UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
Date of Report (Date of earliest event Commission File Number: 0-20707
reported): July 31, 1997
COLONIAL REALTY LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Delaware 63-1098468
(State of organization) (IRS Employer
Identification Number)
2101 Sixth Avenue North 35203
Suite 750 (Zip Code)
Birmingham, Alabama
(Address of principal executive offices)
(205) 250-8700
(Registrant's telephone number, including area code)
<PAGE>
COLONIAL REALTY LIMITED PARTNERSHIP
Item 5. Other Events
Colonial Realty Limited Partnership (CRLP), a Delaware limited
partnership, is the Operating Partnership of Colonial Properties Trust, an
Alabama real estate investment trust whose common shares are listed on the New
York Stock Exchange under the symbol CLP. CRLP owns and operates commercial real
estate in the southeastern United States. CRLP has acquired one office property
in Georgia and one multifamily apartment community in Mississippi (the Acquired
Properties) since July 21, 1997 (the date of the last Form 8-K filed). The terms
of the acquisitions of the Acquired Properties, which were determined as a
result of arms length negotiations between the sellers of the properties and
CRLP, are set forth in real estate sales contracts. The following is a summary
of the material terms of the transactions.
Terms of Acquisition
The two Acquired Properties total 328 apartment units and 352,000 square feet of
office space and were purchased at a combined purchase price of $66.5 million.
The completed acquisitions increase CRLP's multifamily portfolio to 14,949
apartment units and increase CRLP's office portfolio to 1.9 million square feet.
In association with the Acquired Properties, CRLP assumed existing mortgages
totaling $42.7 million. The remainder of the purchase price of the Acquired
Properties was financed through the issuance of limited partnership units and
advances on CRLP's unsecured line of credit.
Description of Property
Mansell 400 Business Center--Atlanta, Georgia
On July 31, 1997, CRLP completed the first phase of a planned merger which will
ultimately merge the assets of Johnson Development Company, LLC. The first phase
included the six existing office buildings at the Mansell 400 Business Center in
Atlanta, Georgia. These six buildings, which were built in 1987 and 1996,
include 352,000 square feet of office space with an average occupancy of 99% at
the time of acquisition. The total transaction, which was valued at $48.5
million, was funded through the issuance of 540,235 limited partnership units
valued at $15.7 million, the assumption of debt totaling $31.7 million which
bears interest at a weighted average rate of 8.42%, and an advance on CRLP's
unsecured line of credit. In connection with this transaction, the seller,
William M. Johnson, was elected as a director of Colonial Properties Holding
Company, Inc., CRLP's general partner.
Mark Trace--Jackson, Mississippi
On August 29, 1997, CRLP acquired Mark Trace, a 328-unit apartment complex on
approximately 26 acres of land in Jackson, Mississippi. The multifamily
community was developed between 1995 and 1997, and was 98% leased at the time of
acquisition. The purchase price of $17.6 million was financed through the
assumption of debt totaling $11.0 million which bears interest at a weighted
average rate of 8.09%, and an advance on CRLP's unsecured line of credit. The
average unit size is 1,045 square feet with average unit market rent of $637 per
month.
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COLONIAL REALTY LIMITED PARTNERSHIP
Item 7. Financial Statements and Exhibits
Page
(a) Pro Forma Financial Information................................4
Page 3
<PAGE>
COLONIAL REALTY LIMITED PARTNERSHIP
PRO FORMA CONSOLIDATED
CONDENSED BALANCE SHEET
June 30, 1997
(Unaudited)
The following unaudited pro forma consolidated condensed balance sheet reflects
significant transactions effected by CRLP after June 30, 1997 including the
purchase of the two Acquired Properties mentioned elsewhere herein, and two
multifamily communities acquired in July 1997 as discussed in CRLP's Form 8-K
filed July 21, 1997. In addition to these four acquisitions, the unaudited pro
forma consolidated condensed balance sheet reflects two public offerings of debt
in July and August 1997, and cash contributions received from a public offering
of equity securities by Colonial Properties Trust in July 1997. The pro forma
effects of these transactions are included in the unaudited pro forma
consolidated condensed balance sheet assuming the transactions occurred as of
June 30, 1997, and assuming CRLP used the proceeds of the debt and equity
offerings to repay outstanding indebtedness (see notes to unaudited pro forma
consolidated condensed balance sheet).
