited the accompanying consolidated balance sheets of Colonial Realty
Limited Partnership as of December 31, 1996 and 1995 and the consolidated
statements of operations, partners' capital, and cash flows for each of the
three years in the period ended December 31, 1996. These financial statements
are the responsibility of the Partnership's management. Our responsibility is to
express an opinion on these financial statements 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 financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Colonial Realty
Limited Partnership as of December 31, 1996 and 1995 and the consolidated
results of its operations and its cash flows for each of the three years in the
period ended December 31, 1996 in conformity with generally accepted accounting
principles.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Birmingham, Alabama
January 24, 1997
<PAGE>
<TABLE>
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
<CAPTION>
December 31, 1996 and 1995
- ------------------------------------------------------------------------------
1996 1995
- ------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Land, buildings, & equipment, net $ 801,797,749 $ 624,514,188
Undeveloped land and construction
in progress 113,689,163 32,640,381
Cash and equivalents 3,340,281 1,584,850
Restricted cash 2,450,335 2,079,796
Accounts receivable, net 4,778,607 2,280,508
Prepaid expenses 4,467,918 3,561,611
Notes receivable 583,594 580,169
Deferred debt and lease costs 6,288,125 3,841,814
Investment in partnerships 5,028,219 5,363,639
Other assets 5,523,118 4,849,614
- ------------------------------------------------------------------------------
$ 947,947,109 $ 681,296,570
- ------------------------------------------------------------------------------
LIABILITIES AND PARTNERS' CAPITAL
Notes and mortgages payable $ 506,434,925 $ 354,099,770
Accounts payable 7,450,770 6,343,353
Accounts payable to affiliates 9,972,954 5,080,477
Accrued interest 5,465,237 957,518
Accrued expenses 1,584,852 975,550
Tenant deposits 2,926,404 2,401,604
Unearned rent 924,193 843,642
- ------------------------------------------------------------------------------
Total liabilities 534,759,335 370,701,914
- ------------------------------------------------------------------------------
Redeemable units, at redemption value 256,097,639 207,596,087
- ------------------------------------------------------------------------------
Partners' capital, excluding
redeemable units 157,090,135 102,998,569
- ------------------------------------------------------------------------------
$ 947,947,109 $ 681,296,570
- ------------------------------------------------------------------------------
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
For the Years Ended December 31, 1996, 1995, 1994
- --------------------------------------------------------------------------------
1996 1995 1994
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Revenue:
Rent $129,612,153 $106,335,068 $61,478,244
Rent from affiliates 757,818 836,426 775,492
Other 4,511,384 4,265,180 1,704,499
- --------------------------------------------------------------------------------
Total revenue 134,881,355 111,436,674 63,958,235
- --------------------------------------------------------------------------------
Property operating expenses:
General operating expenses 9,530,324 8,355,107 4,704,992
Salaries and benefits 8,606,321 7,362,486 4,203,958
Repairs and maintenance 13,072,944 10,890,018 5,770,758
Taxes, licenses,
and insurance 11,538,481 9,926,589 5,849,776
General and administrative 4,071,156 5,747,452 3,481,517
Depreciation 22,024,933 18,043,875 10,816,858
Amortization 1,508,515 2,570,861 2,243,662
- --------------------------------------------------------------------------------
Total operating expenses 70,352,674 62,896,388 37,071,521
- --------------------------------------------------------------------------------
Income from operations 64,528,681 48,540,286 26,886,714
- --------------------------------------------------------------------------------
Other income (expense):
Interest expense (24,584,298) (23,972,107) (10,819,643)
Income from partnerships 635,278 498,664 460,897
Gains from sales of property 468,619 174,954 121,600
- --------------------------------------------------------------------------------
Total other expense (23,480,401) (23,298,489) (10,237,146)
- --------------------------------------------------------------------------------
Income before
extraordinary items 41,048,280 25,241,797 16,649,568
Extraordinary loss from early
extinguishment of debt (510,602) -0- -0-
- --------------------------------------------------------------------------------
Net income $ 40,537,678 $ 25,241,797 $16,649,568
- --------------------------------------------------------------------------------
Income per unit
Income before extraordinary items $ 1.60 $ 1.28 $ 1.17
Extraordinary loss from early
extinguishment of debt (0.02) -0- -0-
- --------------------------------------------------------------------------------
Net income per unit $ 1.58 $ 1.28 $ 1.17
- --------------------------------------------------------------------------------
Weighted average units outstanding 25,702,846 19,694,071 14,270,527
- --------------------------------------------------------------------------------
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL
<CAPTION>
For the Years Ended December 31, 1996, 1995, 1994
- -------------------------------------------------------------------------
Total
Partners'
Capital
- -------------------------------------------------------------------------
<S> <C>
Balance, December 31, 1993 $ 73,718,916
Distributions (24,684,603)
Net income 16,649,568
Issuance of limited partnership units 75,538,014
Allocations to redeemable units (80,665,963)
Other 3,085,472
- -------------------------------------------------------------------------
Balance, December 31, 1994 63,641,404
Cash Contributions 73,742,388
Distributions (35,222,284)
Net income 25,241,797
Issuance of limited partnership units 1,629,872
Allocations to redeemable units (26,017,509)
Other (17,099)
- -------------------------------------------------------------------------
Balance, December 31, 1995 102,998,569
Cash Contributions 106,847,154
Distributions (51,818,736)
Net income 40,537,678
Issuance of limited partnership units 7,027,021
Allocations to redeemable units (48,501,551)
- -------------------------------------------------------------------------
Balance, December 31, 1996 $ 157,090,135
- -------------------------------------------------------------------------
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
For the Years Ended December 31, 1996, 1995, 1994
- -------------------------------------------------------------------------------
1996 1995 1994
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $40,537,678 $25,241,797 $16,649,568
Adjustments to reconcile net income
to net cash
provided by operating activities:
Depreciation and amortization 23,533,448 20,614,736 13,060,520
Income from partnerships (635,278) (498,664) (460,897)
Other 557,828 (38,837) 34,027
Decrease (increase) in:
Restricted cash (370,539) (933,092) (629,340)
Accounts receivable (3,245,731) 218,455 (1,005,957)
Due from affiliates -0- -0- 23,961,595
Prepaid expenses (248,441) (172,691) 903,025
Other assets (1,187,461) (1,855,155) (1,302,050)
Increase (decrease) in:
Accounts payable 10,529 4,583,012 92,829
Accrued interest 3,569,771 138,518 208,473
Accrued expenses and other 404,435 (130,764) 287,892
- -------------------------------------------------------------------------------
Net cash provided by
operating activities 62,926,239 47,167,315 51,799,685
- -------------------------------------------------------------------------------
Cash flows from investing activities:
Acquisition of properties (125,926,554)(67,580,603)(106,035,067)
Development expenditures (22,168,286) (3,741,192) (3,364,634)
Development expenditures paid to
an affiliate (70,414,613)(21,646,534) (8,933,717)
Tenant improvements (1,029,075) (1,061,087) (1,531,885)
Capital expenditures (6,824,888) (2,803,685) (658,202)
Proceeds from sales of property 1,254,359 328,237 513,963
Distributions from partnerships 984,492 998,244 1,037,234
Capital contributions to partnerships (13,794) (230,121) (202,269)
- -------------------------------------------------------------------------------
Net cash used in investing
activities (224,138,359)(95,736,741)(119,174,577)
- -------------------------------------------------------------------------------
Cash flows from financing activities:
Principal reductions of debt (45,797,858)(19,231,834) (1,102,053)
Proceeds from additional borrowings 179,540,450 62,220,000 -0-
Net change in revolving credit balances(21,877,000)(33,205,744) 93,897,744
Cash contributions 106,847,154 73,742,388 -0-
Capital distributions (51,818,736)(35,222,284) (24,684,603)
Payment of mortgage financing cost (3,415,857) (946,017) (1,206,340)
Other, net (510,602) -0- -0-
- -------------------------------------------------------------------------------
Net cash provided by
financing activities 162,967,551 47,356,509 66,904,748
- -------------------------------------------------------------------------------
Increase (decrease) in cash
and equivalents 1,755,431 (1,212,917) (470,144)
Cash and equivalents, beginning of period 1,584,850 2,797,767 3,267,911
- -------------------------------------------------------------------------------
Cash and equivalents, end of period $ 3,340,281 $ 1,584,850 $ 2,797,767
- -------------------------------------------------------------------------------
Supplemental disclosures of cash flow information:
Cash paid during the year for interest $20,076,579 $23,609,172 $10,621,230
- -------------------------------------------------------------------------------
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
COLONIAL REALTY LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Organization and Basis of Presentation
Organization--Colonial Realty Limited Partnership (the "Operating
Partnership" or "CRLP"), a Delaware limited partnership, was formed on August
6, 1993, to succeed as owner of substantially all of the predecessor interests
of Colonial Properties, Inc. (CPI), and certain real estate interests of
persons and companies affiliated with CPI. CRLP is the operating partnership of
Colonial Properties Trust, an Alabama real estate investment trust (the
"Company") whose shares are listed on the New York Stock Exchange ("NYSE"). The
Company is engaged in the ownership, development, management, and leasing of
multifamily housing communities, retail malls and centers, and office
buildings. Certain parcels of land are also included.
The Company manages CRLP through the Company's wholly owned subsidiary,
Colonial Properties Holding Company, Inc. ("CPHC"), which in turn owns
approximately 68% of the general and limited partnership interests in CRLP and
serves as the sole general partner of CRLP. The limited partners who hold
partnership units can require that CRLP redeem their partnership units. Unless
the Company elects the right to issue common shares in exchange for these
partnership units, the redeeming limited partner will receive cash in an amount
equal to the market value of the partnership units to be redeemed. The Company
currently intends to exercise its right to issue the common shares for these
redeemed partnership units. Partners' capital allocable to limited partnership
interests is included in "redeemable units" in the Consolidated Balance Sheets
at the cash redemption amount at the balance sheet date. Net income,
distributions, and adjustments to partners' capital allocable to limited
partnership interests are reflected as "allocations to redeemable units" in the
Consolidated Statements of Partners' Capital. At December 31, 1996 and 1995,
CRLP had redeemable units outstanding in the amount of 8,431,198 and 8,141,023,
respectively.
Federal Income Tax Status--No provision for income taxes is provided since
all taxable income or loss or tax credits are passed through to the partners.
The Company, which is considered a corporation for federal income tax purposes,
qualifies as a real estate investment trust for federal income tax purposes and
generally will not be subject to federal income tax to the extent it distributes
its REIT taxable income to its shareholders. REITs are subject to a number of
organizational and operational requirements. If the Company fails to qualify as
a REIT in any taxable year, the Company will be subject to federal income tax on
its taxable income at regular corporate rates.
Principles Of Consolidation--The consolidated financial statements include
the Operating Partnership and Colonial Properties Services Limited Partnership
(in which Colonial Realty Limited Partnership holds 99% general and limited
partner interests).
