<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM 8-K/A-1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
----------
Date of Report (Date of earliest event reported): NOVEMBER 4, 1998
SUMMIT PROPERTIES PARTNERSHIP, L.P.
(Exact name of Registrant as specified in charter)
DELAWARE 0-22411 56-1857809
- --------------------------------------------------------------------------------
(State or other jurisdiction (Commission File Number) (IRS employer
of incorporation) identification no.)
212 SOUTH TRYON STREET, SUITE 500, CHARLOTTE, NC 28281
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(704) 334-9905
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
<PAGE> 2
The Form 8-K of Summit Properties Partnership, L.P. (the "Operating
Partnership") filed on November 13, 1998 is hereby amended to include financial
statements, pro forma financial information and certain exhibits.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements under Rule 3-14 of Regulation S-X
Ewing Apartments
Combined Statement of Revenues and Certain Expenses for the Year
Ended December 31, 1997 and Independent Auditors' Report and the
Nine Months Ended September 30, 1998 (unaudited)
(b) Pro Forma Financial Information
Summit Properties Partnership, L.P.
Pro Forma Condensed Combined Balance Sheet as of September 30,
1998 (Unaudited)
Pro Forma Condensed Combined Statement of Earnings for the Nine
Months Ended September 30, 1998 (Unaudited)
Pro Forma Condensed Combined Statement of Earnings for the Year
Ended December 31, 1997 (Unaudited)
(c) Exhibits:
2.1 Agreement and Plan of Reorganization dated as of October
31, 1998 among Summit Properties Inc., affiliates of
Summit Properties Inc. (including Summit Properties
Partnership, L.P.), Ewing Industries, Inc. and
affiliates of Ewing Industries, Inc. (previously filed).
10.1 Amendment No. 13 to the Limited Partnership Agreement of
Summit Properties Partnership, L.P. (previously filed).
23.1 Consent of Deloitte & Touche LLP (filed herewith).
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following person in the capacity and on the date
indicated. The person set forth below has signed this report as an officer of
Summit Properties Inc., in its capacity as general partner of Summit Properties
Partnership, L.P.
SUMMIT PROPERTIES INC.
Date: December 1, 1998 By: /s/ William F. Paulsen
-------------------------------------
William F. Paulsen
President and Chief Executive Officer
<PAGE> 4
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of
Summit Properties Inc.
We have audited the accompanying combined statement of revenues and certain
expenses (defined as being operating revenues less direct operating expenses) of
Belcourt, Turtle Rock, Turtle Cove, Buena Vista, Camino Real and Los Arboles I &
II Apartments (collectively the "Ewing Apartments") for the year ended December
31, 1997. This financial statement is the responsibility of the management of
Summit Properties Inc. Our responsibility is to express an opinion on this
statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the combined statement of revenues and certain expenses
is free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis
for our opinion.
The accompanying combined statement of revenues and certain expenses was
prepared for the purpose of complying with the rules and regulations of the
Securities and Exchange Commission for inclusion in the Form 8-K of Summit
Properties Inc. Material amounts, described in Note 1 to the combined statement
of revenues and certain expenses, that would not be comparable to those
resulting from the proposed future operations of the Ewing Apartments are
excluded and the statement is not intended to be a complete presentation of the
revenues and expenses of these apartments.
In our opinion, such combined statement of revenues and certain expenses
presents fairly, in all material respects, the revenues and certain expenses, as
defined above, of the Ewing Apartments for the year ended December 31, 1997, in
conformity with generally accepted accounting principles.
