<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 1
TO
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): SEPTEMBER 30, 1999
AMB PROPERTY CORPORATION
-----------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER
MARYLAND 001-13545 94-3281941
- --------------------------------- ----------- -------------------
(STATE OR OTHER JURISDICTION OF (COMMISSION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) FILE NO.) IDENTIFICATION NO.)
505 MONTGOMERY STREET, SAN FRANCISCO, CA 94111
--------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(415) 394-9000
--------------------------------
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
<PAGE> 2
FORWARD-LOOKING STATEMENTS
Some of the information included in this report contains forward-looking
statements, such as statements pertaining to our intended use of proceeds.
Forward-looking statements involve numerous risks and uncertainties and you
should not rely on them as predictions of future events. The events or
circumstances reflected in forward-looking statements might not occur. You can
identify forward-looking statements by the use of forward-looking terminology
such as "believes," "expects," "may," "will," "should," "seeks,"
"approximately," "intends," "plans," "pro forma," "estimates" or "anticipates"
or the negative of these words and phrases or similar words or phrases. You can
also identify forward-looking statements by discussions of strategy, plans or
intentions. Forward-looking statements are necessarily dependent on assumptions,
data or methods that may be incorrect or imprecise and we may not be able to
realize them. The failure of the remaining transaction with BPP Retail, LLC to
close with respect to some or all of the properties under contract or a
significant delay with respect to the remaining transaction could cause actual
results and future events to differ materially from those set forth or
contemplated in the forward-looking statements. We caution you not to place
undue reliance on forward-looking statements, which reflect our analysis only
and speak only as of the date of this report or the dates indicated in the
statements.
ITEM 5. OTHER EVENTS.
We hereby amend Item 7 of our Current Report on Form 8-K filed with the
Securities and Exchange Commission on October 15, 1999 to file certain required
audited financial statements related to 1999 acquisitions by AMB Property, L.P.
(the "1999 Property Acquisitions") and unaudited pro forma financial information
pertaining to the purchase of the 1999 Property Acquisitions.
1
<PAGE> 3
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
<TABLE>
<CAPTION>
Page Ref.
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<S> <C> <C> <C>
(a) Financial Statements.
i. Statements of Revenues and Certain Expenses for the Columbia
Business Center
Report of Independent Public Accountants 4
Statements of Revenues and Certain Expenses for the Columbia 5
Business Center for the period from January 1, 1999 to
January 31, 1999, (unaudited) and for the year ended
December 31, 1998
Notes to Statements of Revenues and Certain Expenses for the 6
Columbia Business Center for the period from January 1,
1999 to January 31, 1999, (unaudited) and for the year
ended December 31, 1998.
ii. Combined Statements of Revenues and Certain Expenses for the
Manekin Portfolio
Report of Independent Public Accountants 9
Combined Statements of Revenues and Certain Expenses for the 10
Manekin Portfolio for the period from January 1, 1999 to
January 31, 1999, (unaudited) and for the year ended
December 31, 1998
Notes to Combined Statements of Revenues and Certain Expenses 11
for the Manekin Portfolio for the period from January 1,
1999 to January 31, 1999, (unaudited) and for the year
ended December 31, 1998.
iii. Statements of Revenues and Certain Expenses for the Technology
Park II Portfolio
Report of Independent Public Accountants 14
Statements of Revenues and Certain Expenses for the Technology 15
Park II Portfolio for the period from January 1, 1999 to
April 30, 1999 (unaudited) and for the year ended
December 31, 1998
Notes to Statements of Revenues and Certain Expenses for the 16
Technology Park II Portfolio for the period from
January 1, 1998 to April 30, 1998, (unaudited) and for
the year ended December 31, 1998
iv. Combined Statements of Revenues and Certain Expenses for the
WOCAC Portfolio
Report of Independent Public Accountants 18
Combined Statements of Revenues and Certain Expenses for the 19
WOCAC Portfolio for the period from January 1, 1999 to
May 26, 1999 (unaudited) and for the year ended December
31, 1998
Notes to Combined Statements of Revenues and Certain Expenses 20
for the WOCAC Portfolio for the period from January 1,
1999 to May 26, 1999 (unaudited) and for the year ended
December 31, 1998
v. Statements of Revenues and Certain Expenses for Junction
Industrial Park
Report of Independent Public Accountants 22
Statements of Revenues and Certain Expenses for Junction 23
Industrial Park for the period from January 1, 1999 to
June 23, 1999, (unaudited) and for the year ended
December 31, 1998
Notes to Combined Statements of Revenues and Certain Expenses 24
for Junction Industrial Park for period from January 1,
1999 to June 23, 1999, (unaudited) and for the year
ended December 31, 1998
vi. Statements of Revenues and Certain Expenses for the Miami
Airport Business Center
Report of Independent Public Accountants 26
Statements of Revenues and Certain Expenses for the Miami 27
Airport Business Center for the period from January 1,
1999 to June 28, 1999, (unaudited) and for the year
ended December 31, 1998
Notes to Statements of Revenues and Certain Expenses for the 28
Miami Airport Business Center for the period from
January 1, 1999 to June 28, 1999, (unaudited) and for
the year ended December 31, 1998
</TABLE>
2
<PAGE> 4
<TABLE>
<CAPTION>
Page Ref.
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<S> <C> <C> <C>
(b) Pro Forma Financial Information for AMB Property Corporation (Unaudited)
Pro Forma Financial Information Background 30
Pro Forma Condensed Consolidated Balance Sheet as of 32
September 30, 1999
Notes and adjustments to Pro Forma Condensed Consolidated 33
Balance Sheet as of September 30, 1999
Pro Forma Condensed Consolidated Statement of Operations for 35
the nine months ended September 30, 1999
Notes and adjustments to Pro Forma Condensed Consolidated 36
Statement of Operations for the nine months ended
September 30, 1999
Pro Forma Condensed Consolidated Statement of Operations for 38
the year ended December 31, 1998
Notes and adjustments to Pro Forma Condensed Consolidated 39
Statement of Operations for the year ended
December 31, 1998
</TABLE>
(c) Exhibits.
None.
3
<PAGE> 5
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To AMB Property Corporation:
We have audited the accompanying statement of revenues and certain expenses of
the Columbia Business Center (as defined in Note 1) for the year ended December
31, 1998. This financial statement is the responsibility of the management of
the Columbia Business Center. Our responsibility is to express an opinion on
this financial 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 financial statement 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 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 AMB Property Corporation.
Material amounts, described in Note 1 to the statement of revenues and certain
expenses, that would not be comparable to those resulting from the proposed
future operations of the Columbia Business Center are excluded and the financial
statement is not intended to be a complete presentation of the revenues and
expenses of the Columbia Business Center.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the revenues and certain expenses of the Columbia
Business Center for the year ended December 31, 1998, in conformity with
generally accepted accounting principles.
ARTHUR ANDERSEN LLP
San Francisco, California
June 11, 1999
4
<PAGE> 6
COLUMBIA BUSINESS CENTER
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31,
1998 AND FOR THE PERIOD FROM JANUARY 1, 1999 TO
FEBRUARY 1, 1999 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
1998 1999
---------- ----------
<S> <C> <C>
(UNAUDITED)
REVENUES
Rental revenues ..................... $ 1,758 $ 150
Other income ........................ 18 -
---------- ----------
1,776 150
CERTAIN EXPENSES
Property operating expenses ......... 308 41
Real estate taxes ................... 162 14
---------- ----------
470 55
---------- ----------
REVENUES IN EXCESS OF CERTAIN EXPENSES ... $ 1,306 $ 95
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE> 7
COLUMBIA BUSINESS CENTER
NOTES TO STATEMENTS OF REVENUES
AND CERTAIN EXPENSES
(DOLLARS IN THOUSANDS)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PROPERTIES ACQUIRED
The accompanying statements of revenues and certain expenses include the
operations of the Columbia Business Center (the "Portfolio"). AMB Property L.P.
(the "Company") acquired the Portfolio from an unrelated party on February 1,
1999 for a purchase price of approximately $15,100 (unaudited), which includes
the assumption of the mortgage payable (see Note 3). The Portfolio is located in
Columbia, Maryland, consists of 9 industrial buildings and aggregates
approximately 160,000 square feet (unaudited).
BASIS OF PRESENTATION
The accompanying statements of revenues and certain expenses have been prepared
for the purpose of complying with Rule 3-14 of the Securities and Exchange
Commission's rules and regulations.