Investments In Partnerships--Partnerships in which CRLP owns a fifty
percent or less interest and does not control are reflected in the consolidated
financial statements as investments accounted for under the equity method. Under
this method the investment is carried at cost plus or minus equity in
undistributed earnings or losses since the date of acquisition.
2. Summary of Significant Accounting Policies
Land, Buildings, and Equipment--Land, buildings, and equipment is stated
at the lower of cost, less accumulated depreciation, or net realizable value.
Where an impairment of a property's value is determined to be other than
temporary, an allowance for the estimated potential loss is established to
record the property at its net realizable value. Depreciation is computed using
the straight-line method over the estimated useful lives of the assets, which
range from 7 to 40 years. Maintenance and repairs are charged to expense as
incurred. Replacements and improvements are capitalized and depreciated over the
estimated remaining useful lives of the assets. When items of land, buildings,
or equipment are sold or retired, the related cost and accumulated depreciation
are removed from the accounts and any gain or loss is included in the results of
operations.
Undeveloped Land and Construction in Progress--Undeveloped land and
construction in progress is stated at the lower of cost or net realizable value.
CRLP capitalizes all costs associated with land development including
construction period interest and property taxes during periods in which property
is undergoing development activities necessary to prepare the asset for its
intended use.
Cash and Equivalents--CRLP includes highly liquid marketable securities
and debt instruments purchased with a maturity of three months or less in cash
equivalents.
Restricted Cash--Cash which is legally restricted as to use consists
primarily of tenant deposits.
Deferred Debt and Lease Costs--Amortization of mortgage costs is recorded
using the straight-line method, which approximates the effective interest
method, over the terms of the related mortgages. Leasing commissions and fees
are amortized using the straight-line method over the terms of the related
leases.
Interest rate cap agreements are used to reduce the potential impact of
increases in interest rates on variable-rate debt. Premiums paid for purchased
interest rate cap agreements are amortized to expense over the terms of the
caps. Unamortized premiums are included in other assets in the balance sheets.
Amounts receivable under cap agreements are accrued as a reduction of interest
expense.
Revenue Recognition--Rental income attributable to leases is recognized on
a straight-line basis over the terms of the leases.
Use of Estimates--The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the reported amounts of revenues and expenses. Actual results
could differ from those estimates.
Reclassifications--Certain immaterial reclassifications have been made to
the 1994 and 1995 financial statements in order to conform them to the 1996
financial statement presentation.
3. Property Acquisitions
CRLP acquired 11 properties during 1996, six properties during 1995, and
20 properties during 1994 at aggregate costs of approximately $173,700,000,
$68,400,000, and $331,000,000, respectively. CRLP funded these acquisitions with
cash proceeds from its public offerings of debt (see Note 7), advances on bank
lines of credit, proceeds from the issuance of limited partnership units, and
cash from operations. A portion of the purchase price of Rime Village-Huntsville
was subject to adjustment during 1995 based upon the operating results of the
second phase of the property which was in lease-up when it was acquired. This
portion of the purchase price was paid through the issuance of 70,864 additional
limited partnership units.
The properties acquired during 1996, 1995, and 1994 are listed below:
<TABLE>
Effective
Acquisition
Location Date
- -----------------------------------------------------------------
<S> <C> <C>
Multifamily Properties:
Carrollwood Tampa, FL January 1, 1994
Grande View Towers Huntsville, AL January 1, 1994
Plantation Gardens Sarasota, FL March 31, 1994
Patio I Auburn, AL March 31, 1994
Arbors at Kirkman Orlando, FL August 10, 1994
Polos at Gainesville Gainesville, FL August 10, 1994
Polos at Ponte Vedra Jacksonville, FL August 10, 1994
Polos West Orlando, FL August 10, 1994
Huntleigh Woods Mobile, AL December 31, 1994
Monte D'Oro Birmingham, AL December 31, 1994
Rime Village-Hoover Birmingham, AL December 31, 1994
Rime Village-Huntsville Huntsville, AL December 31, 1994
Riverchase Manor Birmingham, AL December 31, 1994
Ski Lodge I Birmingham, AL December 31, 1994
Ski Lodge II Birmingham, AL December 31, 1994
Ski Lodge III Birmingham, AL December 31, 1994
Ski Lodge Tuscaloosa Tuscaloosa, AL December 31, 1994
Stockbridge Manor Stockbridge, GA December 31, 1994
Ashford Place Mobile, AL April 1, 1996
Pointe West Mobile, AL April 1, 1996
Spring Creek Macon, GA April 1, 1996
Crowne Chase Birmingham, AL April 15, 1996
Crowne Point Birmingham, AL May 10, 1996
Crowne Ridge Birmingham, AL May 10, 1996
Barrington Club Macon, GA September 13, 1996
Retail Properties:
Burnt Store Square Punta Gorda, FL July 13, 1994
Britt David
Shopping Center Columbus, GA October 25, 1994
Bear Lake Village Orlando, FL July 1, 1995
Country Lake Village Orlando, FL July 1, 1995
Winter Haven Village Orlando, FL July 1, 1995
River Oaks Center Decatur, AL July 14, 1995
North Dale Court Tampa, FL October 1, 1995
Paddock Park Ocala, FL November 16, 1995
Briarcliffe Mall Myrtle Beach, SC July 1, 1996
Wekiva River Walk Orlando, FL October 1, 1996
Bardmoor Village St. Petersburg, FL October 1, 1996
Island Walk Orlando, FL October 1, 1996
</TABLE>
<PAGE>
Results of operations of these properties, subsequent to their respective
acquisition dates, are included in the consolidated financial statements of
CRLP. The cash paid to acquire these properties is included in the statements of
cash flows. The acquisitions during 1996, 1995, and 1994 are comprised of the
following: <TABLE>
1996 1995 1994
================================================================================
<S> <C> <C> <C>
Assets purchased:
Land, buildings, and equipment $173,276,789 $68,322,274 $328,593,287
Other assets 454,515 42,691 2,422,530
- --------------------------------------------------------------------------------
173,731,304 68,364,965 331,015,817
Notes and mortgages assumed (40,443,806) -0- (141,005,861)
Other liabilities assumed or recorded (1,773,648) (784,362) (8,436,875)
Issuance of limited partnership units
of Colonial Realty Limited Partnership (5,587,296) -0- (75,538,014)
- --------------------------------------------------------------------------------
Cash paid $125,926,554 $67,580,603 $106,035,067
================================================================================
</TABLE>
CRLP's unaudited pro forma results of operations, assuming these
acquisitions had been effected by CRLP prior to January 1, 1994, are as
follows:
<TABLE>
For the Year Ended December 31, 1996 1995 1994
================================================================================
<S> <C> <C> <C>
Revenues $145,866,000 $139,522,000 $129,063,000
================================================================================
Net income $ 41,281,000 $ 36,427,000 $ 35,358,000
================================================================================
Net income per unit $ 1.58 $ 1.40 $ 1.35
</TABLE>
On January 8, 1997, subsequent to year end, CRLP acquired Riverchase
Center, an office park comprised of eight one-level buildings in Birmingham,
Alabama totaling 306,000 square feet of leasable area. The total purchase price
of $20,800,000 was funded by the assumption of $8,710,000 in mortgage debt, the
issuance of 25,163 limited partnership units valued at $750,000, and an advance
on CRLP's bank line of credit agreement. The effects of this acquisition are not
included in CRLP's accompanying consolidated financial statements or in the pro
forma information above.
4. Land, Buildings, and Equipment
Land, buildings, and equipment consists of the following at December 31,
1996 and 1995:
<TABLE>
1996 1995
------------ -------------
<S> <C> <C> <C>
Buildings $ 736,621,679 $ 568,861,504 $
Furniture and fixtures 23,440,761 18,284,701
Equipment 2,569,139 1,406,215
Land improvements 18,327,845 14,218,447
Tenant improvements 11,969,390 10,516,274
------------ -------------
792,928,814 613,287,141
Accumulated depreciation (101,547,650) (79,779,155)
------------ -------------
691,381,164 533,507,986
Land 110,416,585 91,006,202
------------ -------------
$ 801,797,749 $ 624,514,188 $
============ =============
</TABLE>
5. Undeveloped Land and Construction in Progress
During 1996 CRLP completed the construction of three multifamily expansion
projects at a combined total cost of approximately $18,960,000. The expansion
projects produced 356 new apartment units (51 units completed during 1995 and
305 units completed during 1996), 16 units at McGehee Place in Montgomery,
Alabama, 180 units at Colonial Grand at Inverness in Mobile, Alabama, and 160
units at Colonial Grand at Galleria in Birmingham, Alabama. CRLP currently has
nine active expansion and development projects in progress and various parcels
of land available for expansion, construction, or sale. During 1996 CRLP
completed construction on 873 apartment units (including the 305 units in
completed projects mentioned above), and CRLP has an additional 1,216 apartment
units in progress at December 31, 1996. Undeveloped land and construction in
progress is comprised of the following at December 31, 1996:
<TABLE>
Total
Units/ Costs
Square Estimated Estimated Capitalized
Feet Completion Total Costs To Date
================================================================================
<S> <C> <C> <C> <C>
Multifamily Projects:
Colonial Village at
Heatherbrooke (expansion) 84 1997 $ 4,100,000 $ 1,462,407
Colonial Village at
Riverchase (expansion) 276 1997 14,900,000 13,368,319
Colonial Grand at Heathrow 312 1997 20,400,000 20,050,293
Colonial Grand at Bayshore 212 1997 11,600,000 11,155,327
Colonial Grand at Bayshore II 164 1997 9,100,000 3,377,532
Colonial Grand at Wesleyan 240 1997 12,800,000 7,758,183
Colonial Grand at Hunters Creek 496 1998 33,000,000 16,824,877
- --------------------------------------------------------------------------------
1,784 105,900,000 73,996,938
================================================================================
Retail Projects:
Macon Mall (expansion) 423,000 1997 52,000,000 38,085,793
Montgomery
Promenade (expansion) 225,000 1997 7,000,000 1,100,000
- --------------------------------------------------------------------------------
648,000 59,000,000 39,185,793
================================================================================
Other Projects and
Undeveloped Land 506,432
- --------------------------------------------------------------------------------
$164,900,000 $113,689,163
================================================================================
</TABLE>
Interest capitalized on construction in progress during 1996, 1995, and 1994
was $3,745,000, $868,000 and $333,000, respectively. During February 1997, the
Company completed its expansion of Macon Mall.