Deloitte & Touche LLP
Dallas, Texas
November 20, 1998
<PAGE> 5
EWING APARTMENTS
COMBINED STATEMENT OF REVENUES AND CERTAIN EXPENSES
(In thousands)
<TABLE>
<CAPTION>
Nine Months Ended Year Ended
September 30, 1998 December 31, 1997
------------------ -----------------
(Unaudited)
<S> <C> <C>
Revenues
Rental Income $12,399 $14,322
Other property income, net 590 690
------- -------
Total revenues 12,989 15,012
Certain Expenses
Property operating and maintenance 3,088 3,911
Real estate taxes 2,159 2,362
Management fees 693 756
------- -------
Total expenses 5,940 7,029
------- -------
Revenues in excess of certain expenses $ 7,049 $ 7,983
======= =======
</TABLE>
See Notes to Combined Statement of Revenues and Certain Expenses
<PAGE> 6
EWING APARTMENTS
NOTES TO COMBINED STATEMENT OF REVENUES AND CERTAIN EXPENSES
YEAR ENDED DECEMBER 31, 1997
- --------------------------------------------------------------------------------
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION - The combined operating revenues and direct
operating expenses of the Belcourt, Turtle Rock, Turtle Cove, Buena
Vista, Camino Real and Los Arboles I & II Apartments (collectively the
"Ewing Apartments") described in Note 2 is presented on the accrual
basis of accounting. The accompanying financial statements are not
representative of the actual operations for the periods presented as
certain expenses, which may not be comparable to the proposed future
operations of the Ewing Apartments, have been excluded in accordance
with the Securities and Exchange Commission Regulation S-X, Rule 3-14.
Expenses excluded consist of interest, including interest related to
certain indebtedness assumed with a principal balance of $79,852,000
at September 30, 1998 (unaudited), depreciation and amortization,
professional fees and other costs not directly related to the future
operations of the Ewing Apartments.
INCOME RECOGNITION - Rental income is recorded when it is earned and
due from tenants. Apartment units are rented under lease agreements
with terms of one year or less.
INTERIM FINANCIAL DATA (UNAUDITED) - In the opinion of management, all
adjustments and eliminations consisting only of normal recurring
adjustments necessary to present fairly the combined statement of
revenues and certain expense of the Ewing Apartments for the nine
months ended September 30, 1998 have been included. The combined
results of operations for the nine months ended September 30, 1998 are
not necessarily indicative of the results for the full year.
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 revenues and expenses as of and for the reporting period.
Actual results could differ from those estimates.
<PAGE> 7
2. DESCRIPTION OF THE AUDITED ACQUISITION PROPERTIES
The following properties are included in the combined statement of
revenues and certain expenses:
<TABLE>
<CAPTION>
Property Location Number of Units
-------- -------- ---------------
<S> <C> <C>
Belcourt Dallas, Texas 180
Turtle Rock San Antonio, Texas 250
Turtle Cove Dallas, Texas 348
Buena Vista Dallas, Texas 467
Camino Real Dallas, Texas 364
Los Arboles I & II Austin, Texas 408
-----
2,017
=====
</TABLE>
The Camino Real Apartments were placed in service in July 1997. The
property was approximately 40% occupied at December 31, 1997 and 94%
occupied at September 30, 1998 (unaudited).
3. RELATED PARTY TRANSACTIONS
MANAGEMENT FEES - The Ewing Apartments had a management agreement with an
affiliated management company to maintain and manage the operations of
the apartment complexes. Management fees are based on 5% of total revenue
collected. Upon acquisition of the Ewing Apartments by Summit Properties,
such management contract was canceled, at which time Summit Properties
began to manage the Ewing Apartments.
DEVELOPMENT FEES - The Ewing Apartments entered into development
agreements with an affiliated company to provide development oversight
services for the properties. Development fees were capitalized as part of
the carrying basis of the properties by the Ewing Apartments when
incurred and therefore no amounts are reflected in this financial
statement related to this activity.
CONSTRUCTION FEES - The Ewing Apartments entered into construction
agreements with an affiliated company to provide general contractor
services during the development period for the properties. Construction
fees were capitalized as part of the carrying basis of the properties by
the Ewing Apartments when incurred and therefore no amounts are reflected
in this financial statement related to this activity. Construction fees
were based on a fixed percentage of each contract as defined in the
agreements.
* * * * * *
<PAGE> 8
SUMMIT PROPERTIES PARTNERSHIP, L.P.
