<PAGE> 1
- --------------------------------------------------------------------------------
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 reported) May 19, 1998
----------------
PAN PACIFIC RETAIL PROPERTIES, INC.
------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
Maryland 001-13243 33-0752457
------------------------------ ------------ -------------------
(State or other jurisdiction of (Commission (IRS Employer
incorporation or organization) File Number) Identification No.)
1631-B South Melrose Drive
Vista, California 92083
---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (760) 727-1002
------------------
N.A.
-------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE> 2
Item 5. Other Events.
(1) On May 19, 1998, Pan Pacific Retail Properties, Inc. (the
"Registrant") accepted a deed in lieu of foreclosure
related to a non-performing note receivable and therefore
became the fee simple owner of a property commonly known
as Westwood Village Shopping Center. The asset was
acquired for $4,500,000, the book value of the note
receivable and the assumption of the first mortgage on the
property. The property, a 102,375 square foot retail
center located in Redding, California was acquired from an
unrelated third party. The Registrant intends to continue
to operate the asset as a shopping center.
(2) On May 28, 1998, the Registrant acquired the Fashion Faire
Shopping Center pursuant to a Purchase and Sale Agreement
executed on April 30, 1998. The property, a 95,225 square
foot retail center located in San Leandro, California, was
acquired for $11,450,000 from Fashion Faire Place, a
California limited partnership, an unrelated third party.
The asset, acquired for cash, was paid for with available
cash and borrowings under an existing unsecured credit
facility available to the Registrant. The Registrant
intends to continue to operate the asset as a shopping
center.
(3) On June 18, 1998, the Registrant acquired the Pacific
Commons Shopping Center pursuant to a Purchase and Sale
Agreement executed on June 11, 1998. The property, a
206,474 square foot retail center located in Spanaway,
Washington, of which the Registrant owns 151,233 square
feet, was acquired for $13,675,000 from Ray W. Strand and
Ruby G. Strand, Trustees of the STRAND TRUST, an unrelated
third party. The asset, acquired for cash, was paid for
with available cash and borrowings under an existing
unsecured credit facility available to the Registrant. The
Registrant intends to continue to operate the asset as a
shopping center.
(4) Included in this filing is certain historical and pro
forma financial information as follows:
(a) Financial Statement Pursuant to Rule 3-14 of
Regulation S-X.
Pacific Commons Shopping Center
Independent Auditors' Report
Statement of Revenue and Certain Expenses for the
year ended December 31, 1997
Notes to Statement of Revenue and Certain Expenses
<PAGE> 3
(b) Pro Forma Financial Information.
Pro Forma Condensed Consolidated Statement of
Operations for the six months ended June 30,
1998 (unaudited)
ProForma Condensed Consolidated Statement of
Operations for the year ended December 31, 1997
(unaudited)
Notes to the Pro Forma Condensed Consolidated
Statements of Operations (unaudited)
Combining Schedules of Revenue and Certain Expenses
of the Acquisition Properties and Notes
Receivable as follows:
1) Combining Schedule of Revenue and Certain
Expenses of the 1998 Acquisition Properties
for the Six Months Ended June 30, 1998
(unaudited)
2) Combining Schedule of Revenue and Certain
Expenses of the 1998 Acquisition Properties
for the Year Ended December 31, 1997
(unaudited)
3) Combining Schedule of Revenue and Certain
Expenses of the 1997 Acquisition Properties
and Notes Receivable for the Year Ended
December 31, 1997 (unaudited)
(c) Exhibits.
None
<PAGE> 4
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Pan Pacific Retail Properties, Inc.:
We have audited the accompanying statement of revenue and certain expenses of
Pacific Commons Shopping Center for the year ended December 31, 1997. This
statement is the responsibility of management. 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 statement of revenue and certain expenses is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the statement. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the statement. We
believe that our audit provides a reasonable basis for our opinion.