The accompanying statements of revenues and certain expenses exclude certain
expenses, such as interest, depreciation and amortization, professional fees and
other costs not directly related to the future operation of the Portfolio, that
may not be comparable to the expenses expected to be incurred by the Company in
the proposed future operations of the Portfolio. Management is not aware of any
material factors relating to the Portfolio that would cause the reported
financial information not to be indicative of future operating results.
INTERIM FINANCIAL INFORMATION
The statement of revenues and certain expenses for the period from January 1,
1999 to February 1, 1999 is unaudited. In the opinion of management, the
unaudited financial information contains all adjustments, consisting of normal
recurring accruals, necessary for a fair presentation of the statement of
revenues and certain expenses for the Portfolio for the unaudited interim
period.
SIGNIFICANT ACCOUNTING POLICIES
The accompanying statements were prepared on the accrual basis of accounting.
All leases are classified as operating leases, and rental revenue is recognized
on a straight-line basis over the terms of the leases.
USES 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 during the periods
presented. Actual results could differ from those estimates.
2. LEASING ACTIVITY
Future minimum rental income due under non-cancelable operating leases with
tenants in effect as of December 31, 1998 is as follows:
<TABLE>
<CAPTION>
Year Amount
---- --------
<S> <C>
1999......................................................... $ 1,433
2000......................................................... 1,264
2001......................................................... 966
2002......................................................... 808
2003......................................................... 529
Thereafter................................................... 602
--------
Total............................................... $ 5,602
--------
</TABLE>
6
<PAGE> 8
In addition to minimum rental payments, tenants pay reimbursements for their pro
rata share of specified operating expenses and real estate taxes, which amounted
to $349 and $23 for the year ended December 31, 1998 and for the period from
January 1, 1999 to February 1, 1999 (unaudited), respectively. Certain leases
contain options to renew.
3. MORTGAGE PAYABLE
In connection with the purchase of the Portfolio, the Company assumed a mortgage
payable with a principal value of $4,753 as of December 31, 1998. The mortgage
payable requires monthly principal and interest payments and is secured by the
deed of trust on the Portfolio properties. The mortgage payable bears interest
at 7.82% and is due in January, 2006. The mortgage payable has various financial
and non-financial covenants.
The scheduled maturities of the mortgage payable as of December 31, 1998
are as follows:
<TABLE>
<CAPTION>
Year Amount
---- --------
<S> <C>
1999........................................................................ $ 174
2000........................................................................ 188
2001........................................................................ 203
2002........................................................................ 219
2003........................................................................ 237
Thereafter.................................................................. 3,732
--------
Total.............................................................. $ 4,753
========
</TABLE>
7
<PAGE> 9
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To AMB Property Corporation:
We have audited the accompanying combined statement of revenues and certain
expenses of the Manekin Portfolio (as defined in Note 1) for the year ended
December 31, 1998. This combined financial statement is the responsibility of
the management of the Manekin Portfolio. Our responsibility is to express an
opinion on this combined financial 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 financial statement 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 AMB Property
Corporation. Material amounts, described in Note 1 to the statement of revenues
and certain expenses, that would not be comparable to those resulting from the
proposed future operations of the Manekin Portfolio are excluded and the
financial statement is not intended to be a complete presentation of the
revenues and expenses of the Manekin Portfolio.
In our opinion, the combined financial statement referred to above presents
fairly, in all material respects, the revenues and certain expenses of the
Manekin Portfolio for the year ended December 31, 1998, in conformity with
generally accepted accounting principles.
ARTHUR ANDERSEN LLP
San Francisco, California
June 11, 1999
8
<PAGE> 10
MANEKIN PORTFOLIO
COMBINED STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31,
1998 AND FOR THE PERIOD FROM JANUARY 1, 1999 TO
FEBRUARY 1, 1999 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
1998 1999
---------- ----------
<S> <C> <C>
(UNAUDITED)
REVENUES
Rental revenues ..................... $ 12,131 $ 1,033
Other income ........................ 129 20
---------- ----------
12,260 1,053
CERTAIN EXPENSES
Property operating expenses ......... 3,018 283
Real estate taxes ................... 1,120 93
---------- ----------
4,138 376
---------- ----------
REVENUES IN EXCESS OF CERTAIN EXPENSES ... $ 8,122 $ 677
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
9
<PAGE> 11
MANEKIN PORTFOLIO
NOTES TO COMBINED STATEMENTS OF REVENUES
AND CERTAIN EXPENSES
(DOLLARS IN THOUSANDS)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PROPERTIES ACQUIRED
The accompanying combined statements of revenues and certain expenses include
the operations of the Manekin Portfolio (the "Portfolio"). AMB Property L.P.
(the "Company") acquired the Portfolio from an unrelated party on February 1,
1999 for a purchase price of approximately $83,300 (unaudited), which includes
the assumption of mortgages payable (see Note 3). The Portfolio is located in
Maryland, consists of 26 industrial buildings and aggregates approximately 1.1
million square feet (unaudited).
BASIS OF PRESENTATION
The accompanying combined statements of revenues and certain expenses have been
prepared for the purpose of complying with Rule 3-14 of the Securities and
Exchange Commission's rules and regulations.
The accompanying combined statements of revenues and certain expenses exclude
certain expenses, such as interest, depreciation and amortization, professional
fees and other costs not directly related to the future operation of the
Portfolio, that may not be comparable to the expenses expected to be incurred by
the Company in the proposed future operations of the Portfolio. Management is
not aware of any material factors relating to the Portfolio that would cause the
reported financial information not to be indicative of future operating results.
INTERIM FINANCIAL INFORMATION
The combined statement of revenues and certain expenses for the period from
January 1, 1999 to February 1, 1999 is unaudited. In the opinion of management,
the unaudited financial information contains all adjustments, consisting of
normal recurring accruals, necessary for a fair presentation of the combined
statement of revenues and certain expenses for the Portfolio for the unaudited
interim period.
SIGNIFICANT ACCOUNTING POLICIES
The accompanying combined statements were prepared on the accrual basis of
accounting. All leases are classified as operating leases, and rental revenue is
recognized on a straight-line basis over the terms of the leases.
USES 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 during the periods
presented. Actual results could differ from those estimates.
2. LEASING ACTIVITY
Future minimum rental income due under non-cancelable operating leases with
tenants in effect as of December 31, 1998 is as follows:
<TABLE>
<CAPTION>
Year Amount
---- ---------
<S> <C>
1999........................................................................ $ 9,027
2000........................................................................ 6,808
2001........................................................................ 5,106
2002........................................................................ 3,791
2003........................................................................ 2,060
Thereafter.................................................................. 8,270
---------
Total.............................................................. $ 35,062
=========
</TABLE>
In addition to minimum rental payments, tenants pay reimbursements for their pro
rata share of specified operating expenses and real estate taxes, which amounted
to $3,146 and $143 for the year ended December 31, 1998 and for the period from
January 1, 1999 to February 1, 1999 (unaudited), respectively. Certain leases
contain options to renew.
10
<PAGE> 12
3. MORTGAGES PAYABLE
In connection with the purchase of the Portfolio, the Company assumed certain
mortgages payable with an aggregate principal value of $39,004 as of December
31, 1998. The mortgages payable require monthly principal and interest payments
and are secured by deeds of trust on certain of the Portfolio properties. The
mortgages payable bear interest at rates ranging from 7.08% to 9.06% and are due
between May 2000 and January 2008. The mortgages payable have various financial
and non-financial covenants. The weighted average fixed interest rate on secured
debt at December 31, 1998 was 7.93%.
The scheduled maturities of the mortgages payable as of December 31, 1998 are as
follows:
<TABLE>
<CAPTION>
Year Amount
---------
<S> <C>
1999........................................................................ $ 391
2000........................................................................ 15,941
2001........................................................................ 397
2002........................................................................ 430
2003........................................................................ 306
Thereafter.................................................................. 21,539
---------
Total.............................................................. $ 39,004
=========
</TABLE>
11
<PAGE> 13
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To AMB Property Corporation:
We have audited the accompanying statement of revenues and certain expenses of
the Technology Park II Portfolio (as defined in Note 1) for the year ended
December 31, 1998. This financial statement is the responsibility of the
management of the Technology Park II Portfolio. Our responsibility is to express
an opinion on this financial 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 financial statement 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 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 AMB Property Corporation.