BASIS OF PRESENTATION TO PROFORMA CONDENSED
COMBINED BALANCE SHEET
AS OF SEPTEMBER 30, 1998
The Pro Forma Condensed Combined Balance Sheet gives effect to (i) the
acquisition of a portfolio of multifamily properties in Texas (the "Ewing
Acquisition") through a merger with Ewing Industries Inc. and affiliates thereof
("Ewing Industries") on November 4, 1998 and (ii) the sale of communities
formerly known as Summit Springs and Summit Old Town. The Ewing Acquisition was
funded through (i) the issuance to Ewing Industries of 489,622 shares of common
stock ("Shares") of Summit Properties Inc. and 141,921 units of limited
partnership interest ("Units") of the Operating Partnership with the Shares and
Units valued at Summit Properties' approximate market value of $18.00 on the
consummation date, (ii) the assumption of $79.9 million of debt, and (iii) the
payment of $50.6 million in cash. In addition, Summit Properties has committed
to issue 519,365 Shares as a deposit for a property currently in lease-up, with
respect to which payment of the final consideration is contingent upon the
property reaching stabilization (the "Contingent Property"). The current
estimate of additional consideration to be paid at such time is (i) 1,030,009
Shares of common stock and 36,629 Units (each Share and Unit valued at $18.00)
and (ii) cash in the amount of $1,314,144. The Ewing Acquisition, excluding the
Contingent Property, and the sale of Summit Springs and Summit Old Town have
been presented as if the transactions had occurred on September 30, 1998. The
Pro Forma Condensed Combined Balance Sheet gives effect to the acquisition under
the purchase method of accounting in accordance with Accounting Principles Board
Opinion No. 16. In the opinion of management, all significant adjustments
necessary to reflect the effects of the Ewing Acquisition have been made.
The Pro Forma Condensed Combined Balance Sheet is presented for comparative
purposes only and is not necessarily indicative of what the actual combined
financial position of Ewing Industries and the Operating Partnership at
September 30, 1998 would be, nor does it purport to represent the future
combined financial position of Ewing Industries and the Operating Partnership.
This Pro Forma Condensed Combined Balance Sheet should be read in conjunction
with, and is qualified in its entirety by, the historical financial statements
and notes thereto of the Operating Partnership as included in the Form 10-K for
the year ended December 31, 1997 and the Operating Partnership's Form 10-Q for
the nine months ended September 30, 1998.
<PAGE> 9
SUMMIT PROPERTIES PARTNERSHIP, L.P.
PRO FORMA CONDENSED COMBINED BALANCE SHEET
SEPTEMBER 30, 1998
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
BALANCE
BEFORE EWING EWING PRO FORMA
HISTORICAL DISPOSITIONS ACQUISITION ACQUISITION COMBINED
---------- ------------ ----------- ----------- --------
(A) (B) (C)
<S> <C> <C> <C> <C> <C>
Assets:
Real estate assets, net $ 964,476 ($ 15,904) $ 948,572 $ 147,692 $1,096,264
Cash 4,823 -- 4,823 -- 4,823
Restricted cash 7,702 24,046 31,748 -- 31,748
Other assets 12,999 (15) 12,984 1,713 14,697
---------- ---------- ---------- ---------- ----------
Total assets $ 990,000 $ 8,127 $ 998,127 $ 149,405 $1,147,532
========== ========== ========== ========== ==========
Liabilities:
Notes payable $ 601,872 $ 601,872 $ 133,303 $ 735,175
Other liabilities 41,005 ($ 282) 40,723 4,734 45,457
---------- ---------- ---------- ---------- ----------
Total liabilities 642,877 (282) 642,595 138,037 780,632
Partners' equity 347,123 8,409 355,532 11,368 366,900
---------- ---------- ---------- ---------- ----------
Total liabilities and partners' equity $ 990,000 $ 8,127 $ 998,127 $ 149,405 $1,147,532
========== ========== ========== ========== ==========
</TABLE>
<PAGE> 10
SUMMIT PROPERTIES PARTNERSHIP, L.P.