The accompanying statement of revenue and certain expenses was prepared for the
purpose of complying with the rules and regulations of the Securities and
Exchange Commission and for inclusion in the Current Report on Form 8-K of Pan
Pacific Retail Properties, Inc. as described in Note 1 to the statement of
revenue and certain expenses. It is not intended to be a complete presentation
of Pacific Commons Shopping Center's revenue and expenses.
In our opinion, the statement referred to above presents fairly, in all material
respects, the revenue and certain expenses, as described in Note 1, of Pacific
Commons Shopping Center for the year ended December 31, 1997 in conformity with
generally accepted accounting principles.
San Diego, California
August 4, 1998
<PAGE> 5
PACIFIC COMMONS SHOPPING CENTER
Statement of Revenue and Certain Expenses
For the year ended December 31, 1997
<TABLE>
<CAPTION>
<S> <C>
Revenue:
Rent (notes 3 and 4) $1,331,647
Recoveries from tenants 278,471
Other 3,839
----------
1,613,957
----------
Certain expenses:
Property taxes 182,139
Repairs and maintenance 103,907
Management fees 28,030
Utilities 18,336
Insurance 12,778
Other 2,334
----------
347,524
----------
Revenue in excess of certain expenses $1,266,433
==========
</TABLE>
See accompanying notes to statement of revenue and certain expenses.
2
<PAGE> 6
PACIFIC COMMONS SHOPPING CENTER
Notes to Statement of Revenue and Certain Expenses
For the year ended December 31, 1997
(1) BASIS OF PRESENTATION
The accompanying statement of revenue and certain expenses relates to the
operations of Pacific Commons Shopping Center (the "Property"), a
community shopping center located in Spanaway, Washington. The Property
was purchased by Pan Pacific Retail Properties, Inc.
(the "Company") for $13,675,000 in cash on June 18, 1998.
The accompanying statement of revenue and certain expenses has been
prepared for the purpose of complying with the rules and regulations of
the Securities and Exchange Commission and accordingly, is not
representative of the actual results of operations of Pacific Commons
Shopping Center for the year ended December 31, 1997 due to the exclusion
of the following expenses, which may not be comparable to the proposed
future operations of the Property:
o Depreciation and amortization
o Interest on mortgage which was not assumed by the Company
o Federal and state income taxes
o Other costs not directly related to the proposed future operations
of the Property
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES
(a) REVENUE RECOGNITION
Rent revenue is recognized on a straight-line basis over the term of
the individual leases.
(b) USE OF ESTIMATES
Management has made a number of estimates and assumptions relating to
the reporting and disclosure of revenue and certain expenses during
the reporting period to prepare the statement of revenue and certain
expenses in conformity with generally accepted accounting principles.
Actual results could differ from those estimates.
(3) RENT REVENUE
Retail space is leased to tenants under various operating leases with
terms ranging from 3 to 25 years. The leases generally provide for minimum
rent and reimbursement of real estate taxes, common area maintenance and
certain other operating expenses. Certain leases also contain provisions
for percentage rent. Percentage rent of $17,071 was earned for the year
ended December 31, 1997.
3
<PAGE> 7
PACIFIC COMMONS SHOPPING CENTER
Notes to Statement of Revenue and Certain Expenses, Continued
For the year ended December 31, 1997
Future minimum rentals to be received under noncancelable operating leases
in effect at December 31, 1997 are as follows:
<TABLE>
<CAPTION>
YEARS ENDING DECEMBER 31, AMOUNT
------------------------- -----------
<S> <C>
1998 $ 1,374,784
1999 1,304,788
2000 1,266,580
2001 1,179,847
2002 1,077,902
Thereafter 10,177,863
-----------
$16,381,764
===========
</TABLE>
(4) CONCENTRATION OF CREDIT RISK
At December 31, 1997, two tenants individually accounted for more than 10%
of total revenue. Rent revenue earned and recoveries from these tenants
for the year ended December 31, 1997 were as follows:
Quality Food Centers, Inc. (QFC) $399,110
K-Mart $409,631
4
<PAGE> 8
PACIFIC COMMONS SHOPPING CENTER
Statement of Estimated Taxable Operating Results of Pacific Commons Shopping
Center and Estimated Cash to be made available by Operations of Pacific Commons
Shopping Center.