Material amounts, described in Note 1 to the statement of revenues and certain
expenses, that would not be comparable to those resulting from the proposed
future operations of the Technology Park II Portfolio are excluded and the
financial statement is not intended to be a complete presentation of the
revenues and expenses of the Technology Park II Portfolio.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the revenues and certain expenses of the Technology Park
II Portfolio for the year ended December 31, 1998, in conformity with generally
accepted accounting principles.
ARTHUR ANDERSEN LLP
San Francisco, California
June 11, 1999
12
<PAGE> 14
TECHNOLOGY PARK II PORTFOLIO
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31,
1998 AND FOR THE PERIOD FROM JANUARY 1, 1999
TO APRIL 30, 1999 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
1998 1999
---------- ----------
<S> <C> <C>
(UNAUDITED)
REVENUES
Rental revenues ..................... $ 4,676 $ 1,633
Other income ........................ 61 16
---------- ----------
4,737 1,649
CERTAIN EXPENSES
Property operating expenses ......... 472 207
Real estate taxes ................... 249 97
---------- ----------
721 304
---------- ----------
REVENUES IN EXCESS OF CERTAIN EXPENSES ... $ 4,016 $ 1,345
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
13
<PAGE> 15
TECHNOLOGY PARK II PORTFOLIO
NOTES TO STATEMENTS OF REVENUES
AND CERTAIN EXPENSES
(DOLLARS IN THOUSANDS)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PROPERTIES ACQUIRED
The accompanying statements of revenues and certain expenses include the
operations of the Technology Park II Portfolio (the "Portfolio"). AMB Property
L.P., (the "Company") acquired the Portfolio from an unrelated party on
April 30, 1999 for a purchase price of approximately $40,800 (unaudited).
The Portfolio is located in Frederick, Maryland, consists of 9 industrial
buildings and aggregates approximately 381,000 square feet (unaudited).
BASIS OF PRESENTATION
The accompanying statements of revenues and certain expenses have been prepared
for the purpose of complying with Rule 3-14 of the Securities and Exchange
Commission's rules and regulations.
The accompanying statements of revenues and certain expenses exclude certain
expenses, such as interest, depreciation and amortization, professional fees and
other costs not directly related to the future operation of the Portfolio, that
may not be comparable to the expenses expected to be incurred by the Company in
the proposed future operations of the Portfolio. Management is not aware of any
material factors relating to the Portfolio that would cause the reported
financial information not to be indicative of future operating results.
INTERIM FINANCIAL INFORMATION
The statement of revenues and certain expenses for the period from January 1,
1999 to April 30, 1999 is unaudited. In the opinion of management, the unaudited
financial information contains all adjustments, consisting of normal recurring
accruals, necessary for a fair presentation of the statement of revenues and
certain expenses for the Portfolio for the unaudited interim period.
SIGNIFICANT ACCOUNTING POLICIES
The accompanying statements were prepared on the accrual basis of accounting.
All leases are classified as operating leases, and rental revenue is recognized
on a straight-line basis over the terms of the leases.
USES 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 during the periods
presented. Actual results could differ from those estimates.
2. LEASING ACTIVITY
Future minimum rental income due under non-cancelable operating leases with
tenants in effect as of December 31, 1998 is as follows:
<TABLE>
<CAPTION>
Year Amount
---- -----------
<S> <C>
1999........................................................................ $ 3,888
2000........................................................................ 2,526
2001........................................................................ 1,945
2002........................................................................ 1,599
2003........................................................................ 138
Thereafter.................................................................. -----------
Total.............................................................. $ 10,096
===========
</TABLE>
In addition to minimum rental payments, tenants pay reimbursements for their pro
rata share of specified operating expenses and real estate taxes, which amounted
to $659 and $206 for the year ended December 31, 1998 and for the period from
January 1, 1999 to April 30, 1999 (unaudited), respectively. Certain leases
contain options to renew.
14
<PAGE> 16
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To AMB Property Corporation:
We have audited the accompanying combined statement of revenues and certain
expenses of the WOCAC Portfolio (as defined in Note 1) for the year ended
December 31, 1998. This combined financial statement is the responsibility of
the management of the WOCAC Portfolio. Our responsibility is to express an
opinion on this combined financial 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 financial statement 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 AMB Property
Corporation. Material amounts, described in Note 1 to the statement of revenues
and certain expenses, that would not be comparable to those resulting from the
proposed future operations of the WOCAC Portfolio are excluded and the financial
statement is not intended to be a complete presentation of the revenues and
expenses of the WOCAC Portfolio.
In our opinion, the combined financial statement referred to above presents
fairly, in all material respects, the revenues and certain expenses of the WOCAC
Portfolio for the year ended December 31, 1998, in conformity with generally
accepted accounting principles.
ARTHUR ANDERSEN LLP
San Francisco, California
November 3, 1999
15
<PAGE> 17
WOCAC PORTFOLIO
COMBINED STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31,
1998 AND FOR THE PERIOD FROM JANUARY 1, 1999
TO MAY 26, 1999 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
1998 1999
---------- ----------
<S> <C> <C>
(UNAUDITED)
REVENUES
Rental revenues ..................... $ 10,365 $ 4,415
Other income ........................ 37 17
---------- ----------
10,402 4,432
CERTAIN EXPENSES
Property operating expenses ......... 2,143 896
Real estate taxes ................... 900 446
---------- ----------
3,043 1,342
---------- ----------
REVENUES IN EXCESS OF CERTAIN EXPENSES ... $ 7,359 $ 3,090
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
16
<PAGE> 18
WOCAC PORTFOLIO
NOTES TO COMBINED STATEMENTS OF REVENUES
AND CERTAIN EXPENSES
(DOLLARS IN THOUSANDS)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PROPERTIES ACQUIRED
The accompanying combined statements of revenues and certain expenses include
the operations of the WOCAC Portfolio (the "Portfolio"). AMB Property L.P. ("the
Company") acquired the Portfolio from an unrelated party on May 26, 1999 for a
purchase price of approximately $94,600 (unaudited). The Portfolio is located in
California and Washington, consists of 41 industrial buildings and aggregates
approximately 1.3 million square feet (unaudited).
BASIS OF PRESENTATION
The accompany combined statements of revenues and certain expenses have been
prepared for the purpose of complying with Rule 3-14 of the Securities and
Exchange Commission's rules and regulations.
The accompanying combined statements of revenues and certain expenses exclude
certain expenses, such as interest, depreciation and amortization, professional
fees and other costs not directly related to the future operation of the
Portfolio, that may not be comparable to the expenses expected to be incurred by
the Company in the proposed future operations of the Portfolio. Management is
not aware of any material factors relating to the Portfolio that would cause the
reported financial information not to be indicative of future operating results.
INTERIM FINANCIAL INFORMATION
The financial information presented for the period from January 1, 1999 to May
26, 1999 is unaudited. In the opinion of management, the unaudited financial
information contains all adjustments, consisting of normal recurring accruals,
necessary for a fair presentation of the combined statement of revenues and
certain expenses for the Portfolio for the unaudited interim period.
SIGNIFICANT ACCOUNTING POLICIES
The accompanying combined statements were prepared on the accrual basis of
accounting. All leases are classified as operating leases, and rental revenue is
recognized on a straight-line basis over the terms of the leases.
USES 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 during the periods
presented. Actual results could differ from those estimates.
17
<PAGE> 19
2. LEASING ACTIVITY
Future minimum rental income due under non-cancelable operating leases with
tenants in effect as of December 31, 1998 is as follows:
<TABLE>
<CAPTION>
Year Amount
---- -----------
<S> <C>
1999........................................................................ $ 9,520
2000........................................................................ 9,794
2001........................................................................ 8,351
2002........................................................................ 6,238
2003........................................................................ 3,417
Thereafter.................................................................. 3,734
-----------
Total.............................................................. $ 41,054
===========
</TABLE>
In addition to minimum rental payments, tenants pay reimbursements for their pro
rata share of specified operating expenses and real estate taxes, which amounted
to $1,648 and $1,114 for the year ended December 31, 1998 and for the period
from January 1, 1999 to May 26, 1999 (unaudited), respectively. Certain leases
contain options to renew.
18
<PAGE> 20
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To AMB Property Corporation:
We have audited the accompanying statement of revenues and certain expenses of
Junction Industrial Park (as defined in Note 1) for the year ended December 31,
1998. This financial statement is the responsibility of the management of
Junction Industrial Park. Our responsibility is to express an opinion on this
financial 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 financial statement 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 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 AMB Property Corporation.