NOTES TO PRO FORMA CONDENSED COMBINED
BALANCE SHEET
SEPTEMBER 30, 1998
(UNAUDITED)
ADJUSTMENTS:
<TABLE>
<S> <C> <C>
A. Reflects the Summit Properties Partnership, L.P. Consolidated Balance
Sheet as of September 30, 1998.
B. Reflects the sale of Summit Springs and Summit Old Town on October 23,
1998 and November 12, 1998 respectively. The sales are summarized as
follows:
Net sales proceeds after disposition costs $24,046
Net book value of assets sold (15,904)
Cost of other assets sold (15)
Liabilities assumed by buyer 282
-----------
Gain on sale $8,409
===========
Proceeds were put in escrow in accordance with Internal Revenue Service
like-kind exchange rules. Accordingly, proceeds are classified as
restricted cash.
C. Reflects the Ewing Acquisition. The purchase is summarized as follows:
Loan escrow acquired $1,713
Mortgage notes payable assumed ($79,852)
Borrowings on the Operating Partnership's unsecured credit facility (50,575)
Adjustment to mortgage notes assumed to reflect estimated fair value (2,876) (133,303)
-----------
Other net liabilities assumed (4,734)
Issuance of Units to Summit Properties Inc. for issuance of
similar number of Shares to seller (489,622) (8,768)
Issuance of Units to seller (141,921) (2,600)
-------------
Purchase price including acquisition costs ($147,692)
=============
The effects of accounting policy differences are immaterial and have not
been adjusted in the unaudited Pro Forma Condensed Combined Balance
Sheet.
</TABLE>
<PAGE> 11
SUMMIT PROPERTIES PARTNERSHIP, L.P.
BASIS OF PRESENTATION TO PRO FORMA CONDENSED
COMBINED STATEMENTS OF EARNINGS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND
THE YEAR ENDED DECEMBER 31, 1997
The Pro Forma Condensed Combined Statements of Earnings for the nine months
ended September 30, 1998 and the year ended December 31, 1997 are presented as
if the following transactions had occurred on January 1, 1997:
(i) The acquisition of Ewing Industries, as further described in the Basis
of Presentation to the Pro Forma Combined Condensed Balance Sheet.
Adjustments related to the Contingent Property are not included in the
pro forma statements as it was in construction in 1997 and a portion of
1998 and its operations are not material to the Pro Forma Condensed
Combined Statements of Earnings. In addition, the Operating Partnership
has a cash flow management contract with a surviving affiliate of Ewing
Industries to manage such property until the property reaches
stabilization. In consideration for managing the property, such
affiliates retain all net cash flows for the property. Certain of the
properties acquired in the Ewing Acquisition were in lease up in 1998
and/or 1997. The operations of such lease-up properties are not
reflective of fully stabilized properties.
(ii) The sale of Summit Old Town, Summit Springs, Summit Providence and
Summit Charleston on November 12, 1998, October 23, 1998, May 18, 1998
and May 14, 1997, respectively.
(iii) The purchase of Summit Lenox on July 8, 1998. The purchase of Summit
Club at Dunwoody and Summit St. Clair on May 22, 1998 and March 1, 1998,
respectively, are shown as if they were acquired on January 1, 1998.
These two properties were under construction during 1997 and would not
have had a material effect on 1997 operations.
(iv) The purchase of Summit Fair Oaks, Summit Windsor II, Summit Sand Lake
and Summit Portofino ("1997 Acquisitions") on December 31, 1997, July
18, 1997, February 20, 1997 and January 6, 1997, respectively.
The Pro Forma Condensed Combined Statements of Earnings give effect to the
acquisitions under the purchase method of accounting in accordance with
Accounting Principles Board Opinion No. 16. In the opinion of management, all
significant adjustments necessary to reflect the effects of these transactions
have been made.
