<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACTION OF 1934
For the Quarter ended SEPTEMBER 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number 0-2809
WESTERN INVESTMENT REAL ESTATE TRUST
(Exact name of registrant as specified in its charter)
CALIFORNIA 94-6100058
- ------------------------------------------ ---------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3450 CALIFORNIA STREET, SAN FRANCISCO, CA 94118
- ------------------------------------------ ---------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 929-0211
--------------------
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the end of the period covered by this report.
Shares of Beneficial Interest, No Par Value - 17,138,432 shares as of
September 30, 1996
1
<PAGE>
WESTERN INVESTMENT REAL ESTATE TRUST
INDEX TO 10-Q
PART I. FINANCIAL INFORMATION Page
----
Item 1. Financial Statements (unaudited)
Balance Sheets - September 30, 1996 and December 31, 1995 3
Statements of Income - Three and nine months ended
September 30, 1996 and 1995 4
Statements of Shareholders' Equity - Nine months ended
September 30, 1996 and year ended December 31, 1995 5
Statements of Cash Flows - Nine months ended
September 30, 1996 and 1995 6
Notes to Financial Statements 7 - 10
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 11 - 13
PART II. OTHER INFORMATION 14
SIGNATURE 15
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
WESTERN INVESTMENT REAL ESTATE TRUST
Balance Sheets
(Unaudited)
<TABLE>
<CAPTION>
ASSETS September 30, December 31,
1996 1995
----------------------------
(In thousands)
<S> <C> <C>
Real estate investments:
Real estate owned. . . . . . . . . . . . . . . . . . . $399,662 $395,800
Less accumulated depreciation and amortization . . . . (69,127) (61,249)
-------- --------
Net real estate investments . . . . . . . . . . . 330,535 334,551
Cash and cash equivalents. . . . . . . . . . . . . . . . . 925 657
Accounts receivable and other assets . . . . . . . . . . . 7,316 6,868
Deferred long-term debt issuance costs, net. . . . . . . . 2,266 2,495
-------- --------
$341,042 $344,571
-------- --------
-------- --------
LIABILITIES AND SHAREHOLDERS' EQUITY
Bank line of credit. . . . . . . . . . . . . . . . . . . . $ 32,250 $ 29,250
Convertible debentures . . . . . . . . . . . . . . . . . . 61,310 63,433
Senior notes, net. . . . . . . . . . . . . . . . . . . . . 49,893 49,882
Real estate loan payable . . . . . . . . . . . . . . . . . -- 1,294
-------- --------
143,453 143,859
Interest payable . . . . . . . . . . . . . . . . . . . . . 492 1,641
Prepaid rents and security deposits. . . . . . . . . . . . 1,585 1,320
Other liabilities. . . . . . . . . . . . . . . . . . . . . 1,517 952
-------- --------
Total liabilities. . . . . . . . . . . . . . . . . . . 147,047 147,772
-------- --------
Shareholders' equity:
Shares of beneficial interest, no par value,
unlimited share authorization.
Issued and outstanding:
September 30, 1996 - 17,138,432 shares;
December 31, 1995 - 16,972,496 shares . . . . . . 242,054 240,034
Accumulated dividends in excess of net income. . . . . (48,059) (43,235)
-------- --------
Commitments and contingencies (Note E)
Total shareholders' equity . . . . . . . . . . . . . . 193,995 196,799
-------- --------
$341,042 $344,571
-------- --------
-------- --------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
3
<PAGE>
WESTERN INVESTMENT REAL ESTATE TRUST
Statements of Income
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
1996 1995 1996 1995
--------------------------------------------------
(In thousands, except share and per share data)
<S> <C> <C> <C> <C>
REVENUES:
Minimum rents. . . . . . . . . . . . . . . . $ 9,471 $ 9,578 $ 28,607 $ 27,954
Percentage rents . . . . . . . . . . . . . . 174 132 514 398
Recoveries from tenants. . . . . . . . . . . 1,873 1,150 5,185 4,306
Other income . . . . . . . . . . . . . . . . 209 129 618 410
---------- ---------- ----------- -----------
Total revenues . . . . . . . . . . . . . . . . . 11,727 10,989 34,924 33,068
---------- ---------- ----------- -----------
EXPENSES:
Interest . . . . . . . . . . . . . . . . . . 2,816 2,867 8,476 8,690
Property operating costs . . . . . . . . . . 2,203 1,575 6,242 5,522
Depreciation and amortization. . . . . . . . 2,914 2,747 8,481 8,143
Other operating expenses . . . . . . . . . . 716 723 2,055 2,140
General and administrative . . . . . . . . . 367 352 1,306 1,257
---------- ---------- ----------- -----------
Total expenses . . . . . . . . . . . . . . . . . 9,016 8,264 26,560 25,752
---------- ---------- ----------- -----------
Income from operations . . . . . . . . . . . 2,711 2,725 8,364 7,316
---------- ---------- ----------- -----------
Gains on sales of real estate investments. . . . 83 47 1,115 47
---------- ---------- ----------- -----------
Net income . . . . . . . . . . . . . . . . . $ 2,794 $ 2,772 $ 9,479 $ 7,363
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
Per share data:
Income from operations . . . . . . . . . . . $ 0.158 $ 0.161 $ 0.491 $ 0.435
---------- ---------- ----------- -----------
Gains on sales of real estate
investments. . . . . . . . . . . . . . . . $ 0.005 $ 0.003 $ 0.065 $ 0.003
---------- ---------- ----------- -----------
Net income . . . . . . . . . . . . . . . . . $ 0.163 $ 0.164 $ 0.557 $ 0.438
---------- ---------- ----------- -----------
Cash dividends paid. . . . . . . . . . . . . $ 0.28 $ 0.28 $ 0.84 $ 0.84