Material amounts, described in Note 1 to the statement of revenues and certain
expenses, that would not be comparable to those resulting from the proposed
future operations of the Junction Industrial Park are excluded and the financial
statement is not intended to be a complete presentation of the revenues and
expenses of the Junction Industrial Park.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the revenues and certain expenses of Junction Industrial
Park for the year ended December 31, 1998, in conformity with generally accepted
accounting principles.
ARTHUR ANDERSEN LLP
San Francisco, California
May 17, 1999
19
<PAGE> 21
JUNCTION INDUSTRIAL PARK
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31,
1998 AND FOR THE PERIOD FROM JANUARY 1, 1999
TO JUNE 23, 1999 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
1998 1999
---------- ----------
<S> <C> <C>
(UNAUDITED)
REVENUES
Rental revenues ..................... $ 2,815 $ 1,481
Other income ........................ 15 12
---------- ----------
2,830 1,493
CERTAIN EXPENSES
Property operating expenses ......... 275 120
Real estate taxes ................... 283 136
---------- ----------
558 256
---------- ----------
REVENUES IN EXCESS OF CERTAIN EXPENSES ... $ 2,272 $ 1,237
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
20
<PAGE> 22
JUNCTION INDUSTRIAL PARK
NOTES TO STATEMENTS OF REVENUES
AND CERTAIN EXPENSES
(DOLLARS IN THOUSANDS)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PROPERTIES ACQUIRED
The accompanying statements of revenues and certain expenses include the
operations of Junction Industrial Park (the "Portfolio"). AMB Property L.P. (the
"Company") acquired the Portfolio from an unrelated party on June 23, 1999 for a
purchase price of approximately $31,500 (unaudited). The Portfolio is located in
San Jose, California, consists of 4 industrial buildings and aggregates
approximately 400,000 square feet (unaudited).
BASIS OF PRESENTATION
The accompanying statements of revenues and certain expenses have been prepared
for the purpose of complying with Rule 3-14 of the Securities and Exchange
Commission's rules and regulations.
The accompanying statements of revenues and certain expenses exclude certain
expenses, such as interest, depreciation and amortization, professional fees and
other costs not directly related to the future operation of the Portfolio, that
may not be comparable to the expenses expected to be incurred by the Company in
the proposed future operations of the Portfolio. Management is not aware of any
material factors relating to the Portfolio that would cause the reported
financial information not to be indicative of future operating results.
INTERIM FINANCIAL INFORMATION
The statement of revenues and certain expenses for the period from January 1,
1999 to June 23, 1999 is unaudited. In the opinion of management, the unaudited
financial information contains all adjustments, consisting of normal recurring
accruals, necessary for a fair presentation of the statements of revenues and
certain expenses for the Portfolio for the unaudited interim period.
SIGNIFICANT ACCOUNTING POLICIES
The accompanying statements were prepared on the accrual basis of accounting.
All leases are classified as operating leases, and rental revenue is recognized
on a straight-line basis over the terms of the leases.
USES 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 during the periods
presented. Actual results could differ from those estimates.
2. LEASING ACTIVITY
Future minimum rental income due under non-cancelable operating leases with
tenants in effect as of December 31, 1998 is as follows:
<TABLE>
<CAPTION>
Year Amount
---- ---------
<S> <C>
1999........................................................................ $ 2,784
2000........................................................................ 2,636
2001........................................................................ 2,640
2002........................................................................ 1,720
2003........................................................................ 1,005
Thereafter.................................................................. 256
=========
Total.............................................................. $ 11,041
=========
</TABLE>
In addition to minimum rental payments, tenants pay reimbursements for their pro
rata share of specified operating expenses and real estate taxes, which amounted
to $538 and $266 for the year ended December 31, 1998 and for the period from
January 1, 1999 to June 23, 1999 (unaudited), respectively. Certain leases
contain options to renew.
21
<PAGE> 23
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To AMB Property Corporation:
We have audited the accompanying statement of revenues and certain expenses of
the Miami Airport Business Center (as defined in Note 1) for the year ended
December 31, 1998. This financial statement is the responsibility of the
management of the Miami Airport Business Center. Our responsibility is to
express an opinion on this financial 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 financial statement 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 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 AMB Property Corporation.
Material amounts, described in Note 1 to the statement of revenues and certain
expenses, that would not be comparable to those resulting from the proposed
future operations of the Miami Airport Business Center are excluded and the
financial statement is not intended to be a complete presentation of the
revenues and expenses of the Miami Airport Business Center.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the revenues and certain expenses of the Miami Airport
Business Center for the year ended December 31, 1998, in conformity with
generally accepted accounting principles.
ARTHUR ANDERSEN LLP
San Francisco, California
June 8, 1999
22
<PAGE> 24
MIAMI AIRPORT BUSINESS CENTER
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31,
1998 AND FOR THE PERIOD FROM JANUARY 1, 1999
TO JUNE 28, 1999 (UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
1998 1999
---------- ----------
<S> <C> <C>
(UNAUDITED)
REVENUES
Rental revenues ..................... $ 3,705 $ 1,822
Other income ........................ 10 3
---------- ----------
3,715 1,825
CERTAIN EXPENSES
Property operating expenses ......... 968 414
Real estate taxes ................... 408 203
---------- ----------
1,376 617
---------- ----------
REVENUES IN EXCESS OF CERTAIN EXPENSES ... $ 2,339 $ 1,208
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
23
<PAGE> 25
MIAMI AIRPORT BUSINESS CENTER
NOTES TO STATEMENTS OF REVENUES
AND CERTAIN EXPENSES
(DOLLARS IN THOUSANDS)
1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PROPERTIES ACQUIRED
The accompanying statements of revenues and certain expenses include the
operations of the Miami Airport Business Center (the "Portfolio"). AMB Property,
L.P. (the "Company") acquired the Portfolio, from an unrelated party on June 28,
1999 for a purchase price of approximately $25,600 (unaudited). The Portfolio is
located in Miami, Florida, consists of 6 industrial buildings and aggregates
approximately 500,000 square feet (unaudited).
BASIS OF PRESENTATION
The accompanying statements of revenues and certain expenses have been prepared
for the purpose of complying with Rule 3-14 of the Securities and Exchange
Commission's rules and regulations.
The accompanying statements of revenues and certain expenses exclude certain
expenses, such as interest, depreciation and amortization, professional fees and
other costs not directly related to the future operation of the Portfolio, that
may not be comparable to the expenses expected to be incurred by the Company in
the proposed future operations of the Portfolio. Management is not aware of any
material factors relating to the Portfolio that would cause the reported
financial information not to be indicative of future operating results.
INTERIM FINANCIAL INFORMATION
The statement of revenues and certain expenses for the period from January 1,
1999 to June 28, 1999 is unaudited. In the opinion of management, the unaudited
financial information contains all adjustments, consisting of normal recurring
accruals, necessary for a fair presentation of the statements of revenues and
certain expenses for the Portfolio for the unaudited interim period.
SIGNIFICANT ACCOUNTING POLICIES
The accompanying statements were prepared on the accrual basis of accounting.
All leases are classified as operating leases, and rental revenue is recognized
on a straight-line basis over the terms of the leases.
USES 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 during the periods
presented. Actual results could differ from those estimates.
2. LEASING ACTIVITY
Future minimum rental income due under non-cancelable operating leases with
tenants in effect as of December 31, 1998 is as follows:
<TABLE>
<CAPTION>
Year Amount
---- -----------
<S> <C>
1999........................................................................ $ 2,755
2000........................................................................ 3,246
2001........................................................................ 2,582
2002........................................................................ 1,833
2003........................................................................ 1,833
Thereafter.................................................................. 1,343
===========
Total.............................................................. $ 13,592
===========
</TABLE>
In addition to minimum rental payments, tenants pay reimbursements for their pro
rata share of specified operating expenses and real estate taxes, which amounted
to $367 and $95 for the year ended December 31, 1998 and for the period from
January 1, 1999 to June 28, 1999 (unaudited), respectively. Certain leases
contain options to renew.