The Pro Forma Condensed Combined Statements of Earnings are presented for
comparative purposes only and are not necessarily indicative of what the actual
combined results of the above transactions and the Operating Partnership for the
nine months ended September 30, 1998, and the year ended December 31, 1997 would
be, nor do they purport to be indicative of the results of operations in future
periods. The Pro Forma Condensed Combined Statements of Earnings should be read
in conjunction with, and are qualified in their entirety by, the historical
financial statements and notes thereto of the Operating Partnership as included
in the Form 10-K for the year ended December 31, 1997 and the Operating
Partnership's Form 10-Q for the nine months ended September 30, 1998.
<PAGE> 12
SUMMIT PROPERTIES PARTNERSHIP, L.P.
PRO FORMA CONDENSED COMBINED STATEMENT OF EARNINGS
NINE MONTHS ENDED SEPTEMBER 30, 1998
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
BALANCE EWING
OTHER BEFORE EWING EWING ACQUISITION PRO FORMA
HISTORICAL ACQUISITIONS DISPOSITIONS ACQUISITION ACQUISITION ADJUSTMENTS CONSOLIDATED
---------- ------------ ------------ ----------- ----------- ----------- ------------
(A) (B) (C) (D)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues:
Rental $ 99,047 $ 4,006 ($ 3,974) $ 99,079 $ 12,399 $111,478
Other property income 5,733 162 (221) 5,674 590 6,264
Interest and other 1,286 -- -- 1,286 -- 1,286
-------- -------- -------- -------- -------- -------- --------
Total revenues 106,066 4,168 (4,195) 106,039 12,989 119,028
-------- -------- -------- -------- -------- -------- --------
Expenses:
Property operating and maintenance 26,948 1,485 (1,283) 27,150 3,713 ($ 368)(E) 30,495
Real estate taxes and insurance 10,251 316 (392) 10,175 2,227 -- 12,402
Depreciation 20,774 885 (696) 20,963 -- 3,068 (F) 24,031
Interest 23,351 2,178 (1,878) 23,651 -- 7,166 (G) 30,817
General and administrative expenses 2,726 -- -- 2,726 -- -- 2,726
Loss on equity investments 95 -- -- 95 -- -- 95
-------- -------- -------- -------- -------- -------- --------
Total expenses 84,145 4,864 (4,249) 84,760 5,940 9,866 100,566
-------- -------- -------- -------- -------- -------- --------
Income before gain on real estate assets
and extraordinary item 21,921 (696) 54 21,279 7,049 (9,866) 18,462
Gain on sale of real estate assets 8,731 -- (8,731) -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Income before extraordinary item $ 30,652 ($ 696) ($ 8,677) $ 21,279 $ 7,049 ($ 9,866) $ 18,462
======== ======== ======== ======== ======== ======== ========
Per unit data:
Income before extraordinary items -
basic and diluted (H) $ 1.06 $ 0.62
========== ==========
Weighted average units - basic 28,808,330 29,543,050
========== ==========
Weighted average units - diluted 28,825,095 29,559,815
========== ==========
</TABLE>
<PAGE> 13
SUMMIT PROPERTIES PARTNERSHIP, L.P.
NOTES TO PRO FORMA CONDENSED COMBINED
STATEMENT OF EARNINGS
NINE MONTHS ENDED SEPTEMBER 30, 1998
(UNAUDITED)
ADJUSTMENTS:
A. Reflects the Summit Properties Partnership, L.P. Consolidated Statement
of Earnings for the nine months ended September 30, 1998.
B. Reflects the operations of Summit St. Clair acquired effective March
1,1998, Summit Club at Dunwoody acquired May 22, 1998 and Summit Lenox
acquired July 8, 1998, from January 1, 1998 to date of acquisition.
C. Reflects the operations of Summit Providence sold on May 18, 1998 from
January 1, 1998 to date of sale. Reflects Summit Springs and Summit Old
Town sold on October 23, 1998 and on November 12, 1998, respectively,
from January 1, 1998 to September 30, 1998. In addition, the gain on
sale of real estate assets has been eliminated for pro forma
presentation.