For a Twelve-Month Period
(unaudited)
<TABLE>
<CAPTION>
<S> <C>
Revenue:
Rent, net of straight-line rent $1,314,933
Recoveries from tenants 278,471
Other 3,839
----------
1,597,243
----------
Expenses:
Depreciation 256,000
Property operating 135,021
Property taxes 182,139
Property management fees 28,030
Other 2,334
----------
603,524
----------
Estimated taxable operating income 993,719
Add back depreciation 256,000
----------
Estimated cash to be made available by operations $1,249,719
==========
</TABLE>
This statement of estimated taxable operating results and estimated cash to be
made available by operations is an estimate of operating results of Pacific
Commons Shopping Center for a period of twelve months based on information
provided by management and does not purport to reflect actual results for any
period. This statement includes an adjustment to rent revenue of $16,714 to
reverse the effects of straight-line rent that was recognized for financial
reporting purposes. The Company does not expect to pay federal income tax
because of its election to be taxed as a REIT.
<PAGE> 9
PAN PACIFIC RETAIL PROPERTIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
The following unaudited pro forma condensed consolidated statements of
operations for the six months ended June 30, 1998 and the year ended December
31, 1997 are presented as if: (i) the consummation of the initial public
offering of common stock in August 1997 (the "IPO"), the related formation
transactions in connection with the IPO and the related repayment of notes
payable; (ii) the acquisitions of Chico Crossroads, Monterey Plaza, Fairmont
Shopping Center, Lakewood Shopping Center, Green Valley Town & Country , Rainbow
Promenade, The PNW Portfolio, Palmdale Shopping Center, Tustin Heights Shopping
Center and Brookvale Shopping Center (collectively the "1997 Acquisitions") and
certain secured notes receivable; (iii) the acquisitions of Bear Creek Plaza,
San Dimas Marketplace, The Oregon Portfolio, Manteca Marketplace, Creekside
Center, Panther Lake Shopping Center, Westwood Village Shopping Center, Fashion
Faire Shopping Center and Pacific Commons Shopping Center (collectively the
"1998 Acquisitions") and (iv) the secondary offering completed on May 18, 1998,
the exercise of Pan Pacific Development (U.S.), Inc.'s participation rights and
related repayment of a portion of the unsecured credit facility all had occurred
on January 1, 1997.
The pro forma condensed consolidated balance sheet of Pan Pacific Retail
Properties, Inc. as of June 30, 1998 has been excluded from this filing of Form
8-K as the transactions that were given pro forma effect in the pro forma
condensed consolidated statements of operations occurred prior to June 30, 1998,
and therefore are included in Pan Pacific Retail Properties, Inc.'s June 30,
1998 unaudited consolidated balance sheet included in the registrants Form 10-Q
filing on August 13, 1998.
The pro forma condensed consolidated statements of operations should be
read in conjunction with the consolidated financial statements of Pan Pacific
Retail Properties, Inc., including the notes thereto, that were filed with and
as part of Pan Pacific Retail Properties, Inc's annual report on Form 10-K for
the year ended December 31, 1997 filed on March 30, 1998, quarterly report on
Form 10-Q for the period ended March 31, 1998 filed on May 15, 1998, and
quarterly report on Form 10-Q for the period ended June 30, 1998 filed on August
13, 1998. The pro forma condensed consolidated statements of operations do not
purport to represent Pan Pacific Retail Properties, Inc's results of operations
for the six months ended June 30, 1998 or for the year ended December 31, 1997
that would actually have occurred had the Company completed the transactions
described above nor do they purport to represent the results of operations as of
any future date or for any future period.