24
<PAGE> 26
AMB PROPERTY CORPORATION
PRO FORMA FINANCIAL INFORMATION (UNAUDITED)
BACKGROUND
On March 9, 1999, AMB Property, L.P., a Delaware limited partnership (the
"Operating Partnership") in which AMB Property Corporation (the "Company") is
the sole general partner, signed three definitive agreements with BPP Retail,
LLC ("BPP Retail"), a co-investment entity between Burnham Pacific Properties
("BPP") and the California Public Employees' Retirement System ("CalPERS"),
pursuant to which, if fully consummated, BPP Retail would have acquired up to 28
retail shopping centers from the Operating Partnership, totaling 5.1 million
square feet, for an aggregate price of $663,400. The disposition of three of the
properties was subject to the consent of one of the Company's joint venture
partners, which did not consent to the sale of these properties. As a result,
the price with respect to the 25 remaining properties, totaling approximately
4.3 million square feet, is approximately $560,300. Pursuant to the agreements,
BPP Retail will acquire the 25 centers in three separate transactions (the
"Divestiture") as follows:
<TABLE>
<CAPTION>
SQUARE FOOTAGE PRICE
CLOSING DATE CENTERS (000's) (MILLIONS)
---------- -------------- ----------
<S> <C> <C> <C>
June 15, 1999 9 1,409 $ 207.4
August 4, 1999 12 2,036 245.8
December 1, 1999 (estimated) 4 868 107.1
---------- ---------- ----------
TOTAL 25 4,313 $ 560.3
========== ========== ==========
</TABLE>
The accompanying unaudited pro forma condensed consolidated balance sheet as of
September 30, 1999 has been prepared to reflect the Operating Partnership
divesting of the remaining four retail shopping centers in connection with the
third transaction of the Divestiture for an aggregate price of $107.1 million as
if the closing had occurred on September 30, 1999.
The accompanying unaudited pro forma condensed consolidated statement of
operations for the nine months ended September 30, 1999 has been prepared to
reflect: (i) the Divestiture, (ii) the sale of 7.75% Series D Cumulative
Redeemable Preferred Units (the "Series D Preferred Units") of AMB Property II,
L.P., a subsidiary of the Operating Partnership, and the sale of 7.75% Series E
Cumulative Redeemable Preferred Units (the "Series E Preferred Units") of AMB
Property II, L.P. and the application of the resulting net proceeds and (iii)
the incremental effect of the acquisition of properties during 1999 by the
Operating Partnership (the "1999 Property Acquisitions") as if such transactions
and adjustments had occurred on January 1, 1998 and were carried forward through
September 30, 1999.
The accompanying unaudited pro forma condensed consolidated statement of
operations for the year ended December 31, 1998 has been prepared to reflect:
(i) the incremental effect of the acquisition of properties during 1998 by the
Operating Partnership (the "1998 Property Acquisitions"), (ii) pro forma debt
and other adjustments resulting from the sale of the Operating Partnership's
senior debt securities, the sale of 8.5% Series A Cumulative Redeemable
Preferred Stock (the "Series A Preferred Stock") of the Company, the sale of
8.625% Series B Cumulative Redeemable Preferred Units (the "Series B Preferred
Units") of the Operating Partnership, the sale of 8.75% Series C Cumulative
Redeemable Preferred Units (the "Series C Preferred Units") of AMB Property II,
L.P., the sale of the 7.75% Series D Cumulative Redeemable Preferred Units (the
"Series D Preferred Units") of AMB Property II, L.P. and the sale of 7.75%
Series E Cumulative Redeemable Preferred Units (the "Series E Preferred Unites")
of AMB Property II, L.P., and the application of the resulting net proceeds,
(iii) the 1999 Property Acquisitions and (iv) the Divestiture, as if such
transactions and adjustments had occurred on January 1, 1998 and were carried
forward through December 31, 1998.
These unaudited pro forma condensed consolidated statements should be read in
connection with the historical consolidated financial statements and notes
thereto included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1998 and Quarterly Report on Form 10-Q for the quarter ended
September 30, 1999. In the opinion of management, the pro forma condensed
consolidated financial information provides for all adjustments necessary to
reflect the effects of the sale of the senior debt securities, the sale of the
Series A Preferred Stock, the sale of the Series B Preferred Units, the sale of
the Series C Preferred Units, the sale of the Series D Preferred Units, the sale
of the Series E Preferred Units and the application of the resulting net
proceeds therefrom, the 1998 Property Acquisitions, the Divestiture and the 1999
Property Acquisitions.
The pro forma information is unaudited and is not necessarily indicative of the
consolidated results that would have occurred if the transactions and
adjustments reflected therein had been consummated in the period or on the date
presented, or on any particular date in the future, nor does it purport to
represent the financial position, results of operations or cash flows for future
periods.
25
<PAGE> 27
AMB PROPERTY CORPORATION
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1999 (UNAUDITED, IN THOUSANDS)
<TABLE>
<CAPTION>
COMPANY(1) DIVESTITURE(2) PRO FORMA
----------- -------------- -----------
<S> <C> <C> <C>
ASSETS
Investments in real estate, net .............................. $ 3,041,862 $ -- $ 3,041,862
Properties held for divestiture, net ......................... 477,815 (94,216) 383,599
Divestiture receivable ....................................... -- 104,294 104,294
Cash and cash equivalents .................................... 70,821 -- 70,821
Other assets ................................................. 57,449 -- 57,449
----------- ----------- -----------
Total assets ........................................... $ 3,647,947 $ 10,078 $ 3,658,025
=========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Secured debt ................................................. $ 749,571 $ -- $ 749,571
Secured credit facility ...................................... 80,000 -- 80,000
Unsecured credit facility .................................... 49,000 -- 49,000
Unsecured senior debt securities ............................. 400,000 -- 400,000
Other liabilities ............................................ 138,360 -- 138,360
----------- ----------- -----------
Total liabilities ...................................... 1,416,931 -- 1,416,931
----------- ----------- -----------
Minority interests ........................................... 428,221 504 428,725
----------- ----------- -----------
Stockholders' Equity
Series A Preferred Stock ................................... 96,100 -- 96,100
Common Shares ............................................. 865 -- 865
Additional paid-in capital ................................. 1,678,988 -- 1,678,988
Retained earnings .......................................... 26,842 9,574 36,416
----------- ----------- -----------
Total equity ........................................... 1,802,795 9,574 1,812,369
----------- ----------- -----------
Total liabilities and stockholders' equity ............. $ 3,647,947 $ 10,078 $ 3,658,025
=========== =========== ===========
</TABLE>
26
<PAGE> 28
AMB PROPERTY CORPORATION
NOTES AND ADJUSTMENTS TO PRO FORMA
CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1999
(UNAUDITED, DOLLARS IN THOUSANDS)
(1.) Reflects the historical consolidated balance sheet of AMB Property
Corporation (the "Company") as of September 30, 1999. See the historical
consolidated financial statements and notes thereto included in AMB Property
Corporation's Quarterly Report on Form 10-Q for the quarter ended September 30,
1999.
On March 9, 1999, AMB Property, L.P., a Delaware limited partnership (the
"Operating Partnership") in which the Company is the sole general partner,
signed three definitive agreements with BPP Retail, LLC ("BPP Retail"), a
co-investment entity between Burnham Pacific Properties ("BPP") and the
California Public Employees' Retirement System ("CalPERS"), pursuant to which,
if fully consummated, BPP Retail would have acquired up to 28 retail shopping
centers from the Operating Partnership, totaling 5.1 million square feet, for an
aggregate price of $663,400. The disposition of three of the properties was
subject to the consent of one of the Company's joint venture partners, which did
not consent to the sale of these properties. As a result, the price with respect
to the 25 remaining properties, totaling approximately 4.3 million square feet,
is approximately $560,300. The Company intends to dispose of the remaining three
properties or its interests in the joint ventures through which it holds the
three properties and has therefore continued to reflect the properties as
properties held for divestiture in the accompanying pro forma balance sheet.
Pursuant to the agreements, BPP Retail will acquire the 25 centers in three
separate transactions (the "Divestiture"). Under the agreements, the Operating
Partnership has the right to extend the closing dates for a period of up to
either 20 or 50 days. The Operating Partnership has exercised this right with
respect to the first and second transactions, which closed on June 15, 1999 and
August 4, 1999, respectively. Pursuant to the closing of the first transaction,
BPP Retail acquired nine retail shopping centers, totaling approximately 1.4
million square feet, for an aggregate price of approximately $207,400. The
Operating Partnership used the net proceeds from the first transaction to repay
secured debt of $35,100 (including prepayment penalties of $3,300) related to
the properties divested, to partially pay down $96,400 under the Operating
Partnership's unsecured credit facility, $72,200 for property acquisitions and
for general corporate purposes. The first transaction resulted in an approximate
gain of $11,600 and an approximate extraordinary loss of $1,500, consisting of
prepayment penalties with an off-set for the write-off of debt premiums related
to the indebtedness extinguished. On August 4, 1999, the second transaction with
BPP Retail closed. Pursuant to the closing of the second transaction, BPP Retail
acquired 12 of the Operating Partnership's retail shopping centers, totaling
approximately 2.0 million square feet, for an aggregate price of $245,800. The
Operating Partnership used the proceeds from the second transaction to repay
secured debt of $23,600 (including prepayment penalties of $1,800) related to
the properties divested, to partially pay down $111,700 under the Operating
Partnership's unsecured credit facility, to pay $1,000 in transaction expenses,
$107,200 for potential property acquisitions and/or like-kind exchanges and for
general corporate purposes. The second transaction resulted in an approximate
gain of $21,500 and an extraordinary loss of approximately $1,300, consisting of
prepayment penalties of approximately $1,800 offset by the write-off of
approximately $500 in debt premiums related to the indebtedness extinguished.