D. Reflects the operations of the communities acquired in the Ewing
Acquisition for the nine months ended September 30, 1998. Pro forma
effects of the Contingent Property have not been included in the Pro
Forma Condensed Combined Statement of Earnings as such property was
substantially under construction for the period presented and,
therefore, its effect on pro forma earnings is not significant.
Final consideration related to the Contingent Property is issuable
contingent upon such property achieving stabilization in the future.
Management expects the potential impact of the Contingent Property on
future earnings of the Operating Partnership to be insignificant.
The effects of accounting policy differences are immaterial and have not
been adjusted in the unaudited Pro Forma Condensed Combined Statement of
Earnings.
E. Adjustment represents property supervision costs adjusted to 2.5% of
revenues. The 2.5% estimate reflects the Operating Partnership's
historical costs of property supervision. Such costs, as a percent of
property revenues should not change significantly as a result of the
acquisitions and dispositions.
F. Reflects depreciation on the Operating Partnership's basis in the Ewing
Acquisition. Depreciation is computed on a straight-line basis over the
estimated useful lives of the properties (buildings - 37 to 40 years and
furniture, fixtures and equipment - 5 to 7 years).
G. Includes the interest costs on the mortgage debt assumed in conjunction
with the Ewing Acquisition and the incremental borrowings to finance the
acquisition of $50.6 million. The purchase was assumed to be financed
from the Operating Partnership's credit facility at the weighted average
interest rate for the nine months ended September 30, 1998 of 6.76%.
H. Based upon 29,543,050 and 29,559,815 basic and diluted weighted average
Units issued and outstanding, respectively.
<PAGE> 14
SUMMIT PROPERTIES PARTNERSHIP, L.P.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS
YEAR ENDED DECEMBER 31, 1997
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
BALANCE EWING
OTHER BEFORE EWING EWING ACQUISITION PRO FORMA
HISTORICAL ACQUISITIONS DISPOSITIONS ACQUISITION ACQUISITION ADJUSTMENTS CONSOLIDATED
---------- ------------ ------------ ----------- ----------- ----------- ------------
(A) (B) (C) (D)
Revenues:
<S> <C> <C> <C> <C> <C> <C> <C>
Rental $ 109,827 $ 8,517 ($ 7,084) $ 111,260 $ 14,322 $ 125,582
Other property income 6,179 364 (409) 6,134 690 6,824
Interest and other 671 -- -- 671 -- 671
--------- --------- --------- --------- --------- --------- ---------
Total revenues 116,677 8,881 (7,493) 118,065 15,012 133,077
--------- --------- --------- --------- --------- --------- ---------
Expenses:
Property operating and maintenance 31,311 3,160 (2,282) 32,189 4,439 ($ 381)(E) 36,247
Real estate taxes and insurance 10,721 755 (758) 10,718 2,590 -- 13,308
Depreciation 22,652 1,934 (1,404) 23,182 -- 3,504 (F) 26,686
Interest 21,959 4,560 (3,725) 22,794 -- 8,234 (G) 31,028
General and administrative expenses 2,740 -- -- 2,740 -- -- 2,740
Gain on equity investments (274) -- -- (274) -- -- (274)
--------- --------- --------- --------- --------- --------- ---------
Total expenses 89,109 10,409 (8,169) 91,349 7,029 11,357 109,735
--------- --------- --------- --------- --------- --------- ---------
Income before gain on real estate assets
and extraordinary item 27,568 (1,528) 676 26,716 7,983 (11,357) 23,342
Gain on sale of real estate assets 4,366 -- (4,366) -- -- -- --
--------- --------- --------- --------- --------- --------- ---------
Net income $ 31,934 ($ 1,528) ($ 3,690) $ 26,716 $ 7,983 ($ 11,357) $ 23,342
========= ========= ========= ========= ========= ========= =========
Per unit data:
Net income - basic and diluted (H) $ 1.17 $0.83
========== ==========
Weighted average units - basic 27,257,637 27,956,153
========== ==========
Weighted average units - diluted 27,294,058 27,992,574
========== ==========
</TABLE>
<PAGE> 15
SUMMIT PROPERTIES PARTNERSHIP, L.P.