<PAGE>
6. INVESTMENT IN PARTNERSHIPS
Investment in partnerships at December 31, 1996 and 1995 consists of the
following:
<TABLE>
Percent
Owned 1996 1995
================================================================================
<S> <C> <C> <C>
Office:
600 Building Partnership, Birmingham, AL 33.34% $ 5,044 $ 21,143
Anderson Block Properties, Montgomery, AL 33.33% (52,773) (65,760)
Hoar/Colonial/Polar-BEK Partnership I,
Birmingham, AL 37.50% (429,744) (395,691)
Hoar/Colonial/Polar-BEK Partnership II,
Birmingham, AL 37.50% (34,876) (2,438)
Polar-BEK/Colonial Partnership I,
Birmingham, AL 50.00% 4,999,726 5,236,912
Polar-BEK/Rubaiyat/Colonial Partnership,
Birmingham, AL 25.00% 505,338 526,824
- --------------------------------------------------------------------------------
4,992,715 5,320,990
- --------------------------------------------------------------------------------
Other:
Colonial/Polar-BEK Management Company,
Birmingham, AL 50.00% 35,504 42,649
- --------------------------------------------------------------------------------
$5,028,219 $5,363,639
================================================================================
</TABLE>
7. NOTES AND MORTGAGES PAYABLE
Notes and mortgages payable at December 31, 1996 and 1995 consists of the
following:
<TABLE>
1996 1995
================================================================================
<S> <C> <C>
Senior unsecured notes, net of unamortized
discounts totaling $433,793 $179,566,207 $ -0-
Revolving credit agreements 48,815,000 70,692,000
Mortgages and other notes:
4.50% to 6.00% 76,605,000 88,095,394
6.01% to 7.50% 39,324,252 49,774,944
7.51% to 9.00% 115,369,461 98,455,300
9.01% to 10.25% 46,755,005 47,082,132
- --------------------------------------------------------------------------------
$506,434,925 $354,099,770
================================================================================
</TABLE>
As of December 31, 1996, CRLP has one unsecured bank line of credit
providing for total borrowings of up to $125,000,000. The line of credit
agreement bears interest at LIBOR plus 100 to 150 basis points, has a term of
two years beginning in December 1996, and provides for a one-year amortization
in the case of non-renewal. The credit facility is primarily used by CRLP to
finance property acquisitions and development and had an outstanding balance at
December 31, 1996, of $48,815,000. The weighted average interest rate of this
short-term borrowing facility was 6.81% and 7.47% at December 31, 1996 and 1995,
respectively.
In July 1996 CRLP completed a public offering of senior, unsecured debt
securities totaling $130,000,000. The securities were issued in two series of
$65,000,000 each requiring semi-annual payments of interest only. One series,
which matures in July 2001, bears interest at 7.50% and was priced at a spread
of 95 basis points over the five-year treasury bond rate, resulting in an
original issue discount of $145,383. The other series, which matures in July
2006, bears interest at 8.05% and was priced at a spread of 128 basis points
over the ten-year treasury bond rate, resulting in an original issue discount of
$288,410. The issue discounts are being amortized to interest expense over the
life of the corresponding issue.
In July 1996 CRLP refinanced loans collateralized by five of CRLP's
multifamily properties and representing a total of approximately $53.0 million
in outstanding indebtedness. The loans are financed through tax-exempt bonds
which are credit enhanced by Fannie Mae. The loans, which bear interest at a
weekly variable rate, require monthly interest payments through June 2006 and
principal and interest payments from July 2006 through June 2026. The weighted
average interest rate of these five loans was 3.42% at December 31, 1996.
In December 1996 CRLP completed a public offering of unsecured medium term
debt securities totaling $50,000,000. The securities mature in December 2003 and
pay a coupon rate of 7.05% which equated to a spread of 90 basis points over the
seven-year treasury bond rate.
In January 1997, subsequent to year-end, CRLP completed a public offering
of unsecured medium term debt securities totaling $50,000,000. The securities
mature in January 2003 and pay a coupon rate of 7.16% which equated to a spread
of 80 basis points over the six-year treasury bond rate. The effect of this
issuance is not reflected in CRLP's consolidated financial statements.
In February 1995 CRLP entered into a note payable agreement with
Nationwide Life Insurance Company in the amount of $61,520,000. The ten-year
note requires monthly payments of interest only at 8.87% for the first five
years and monthly payments of interest only at a redetermined interest rate for
the remainder of the term. At the end of the first five years of the term, CRLP
may elect to repay the note without penalty.
CRLP has entered into an interest rate cap agreement which limits debt of
$17,800,000 to an interest rate of 5.96% through September 30, 1998. CRLP paid
approximately $374,000 in total for the interest rate cap, which is being
amortized over the life of the agreement. CRLP is exposed to credit losses in
the event of nonperformance by the counterparties to its interest rate cap and
nonderivative financial assets but has no off-balance-sheet credit risk of
accounting loss. CRLP anticipates, however, that counterparties will be able to
fully satisfy their obligations under the contracts. CRLP does not obtain
collateral or other security to support financial instruments subject to credit
risk but monitors the credit standing of counterparties.
At December 31, 1996, CRLP had $228,815,000 in unsecured indebtedness
including balances outstanding on its bank line of credit and certain other
notes payable. The remainder of CRLP's notes and mortgages payable are
collateralized by the assignment of rents and leases of certain properties and
assets with an aggregate net book value of $467,203,240 at December 31, 1996.
The aggregate maturities of notes and mortgages payable at December 31,
1996, are as follows:
<TABLE>
<S> <C>
1997 $ 2,383,837
1998 84,465,343
1999 33,631,776
2000 27,654,318
2001 82,213,194
Thereafter 276,086,457
------------
$ 506,434,925
============
</TABLE>
A substantial majority of CRLP's notes and mortgages payable have been
recently financed or are covered by interest rate cap agreements, and as such,
the balances outstanding on these notes and mortgages are considered to be the
fair values. CRLP's line of credit arrangement bears interest at a rate that
varies with changes in LIBOR; therefore, the balances outstanding are considered
to be the fair value.
Certain partners of CRLP have guaranteed indebtedness of CRLP totaling
approximately $25,348,000 (of which $19,048,000 was guaranteed during 1996 in
conjunction with the acquisition of Briarcliffe Mall) at December 31, 1996. CRLP
has indemnified these individuals from their guarantees of approximately
$3,304,000 of this indebtedness.
8. Cash Contributions
During 1995 and 1996 and in the first quarter of 1997, the Company
completed three public offerings of stock totaling 9,550,000 common shares of
beneficial interest (Common Shares). The net proceeds of the offerings were
contributed to CRLP and used to fund acquisitions and development expenditures,
repay balances outstanding on CRLP's revolving credit agreements, repay certain
notes and mortgages payable, and for general corporate purposes. Details
relating to these equity offerings are as follows:<TABLE>
Number of Stock Price Gross Offering Net
Date Common Shares Per Share Proceeds Costs Proceeds
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
May 1995 3,450,000 $22.750 $ 78,487,500 $4,831,871 $ 73,655,629
January 1996 4,600,000 $24.625 $ 113,275,000 $6,631,817 $ 106,643,183
January 1997 1,500,000 $29.875 $ 44,812,500 $1,422,500 $ 43,390,000
</TABLE>
The effect of the January 1997 offering is not reflected in CRLP's consolidated
financial statements.
9. Employee Benefits
Employees of CRLP have participated with those of Colonial Properties
Services, Inc. (CPSI) (an affiliate of the Company) and The Colonial Company
(TCC) (an affiliate of certain limited partners) and its other related entities
in a noncontributory defined benefit pension plan covering substantially all
employees. TCC's policy was to currently fund the amount of pension cost allowed
by the Internal Revenue Code. Pension expense includes service and interest
costs adjusted by actual earnings on plan assets and amortization of prior
service cost and the transition amount, calculated using the guidelines of
Statement of Financial Accounting Standards No. 87. The benefits are based on
years of service and the employees' final compensation. The allocated pension
cost of CRLP and CPSI, based on their portion of total payroll expense for the
year ended December 31, 1994, was $186,000, which was paid to The Colonial
Company.
Effective January 1, 1995, the Company created a new noncontributory
defined benefit pension plan designed to cover substantially all employees of
CRLP and CPSI. Therefore, these employees did not participate in the pension
plan mentioned above after December 31, 1994. The benefits provided by this plan
are based on years of service and the employee's final average compensation. The
Company's policy is to fund the minimum required contribution under ERISA and
the Internal Revenue Code.
The table below presents a summary of pension plan status as of December
31, 1996 and 1995, as it relates to the employees of CRLP and CPSI.
<TABLE>
1996 1995
============================================================================
<S> <C> <C>
Actuarial present value of accumulated
benefit obligation including vested
benefits of $528,000 and $374,000
at December 31, 1996 and 1995,
respectively $ 587,000 $ 401,000
Actuarial present value of projected
benefit obligations at year end 1,439,000 1,140,000
Fair value of assets at year end 644,000 358,000
Accrued pension cost 274,000 176,000
Net pension cost for the year 337,000 216,000
</TABLE>
Actuarial assumptions used in determining the actuarial present value of
projected benefit obligations at January 1, 1996 are as follows:
<TABLE>
1996 1995
==============================================================================
<S> <C> <C>
Weighted-average interest rate 7.75% 7.0%
- ------------------------------------------------------------------------------
Increase in future compensation levels 4.5% 4.0%
</TABLE>
CRLP and CPSI also participated with TCC and its other related entities in
a salary reduction profit sharing plan covering substantially all employees.
This plan provided, with certain restrictions, that employees may contribute a
portion of their earnings with the employer matching one-half of such
contributions. Contributions by CRLP and CPSI were $108,000 for the year ended
December 31, 1994.
Effective January 1, 1995, the Company also created a new salary reduction
profit sharing plan covering substantially all employees of CRLP and CPSI.
Similar to TCC's salary reduction profit sharing plan, this plan provides, with
certain restrictions, that employees may contribute a portion of their earnings
with the employer matching one-half of such contributions. Therefore, the
employees of CRLP and CPSI did not participate in the salary reduction profit
sharing plan mentioned above after December 31, 1994. Contributions by CRLP and
CPSI were $164,000 and $155,000 for the years ended December 31, 1996 and 1995,
respectively.
10. Leasing Operations
CRLP is in the business of leasing and managing commercial, retail, and
residential property. For properties owned by CRLP, minimum rentals due in
future periods under noncancelable operating leases extending beyond one year at
December 31, 1996, are as follows:
<TABLE>
<S> <C> <C>
1997 $ 40,897,000 $
1998 35,756,000
1999 30,329,000
2000 23,951,000
2001 19,293,000
Thereafter 99,845,000
------------
$ 250,071,000 $
============
</TABLE>
The noncancelable leases are primarily with tenants engaged in retail and
commercial operations in Alabama, Georgia, Florida, and South Carolina.
Performance in accordance with the lease terms is in part dependent upon the
economic conditions of the respective areas. No additional credit risk exposure
relating to the leasing arrangements exists beyond the accounts receivable
amounts shown in the December 31, 1996, balance sheet. Leases with tenants in
multifamily properties are generally for one year or less and are thus excluded
from the above table. Substantially all of CRLP's land, buildings, and equipment
represent property leased under the above and other short-term leasing
arrangements.