In addition, the Operating Partnership entered into a definitive agreement,
subject to a financing condition, with BPP, pursuant to which, if fully
consummated, BPP would have acquired up to six additional retail centers,
totaling approximately 1.5 million square feet, for approximately $284,400. On
June 30, 1999, this agreement was terminated pursuant to its terms as a result
of BPP's decision not to waive the financing condition. The Operating
Partnership currently intends to dispose of five of these retail properties,
either on an individual or portfolio basis, or its interest in the joint venture
which holds one of the five the properties and has therefore continued to
reflect such properties as properties held for divestiture in the accompanying
pro forma balance sheet.
In connection with the BPP Retail transactions, the Company has granted
CalPERS an option to purchase up to 2,000,000 shares of the Company's common
stock for an exercise price of $25.00 per share that CalPERS may exercise on or
before March 31, 2000. The Company has registered the 2,000,000 shares of common
stock issuable upon exercise of the option.
(2.) The Operating Partnership currently expects the third transaction of the
Divestiture to close on or about December 1, 1999. The Operating Partnership
intends to use the proceeds of approximately $107,100 from the third transaction
to pay down $27,000 outstanding under the Operating Partnership's unsecured
credit facility, to pay $2,800 in transaction expenses and to utilize $77,300
for potential future acquisitions and for general corporate purposes.
27
<PAGE> 29
Although the remaining transaction with BPP Retail does not have a
discretionary due diligence period, it is subject to certain customary closing
conditions, which are generally applied on a property-by-property basis. BPP has
announced that it has received and is reviewing a merger proposal. The Operating
Partnership does not believe that the contractual obligations of BPP Retail with
respect to the purchase of the retail centers will be affected by any resulting
merger. BPP Retail has posted a deposit of $8,375 on the remaining transaction.
BPP Retail's liability in the event of its default under the remaining
definitive agreement is limited to its deposit. Although the Operating
Partnership believes that the remaining transaction with BPP Retail is probable,
the transaction might not close as scheduled or close at all, and it is possible
that the transaction may close with respect to just a portion of the properties
currently subject to the agreement.
The adjustments reflect the elimination of the real estate assets being
divested in connection with the third transaction of the Divestiture. The
adjustments include a Divestiture receivable for the estimated net proceeds of
approximately $104,300 from the third transaction. The Divestiture related to
the third transaction will result in an estimated gain of approximately $10,100.
The gain has been allocated among the Company and the limited partners based on
their respective ownership of the Operating Partnership as of September 30,
1999, resulting in minority interest of $504.
28
<PAGE> 30
AMB PROPERTY CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999
(UNAUDITED, DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
SERIES D AND
SERIES E
PREFERRED UNIT 1999 PROPERTY
COMPANY(1) DIVESTITURE(2) OFFERINGS(3) ACQUISITIONS(4) PRO FORMA
------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
REVENUES
Rental revenues $ 330,895 $ (38,108) $ -- $ 14,200 $ 306,987
Equity in earnings of unconsolidated
joint venture 3,580 -- -- -- 3,580
Investment management and other income 2,258 (242) -- -- 2,016
------------ ------------ ------------ ------------ ------------
Total revenues 336,733 (38,350) -- 14,200 312,583
OPERATING EXPENSES
Property operating expenses
And real estate taxes 82,541 (10,872) -- 3,759 75,428
General, administrative and other 19,116 ---- -- -- 19,116
Depreciation and amortization 49,295 (3,571) -- 2,649 48,373
Interest expense 67,705 (10,163) (2,006) 2,513 58,049
------------ ------------ ------------ ------------ ------------
Total operating expenses 218,657 (24,606) (2,006) 8,921 200,966
------------ ------------ ------------ ------------ ------------
Income from operations before
minority interests 118,076 (13,744) 2,006 5,279 111,617
Minority interests' share of net
income (24,367) 687 (2,786) (1,032) (27,498)
------------ ------------ ------------ ------------ ------------
Net income before gain from
Divestiture and extraordinary items 93,709 (13,057) (780) 4,247 84,119
Preferred stock dividends (6,375) -- -- -- (6,375)
------------ ------------ ------------ ------------ ------------
Net income available to common
stockholders before gain from
Divestiture and extraordinary items $ 87,334 $ (13,057) $ (780) $ 4,247 $ 77,744
============ ============ ============ ============ ============
Net income per common share before gain
from Divestiture and extraordinary items:
Basic $ 1.01 $ .90
============ ============
Diluted $ 1.01 $ .90
============ ============
Weighted average common shares outstanding:
Basic 86,274,878 86,274,878
============ ============
Diluted 86,375,711 86,375,711
============ ============
</TABLE>
29
<PAGE> 31
AMB PROPERTY CORPORATION
NOTES AND ADJUSTMENTS TO PRO FORMA
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999
(UNAUDITED, DOLLARS IN THOUSANDS, EXCEPT SHARE AND UNIT DATA)
(1.) Reflects the historical consolidated operations of AMB Property Corporation
(the "Company") for the nine months ended September 30, 1999. See the
historical consolidated financial statements and notes thereto included in
AMB Property Corporation's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1999.
(2.) Reflects the elimination of the historical revenues and expenses for the
period from January 1, 1999 to June 15, 1999 related to the real estate
assets divested in connection with the first transaction of the
Divestiture, the elimination of the historical revenues and expenses for
the period from January 1, 1999 to August 4, 1999 related to the real
estate assets divested in connection with the second transaction of the
Divestiture and the elimination of the historical revenues and expenses for
the nine months ended September 30, 1999 for the real estate assets to be
divested in connection with the third transaction of the Divestiture. The
interest expense adjustment consists of a reduction of interest related to
the mortgage debt on the properties divested of $10,163 related to the
partial pay down of the unsecured credit facility with proceeds from
the first and second Divestiture transactions.
(3.) In May 1999, AMB Property II, L.P. , a partnership in which a wholly owned
subsidiary of the Company owns an approximate 1% general partnership
interest and the Operating Partnership owns an approximate 99% common
limited partnership interest, issued and sold 1,595,337 units of 7.75%
Series D Cumulative Redeemable Preferred Units at a price of $50.00 per
unit (the "Series D Preferred Units") in a private placement. Distributions
are cumulative from the date of original issuance and are payable quarterly
in arrears at a rate per unit equal to $3.875 per annum. The Series D
Preferred Units are redeemable by AMB Property II, L.P. on or after May 5,
2004, subject to certain conditions, for cash at a redemption price equal
to $50.00 per unit, plus accumulated and unpaid distributions thereon, if
any, to the redemption date. The Series D Preferred Units are exchangeable,
at specified times and subject to certain conditions, on a one-for-one
basis, for shares of the Company's Series D Preferred Stock. AMB Property
II, L.P. used the net proceeds of approximately $77,800 to make a loan to
the Operating Partnership in the amount of approximately $20,100 and to
purchase an unconsolidated joint venture interest for approximately $57,700
from the Operating Partnership. The loan was repaid in full in August 1999.
The Operating Partnership used the funds to partially repay borrowings
under the unsecured credit facility.
In August 1999, AMB Property II, L.P. issued and sold 220,440 units of
7.75% Series E Cumulative Redeemable Preferred Units at a price of $50.00
per unit (the "Series E Preferred Units") in a private placement.
Distributions are cumulative from the date of original issuance and are
payable quarterly in arrears at a rate per unit equal to $3.875 per annum.