This unaudited pro forma consolidated condensed balance sheet is not necessarily
indicative of the actual financial position of CRLP had the transactions been
completed as of June 30, 1997, nor does it purport to represent the future
financial position of CRLP. The unaudited pro forma consolidated condensed
balance sheet and related notes should be read in conjunction with the
information appearing in CRLP's 1996 Annual Report as filed with the Securities
and Exchange Commission on Form 10-K and with the financial statements included
therein and the notes thereto, with CRLP's June 30, 1997 Quarterly Report as
filed with the Securities and Exchange Commission on Form 10-Q and with the
financial statements included therein and the notes thereto, and with CRLP's
Form 8-K as filed with the Securities and Exchange Commission on July 21, 1997,
including the financial statements therein and the notes thereto. In
management's opinion, all adjustments necessary to reflect the effects of these
transactions have been made.
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<PAGE>
<TABLE>
Colonial Realty Limited Partnership
Pro Forma Consolidated Condensed Balance Sheet
June 30, 1997
(In Thousands)
(Unaudited)
<CAPTION>
Colonial Realty Colonial Realty
Limited Pro Limited
Partnership Forma Partnership
Historical Adjustments Pro Forma
---------------------------------------------------------
(A) (B)
<S> <C> <C> <C>
ASSETS
Land, buildings, & equipment, net $ 998,546 $ 89,800 $ 1,088,346
Undeveloped land and construction in progress 77,889 77,889
Cash and equivalents 2,931 2,931
Restricted cash 2,593 2,593
Accounts receivable, net 4,721 4,721
Prepaid expenses 2,551 2,551
Notes receivable 610 610
Deferred debt and lease costs 6,696 600 7,296
Investments 5,132 5,132
Other assets 5,679 5,679
---------------------------------------------------------
$ 1,107,348 $ 90,400 $ 1,197,748
=========================================================
LIABILITIES AND PARTNERS' CAPITAL
Notes and mortgages payable $ 619,622 $ 23,233 $ 642,855
Accounts payable 13,655 13,655
Accrued expenses 14,338 14,338
Tenant deposits 3,306 3,306
Unearned rent 956 956
---------------------------------------------------------
Total liabilities 651,877 23,233 675,110
---------------------------------------------------------
Minority interest in consolidated operating property 3,254 3,254
---------------------------------------------------------
Redeemable units, at redemption value 250,561 67,167 317,728
---------------------------------------------------------
Partners' capital, excluding redeemable units 201,656 201,656
---------------------------------------------------------
$ 1,107,348 $ 90,400 $ 1,197,748
=========================================================
</TABLE>
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<PAGE>
COLONIAL REALTY LIMITED PARTNERSHIP
NOTES TO PRO FORMA CONSOLIDATED
CONDENSED BALANCE SHEET
(Unaudited)
(A) Reflects the historical financial position of CRLP as of June 30, 1997 as
presented in CRLP's Form 10-Q as filed with the Securities and Exchange
Commission on August 14, 1997.
(B) Includes the acquisition (subsequent to June 30, 1997) of the two Acquired
Properties; Mansell 400 Business Center for a purchase price of $48.5
million, and Mark Trace for a purchase price of $17.6 million (both
properties included as "Probable Acquisitions" in CRLP's Form 8-K filed on
July 21, 1997). Also includes the acquisition of Timothy Woods for a
purchase price of $12.8 million, and Oakleigh Apartments for a purchase
price of $10.5 million (the effects of which were also included in CRLP's
Form 8-K filed on July 21, 1997). These properties were also acquired
subsequent to June 30, 1997. These property acquisitions were financed
through the issuance of limited partnership units, advances on the Company's
unsecured line of credit and the assumption of indebtedness on the two
Acquired Properties.
The pro forma adjustments also include the application of the proceeds from
the two public debt offerings in July and August 1997 of $100 million, less
offering costs of $.6 million, and the application of the net proceeds of
$49.7 million from the public equity offering by Colonial Properties Trust
in July 1997.
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COLONIAL REALTY LIMITED PARTNERSHIP
PRO FORMA CONSOLIDATED CONDENSED
STATEMENTS OF OPERATIONS
For the Year Ended December 31, 1996 and
the Six Months Ended June 30, 1997
(Unaudited)
The following unaudited pro forma consolidated condensed statements of
operations reflect significant transactions effected by CRLP during 1997 which
includes the purchase of the two Acquired Properties mentioned elsewhere herein.