Rental income for 1996, 1995, and 1994 includes contingent rent of
$1,841,000, $1,782,000, and $1,729,000, respectively. This rental income was
earned when certain retail tenants attained sales volumes specified in their
respective lease agreements.
11. Related Party Transactions
CRLP has generally used affiliated construction companies to manage and
oversee its development projects. CRLP paid $42,554,000, $16,124,000, and
$8,934,000 for property development costs to Lowder Construction Company, Inc.,
a construction company owned by TCC, during the years ended December 31, 1996,
1995, and 1994, respectively. CRLP had outstanding construction invoices and
retainage payable to Lowder Construction Company, Inc. totaling $6,746,000 and
$3,306,000 at December 31, 1996 and 1995, respectively. The $3,440,000 increase
in construction-related payables to this affiliate, representing non-cash
increases in construction in progress, have been excluded from the 1996
statement of cash flows. CRLP also paid $27,861,000 and $5,522,000 for property
development costs to two construction companies owned by three trustees during
the years ended December 31, 1996 and 1995, respectively. CRLP had outstanding
construction invoices and retainage payable to these construction companies
totaling $3,227,000 and $678,000 at December 31, 1996 and 1995, respectively.
The $2,549,000 increase in construction-related payables to this affiliate,
representing non-cash increases in construction in progress, have been excluded
from the 1996 statement of cash flows.
CRLP received rental income totaling $758,000, $836,000, and $775,000 from
TCC, CPSI, and other affiliated companies during the years ended December 31,
1996, 1995, and 1994, respectively.
During 1994, TCC performed certain administrative services for CRLP
including payroll processing and computer processing. CRLP paid TCC $82,000 for
these services during that year. Colonial Insurance Company provides insurance
brokerage services for CRLP for which CRLP paid $187,000, $168,000, and $172,000
during the years ended December 31, 1996, 1995, and 1994, respectively. CRLP
paid rent to Polar BEK/Colonial Partnership I, which is a partnership accounted
for by CRLP under the equity method (listed in Note 6), in the amounts of
$211,000, $209,000, and $213,000 during the years ended December 31, 1996, 1995,
and 1994, respectively.
Colonial Commercial Investments, Inc., which is owned by trustees James K.
Lowder and Thomas H. Lowder, has guaranteed indebtedness totaling $1,438,000 at
December 31, 1996 for Anderson Block Properties, which is a partnership
accounted for by CRLP under the equity method (listed in Note 6). CRLP has
indemnified Colonial Commercial Investments, Inc. from its guarantees of this
indebtedness.
In July 1996 CRLP acquired land in Macon, Georgia, on which CRLP is
developing its Colonial Grand at Wesleyan multifamily community. CRLP acquired
this land from Colonial Commercial Investments, Inc. The purchase price of
$1,440,000, which was determined pursuant to an option acquired at the time of
the Company's initial public offering in September 1993, was paid through the
issuance of 58,466 units of limited partnership interest.
In December 1994 CRLP acquired, in exchange for units of limited
partnership interest ("Units"), ten multifamily properties developed and owned
by The Rime Companies, in which Messrs. Ripps and Meisler owned an interest.
Subsequent to the acquisition, Messrs. Ripps and Meisler were elected to serve
on the Board of Trustees of the Company. The acquisition agreements relating to
the acquisition transaction provided for the possible issuance of additional
Units to the owners of The Rime Companies if one of the properties met certain
performance criteria after the acquisition. During 1995 CRLP issued 33,661 Units
to Mr. Ripps and 33,660 Units to the adult children of Mr. Meisler, pursuant to
these acquisition agreements.
12. Subsequent Event
On January 24, 1997, the Trustees declared a cash distribution to partners
of Colonial Realty Limited Partnership in the amount of $.52 per partnership
unit, totaling $14,322,531. The distribution was made to partners of record as
of February 3, 1997, and was paid on February 10, 1997.
<PAGE>
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
<PAGE>
PART III
Item 10. Directors and Executive Officers of the Registrant.
CRLP is managed by the Company, through CPHC, the general partner of
CRLP. The directors and executive officers of the Company are as follows:
Directors of the Company
Thomas H. Lowder, 47, has been a trustee of the Company since its
formation in July 1993. He is the chairman of the board, president and chief
executive officer of the Company and Colonial Properties Holding Company, Inc.
("CPHC") and is the president and a director of Colonial Properties Services,
Inc. (the "Management Corporation"), which conducts the Company's third-party
management leasing and brokerage operations. Mr. Lowder became President of
Colonial Properties, Inc. ("Colonial"), the Company's predecessor, in 1976 and
since that time has been actively engaged in the acquisition, development,
management, leasing and sale of multifamily, retail and office properties for
Colonial and the Company. Mr. Lowder is a member and past president of the
Alabama Chapter of the Commercial Investment Real Estate Institute. Mr. Lowder
is a former state Chairman of the Young Presidents' Organization and is a member
of the Birmingham Area Board of Realtors, the National Association of Industrial
Office Parks, the International Council of Shopping Centers and the National
Association of Real Estate Investment Trusts (NAREIT). He serves on the Board of
Directors for, among other companies, the Children's Hospital of Alabama,
American Red Cross - Birmingham Area Chapter and the United Way of Central
Alabama. Mr. Lowder is a member of the Executive Committee of the Board of
Trustees. Mr. Lowder also is a member of the executive committee of the board of
directors of CPHC. Mr. Lowder is the brother of James K. Lowder, who also serves
as a trustee.
Carl F. Bailey, 66, has been a trustee of the Company and a director of
CPHC and the Management Corporation since September 1993. Mr. Bailey is a
former co-chairman of BellSouth Telecommunications, Inc. and former chairman
and chief executive officer of South Central Bell Telephone Company,
positions from which he retired in 1991. He worked for South Central Bell in
a number of capacities over the past three and a half decades and was elected
president and a member of the board of directors in 1982. Mr. Bailey is
president of BDI and is a member of the board of directors of SouthTrust
Corporation and Delchamps of Mobile. Mr. Bailey serves on the board of
trustees and executive committee of Southern Research Institute and
Birmingham Southern College. Mr. Bailey is a member of the Executive
Committee and is chairman of the Audit Committee of the Board of Trustees.
He also is a member of the executive committee of the board of directors of
CPHC.
M. Miller Gorrie, 61, is a trustee of the Company and a director of CPHC
and the Management Corporation. Mr. Gorrie is, chairman of the board and chief
executive officer of Brasfield & Gorrie, Inc., a general contracting firm
located in Birmingham, Alabama that is ranked consistently among ENR's "Top 100
Contractors." He serves on the board of directors for, among other
organizations, AmSouth Bank of Alabama, Southern Research Institute and American
Cast Iron Pipe Co. He is a past director of the Alabama Chamber of Commerce, the
Associated General Contractors, the Building Science Advisory Board of Auburn
University, the Business Council of Alabama and the March of Dimes. Mr. Gorrie
is chairman of the Executive Committee and the Executive Compensation Committee
of the Board of Trustees. He also is the chairman of the executive committee and
the executive compensation committee of the board of directors of CPHC.
James K. Lowder, 47, has been a trustee of the Company since its
formation in July 1993. He is also a director of CPHC. Mr. Lowder is also
chairman of the board of The Colonial Company, chairman of the board of
Lowder Construction Company, Inc. and chairman of the board of Lowder New
Homes, Inc. and Lowder Realty Company, Inc. He is also a member of the
Alabama Association of Realtors, Montgomery Board of Realtors, the Home
Builders Association of Alabama and the Greater Montgomery Home Builders
Association. Mr. Lowder is a member of the Executive Compensation Committee
of the Board of Trustees. Mr. Lowder also is a member of the executive
compensation committee of the board of directors of CPHC.
Herbert A. Meisler, 69, is a trustee of the Company and a director of
CPHC. Together with Mr. Ripps, he formed The Rime Companies, a real estate
development, construction and management firm specializing in the development of
multifamily properties. In December 1994, the Company purchased ten multifamily
properties from partners associated with The Rime Companies. While with The Rime
Companies, Mr. Meisler oversaw the development and construction of approximately
15,000 multifamily apartment units in the southeastern United States. He
currently serves on the board of directors for the Community Foundation of South
Alabama and the Mobile Airport Authority and is the president of Wichita
Greyhound Park. He is a past director of the Alabama Eye and Tissue Bank and
past president of the Mobile Jewish Welfare Fund. Mr. Meisler is a member of the
Executive Compensation Committee and the Audit Committee of the Board of
Trustees. He also is a member of the executive compensation committee of the
board of directors of CPHC.
Claude B. Nielsen, 46, is a trustee of the Company and a director of
CPHC. Since 1990, Mr. Nielsen has been president of Coca-Cola Bottling
Company United, Inc., headquartered in Birmingham, Alabama, serving also as
chief operating officer from 1990 to 1991 and as chief executive officer
since 1991. Prior to 1990, Mr. Nielsen served as president of Birmingham
Coca-Cola Bottling Company. Mr. Nielsen is on the board of directors of
AmSouth Bancorporation and Cobb Theatres. He also currently serves as a
board member and finance committee chairman of the Birmingham Civil Rights
Institute as well as a board member of the Birmingham Airport Authority. Mr.
Nielsen is a member of the Executive Compensation Committee of the Board of
Trustees. Mr. Nielsen also is a member of the executive compensation
committee of the board of directors of CPHC.
Harold W. Ripps, 58, is a trustee of the Company and a director of CPHC
and the Management Corporation. Together with Mr. Meisler, they formed The Rime
Companies, a real estate development, construction and management firm
specializing in the development of multifamily properties. In December 1994, the
Company purchased ten multifamily properties from partners associated with The
Rime Companies. While with The Rime Companies, Mr. Ripps oversaw the development
and construction of approximately 15,000 multifamily apartment units in the
southeastern United States. He is a member of the executive committee of the
Birmingham Council of Boy Scouts of America, the President's Advisory Committee
of Birmingham Southern College and the President's Council of the University of
Alabama in Birmingham. Mr. Ripps is a member of the Executive Committee and the
Executive Compensation Committee of the Board of Trustees. He also is a member
of the executive committee and the executive compensation committee of the board
of directors of CPHC.
Donald T. Senterfitt, 77, has been a trustee of the Company and a director
of CPHC since September 1993. Mr. Senterfitt is a former director and vice
chairman of SunTrust Banks, Inc., a bank holding company. He is past president
of the American Bankers Association and former General Counsel to the Florida
Bankers Association, and served both organizations in a variety of other
capacities. He currently serves as president and chief executive officer of The
Pilot Group, L.C., a financial institutions consulting firm headquartered in
Orlando, Florida. He is a director of Colonial Bank of Florida. Mr. Senterfitt
is a member of the Audit Committee of the Board of Trustees.