<PAGE> 10
PAN PACIFIC RETAIL PROPERTIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1998
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
PRO FORMA
ADJUSTMENTS
-----------
1998
ACQUISITION
PROPERTIES
AND OTHER
COMPANY PRO FORMA COMPANY
HISTORICAL ADJUSTMENTS PRO FORMA
---------- ----------- ---------
<S> <C> <C> <C>
REVENUE:
Rental ............................. $ 28,910 $ 2,453 (J) $ 31,363
Percentage rent .................... 307 9 (J) 316
Recoveries from tenants ............ 6,212 529 (J) 6,741
Income from unconsolidated
partnerships ..................... 350 -- 350
Other ................................. 819 9 (J) 828
------------ ------------ ------------
36,598 3,000 39,598
------------ ------------ ------------
EXPENSES
Property operating ................. 4,336 435 (J) 4,771
Property taxes ..................... 2,606 287 (J) 2,893
Property management fees ........... 47 104 (J) 47
(104)(L)
Depreciation and amortization ...... 6,953 498 (K) 7,451
Interest ........................... 9,068 125 (J) 8,588
(605)(D)
Administrative ..................... 1,887 -- 1,887
Other income and expense ........... 208 29 (J) 237
------------ ------------ ------------
25,105 769 25,874
------------ ------------ ------------
INCOME BEFORE MINORITY INTEREST ....... 11,493 2,231 13,724
Minority interest .................. (19) -- (19)
------------ ------------ ------------
NET INCOME BEFORE
EXTRAORDINARY ITEM ................. $ 11,474 $ 2,231 13,705
============ ============ ============
Pro forma basic weighted average
common shares outstanding ....... 21,162,012
============
Pro forma diluted weighted average
common shares outstanding ....... 21,247,110
============
Pro forma basic earnings per share . $ 0.65
============
Pro forma diluted earnings per share $ 0.65
============
</TABLE>
See accompanying notes to pro forma condensed consolidated financial statements.
<PAGE> 11
PAN PACIFIC RETAIL PROPERTIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
PRO FORMA ADJUSTMENTS
--------------------------
1997 1998
ACQUISITION ACQUISITION
PROPERTIES PROPERTIES
AND OTHER AND OTHER
COMPANY PRO FORMA PRO FORMA COMPANY
HISTORICAL ADJUSTMENTS ADJUSTMENTS PRO FORMA
---------- ----------- ----------- ---------
<S> <C> <C> <C> <C>
REVENUE:
Rental ............................. $36,839 $10,512 (A) $11,225 (J) $ 58,576
Percentage Rent .................... 278 127 (A) 59 (J) 464
Recoveries from tenants ............ 8,042 2,145 (A) 2,295 (J) 12,482
Income from unconsolidated
partnerships ..................... 409 297 (D) -- 706
Other ................................. 884 108 (A) 40 (J) 1,032
------- ------- ------- ------------
46,452 13,189 13,619 73,260
------- ------- ------- ------------
EXPENSES
Property operating ................. 6,016 1,400 (A) 1,761 (J) 9,177
Property taxes ..................... 3,187 1,126 (A) 1,243 (J) 5,556
Property management fees ........... 126 497 (A) 466 (J) 126
(497)(C) (466)(L)
Depreciation and amortization ...... 8,928 2,200 (B) 2,349 (K) 13,477
Interest ........................... 14,057 2,506 (A) 327 (L) 17,358
(136)(D)
604 (E)
Administrative ..................... 3,923 558 (F) -- 4,000
(481)(G)
Other income and expense ........... 687 155 (A) 153 (J) 466
(529)(H)
------- ------- ------- ------------
36,924 7,403 5,833 50,160
------- ------- ------- ------------
INCOME BEFORE INCOME TAX
EXPENSE AND MINORITY INTEREST ...... 9,528 5,786 7,786 23,100
Income tax expense ................. (19) 19 (I) -- --
Minority interest .................. (153) (96)(D) -- (249)
------- ------- ------- ------------
NET INCOME BEFORE EXTRAORDINARY ITEM .. $ 9,356 $ 5,709 $ 7,786 $ 22,851
======= ======= ======= ============
Pro forma basic weighted average
common shares outstanding ....... 21,162,012
============
Pro forma diluted weighted average
common shares outstanding ....... 21,220,191
============
Pro forma basic earnings per share . $ 1.08
============
Pro forma diluted earnings per share $ 1.08
============
</TABLE>
See accompanying notes to pro forma condensed consolidated financial statements.