The Series E Preferred Units are redeemable by AMB Property II, L.P. on or
after August 31, 2004, subject to certain conditions, for cash at a
redemption price equal to $50.00 per unit, plus accumulated and unpaid
distributions thereon, if any, to the redemption date. The Series E
Preferred Units are exchangeable, at specified times and subject to certain
conditions, on a one-for-one basis, for shares of the Company's Series E
Preference Stock. AMB Property II, L.P. used the net proceeds of
approximately $10,800 to repay loans made to it by the Operating
Partnership. The Operating Partnership used the funds to partially repay
amounts outstanding under the unsecured credit facility and for general
corporate purposes.
The adjustments reflect a reduction of interest expense of approximately
$2,006 related to the partial pay down of the unsecured credit facility
with proceeds from the sale of 7.75% Series D Cumulative Redeemable
Preferred Units of AMB Property II, L.P. and the sale of 7.75% Series E
Cumulative Redeemable Preferred Limited Partnership Units of AMB Property
II, L.P. The adjustments also reflect $2,686 related to Series D and Series
E Preferred Unit distributions at a rate of 7.75%.
30
<PAGE> 32
(4) The following reflects the incremental effects of the 1999 Property
Acquisitions during the nine month period ended September 30, 1999 based on
the historical operations of such properties for the periods prior to
acquisition by the Operating Partnership:
<TABLE>
<CAPTION>
REAL ESTATE
TAXES AND REVENUES IN
PROPERTY EXCESS OF
ACQUISITION RENTAL OPERATING CERTAIN
DATE REVENUES EXPENSES EXPENSES
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Columbia Business Center ........ 2/01/99 $ 150 $ (55) $ 95
Manekin Portfolio ............... 2/01/99 1,053 (376) 677
Technology Park II .............. 4/30/99 1,649 (304) 1,345
WOCAC Portfolio ................. 5/26/99 4,432 (1,342) 3,090
Junction Industrial Park ........ 6/23/99 1,493 (256) 1,237
Miami Airport Business Center ... 6/28/99 1,825 (617) 1,208
----------- ----------- -----------
Audited total .............. 10,602 (2,950) 7,652
Shawnee Industrial .............. 3/26/99 200 (32) 168
141 Campanelli Drive ............ 5/21/99 64 (10) 54
Sylvan Industrial ............... 6/30/99 558 (80) 478
Wilmington Avenue Warehouse ..... 8/11/99 784 (115) 669
Pardee Drive .................... 8/26/99 168 (79) 89
Murray Hill Parkway ............. 9/15/99 146 (41) 105
East Valley Warehouse ........... 9/29/99 - - -
Pioneer Alburtis ................ 9/29/99 813 (182) 631
Williams & Burroughs ............ 9/30/99 865 (270) 595
----------- ----------- -----------
$ 14,200 $ (3,759) $ 10,441
=========== =========== ===========
</TABLE>
The Operating Partnership purchased the 1999 Property Acquisitions with proceeds
from the Divestiture, borrowings on the unsecured credit facility, the
assumption of mortgage indebtedness and the issuance of Operating Partnership
units. The adjustments reflect additional interest expense of $3,891 related to
borrowings on the unsecured credit facility and assumption of mortgage
indebtedness related to the 1999 Property Acquisitions.
The East Valley Warehouse was vacant upon acquisition and is in the process of
being leased. As such, no property operations have been reflected in the
accompanying pro forma statement of operations related to this acquisition.
Also reflects the estimated incremental depreciation and amortization of $2,649
for the 1999 Property Acquisitions based on estimated useful lives of 40 years.
The adjustments also reflect additional interest of $3,728 related to the
$80,000 secured credit facility. The adjustments also reflect a reduction of
interest expense of $5,106 related to the partial paydown of the unsecured
credit facility with proceeds from the contribution of the WOCAC Portfolio to
the Alliance Fund I. An adjustment to minority interest of $768 has been
reflected related to the Alliance Fund I.
31
<PAGE> 33
AMB PROPERTY CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
(UNAUDITED, DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
1999
DEBT AND PROPERTY
1998 PROPERTY PREFERRED ACQUISITIONS PRO FORMA
COMPANY(1) ACQUISITIONS(2) OFFERINGS(3) Divestiture(4) (5) (6)
------------ --------------- ------------ -------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
REVENUES
Rental revenues .......................... $ 354,658 $ 52,457 $ -- $ (66,205) $ 38,846 $ 379,756
Investment management and other
Income ................................. 4,229 2,988 -- (543) -- 6,674
------------ ------------ ------------ ------------ ------------ ------------
Total revenues ......................... 358,887 55,445 -- (66,748) 38,846 386,430
------------ ------------ ------------ ------------ ------------ ------------
OPERATING EXPENSES
Real estate taxes and property
Operating expenses .................. 96,074 11,863 -- (18,379) 11,286 100,844
Interest expense ......................... 69,670 9,868 3,597 (11,003) 3,465 75,597
Depreciation and amortization ............ 57,464 7,732 -- (12,759) 7,063 59,500
General, administrative and other ........ 11,929 -- -- -- -- 11,929
------------ ------------ ------------ ------------ ------------ ------------
Total operating expenses ........ 235,137 29,463 3,597 (42,141) 21,814 247,870
------------ ------------ ------------ ------------ ------------ ------------
Income from operations before
minority interests .................. 123,750 25,982 (3,597) (24,607) 17,032 138,560
------------ ------------ ------------ ------------ ------------ ------------
Minority interests' share of net income .. (11,157) (3,657) (20,673) 1,503 (1,091) (35,075)
------------ ------------ ------------ ------------ ------------ ------------
Net income before gain from
Divestiture and extraordinary
items.......................... 112,593 22,325 (24,270) (23,104) 15,941 103,485
Preferred stock dividends ................ (3,639) -- (4,861) -- -- (8,500)
============ ============ ============ ============ ============ ============
Net income available to common
stockholders before gain from
Divestiture and extraordinary items..... $ 108,954 $ 22,325 $ (29,131) $ (23,104) $ 15,941 $ 94,985
============ ============ ============ ============ ============ ============
Net income per common share before gain
from Divestiture and extraordinary items:
Basic .................................. $ 1.27 $ 1.11
============ ============
Diluted ................................ $ 1.26 $ 1.10
============ ============
Weighted average common shares:
Outstanding
Basic .................................. 85,876,393 85,876,393
============ ============
Diluted ................................ 86,235,176 86,235,176
============ ============
</TABLE>
32
<PAGE> 34
AMB PROPERTY CORPORATION
NOTES AND ADJUSTMENTS TO PRO FORMA
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
(UNAUDITED, DOLLARS IN THOUSANDS, EXCEPT SHARE AND UNIT DATA)
(1.) Reflects the historical consolidated operations of AMB Property Corporation
for the year ended December 31, 1998. See the historical consolidated financial
statements and notes thereto included in AMB Property Corporation's Annual
Report on Form 10-K for the year ended December 31, 1998.
(2.) The following reflects the incremental effects of properties acquired
during the year ended December 31, 1998 (the "1998 Property Acquisitions") based
on the historical operations of such properties for the periods prior to
acquisition by the Operating Partnership:
<TABLE>
<CAPTION>
REAL ESTATE TAXES REVENUES IN
AND PROPERTY EXCESS OF
OPERATING CERTAIN
RENTAL REVENUES EXPENSES EXPENSES
--------------- ----------------- -----------
<S> <C> <C> <C>
Cascade ................................... $ 44 $ (11) $ 33
Wilsonville................................ 167 (41) 126
Atlanta South Phase II..................... 116 (30) 86
Boston Industrial Portfolio................ 2,853 (108) 2,745
Mansfield Industrial Portfolio............. 71 (2) 69
Orlando Central Park....................... 804 (260) 544
Jamesburg Property......................... 1,466 (543) 923
Corporate Park Industrial.................. 757 (130) 627
Minneapolis Industrial Portfolio........... 592 (230) 362
Houston Service Center..................... 706 (249) 457
Meadowridge Business Park.................. 1,058 (238) 820
Northwest Business Center.................. 323 (75) 248
Forbes..................................... -- -- --
Southfield................................. -- -- --
Crysen Corridor Warehouse.................. 247 (63) 184
Garland Industrial Portfolio............... 1,966 (412) 1,554
Suffolk.................................... 165 (42) 123
Minnetonka Industrial Portfolio............ 2,022 (768) 1,254
Alsip Industrial........................... 374 (106) 268
Suffolk Industrial......................... 444 (112) 332
Chamway Industrial......................... 688 (140) 548
Amberjack Portfolio........................ 5,924 (2,151) 3,773
Willow Lake Portfolio...................... 4,501 (1,026) 3,475
Willow Park Portfolio...................... 9,610 (1,977) 7,633
Porete Avenue Warehouse.................... 1,352 (270) 1,082
Movah Portfolio............................ 3,379 (282) 3,097
National Distribution Portfolio............ 8,180 (1,731) 6,449
South Point Business Park.................. 2,087 (201) 1,886
Northridge................................. 108 (43) 65
Totan Lake Malls........................... 758 (277) 481
Around Lenox............................... 1,695 (345) 1,350
------- -------- -------
$52,457 $(11,863) $40,594
======= ======== =======
</TABLE>
33
<PAGE> 35
Five of the property acquisitions, Jamesburg Property, Corporate Park
Industrial, Garland Industrial Portfolio, Minnetonka Industrial Portfolio and
South Point Business Park, represent a joint venture with a client of AMB
Investment Management in which the Company owns a controlling 50.0005% interest.