Executive Officers of the Company
Thomas H. Lowder, 47, is the President and Chief Executive Officer
of the Company and CPHC, a trustee of the Company, and a director of CPHC and
the Management Corporation. Mr. Lowder became President of Colonial in 1976 and
since that time has been actively engaged in the acquisition, development,
management, leasing, and sale of multifamily, retail, and office properties for
Colonial. Mr. Lowder is a member and past president of the Alabama Chapter of
the Commercial Investment Real Estate Institute. Mr. Lowder is a former state
Chairman of the Young Presidents' Organization and a member of the Birmingham
Area Board of Realtors, the National Association of Industrial Office Parks, the
International Council of Shopping Centers, and the National Association of Real
Estate Investment Trusts (NAREIT). He serves on the board of directors for
Discovery 2000, the Children's Hospital of Alabama, American Red
Cross-Birmingham Area Chapter, and the United Way of Central Alabama. He
graduated with honors from Auburn University with a Bachelor of Science Degree.
Howard B. Nelson, Jr., 49, has been Senior Vice President and Chief
Operating Officer of the Company and CPHC, with responsibility for the
day-to-day management of the Company, since September 1993. He joined Colonial
in 1984 as a vice president and became Senior Vice President-Finance in 1987.
Mr. Nelson has served as treasurer, vice president, president, and board member
of the Birmingham Chapter of the National Association of Industrial and Office
Parks as well as vice president and board member of the Building Owners and
Managers Association of Metropolitan Birmingham. He also serves on the Board of
Directors of the Children's Harbor Family Center and the College of Business
Advisory Council of Auburn University. He holds a Bachelor of Science Degree
from Auburn University.
Douglas B. Nunnelley, 54, has been Senior Vice President and Chief
Financial Officer of the Company and CPHC, with general responsibility for
financing matters, since 1993. From 1979 until 1993, Mr. Nunnelley served as
Executive Vice President, Comptroller, and Chief Accounting Officer of the
AmSouth Bancorporation, and as Senior Vice President and Comptroller of the
First National Bank of Birmingham. He serves on the Board of Directors of
Eastern Health Systems, Inc. Mr. Nunnelley holds a Bachelor of Science Degree in
accounting from the University of Alabama and is a graduate of the Stonier
Graduate School of Banking at Rutgers University and is a Certified Public
Accountant.
Paul F. Earle, 39, has been Senior Vice-President-Multifamily
Division of CPHC, with responsibility for management of all multifamily
properties owned and/or managed by the Company, since April 1996. He joined
Colonial in 1991 and has served as Vice President-Acquisitions. Mr. Earle is an
active member of the Alabama Multifamily Council and National Apartment
Association. Before joining Colonial, Mr. Earle was the President and Chief
Operating Officer of American Residential Management, Inc., Executive Vice
President of Great Atlantic Management, Inc., and Senior Vice President of
Balcor Property Management, Inc.
John N. Hughey, 37, has been Senior Vice President-Retail Division
Development of CPHC, with responsibility for the expansion and new development
of Retail Properties, since September 1993. He joined Colonial in 1982 and
assumed responsibility for an increasing number of shopping centers until being
named to Senior Vice President-Retail Division of Colonial in 1991. Mr. Hughey
served as the Alabama/Mississippi State Operations Chairman for the
International Council of Shopping Centers from 1993-1995. He holds a Bachelor of
Science Degree from Auburn University.
Thomas M. LaDow, 46, has been Senior Vice-President Office Division
of CPHC, with responsibility for management and leasing of all office properties
owned and/or managed by the Company, since September 1993. He joined Colonial in
1975 as a property manager and became Senior Vice-President-Office Division of
Colonial in September 1993. Mr. LaDow is a Certified Property Manager (CPM) and
is an active member of the Institute of Real Estate Management, Building Owner's
and Manager's Association and the National Association of Industrial and Office
Park. He holds a Bachelor of Science Degree from Birmingham Southern College in
Birmingham, Alabama.
Charles A. McGehee, 51, has been Senior Vice President-Multifamily
Acquisitions/Development of CPHC, in charge of the Company's Multifamily
Property acquisitions and the Birmingham sales brokerage departments, since
September 1993. He joined Colonial in 1976 as vice president of retail leasing
and was responsible for leasing all retail space owned and/or managed by
Colonial. He became Senior Vice President-Office Division of Colonial in 1990, a
position he held until assuming his current position. Mr. McGehee has served as
president and a board member of the National Association of Industrial and
Office Parks as well as a member of the board of directors of the Birmingham
Area Board of Realtors. He holds a Bachelor of Science Degree from Auburn
University.
John L. Moss, 47, has been Senior Vice President-Retail Division of
CPHC, with responsibility for management, leasing, and marketing of all retail
property owned and/or managed by the Company, since September 1993. He joined
Colonial in 1973 as a property manager and assumed various positions of
increasing responsibility in the retail area until becoming Senior Vice
President-Retail Division of Colonial in 1990. Mr. Moss, who is a Certified
Shopping Center Manager (CSM), has served as the state director and the
Alabama/Mississippi state governmental affairs chairman of the International
Council of Shopping Centers. He holds a Bachelor of Science Degree from Auburn
University.
C. Reynolds Thompson, III, 34, joined CPHC in February 1997 as
Senior Vice-President Office Acquisitions, with responsibility for all
acquisitions of office properties. Prior to joining Colonial, Mr. Thompson
worked for CarrAmerica Realty Corporation in office building acquisitions and
due diligence. Mr. Thompson's ten year real estate background includes
acquisitions, development, leasing, and management of office properties in the
Southeast. He is an active member of the National Association of Industrial and
Office Parks and holds a Bachelor of Science degree from Washington and Lee
University.
<PAGE>
Item 11. Executive Compensation.
EXECUTIVE COMPENSATION
The following table sets forth certain information concerning the annual
and long-term compensation for the chief executive officer and the four other
most highly compensated executive officers of the Company (the "Named Executive
Officers"):
<TABLE>
Summary Compensation Table
<CAPTION>
Annual Compensation
Other Annual
Name and Principal Position Year Salary ($) Bonus ($) Compensation
<S> <C> <C> <C> <C>
Thomas H. Lowder.............. 1996 $285,000 $30,000 --
Chairman of the Board 1995 285,000 110,000 --
President and Chief Executive. 1994 275,000 100,000 --
Officer
Howard B. Nelson, Jr.......... 1996 171,726 23,000 --
Senior Vice President and .... 1995 145,000 68,000 --
Chief Operating Officer 1994 120,000 62,000 --
John N. Hughey................ 1996 104,998 50,000 --
Senior Vice President - 1995 95,000 62,000 --
Retail Development 1994 95,000 38,000 --
Charles A. McGehee............ 1996 120,000 20,000 --
Senior Vice President - 1995 110,000 63,000 --
Multifamily Acquisitions/ 1994 107,500 58,600 --
Development
John L. Moss.................. 1996 115,000 11,500 --
Senior Vice President - 1995 115,000 35,000 --
Retail Division 1994 115,000 19,000 --
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Long-Term Compensation
Restricted Securities All
Share Underlying Other
Name and Principal Position Awards ($) (1) Options (#) Compensation(2)
<S> <C> <C> <C>
Thomas H. Lowder.............. $67,200 16,000 $4,500
Chairman of the Board 62,775 15,835 4,500
President and Chief Executive. 62,745 16,000 4,620
Officer
Howard B. Nelson, Jr.......... 33,600 8,500 4,500
Senior Vice President and .... 26,100 6,450 4,159
Chief Operating Officer 13,684 3,460 3,588
John N. Hughey................ 14,400 3,500 3,145
Senior Vice President - 13,388 3,295 3,088
Retail Development 10,903 2,740 2,685
Charles A. McGehee............ 16,800 4,000 4,500
Senior Vice President - 15,413 3,815 3,276
Multifamily Acquisitions/ 12,238 3,100 3,349
Development
John L. Moss.................. 14,400 3,500 3,738
Senior Vice President - 16,088 3,990 3,472
Retail Division 13,128 3,320 3,058
<FN>
(1) The number and value of restricted shares held by the Named Executive
Officers as of December 31, 1996 were as follows: Mr. Lowder - 8,410
shares ($255,454); Mr. Nelson - 3,175 shares ($96,441); Mr. Hughey - 1,685
shares ($51,182); Mr. McGehee - 1,935 shares ($58,776); and Mr. Moss -
1,905 shares ($57,864). Dividends are paid on restricted shares at the
same rate paid to all holders of Common Shares.
(2) All Other Compensation consists solely of employer contributions to the
Company's 401(k) Plan.
</FN>
</TABLE>
<PAGE>
The following table sets forth certain information concerning exercised
and unexercised options held by the Named Executive Officers at December 31,
1996:
<TABLE>
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values
<CAPTION>
Number of
Shares Securities Underlying
Acquired Value Unexercised Options
Name on Exercise(#) Realized($) at December 31, 1996
- ---- --------------------------------------------------------
Exercisable Unexercisable
<S> <C> <C> <C> <C>
Thomas H. Lowder -0- $-0- 15,945 31,890
Howard B. Nelson, Jr. -0- -0- 4,457 13,953
John N. Hughey. -0- -0- 2,925 6,610
Charles A. McGehee -0- -0- 3,338 7,577
John L. Moss... -0- -0- 3,543 7,267
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Value of Unexercised
In-the-Money
Options
Name at December 31, 1996(1)
- ---- -------------------
Exercisable Unexercisable
<S> <C> <C>
Thomas H. Lowder $117,594 $209,189
Howard B. Nelson, Jr. 32,867 89,094
John N. Hughey. 21,572 43,061
Charles A. McGehee 24,620 49,378
John L. Moss... 26,132 47,904
- ------------------------
<FN>
(1)Based on closing price of $30.375 per Common Share on December 31, 1996, as
reported by the New York Stock Exchange.
</FN>
</TABLE>
The following table shows certain information relating to options to
purchase Common Shares granted to the Named Executive Officers during 1996:
<TABLE>
Option Grants in Last Fiscal Year
<CAPTION>
Individual Grants
Percent
Number of of Total
Securities Options
Underlying Granted to Exercise
Options Employees in Price
Name Granted (#) Fiscal Year ($/Sh)
<S> <C> <C> <C>
Thomas H. Lowder ........................16,000 23.40% $24.63
Howard B. Nelson, Jr...................... 8,500 12.40% $24.63
John N. Hughey .........................3,500 5.10% $24.63
Charles A. McGehee........................ 4,000 5.80% $24.63
John L. Moss .........................3,500 5.10% $24.63
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Potential Realizable
Value at Assumed
Annual Rates of Share
Price Appreciation for
Expiration Option Term
Name Date 5% 10%
<S> <C> <C> <C>
Thomas H. Lowder ....... 3/11/06 $231,146 $601,997
Howard B. Nelson, Jr..... 3/11/06 122,982 319,811
John N. Hughey ....... 3/11/06 50,640 131,687
Charles A. McGehee....... 3/11/06 57,874 150,499
John L. Moss ....... 3/11/06 50,640 131,687
</TABLE>
All options granted in 1996 become exercisable in three equal annual
installments beginning on the first anniversary of the date of grant and have a
term of ten years.