<PAGE> 12
PAN PACIFIC RETAIL PROPERTIES, INC.
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(IN THOUSANDS)
ADJUSTMENTS TO THE PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
The pro forma adjustments to the Pro Forma Condensed Consolidated
Statement of Operations for the six months ended June 30, 1998 and for the year
ended December 31, 1997 are as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1998 DECEMBER 31, 1997
------------- -----------------
<S> <C> <C>
(A) Acquisition of Chico Crossroads, Monterey Plaza, Fairmont Shopping Center,
Lakewood Shopping Center, Green Valley Town & Country, the secured notes
receivable, Rainbow Promenade, The PNW Portfolio, Palmdale Shopping Center,
Tustin Heights Shopping Center and Brookvale Shopping Center (refer to
Combining Schedules for detailed information by property)
Rental revenue - $10,512
Percentage rent - $ 127
Recoveries from tenants - $ 2,145
Other revenue - $ 108
Property operating expenses - $ 1,400
Property taxes - $ 1,126
Property management fees - $ 497
Interest - $ 2,506
Other expenses - $ 155
(B) Increase in depreciation on buildings for the 1997 Acquisitions as follows:
Chico Crossroads - $ 71
Monterey Plaza - 141
Fairmont Shopping Center - 69
Lakewood Shopping Center - 86
Green Valley Town & Country - 189
Rainbow Promenade - 374
The PNW Portfolio - 671
Palmdale Shopping Center - 86
Tustin Heights Shopping Center - 276
Brookvale Shopping Center - 237
-------
- 2,200
=======
(C) Elimination of property management fees paid to third parties related to the
1997 Acquisitions - $ (497)
(D) Net decrease in interest expense resulting from the repayment of notes
payable with the proceeds from the IPO and the repayment of borrowings under
the Unsecured Credit Facility with proceeds from the Secondary Offering as
follows:
Income from unconsolidated partnerships - $ 297
Interest $ (605) $ (136)
Minority interest - $ (96)
(E) Increase in interest expense for the effect of the amortization of Unsecured
Credit Facility fees $ - $ 604
</TABLE>
<PAGE> 13
PAN PACIFIC RETAIL PROPERTIES, INC.
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 1998 DECEMBER 31, 1997
------------- -----------------
<S> <C> <C>
(F) Increase in general and administrative expenses for the incremental costs of
operating as a public REIT - $ 558
(G) Decrease in general and administrative expenses for management fees charged
by Revenue Properties - $ (481)
(H) Decrease in other expenses for loan guarantee fees charged by Revenue
Properties - $ (529)
(I) Elimination of income tax expense as the Company expects to be taxed as a
REIT - $ 19
(J) Acquisition of Bear Creek Plaza, San Dimas Marketplace, The Oregon
Portfolio, Manteca Marketplace, Creekside Center, Panther Lake Shopping
Center, Westwood Village Shopping Center, Fashion Faire Shopping Center and
Pacific Commons Shopping Center (refer to the Combining Schedules for
detailed information by property)
Rental revenue $ 2,453 $11,225
Percentage Rent 9 59
Recoveries from tenants 529 2,295
Other revenue 9 40
Property operating expenses 435 1,761
Property taxes 287 1,243
Property management fees 104 466
Interest 125 327
Other expenses 29 153
(K) Increase in depreciation on buildings for the 1998 Acquisitions as follows:
Bear Creek Plaza $ 13 $ 246
San Dimas Marketplace 25 427
The Oregon Portfolio 86 569
Manteca Marketplace 62 293
Creekside Center 33 113
Panther Lake Shopping Center 42 146
Westwood Village Shopping Center 32 85
Fashion Faire Shopping Center 87 214
Pacific Commons Shopping Center 118 256
------- -------
$ 498 $ 2,349
======= =======
(L) Elimination of property management fees paid to third parties related to the
1998 Acquisitions $ (104) $ (466)
</TABLE>
<PAGE> 14
PAN PACIFIC RETAIL PROPERTIES, INC.