NOTES TO PRO FORMA CONDENSED COMBINED
STATEMENT OF EARNINGS
YEAR ENDED DECEMBER 31, 1997
(UNAUDITED)
ADJUSTMENTS:
A. Reflects the Summit Properties Partnership, L.P. Consolidated Statement
of Earnings for the year ended December 31, 1997.
B. Reflects the operations of the 1997 Acquisitions from January 1, 1997 to
date of acquisition. In addition, reflects the operations of Summit
Lenox, acquired July 8, 1998 for the year ended December 31, 1997. Does
not reflect the operations of Summit St. Clair and Summit Club at
Dunwoody acquired in 1998 as the properties were in construction in 1997
and their operations for the year ended December 31, 1997 were not
significant.
C. Reflects the operations for the year ended December 31, 1997 of Summit
Providence sold on May 18, 1998, Summit Springs sold on October 23, 1998
and Summit Old Town sold on November 12, 1998. Also reflects the
operations of Summit Charleston from January 1, 1997 to date of sale on
May 14, 1997. In addition, the gain on sale of real estate assets has
been eliminated from the pro forma presentation.
D. Reflects the operations of the communities acquired in the Ewing
Acquisition for the year ended December 31,1997. Pro forma effects of
the Contingent Property have not been included in the Pro Forma
Condensed Combined Statement of Earnings as such property was
substantially under construction for the period presented and,
therefore, its effect on pro forma earnings is not significant.
Final consideration related to the Contingent Property is issuable
contingent upon such property achieving stabilization in the future.
Management expects the potential impact of the Contingent Property on
future earnings of the Operating Partnership to be insignificant.
The effects of accounting policy differences are immaterial and have not
been adjusted in the unaudited Pro Forma Condensed Combined Statement of
Earnings.
E. Adjustment represents property supervision costs adjusted to 2.5% of
revenues. The 2.5% estimate reflects the Operating Partnership's
historical costs of property supervision. Such costs, as a percent of
property revenues should not change significantly as a result of the
acquisitions and dispositions.
F. Reflects depreciation on the Operating Partnership's basis in the Ewing
Acquisition. Depreciation is computed on a straight-line basis over the
estimated useful lives of the properties (buildings - 37 to 40 years and
furniture, fixtures and equipment - 5 to 7 years).
G. Includes the interest costs on the mortgage debt assumed in conjunction
with the Ewing Acquisition and the incremental borrowings to finance the
acquisition of $30.4 million. The purchase was assumed to be financed
from the Operating Partnership's credit facility at the weighted average
interest rate for the year ended December 31, 1997 of 6.73%.
H. Based upon 27,956,153 and 27,992,574 basic and diluted weighted average
Units issued and outstanding, respectively.
<PAGE> 16
EXHIBIT INDEX
2.1 Agreement and Plan of Reorganization dated as of October 31, 1998 among
Summit Properties Inc., affiliates of Summit Properties Inc. (including
Summit Properties Partnership, L.P.), Ewing Industries, Inc. and
affiliates of Ewing Industries, Inc. (previously filed).
10.1 Amendment No. 13 to the Limited Partnership Agreement of Summit
Properties Partnership, L.P. (previously filed).
23.1 Consent of Deloitte & Touche LLP (filed herewith).
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Registration Statement Nos.
333-25575-01 on Form S-3 of Summit Properties Partnership. L.P. of our report
dated November 20, 1998 with respect to the combined statement of revenues and
certain expenses of the Ewing Apartments for the year ended December 31, 1997
appearing in this Current Report on Form 8-K/A-1 of Summit Properties
Partnership, L.P.
DELOITTE & TOUCHE LLP
Charlotte, North Carolina
December 1, 1998