Defined Benefit Plan
The Company has adopted a Retirement Plan (the "Plan") for all of the
employees of the Company and its subsidiaries. The Plan also has been adopted by
the Management Corporation. An employee becomes eligible to participate in the
Plan on January 1 or July 1 following the first anniversary of the person's
employment by the Company or one of its consolidated or unconsolidated
subsidiaries or age 21 if later. Benefits are based upon the number of years of
service (maximum 25 years), and the average of the participant's earnings during
the five highest years of compensation during the final 10 years of employment.
Each participant accrues a benefit at a specified percentage of compensation up
to the Social Security wage base, and at a higher percentage of compensation
above the Social Security wage base. Employment by Colonial, the Company's
predecessor, or certain of its affiliated entities is treated as covered service
for purposes of the Plan. A participant receives credit for a year of service
for every year in which 1,000 hours are completed in the employment of the
Company or its subsidiaries.
The following table reflects estimated annual benefits payable upon
retirement under the Plan as a single life annuity commencing at age 65. These
benefits ignore the lower benefit rate applicable to earnings below the Social
Security covered compensation level.
<TABLE>
Pension Plan Table
<CAPTION>
Years of Service
----------------------------------------------------------
Remuneration 5 10 15 20 25
- -----------
<C> <C> <C> <C> <C> <C>
$100,000 $ 7,600 $15,200 $22,800 $30,400 $38,000
125,000 $ 9,500 $19,000 $28,500 $38,000 $47,500
150,000 $11,400 $22,800 $34,200 $45,600 $57,000
$160,000 or over $12,160 $24,320 $36,480 $48,640 $60,800
</TABLE>
The benefits shown are limited by the current statutory limitations which
restrict the amount of benefits which can be paid from a qualified retirement
plan. The statutory limit on compensation which may be recognized in calculating
benefits is $160,000 in 1997. This limit is scheduled to increase periodically
with the cost of living.
Covered compensation under the Plan includes only the employees'
base salary. Thomas H. Lowder has 22 years of covered service under
the Plan, Howard B. Nelson, Jr. has 12 years of service, John N. Hughey
has 14 years of service, Charles A. McGehee has 19 years, and John L.
Moss has 21 years of service.
Employment Agreement
Thomas H. Lowder, the chief executive officer of the Company, entered into
an employment agreement with the Company in September 1993. This agreement
provided for an initial term of three years, and is renewable automatically for
successive one year terms if neither party delivers notice of non-renewal at
least six months prior to the next scheduled expiration date. The agreement
provides for annual compensation of at least $275,000 and incentive compensation
on substantially the same terms as set forth in the description of the Annual
Incentive Plan. See "Report on Executive Compensation -- Annual Incentive Plan."
The agreement includes provisions restricting Mr. Lowder from competing with the
Company during employment and, except in certain circumstances, for two years
after termination of employment. The employment agreement provides for certain
severance payments in the event of disability or termination by the Company
without cause or by the employee with cause.
<PAGE>
EXECUTIVE COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION
None of the five members of the Executive Compensation Committee
is an employee of the Company. As described below, M. Miller Gorrie, James
K. Lowder, Herbert A. Meisler and Harold W. Ripps, who are members of the
Committee, own interests in certain entities that, during 1996, were parties
to certain transactions involving the Company.
Brasfield & Gorrie General Contractors, Inc., a corporation of which M.
Miller Gorrie is a shareholder and chairman of the board, was engaged during
1995 to construct the expansion of the Company's Macon Mall. The Company paid
the corporation a total of $22.8 million ($21.8 million of which was then paid
to unaffiliated subcontractors) during 1996 pursuant to this engagement.
In July 1996, the Company acquired land in Macon, Georgia on which it is
developing a multifamily community. The Company acquired this land from Colonial
Commercial Investments, Inc., which was owned by James K. Lowder and his brother
Thomas H. Lowder. The purchase price of $1,440,000, which was determined
pursuant to an option acquired at the time of the Company's initial public
offering in September, 1993, was paid through the issuance of 58,446 units of
limited partnership interest in the Company's subsidiary Colonial Realty Limited
Partnership.
The Management Corporation provided management and leasing services during
1996 to certain entities in which James K. Lowder and his brothers Thomas H.
Lowder and Robert E. Lowder, have an interest. The aggregate amount of fees paid
to the Management Corporation by such entities during 1996 was approximately
$356,000.
Colonial Insurance Company, a corporation indirectly owned by the Lowder
family, provided insurance brokerage services for the Company during 1996. The
aggregate amount paid by the Company to Colonial Insurance Company for these
services for the year ended December 31, 1996, was approximately $187,000.
The Company leased space to certain entities in which the Lowder family
has an interest and received rent from these entities totaling approximately
$758,000 during 1996.
The Company engaged Lowder Construction Company, Inc., of which James K.
Lowder serves as chairman of the board and which is indirectly owned by James K.
Lowder and Thomas H. Lowder, to serve as construction manager for 11 multifamily
development and expansion projects during 1996. The Company paid a total of
$42.6 million ($41.2 million of which was then paid to unaffiliated
subcontractors) for the construction of these development and expansion projects
during 1996.
The Company also paid to Rime Construction Company, Inc., a corporation in
which Harold W. Ripps, Herbert A. Meisler, and Mr. Meisler's son own an
interest, a total of $5.1 million ($4.9 million of which was then paid to
unaffiliated subcontractors) for construction of one multifamily expansion
project during 1996.
The information required by this item is hereby incorporated by
reference to the material appearing in the Proxy Statement under the caption
"Executive Compensation."
<PAGE>
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information, as of March 10, 1997,
regarding the beneficial ownership of Units by (1) each person known by CRLP to
be the beneficial owner of more than five percent of CRLP's outstanding Units,
(2) each trustee of the Company (each of whom also serves as a director of CPHC)
and each of the chief executive officer and the four other most highly
compensated executive officers of the Company (the "Named Executive Officers")
(each of whom also is an executive officer of CPHC) and (3) the trustees and
executive officers of Colonial as a group. Each person named in the table has
sole voting and investment power with respect to all Units shown as beneficially
owned by such person, except as otherwise set forth in the notes to the table.
The extent to which a person held Common Shares of Colonial as of March 10,
1997, is set forth in Colonial's Proxy Statement dated March 24, 1997, under the
caption "Voting Securities and Principal Holders Thereof," and is incorporated
by reference in this Annual Report and shall be deemed a part hereof. Unless
otherwise provided in the table, the address of each beneficial owner is Energen
Plaza, Suite 750, 2101 Sixth Avenue North, Birmingham, Alabama 35203.
<TABLE>
Name and Business Number of Percent of
Address of Beneficial Owner Units Units(1)
- ----------------------------------------- -------------- ---------------
<S> <C> <C>
Colonial Properties Trust (through
Colonial Properties Holding Company, 18,898,575 (2) 68.4%
Inc.)
Thomas H. Lowder 2,791,829 (3) 10.1%
James K. Lowder 2,791,829 (4) 10.1%
2000 Interstate Parkway
Suite 400
Montgomery, Alabama 36104
Robert E. Lowder 1,737,933 (5) 6.3%
One Commerce Street
Montgomery, Alabama 36104
Carl F. Bailey -0- *
M. Miller Gorrie -0- *
Herbert A. Meisler 1,442,757 (6) 5.2%
Claude B. Nielsen -0- *
Harold W. Ripps 1,851,308 6.7%
Donald T. Senterfitt -0- *
John N. Hughey -0- *
Charles A. McGehee -0- *
John L. Moss -0- *
Howard B. Nelson, Jr. -0- *
All executive officers and trustees as a
group (15 persons) 6,618,694 (7) 24.0%
* Less than 1%
- -----------------------------------------
<FN>
(1) The number of Units outstanding as of March 10, 1997, was 27,631,248.
(2) Does not include 276,312 units of general partnership interest held by
CPHC, representing a one percent equity interest in CRLP.
(3) Includes 532,800 Units owned by Thomas Lowder, 1,258,297 Units owned
by Colonial Commercial Investments, Inc. ("CCI"), a corporation owned
equally by Thomas and James Lowder, and 1,000,732 Units owned by Equity
Partners Joint Venture ("EPJV"), a general partnership of which Thomas,
James and Robert Lowder are the sole general partners. Units owned by CCI
are reported twice in this table, once as beneficially owned by Thomas
Lowder and again as beneficially owned by James Lowder. Units owned by
EPJV are reported three times in this table, as beneficially owned by each
of the Lowder brothers.
(4) Includes 532,800 Units owned by James Lowder, 1,258,297 Units owned by
CCI and 1,000,732 Units owned by EPJV.
(5) Includes 523,546 Units owned by Robert Lowder, 213,655 Units owned by CBC
Realty, Inc. ("CBC"), a corporation wholly owned by Robert Lowder, and
1,000,732 Units owned by EPJV.
(6) Includes 55,062 Units owned by Mr. Meisler, 915,823 Units owned by Bamil
Investment Company, a partnership comprised of Mr. Meisler's children, and
471,872 Units owned by BerFan Company, a partnership of which Mr. Meisler
and his wife are the sole general partners.
(7) Units held by CCI and EPJV have been counted only once for this purpose.
</FN>
</TABLE>
Item 13. Certain Relationships and Related Transactions.
The information required by this item is included in Item 11 of this
Form 10-K.
<PAGE>
Part IV
Item 14. Exhibits, Financial Schedules, and Reports on Form 8-K.
14(a)(1) and (2) Financial Statements and Schedules
Index to Financial Statements and Financial Statement Schedules
Financial Statements:
The following financial statements of CRLP are included in Part II, Item
8:
Report of Independent Accountants
Consolidated Balance Sheets as of December 31, 1996 and 1995
Consolidated Statements of Income for the years ended December 31,
1996, 1995, and 1994
Consolidated Statements of Partners' Capital for the years ended
December 31, 1996, 1995, and 1994
Consolidated Statements of Cash Flows for the years ended December 31,
1996, 1995, and 1994
Notes to Consolidated Financial Statements
Financial Statement Schedules:
Schedule III Real Estate and Accumulated Depreciation
Report of Independent Accountants
All other schedules have been omitted because the required information of
such other schedules is not present in amounts sufficient to require submission
of the schedule or because the required information is included in the
consolidated financial statements.
14(a)(3) Exhibits
* 3.1 Declaration of Trust of Company.
* 3.2 Bylaws of the Company.
** 10.1 Second Amended and Restated Agreement of Limited
Partnership of the Operating Partnership, as amended.
+ 10.2 Registration Rights and Lock-Up Agreement among the
Company and the persons named herein.
** 10.3 ++ First Amended and Restated Employee Share Option and
Restricted Share Plan.