COMBINING SCHEDULE OF REVENUE AND CERTAIN EXPENSES OF THE
1998 ACQUISITION PROPERTIES
FOR THE SIX MONTHS ENDED JUNE 30, 1998(1)
(UNAUDITED)
<TABLE>
<CAPTION>
BEAR CREEK SAN DIMAS THE OREGON MANTECA CREEKSIDE PANTHER LAKE
PLAZA MARKETPLACE PORTFOLIO MARKETPLACE CENTER SHOPPING CENTER
---------- ----------- ---------- ----------- --------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Revenue:
Base rents............ $81,022 $469,107 $61,382 $181,761 $183,180 $211,279
Recoveries from
tenants............. 9,682 95,302 13,500 30,250 53,279 54,547
Percentage rents...... 0 0 609 0 0 0
Other................. 0 2,855 134 576 110 1,177
------- -------- ------- -------- -------- --------
90,704 567,264 75,625 212,587 236,569 267,003
------- -------- ------- -------- -------- --------
Expenses:
Property operating.... 3,601 70,612 5,098 43,734 99,906 29,624
Property taxes........ 6,935 49,201 7,613 19,000 23,752 32,479
Property management
fees................ 2,281 21,703 1,568 10,632 11,535 7,986
Interest 0 0 0 0 0 0
Other................. 1,237 9,957 807 719 3,076 3,620
-------- -------- -------- -------- -------- --------
14,054 151,473 15,086 74,085 138,269 73,709
-------- -------- -------- -------- -------- --------
Income (loss) before
income tax expense.... 76,650 415,791 60,539 138,502 98,300 193,294
Income tax expense.... $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
-------- -------- -------- -------- -------- --------
Net income (loss)....... $ 76,650 $415,791 $ 60,539 $138,502 $ 98,300 $193,294
======== ======== ======== ======== ======== ========
</TABLE>
<TABLE>
<CAPTION>
WESTWOOD VILLAGE FASHION FAIRE PACIFIC COMMONS
SHOPPING CENTER SHOPPING CENTER SHOPPING CENTER TOTAL
---------------- --------------- --------------- -----------
<S> <C> <C> <C> <C>
Revenue:
Base rents............ $233,844 $423,021 $608,667 $2,453,263
Recoveries from
tenants............. 46,942 97,033 128,936 529,471
Percentage rents...... 0 0 7,904 8,513
Other................. 303 2,484 1,778 9,417
-------- -------- -------- ----------
281,089 522,538 747,285 3,000,664
-------- -------- -------- ----------
Expenses:
Property operating.... 33,214 86,322 62,517 434,628
Property taxes........ 26,630 37,422 84,333 287,365
Property management
fees................ 14,054 20,904 12,978 103,641
Interest.............. 124,617 0 -- 124,617
Other................. 7,717 1,024 1,081 29,238
-------- -------- -------- ----------
206,232 145,672 160,909 979,489
-------- -------- -------- ----------
Income (loss) before
income tax expense.... 74,857 376,866 586,376 2,021,175
Income tax expense.... 0 0 0 0
-------- -------- -------- ----------
Net income (loss)....... $ 74,857 $376,866 $586,376 $2,021,175
======== ======== ======== ==========
</TABLE>
- --------------
(1) Amounts shown reflect operating results for the period during 1998 that the
assets were not owned by the Company.