In addition to the Acquired Properties, the following significant transactions
are reflected in the unaudited pro forma consolidated condensed statements of
operations: (i) CRLP's cash contributions received from Colonial Properties
Trust's equity offerings completed in January 1996, January 1997, and July (ii)
CRLP's debt offerings completed in July 1996, December 1996, January 1997, July
1997, and August 1997, and (iii) CRLP's acquisition of 10 properties during 1997
other than the two Acquired Properties. The pro forma effects of all such
transactions are included in the unaudited pro forma consolidated condensed
statements of operations assuming the transactions had occurred as of January 1,
1996 and assuming CRLP used the proceeds of the equity and debt offerings to
repay outstanding indebtedness (see notes to unaudited pro forma consolidated
condensed statements of operations).
These unaudited pro forma consolidated condensed statements of operations are
not necessarily indicative of the actual results of operations had the
transactions been completed as of January 1, 1996, nor do they purport to
represent the future results of the operations of CRLP. CRLP is not aware of any
material factors relating to the Acquired Properties, other than as disclosed in
the footnotes to the unaudited pro forma consolidated condensed statements of
operations, which would cause the combined historical summaries of revenues and
direct operating expenses not to be necessarily indicative of future operating
results.
The unaudited pro forma consolidated condensed statements of operations and
related notes should be read in conjunction with the information appearing in
CRLP's 1996 Annual Report as filed with the Securities and Exchange Commission
on Form 10-K and with the financial statements included therein and the notes
thereto, with CRLP's June 30, 1997 Quarterly Report as filed with the Securities
and Exchange Commission on Form 10-Q and with the financial statements included
therein and the notes thereto, and with CRLP's Form 8-K as filed with the
Securities and Exchange Commission on July 21, 1997, including the financial
statements therein and the notes thereto. In management's opinion, all
adjustments necessary to reflect the effects of these transactions have been
made.
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<PAGE>
<TABLE>
Colonial Realty Limited Partnership
Pro Forma Consolidated Condensed Statements of Operations
For the year ended December 31, 1996
(In Thousands, Except Per Unit Data)
(Unaudited)
<CAPTION>
For the year ended December 31, 1996
---------------------------------------------------
Colonial Realty Colonial Realty
Limited Pro Limited
Partnership Forma Partnership
Historical Adjustments Pro Forma
-------------------------------------------------
(A) (B)
<S> <C> <C> <C>
Revenues:
Rent $ 130,370 $ 20,946 $ 151,316
Other 4,511 45 4,556
-------------------------------------------------
Total revenue 134,881 20,991 155,872
-------------------------------------------------
Property operating expenses:
General operating expenses 9,530 2,761 12,291
Salaries and benefits 8,606 484 9,090
Repairs and maintenance 13,073 1,182 14,255
Taxes, licenses and insurance 11,538 1,410 12,948
General and administrative 4,071 358 4,429
Depreciation 22,025 3,917 25,942
Amortization 1,509 58 1,567
-------------------------------------------------
Total operating expenses 70,352 10,170 80,522
-------------------------------------------------
Income from operations 64,529 10,821 75,350
-------------------------------------------------
Other income (expense):
Interest expense (24,584) (1,630) (26,214)
Income from partnerships 635 (36) 599
Gains (losses) from sale of property 469 -0- 469
Minority interest in consolidated operating property -0- 15 15
-------------------------------------------------
Total other expense (23,480) (1,651) (25,131)
-------------------------------------------------
Income before extraordinary items 41,049 9,170 50,219
Extraordinary loss from debt extinguishment (511) -0- (511)
-------------------------------------------------
Net income $ 40,538 $ 9,170 $ 49,708
=================================================
Net income per unit $ 1.58 $ 1.68
=============== =================
Units outstanding 25,703 29,503
=============== =================
</TABLE>
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<PAGE>
<TABLE>
Colonial Realty Limited Partnership
Pro Forma Consolidated Condensed Statements of Operations
For the six months ended June 30, 1997
(In Thousands, Except Per Unit Data)
(Unaudited)
<CAPTION>
For the six months ended June 30, 1997
------------------------------------------------------------
Colonial Realty Colonial Realty
Limited Pro Limited
Partnership Forma Partnership
Historical Adjustments Pro Forma
-------------------------------------------------------
(A) (B)
<S> <C> <C> <C>
Revenues:
Rent $ 78,960 $ 8,915 $ 87,875
Other 3,033 60 3,093
-------------------------------------------------------