The joint venture acquisitions are accounted for on a consolidated basis and,
accordingly, minority interests of $2,384 has been reflected relative to these
acquisitions.
Two of the property acquisitions, Forbes and Southfield, represent the purchase
of vacant buildings which are in the process of being leased. As such, no
property operations have been reflected in the accompanying pro forma statement
of operations relative to these acquisitions.
Also reflects the acquisition of a non-controlling unconsolidated limited
partnership interest in an existing real estate joint venture which owns the
DuPage Elk Grove Property. As such, the Company's incremental share of equity in
earnings of this joint venture of $2,988 is included in interest and other
income in the accompanying pro forma statement of operations.
Also reflects the estimated incremental depreciation and amortization of the
1998 Property Acquisitions based on estimated useful lives of 40 years and
additional interest expense related to the assumption of secured debt related
to the 1998 Property Acquisitions.
(3.) In June 1998, the Operating Partnership issued $400,000 aggregate principal
amount of unsecured notes ("Unsecured Senior Debt Securities") in an
underwritten public offering, of which the net proceeds of approximately
$394,466 were contributed to the Operating Partnership and used to repay amounts
outstanding under the unsecured credit facility. The Unsecured Senior Debt
Securities mature in June 2008, June 2015 and June 2018 and bear interest at a
weighted average rate of 7.18%.
In July, 1998, the Company sold 4,000,000 shares of 8.5% Series A Cumulative
Redeemable Preferred Stock at $25.00 per share for $100,000 in an underwritten
public offering. These shares are redeemable solely at the option of the Company
on or after July 27, 2003. The net proceeds of $96,100 from the offering were
contributed to the Operating Partnership in exchange for 4,000,000 Series A
preferred units with the terms identical to the Series A Preferred Stock. The
Operating Partnership used these proceeds to partially repay borrowings under
the unsecured credit facility.
In November 1998, the Operating Partnership issued and sold 1,300,000 8.625%
Series B Cumulative Redeemable Preferred Units at a price of $50.00 per unit in
a private placement. Distributions are cumulative from the date of original
issuance and are payable quarterly in arrears at a rate per unit equal to
$4.3125 per annum. The Series B Preferred Units are redeemable by the Operating
Partnership on or after November 12, 2003, subject to certain conditions, for
cash at a redemption price equal to $50.00 per unit, plus accumulated and unpaid
distributions thereon, if any, to the redemption date. The Series B Preferred
Units are exchangeable, at specified times and subject to certain conditions, on
a one-for-one basis, for shares of the Company's Series B Preferred Stock. The
Operating Partnership used the net proceeds of $62,259 to repay partially
borrowings under the unsecured credit facility.
In November 1998, AMB Property II, L.P. issued and sold 2,200,000 units of 8.75%
Series C Cumulative Redeemable Preferred Units at a price of $50.00 per unit in
a private placement. Distributions are cumulative from the date of original
issuance and are payable quarterly in arrears at a rate per unit equal to $4.375
per annum. The Series C Preferred Units are redeemable by AMB Property II, L.P.
on or after November 24, 2003, subject to certain conditions, for cash at a
redemption price equal to $50.00 per unit, plus accumulated and unpaid
distributions thereon, if any, to the redemption date. The Series C Preferred
Units are exchangeable, at specified times and subject to certain conditions, on
a one-for-one basis, for shares of the Company's Series C Preferred Stock. AMB
Property II, L.P. used the net proceeds of $105,734 to make a loan to the
Operating Partnership, which used the funds to repay partially borrowings under
the unsecured credit facility.
Reflects an adjustment to interest expense as follows:
<TABLE>
<S> <C>
Unsecured Senior Debt Securities.......................... $ 14,820
Unsecured Credit Facility................................. (11,223)
--------
$ 3,597
========
</TABLE>
The net increase in pro forma interest expense is the result of the issuance of
unsecured senior debt securities which is partially offset by the repayment of
borrowings on the unsecured credit facility using the net proceeds from the sale
of the Unsecured Senior Debt Securities, Series A Preferred Shares, Series B
Preferred Units, Series C Preferred Units, Series D Preferred Units and Series E
Preferred Units.
34
<PAGE> 36
Also reflects the payment of pro forma Series A Preferred Stock dividends at a
dividend rate of 8.6%, Series B Preferred Unit distributions at a distribution
rate of 8.625%, Series C Preferred Unit distributions at a distribution rate of
8.75%, Series D Preferred Unit distributions at a distribution rate of 7.75% and
Series E Preferred Unit distributions at a distribution rate of 7.75%.
(4.) Reflects the elimination of the historical revenues and expenses for the
year ended December 31, 1998 related to the real estate assets divested in
connection with the Divestiture. The interest expense adjustment consists of a
reduction of interest related to the mortgage debt on the properties divested of
$11,003 related to the partial pay down of the unsecured credit facility with
proceeds from the first and second transactions related to the Divestiture.
(5.) The following reflects the historical operations for 1998 related to the
1999 Property Acquisitions:
<TABLE>
<CAPTION>
REAL ESTATE
TAXES AND REVENUES IN
PROPERTY EXCESS OF
ACQUISITION RENTAL OPERATING CERTAIN
DATE REVENUES EXPENSES EXPENSES
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Columbia Business Center ...... 2/01/99 $ 1,776 $ (470) $ 1,306
Manekin Portfolio ............. 2/01/99 12,260 (4,138) 8,122
Technology Park II ............ 4/21/99 4,737 (721) 4,016
WOCAC ......................... 5/26/99 10,402 (3,043) 7,359
Junction Industrial Park ...... 6/23/99 2,830 (558) 2,272
Miami Airport Business Center.. 6/28/99 3,715 (1,376) 2,339
----------- ----------- -----------
Audited total .............. $ 35,720 $ (10,306) $ 25,414
Shawnee Industrial ............ 3/26/99 - (64) (64)
141 Campanelli Drive .......... 5/21/99 146 (1) 145
Sylvan Industrial ............. 6/30/99 251 (296) (45)
Wilmington Avenue Warehouse ... 8/11/99 1,301 (168) 1,133
Pardee Drive .................. 8/26/99 233 (58) 175
Murray Hill Parkway ........... 9/15/99 205 (58) 147
East Valley Warehouse ......... 9/29/99 - - -
Pioneer Alburtis .............. 9/29/99 71 (50) 21
Williams & Burroughs .......... 9/30/99 919 (285) 634
=========== =========== ===========
$ 38,846 $ (11,286) $ 27,560
=========== =========== ===========
</TABLE>
Also reflects the estimated incremental depreciation and amortization of the
1999 Property Acquisitions based on estimated useful lives of 40 years.
The adjustments also reflect additional interest of $5,264 related to the
$80,000 secured credit facility. The adjustments also reflect a reduction of
interest expense of $6,580 related to the partial paydown of the unsecured
credit facility with proceeds from the contribution of the WOCAC Portfolio to
the Alliance Fund I. An adjustment to minority interest of $256 has been
reflected related to the Alliance Fund I.
(6.) The pro forma taxable income of the Company for the year ended December
31, 1998 is approximately $103,600, which is based upon pro forma net income of
approximately $138,000, plus book depreciation and amortization of approximately
$31,800 less other book/tax differences of approximately $7,800 and less tax
depreciation and amortization of approximately $58,700.
35
<PAGE> 37
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMB PROPERTY CORPORATION
(Registrant)
Date: November 15, 1999 By: /s/ MICHAEL A. COKE
-------------------------------------
Michael A. Coke
Chief Financial Officer and
Senior Vice President
(Principal Financial and
Accounting Officer)
36