+ 10.4 Non-employee Trustee Share Option Plan.
+ 10.5 Non-employee Trustee Option Agreement.
+ 10.6 ++ Employment Agreement between the Company and Thomas H.
Lowder.
+ 10.7 Officers and Trustees Indemnification Agreement.
+ 10.8 Partnership Agreement of the Management Partnership.
** 10.9 Articles of Incorporation of the Management
Corporation, as amended.
+ 10.10 Bylaws of the Management Corporation.
** 10.11 Articles of Incorporation of CPHC, as amended.
+ 10.12 Bylaws of CPHC.
+ 10.13 Land Option Agreement.
++ 10.14 Credit agreement between the Company and SouthTrust
Bank of Alabama, National Association, AmSouth Bank of
Alabama, Wells Fargo Realty Advisors Funding,
Incorporated, and National Bank of Commerce of Birmingham
dated December 18, 1995 and related promissory notes.
+ 10.16 ++ Annual Incentive Plan.
++++10.17 Indenture dated as of July 22, 1996, by and between
Colonial Realty Limited Partnership and Bankers Trust
Company, as amended
+ 21.1 List of Subsidiaries.
23.1 Consent of Independent Accountants.
27 Financial Data Schedules.
- --------------------
* Incorporated by reference to the Annexes to the Company's Proxy Statement
dated September 1, 1995.
** Incorporated by reference to the same titled and number exhibit in Colonial's
Annual Report on Form 10-K dated December 31, 1994.
+ Incorporated by reference to the same titled and numbered exhibit in
Colonial's Registration Statement on Form S-11, No. 33-65954.
++ Management contract or compensatory plan required to be filed pursuant to
Item 14(c) of Form 10-K.
++ Incorporated by reference to the same titled and number exhibit in the
Company's Annual Report on Form 10-K dated December 31, 1995.
++++ Incorporated by reference to (i) Exhibit D to the Form 8-K dated July 19,
1996, filed by Colonial Realty Limited Partnership, and (ii) Exhibit B to the
Form 8-K dated December 6, 1996, filed by Colonial Realty Limited
Partnership.
14(b) Reports on Form 8-K
Reports on Form 8-K filed during the last quarter of 1996:
- Form 8-K dated December 5, 1996, reported certain property
acquisitions during 1996 under Item 5, "Other Events."
- Form 8-K dated December 6, 1996, reported the required
filings for the issuance of medium term debt securities under
Item 5, "Other Events."
14(c) Exhibits
The list of Exhibits filed with this report is set forth in response
to Item 14(a)(3).
14(d) Financial Statements
None.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized, on March 28, 1997.
COLONIAL REALTY LIMITED PARTNERSHIP,
a Delaware limited partnership
By: Colonial Properties Holding
Company, Inc.,
its general partner
By: /s/ Douglas B. Nunnelley
-------------------------
Douglas B. Nunnelley
Senior Vice President and
Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, this report has been signed below by the following persons on
behalf of the registrant and the capacities indicated on March 28, 1997.
Signature
/s/ Thomas H. Lowder Chairman of the Board, President,
- ------------------------------------------- and Chief Executive Officer
Thomas H. Lowder
/s/ Douglas B. Nunnelley Senior Vice President and Chief
- ------------------------------------------- Financial Officer
Douglas B. Nunnelley
/s/ Kenneth E. Howell Vice President, Controller,
- ------------------------------------------- and Secretary
Kenneth E. Howell (Chief Accounting Officer)
/s/ Carl F. Bailey Director
- -------------------------------------------
Carl F. Bailey
/s/ M. Miller Gorrie Director
- -------------------------------------------
M. Miller Gorrie
/s/ James K. Lowder Director
- -------------------------------------------
James K. Lowder
Director
- -------------------------------------------
Herbert A. Meisler
/s/ Claude B. Nielsen Director
- -------------------------------------------
Claude B. Nielsen
/s/ Harold W. Ripps Director
- -------------------------------------------
Harold W. Ripps
/s/ Donald T. Senterfitt Director
- -------------------------------------------
Donald T. Senterfitt
<PAGE>
<TABLE>
SCHEDULE III
COLONIAL REALTY LIMITED PARTNERSHIP
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 1996
<CAPTION>
Initial Cost to
Company
Buildings and
Description Encumbrances Land Improvements
<S> <C> <C> <C>
Multifamily:
Colonial Grand at Kirkman Park $12,535,549 $ 2,220,000 $21,747,240
Ashford Place 3,420,517 537,600 5,839,838
Barrington Club -0- 880,000 8,605,143
Carrollwood Apartments 6,230,000 1,464,000 10,657,840
Colonial Village at Rocky Ridge 7,418,333 644,943 8,325,057
Colony Park -0- 409,401 4,345,599
Colonial Grand at Galleria Woods 7,395,088 1,220,000 12,480,949
Colonial Grand at Mountain Brook 12,261,239 1,960,000 21,181,118
Colonial Village at Cahaba Heights 3,772,907 625,000 6,548,683
Grande View Towers 9,952,418 1,540,000 12,671,606
Colonial Village at Inverness 9,900,000 1,713,668 10,352,151
Huntleigh Woods 3,022,034 745,600 4,908,990
Inverness Apts 5,741,667 735,461 7,254,539
Inverness Lakes Apts -0- 641,334 8,873,906
McGehee Place Apts -0- 795,627 -0-
Colonial Village at Monte D'Oro 5,314,434 1,000,000 6,994,227
North Ingle Villas -0- 497,574 4,122,426
Patio I, II & III -0- 249,876 3,305,124
Pelican Pointe 8,245,000 1,479,352 -0-
Plantation Gardens -0- 1,488,000 13,515,075
Pointe West 2,880,971 332,800 4,310,671
Polos at Gainesville 11,360,000 3,360,000 24,173,649
Polos at Ponte Vedra 5,760,000 1,440,000 10,038,593
Polos West 5,777,805 1,200,000 8,581,389
Colonial Grand at Galleria 22,400,000 4,600,000 39,078,925
Rime Village - Rime Reserve -0- 758,439 7,902,382
Rime Village - Huntsville 12,775,000 3,680,000 31,686,621
Riverchase II -0- 857,080 -0-
Colonial Grand at Riverchase 9,197,454 2,340,000 25,248,548
Ski Lodge I 7,899,217 3,270,000 12,574,303
Ski Lodge II 9,082,891 3,220,000 13,678,104
Ski Lodge III 10,300,000 2,770,000 15,244,144
Ski Lodge - Tuscaloosa 4,827,530 1,064,000 6,636,685
Somerset Place 4,500,000 699,128 4,920,872
Somerset Wharf 3,400,000 960,984 3,511,596
Spring Creek -0- 1,184,000 13,243,975
Stockbridge Manor -0- 960,000 11,975,947
Colonial Village at Lake Mary -0- 2,145,480 -0-
Sunchase -0- 1,121,244 -0-
Vieux Carre 5,158,370 32,143 -0-
Willow Bend 4,996,667 511,700 5,508,300
Willowtree -0- 134,000 3,986,304
Retail:
Bardmoor Village -0- 2,143,152 9,746,573
Bear Lake Village -0- 2,134,440 6,551,683
Bellwood 2,995,932 330,000 -0-
Briarcliffe Mall -0- 9,099,972 33,663,654
Britt David -0- 1,755,000 4,951,852
Burnt Store Square -0- 3,750,000 8,198,677
Country Lake Village -0- 3,659,040 6,783,697
Gadsden Mall 15,480,000 639,577 -0-
Island Walk 10,406,672 4,181,760 13,023,401
Macon Mall -0- 1,684,875 -0-
McGehee Place -0- 197,152 -0-
Montgomery Promenade 10,810,000 3,788,913 11,346,754
Northdale Court -0- 3,059,760 8,054,090
Old Springville -0- 272,594 -0-
Olde Town 1,676,562 343,325 -0-
Paddock Park -0- 1,532,520 3,754,879
River Oaks -0- 3,262,800 23,636,229
University Park Plaza 14,445,000 6,946,785 20,104,517
Village Mall -0- 103,480 -0-
Wekiva River Walk -0- 2,817,788 15,302,375
Winter Haven Village -0- 1,768,586 3,928,903
Office:
250 Commerce Street -0- 25,000 200,200
AmSouth Center -0- 764,961 -0-
Interstate Park 4,731,991 1,125,990 7,113,558
P&S Building -0- 104,089 -0-
University Park -0- 396,960 -0-
Whitesburg Building 1,282,470 1,081,618 1,050,000
Active Development Projects:
Colonial Grand at Bayshore -0- 11,155,327 -0-
Colonial Grand at Bayshore II -0- 3,377,532 -0-
Colonial Grand at Wesleyan -0- 7,034,301 -0-
Colonial Village at Inverness -0- 1,462,407 -0-
Colonial Grand at Heathrow -0- 20,050,293 -0-
Colonial Grand at Hunter's Creek -0- 16,824,877 -0-
Inverness Lakes -0- 17,733 -0-
Macon Mall Expansion -0- 37,422,651 -0-
McGehee Place Apts. I -0- 58,548 -0-
Montgomery Promenade -0- 1,100,000 -0-
Riverchase III -0- 13,368,319 -0-
Unimproved Land:
Macon Mall Outparcels -0- 663,142 -0-
Colonial Grand at Wesleyan Land -0- 720,000 3,882
Village Mall -0- 404,187 -0-
McGehee Place Land 700,000 430,151 -0-
- --------------------------------------------------------------------------------
$ 278,053,718 $228,548,039 $ 591,445,443
- --------------------------------------------------------------------------------
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Cost Gross Amount at Which
Capitalized Carried at Close of Period
Subsequent to Buildings and
Acquisition Land Improvements Total
<S> <C> <C> <C>
$ 313,875 $ 2,220,000 $22,061,115 $24,281,115
15,465 537,600 5,855,303 6,392,903
20,282 880,000 8,625,425 9,505,425
517,598 1,464,000 11,175,438 12,639,438
54,552 644,943 8,379,609 9,024,552
135,648 409,406 4,481,243 4,890,648
4,733 1,220,000 12,485,682 13,705,682
38,214 1,960,000 21,219,332 23,179,332
11,404 625,000 6,560,087 7,185,087
82,008 1,540,000 12,753,614 14,293,614
7,394,197 1,713,668 17,746,348 19,460,016
324,208 745,600 5,233,198 5,978,798
109,111 735,080 7,364,031 8,099,111
-0- 641,334 8,873,906 9,515,240