<PAGE> 15
PAN PACIFIC RETAIL PROPERTIES, INC.
COMBINING SCHEDULE OF REVENUE AND CERTAIN EXPENSES OF THE
1998 ACQUISITION PROPERTIES
FOR THE YEAR ENDED DECEMBER 31, 1997
(UNAUDITED)
<TABLE>
<CAPTION>
BEAR CREEK SAN DIMAS THE OREGON MANTECA CREEKSIDE PANTHER LAKE
PLAZA MARKETPLACE PORTFOLIO MARKETPLACE CENTER SHOPPING CENTER
---------- ----------- ---------- ----------- --------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Revenue:
Rent.................. $1,179,184 $1,408,238 $3,438,981 $ 861,593 $630,763 $734,445
Percentage rents...... 11,692 -- 30,589 -- -- --
Recoveries from
tenants............. 259,347 168,280 710,016 143,395 183,460 189,615
Other................. 2,570 -- 19,381 2,730 380 4,092
---------- ---------- ---------- ---------- -------- --------
1,452,793 1,576,518 4,198,967 1,007,718 814,603 928,152
---------- ---------- ---------- ---------- -------- --------
Expenses:
Property operating.... 97,938 62,592 511,527 207,312 344,015 102,980
Property taxes........ 146,246 120,541 347,347 90,067 81,788 112,902
Management fees....... 30,122 39,643 162,182 50,400 39,720 27,761
Interest.............. -- -- -- -- -- --
Other................. 15,508 21,500 64,020 3,408 10,591 12,584
---------- ---------- ---------- ---------- -------- --------
289,814 244,276 1,085,076 351,187 476,114 256,227
---------- ---------- ---------- ---------- -------- --------
Revenue in excess of
certain expenses...... $1,162,979 $1,332,242 $3,113,891 $ 656,531 $338,489 $671,925
========== ========== ========== ========== ======== ========
</TABLE>
<TABLE>
<CAPTION>
WESTWOOD VILLAGE FASHION FAIRE PACIFIC COMMONS
SHOPPING CENTER SHOPPING CENTER SHOPPING CENTER TOTAL
---------------- --------------- --------------- -----------
<S> <C> <C> <C> <C>
Revenue:
Rent.................. $614,052 $1,043,262 $1,314,576 $11,225,094
Percentage rents...... 0 0 17,071 59,352
Recoveries from
tenants............. 123,264 239,305 278,471 2,295,153
Other................. 796 6,126 3,839 39,914
-------- ---------- ---------- -----------
738,112 1,288,693 1,613,957 13,619,513
-------- ---------- ---------- -----------
Expenses:
Property operating.... 87,216 212,888 135,021 1,761,489
Property taxes........ 69,928 92,290 182,139 1,243,248
Management fees....... 36,904 51,554 28,030 466,316
Interest.............. 327,231 -- -- 327,231
Other................. 20,264 2,525 2,334 152,734
-------- ---------- ---------- -----------
541,543 359,257 347,524 3,951,018
-------- ---------- ---------- -----------
Revenue in excess of
certain expenses...... $196,569 $ 929,436 $1,266,433 $ 9,668,495
======== ========== ========== ===========
</TABLE>
<PAGE> 16
PAN PACIFIC RETAIL PROPERTIES, INC.