Total revenue 81,993 8,975 90,968
-------------------------------------------------------
Property operating expenses:
General operating expenses 5,617 1,249 6,866
Salaries and benefits 4,687 248 4,935
Repairs and maintenance 8,024 519 8,543
Taxes, licenses and insurance 7,434 647 8,081
General and administrative 2,764 159 2,923
Depreciation 14,054 1,717 15,771
Amortization 725 17 742
-------------------------------------------------------
Total operating expenses 43,305 4,556 47,861
-------------------------------------------------------
Income from operations 38,688 4,419 43,107
-------------------------------------------------------
Other income (expense):
Interest expense (17,862) (1,347) (19,209)
Income from partnerships 360 (13) 347
Gains (losses) from sale of property (1) -0- (1)
Minority interest in consolidated operating property (114) -0- (114)
-------------------------------------------------------
Total other expense (17,617) (1,360) (18,977)
-------------------------------------------------------
Income before extraordinary items 21,071 3,059 24,130
Extraordinary loss from debt extinguishment (481) 76 (405)
-------------------------------------------------------
Net income $ 20,590 $ 3,135 $ 23,725
=======================================================
Net income per unit $ 0.75 $ 0.80
================ =====================
Units outstanding 27,420 29,503
================ =====================
</TABLE>
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COLONIAL REALTY LIMITED PARTNERSHIP
NOTES TO PRO FORMA CONSOLIDATED
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
(A) Reflects CRLP's historical results of operations for the year ended December
31, 1996, as presented in CRLP's 1996 Annual Report as filed with the
Securities and Exchange Commission on Form 10-K and CRLP's historical
results of operations for the six months ended June 30, 1997 as presented in
CRLP's June 30, 1997 Quarterly Report as filed with the Securities and
Exchange Commission on Form 10-Q.
(B) Reflects the operating results of the 12 properties acquired during 1997
(including the two Acquired Properties mentioned elsewhere herein), less the
operations of the three properties exchanged in connection with two of the
acquisitions during 1997 (as discussed in CRLP's Form 8-K filed July 21,
1997). The results included as pro forma adjustments for these properties
include those operating results of the properties for the respective periods
during which CRLP did not own the properties. This column also reflects the
net effect of the application of the equity and debt offering proceeds to
repay portions of the revolving debt incurred in the acquisition of
properties and certain mortgage debt. The interest saved from this repayment
of debt is shown net of interest expense arising from debt incurred from the
debt offerings.
The pro forma statements of operations include certain adjustments made to
the historical financial results of the Acquired Properties as presented in
the following table.
For the
Year Ended
December 31, 1996
(in thousands)
------------
Excess of revenues over direct
operating expenses (1)
Mansell 400 Business Center $ 3,027
Mark Trace 1,678
Other properties 10,091
------------
14,796
Less:
Depreciation and
amortization of property(2) 3,975
Interest on acquisition
financing, net of savings from
debt and equity offerings(3) 1,630
Other adjustments 21
------------
Pro forma income $ 9,170
============
(1) The excess of revenues over direct operating expenses is based upon
historical operations for the properties acquired during 1997 for the
year ended December 31, 1996.
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<PAGE>
(2) The asset basis used in the computation of depreciation includes a
preliminary allocation of the purchase price to land, land improvements,
building, and personal property, plus acquisition costs to date. Such
allocation may be adjusted pending receipt of additional information.
Depreciation has been computed using the straight line method with cost
recovery periods of 7 to 40 years.
(3) Includes interest expense incurred from sources of funds used to finance
the acquisition of the Acquired Properties including advances on CRLP's
unsecured line of credit, net of the effect of the application of the
equity and debt offering proceeds to repay the revolving debt incurred
in the acquisition of properties and mortgage debt. The interest saved
from this repayment of debt is shown net of interest expense arising
from debt incurred from the debt offerings.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned hereunto duly authorized.
COLONIAL REALTY LIMITED PARTNERSHIP,
a Delaware limited partnership
By:Colonial Properties Holding Company, Inc.
its general partner
Date: September 17, 1997 /s/ Howard B. Nelson, Jr.
-------------------------
Howard B. Nelson, Jr.
Chief Financial Officer
(Duly Authorized Officer
and Principal Financial Officer)
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