16,185,893 842,321 16,139,199 16,981,520
554,158 1,000,000 7,548,385 8,548,385
267,212 497,574 4,389,638 4,887,212
1,888,226 366,717 5,076,509 5,443,226
12,219,880 1,479,352 12,219,880 13,699,232
92,851 1,489,500 13,606,426 15,095,926
12,401 332,800 4,323,072 4,655,872
2,447,552 3,361,850 26,619,351 29,981,201
102,400 1,440,000 10,140,993 11,580,993
144,379 1,200,000 8,725,768 9,925,768
578,891 4,600,000 39,657,816 44,257,816
-0- 758,439 7,902,382 8,660,821
(2,241,014) 3,680,000 29,445,607 33,125,607
8,879,587 857,080 8,879,587 9,736,667
308,789 2,340,000 25,557,337 27,897,337
451,675 3,270,000 13,025,978 16,295,978
442,794 3,220,000 14,120,898 17,340,898
248,578 2,770,000 15,492,722 18,262,722
143,739 1,064,000 6,780,424 7,844,424
184,687 699,128 5,105,559 5,804,687
2,987,412 960,984 6,499,008 7,459,992
42,571 1,184,000 13,286,546 14,470,546
29,025 960,000 12,004,972 12,964,972
18,757,353 3,634,094 17,268,739 20,902,833
5,534,992 1,121,244 5,534,992 6,656,236
4,661,083 32,143 4,661,083 4,693,226
124,334 511,700 5,632,634 6,144,334
234,856 134,000 4,221,160 4,355,160
3,175 2,143,152 9,749,748 11,892,900
19,543 2,134,440 6,571,226 8,705,666
2,828,827 330,000 2,828,827 3,158,827
149,589 9,099,972 33,813,243 42,913,215
-0- 1,755,000 4,951,852 6,706,852
25,961 3,750,000 8,224,638 11,974,638
35,544 3,659,040 6,819,241 10,478,281
18,438,004 639,577 18,438,004 19,077,581
-0- 4,181,760 13,023,401 17,205,161
30,519,154 1,684,875 30,519,154 32,204,029
3,669,113 197,152 3,669,113 3,866,265
983,175 4,332,432 11,786,410 16,118,842
20,220 3,059,760 8,074,310 11,134,070
3,321,753 277,975 3,316,372 3,594,347
2,435,727 343,325 2,435,727 2,779,052
18,225 1,532,520 3,773,104 5,305,624
292,218 3,262,800 23,928,447 27,191,247
155,080 6,946,785 20,259,597 27,206,382
13,943,984 319,528 13,727,936 14,047,464
-0- 2,817,788 15,302,375 18,120,163
4,297,159 4,045,045 5,949,603 9,994,648
2,248,010 25,000 2,448,210 2,473,210
16,470,520 764,961 16,470,520 17,235,481
8,014,064 1,125,988 15,127,624 16,253,612
641,336 104,089 641,336 745,425
4,153,866 396,960 4,153,866 4,550,826
25,986 1,081,618 1,075,986 2,157,604
-0- 1,062,827 10,092,500 11,155,327
-0- 984,000 2,393,532 3,377,532
-0- 720,000 6,314,301 7,034,301
-0- 630,858 831,549 1,462,407
-0- 2,201,539 17,848,754 20,050,293
-0- 4,000,000 12,824,877 16,824,877
-0- -0- 17,733 17,733
-0- 3,192,332 34,230,319 37,422,651
1 58,549 -0- 58,549
-0- 1,100,000 -0- 1,100,000
-0- 1,662,913 11,705,406 13,368,319
-0- 663,142 -0- 663,142
-0- 720,000 3,882 723,882
-0- 404,187 -0- 404,187
-0- 430,151 -0- 430,151
- ------------------------------------------------------------------
$197,015,833 $136,985,597 $ 880,023,719 $1,017,009,315
- ------------------------------------------------------------------
(INFORMATION CONTINUED FROM PREVIOUS TABLE)
Date
Acquired/
Accumulated Date Placed in Depreciable
Depreciation Completed Service Lives/Years
<S> <C> <C> <C>
$ 1,731,563 1991 1994 7-40 Years
109,842 1983 1996 7-40 Years
113,100 1996 1996 7-40 Years
1,152,497 1966 1994 7-40 Years
685,639 1984 1993 7-40 Years
367,304 1975 1993 7-40 Years
312,979 1994 1996 7-40 Years
369,205 1987/91 1996 7-40 Years
130,255 1992 1996 7-40 Years
1,349,293 1990 1994 7-40 Years
3,140,548 1986/87/90 1986/87/90 7-40 Years
277,678 1978 1994 7-40 Years
607,849 1983 1993 7-40 Years
257,609 1996 1996 7-40 Years
3,139,011 1986/95 1986/95 7-40 Years
373,817 1977 1994 7-40 Years
367,139 1983 1983 7-40 Years
402,449 1966/83/84 1994/93/93 7-40 Years
2,710,564 1992 1992 7-40 Years
1,269,629 1991 1994 7-40 Years
80,981 1981 1996 7-40 Years
2,297,486 1989/93/94 1994 7-40 Years
714,766 1988 1994 7-40 Years
711,946 1991 1994 7-40 Years
2,043,734 1986 1994 7-40 Years
135,201 1996 1996 7-40 Years
1,873,936 1987/94 1994 7-40 Years
2,093,904 1991 1991 7-40 Years
1,478,422 1984/91 1994 7-40 Years
665,845 1972/73/76 1994 7-40 Years
703,702 1979/86 1994 7-40 Years
775,146 1984 1994 7-40 Years
388,992 1976/92 1994 7-40 Years
410,743 1986 1993 7-40 Years
1,335,389 1986/87 1986/93 7-40 Years
334,531 1992/94 1996 7-40 Years
894,806 1993/94 1994 7-40 Years
2,905,302 1991/95 1991/95 7-40 Years
1,759,536 1986 1986 7-40 Years
3,119,253 1971/74/78 1971/74/78 7-40 Years
476,271 1984 1993 7-40 Years
2,037,434 1983 1983 7-40 Years
49,507 1981 1996 7-40 Years
252,138 1990 1995 7-40 Years
796,167 1988 1988 7-40 Years
140,482 1986 1996 7-40 Years
268,225 1990 1994 7-40 Years
513,237 1990 1994 7-40 Years
257,378 1990 1995 7-40 Years
7,235,551 1974 1974 7-40 Years
71,623 1993/95 1996 7-40 Years
13,508,163 1975/88 1975/88 7-40 Years
1,010,591 1986 1986 7-40 Years
1,746,827 1990 1993 7-40 Years
235,422 1988 1995 7-40 Years
2,354,651 1982 1982 7-40 Years
543,272 1978/90 1978/90 7-40 Years
105,386 1988 1995 7-40 Years
812,615 1979/89 1993 7-40 Years
5,120,083 1986/89 1993 7-40 Years
7,312,507 1973/84/89 1973/84/89 7-40 Years
75,433 1990 1996 7-40 Years
165,856 1986 1995 7-40 Years
2,242,334 1904 1980 7-40 Years
4,677,513 1990 1990 7-40 Years
3,684,087 1982-85/89 1982-85/89 7-40 Years
357,335 1946 1974 7-40 Years
1,402,139 1985 1985 7-40 Years
186,865 1974 1990 7-40 Years
76,260 N/A 1985 N/A
-0- N/A 1985 N/A
-0- N/A 1996 N/A
-0- N/A 1985 N/A
234,715 N/A 1994 N/A
-0- N/A 1996 N/A
-0- N/A 1994 N/A
-0- N/A 1987 N/A
-0- N/A 1987 N/A
-0- N/A 1993 N/A
-0- N/A 1985 N/A
-0- N/A 1987 N/A
-0- N/A 1996 N/A
-0- N/A 1981 N/A
-0- N/A 1981 N/A
- ------------------
$ 101,541,658
- ------------------
</TABLE>
<PAGE>
NOTES TO SCHEDULE III
COLONIAL REALTY LIMITED PARTNERSHIP
December 31, 1996
The aggregate cost for Federal Income Tax purposes was approximately (1)
$711,887,000 at December 31, 1996.
See description of mortgage notes payable in Note 7 of Notes to (2)
Consolidated Financial Statements.
The following is a reconciliation of real estate to balances (3) reported
at the beginning of the year:
<TABLE>
Reconciliation of Real Estate
<CAPTION>
1996 1995 1994
--------------- ------------- -------------
<S> <C> <C> <C>
Real estate investments:
Balance at beginning of year $ 736,937,703 $ 640,680,718 $ 295,516,276
Acquisitions of new property 173,276,789 67,326,328 328,593,287
Improvements and development 107,834,251 29,121,438 17,362,104
Disposition of property (1,039,428) (190,781) (790,949)
------------ ------------- -------------
Balance at end of year $1,017,009,315 $ 736,937,703 $ 640,680,718
=============== ============= =============
</TABLE>
<TABLE>
Reconciliation of Accumulated Depreciation
<CAPTION>
1996 1995 1994
--------------- ------------- -------------
<S> <C> <C> <C>
Accumulated depreciation:
Balance at beginning of year $79,780,292 $61,773,344 $51,354,506
Depreciation
22,015,054 18,044,446 10,817,424
Depreciation of disposition of
property (253,688) (37,498) (398,586)
--------------- ------------- -------------
Balance at end of year $101,541,658 $79,780,292 $61,773,344
=============== ============= =============
</TABLE>
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
Colonial Properties Holding Company, Inc.
Our report on the consolidated financial statements of Colonial Realty Limited
Partnership is included in Item 8 of this Form 10-K. In connection with our
audits of such financial statements, we have also audited the related financial
statement schedules listed in the index in Item 14 of this Form 10-K.
In our opinion, the financial statements referred to above, when considered in
relation to the basic financial statements taken as a whole, present fairly, in
all material respects, the information required to be included therein.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Birmingham, Alabama
January 24, 1997
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statements
of Colonial Realty Limited Partnership on Forms S-3 dated July 5, 1996 (File
No. 333-04301) and October 25, 1996 (File No. 333-14401) of our report dated
January 24, 1997 on our audits of the consolidated financial statements and
financial statement schedules of Colonial Realty Limited Partnership as of
December 31, 1996 and 1995, and for the years ended December 31, 1996, 1995,
and 1994, which report is included in this Form 10-K.
/s/ Coopers & Lybrand
L.L.P.
COOPERS & LYBRAND L.L.P.
Birmingham, Alabama
March 28, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 3,340,281
<SECURITIES> 0
<RECEIVABLES> 5,362,201
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 903,345,399
<DEPRECIATION> (101,547,650)
<TOTAL-ASSETS> 947,947,109
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 157,090,135
<TOTAL-LIABILITY-AND-EQUITY> 947,947,109
<SALES> 130,369,971
<TOTAL-REVENUES> 134,881,355
<CGS> 0
<TOTAL-COSTS> (70,352,674)
<OTHER-EXPENSES> (23,480,401)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (24,584,298)
<INCOME-PRETAX> 41,048,280
<INCOME-TAX> 0
<INCOME-CONTINUING> 41,048,280
<DISCONTINUED> 0
<EXTRAORDINARY> (510,602)
<CHANGES> 0
<NET-INCOME> 40,537,678
<EPS-PRIMARY> 1.58
<EPS-DILUTED> 0
</TABLE>