COMBINING SCHEDULE OF REVENUE AND CERTAIN EXPENSES OF THE
1997 ACQUISITION PROPERTIES AND NOTES RECEIVABLE
FOR THE YEAR ENDED DECEMBER 31, 1997(1)
(UNAUDITED)
<TABLE>
<CAPTION>
CHICO MONTERREY FAIRMONT GREEN VALLEY LAKEWOOD NOTES
CROSSROADS PLAZA SHOPPING CENTER TOWN & COUNTRY SHOPPING CENTER RECEIVABLE
---------- --------- --------------- -------------- --------------- ----------
<S> <C> <C> <C> <C> <C>
Revenue:
Rent........................ $349,208 $746,219 $404,174 $1,016,555 $404,375 $ --
Percentage rents............ -- -- -- -- -- --
Recoveries from tenants..... 25,458 121,354 82,779 106,530 80,302 --
Other....................... -- -- 1,986 82 1,213 45,178
-------- -------- -------- ---------- -------- -------
374,666 867,573 488,939 1,123,167 485,890 45,178
-------- -------- -------- ---------- -------- -------
Certain Expenses:
Property operating.......... 23,634 82,744 42,323 122,793 80,585 --
Property taxes.............. 46,964 110,578 29,366 56,654 44,435 --
Management fees............. 6,500 29,047 16,643 44,924 19,850 --
Interest.................... -- 565,001 -- 684,407 -- --
Other....................... 2,934 -- 1,312 4,960 5,958 --
-------- -------- -------- ---------- -------- -------
80,032 787,370 89,644 913,738 150,828 --
-------- -------- -------- ---------- -------- -------
Revenue in excess of certain
expenses.................... $294,634 $ 80,203 $399,295 $ 209,429 $335,062 $45,178
======== ======== ======== ========== ======== =======
</TABLE>
<TABLE>
<CAPTION>
TUSTIN BROOKVALE
RAINBOW THE PNW PALMDALE HEIGHTS SHOPPING
PROMENADE PORTFOLIO SHOPPING CENTER SHOPPING CENTER CENTER TOTAL
---------- ---------- --------------- --------------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Revenue:
Rent........................ $1,450,319 $3,568,281 $427,660 $1,228,648 $ 916,856 $10,512,295
Percentage rents............ -- 20,348 -- -- 106,415 126,763
Recoveries from tenants..... 230,031 847,958 160,100 170,322 320,372 2,145,206
Other....................... 3,992 1,368 2,789 8,584 43,061 108,253
---------- ---------- -------- ---------- ---------- -----------
1,684,342 4,437,955 590,549 1,407,554 1,386,704 12,892,517
---------- ---------- -------- ---------- ---------- -----------
Certain Expenses:
Property operating.......... 126,684 475,486 106,819 153,840 185,590 1,400,498
Property taxes.............. 169,637 371,546 20,727 112,056 163,970 1,125,933
Management fees............. 34,527 168,892 13,867 90,497 72,463 497,210
Interest.................... -- 1,256,882 -- -- -- 2,506,290
Other....................... 14,313 18,137 58,196 38,168 11,413 155,391
---------- ---------- -------- ---------- ---------- -----------
345,161 2,290,943 199,609 394,561 433,436 5,685,322
---------- ---------- -------- ---------- ---------- -----------
Revenue in excess of certain
expenses.................... $1,339,181 $2,147,012 $390,940 $1,012,993 $ 953,268 $ 7,207,195
========== ========== ======== ========== ========== ===========
</TABLE>
- ---------------
(1) Amounts shown reflect operating results for the period during 1997 that the
assets were not owned by the Company.
<PAGE> 17
SIGNATURES
----------
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized on October 1, 1998.
PAN PACIFIC RETAIL PROPERTIES, INC.
By: /s/ Stuart A. Tanz
-------------------------------------
Stuart A. Tanz
President and Chief Executive Officer
By: /s/ David L. Adlard
-------------------------------------
David L. Adlard
Executive Vice President and
Chief Financial Officer
By: /s/ Laurie A. Sneve
-------------------------------------
Laurie A. Sneve, CPA
Vice President and Controller