---------- ---------- ----------- -----------
Weighted average number of shares outstanding. . 17,136,774 16,955,262 17,027,649 16,824,070
---------- ---------- ----------- -----------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
4
<PAGE>
WESTERN INVESTMENT REAL ESTATE TRUST
Statements of Shareholders' Equity
(Unaudited)
Nine Months Ended September 30, 1996 and
Year Ended December 31, 1995
(In thousands, except share data)
<TABLE>
<CAPTION>
Accumulated
Shares of Dividends Total
Beneficial Interest in Excess Share-
------------------- of Net Holders'
Number Amount Income Equity
--------------------------------------------------------
<S> <C> <C> <C> <C>
BALANCE, JANUARY 1, 1995. . . . . . . . . . . . 16,734,532 $237,341 $(34,657) $202,684
Net proceeds from issuance of shares. . . . . . 43,575 514 -- 514
Debenture redemptions . . . . . . . . . . . . . 194,389 2,179 -- 2,179
Net income. . . . . . . . . . . . . . . . . . . -- -- 10,304 10,304
Cash dividends paid . . . . . . . . . . . . . . -- -- (18,882) (18,882)
---------- -------- --------- ---------
BALANCE, DECEMBER 31, 1995. . . . . . . . . . . 16,972,496 240,034 (43,235) 196,799
Debenture redemptions . . . . . . . . . . . . . 165,936 2,020 -- 2,020
Net income. . . . . . . . . . . . . . . . . . . -- -- 9,479 9,479
Cash dividends paid . . . . . . . . . . . . . . -- -- (14,303) (14,303)
---------- -------- --------- ---------
BALANCE, SEPTEMBER 30, 1996 . . . . . . . . . . 17,138,432 $242,054 $(48,059) $193,995
---------- -------- --------- ---------
---------- -------- --------- ---------
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
5
<PAGE>
WESTERN INVESTMENT REAL ESTATE TRUST
Statements of Cash Flows
(Unaudited)
Nine Months Ended
September 30,
-------------
1996 1995
-------------------
(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income. . . . . . . . . . . . . . . . . . . . . . . $ 9,479 $ 7,363
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization . . . . . . . . . . . 8,481 8,143
Amortization of deferred debt issuance costs. . . . 277 294
Gains on sales of real estate investments . . . . . (1,115) (47)
Gains on sale of marketable securities. . . . . . . (75) --
(Increase) decrease in accounts receivable and
other assets . . . . . . . . . . . . . . . . . . (168) 402
Increase in deferred rent receivable. . . . . . . . (559) (751)
Decrease in interest payable. . . . . . . . . . . . (1,149) (841)
Increase in prepaid rents and security deposits
and other liabilities. . . . . . . . . . . . . . 806 448
--------- -------
Net cash provided by operating activities . . . . . 15,977 15,011
--------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of real estate investments. . . . . 1,371 168
Proceeds from sales of marketable securities. . . . . . 234 --
Recovery of acquisition costs (acquisition) of real
estate investments. . . . . . . . . . . . . . . . . 36 (3,312)
Funds escrowed pending acquisition. . . . . . . . . . . -- (168)
Improvements of real estate investments:
Build-to-suit developments. . . . . . . . . . . . . (3,605) (462)
New leases. . . . . . . . . . . . . . . . . . . . . (1,147) (1,691)
General . . . . . . . . . . . . . . . . . . . . . . (161) (458)
Recovery of investment in direct financing leases . . . 200 174
--------- -------
Net cash used in investing activities . . . . . . . (3,072) (5,749)
--------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Advances of bank line of credit . . . . . . . . . . . . 32,468 28,950
Principal payments on bank line of credit . . . . . . . (29,468) (24,445)
Principal payments on real estate loan payable. . . . . (1,294) (51)
Redemption of convertible debentures. . . . . . . . . . (40) --
Net proceeds from issuance of shares. . . . . . . . . . -- 514
Cash dividends paid . . . . . . . . . . . . . . . . . . (14,303) (14,129)
--------- -------
Net cash used in financing activities . . . . . . . (12,637) (9,161)
--------- -------
Net increase in cash and cash equivalents . . . . . 268 101
Cash and cash equivalents, at the beginning of the period. $ 657 $ 648
-------- -------
-------- -------
Cash and cash equivalents, at the end of the period. . . . $ 925 $ 749
-------- -------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for interest. . . . . . . . $ 9,473 $ 9,237
-------- -------
-------- -------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
6
<PAGE>
WESTERN INVESTMENT REAL ESTATE TRUST
Notes to Financial Statements
September 30, 1996
(Unaudited)
Note A: BASIS OF PRESENTATION
The financial statements included in this report have been prepared pursuant to
the rules of the Securities and Exchange Commission. Certain information and
footnote disclosure normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed or
omitted pursuant to such rules. Interim results are not necessarily indicative
of results for a full year.
It is suggested that these financial statements be read in conjunction with the
audited financial statements and notes thereto included in the Trust's latest
annual report on Form 10-K. When necessary, reclassifications have been made to
prior period balances to conform to current period presentation.
Note B: REAL ESTATE INVESTMENTS
At September 30, 1996, the Trust owned 60 income producing properties, totaling
4.8 million leasable square feet. Included in this total are five properties
which are being held for sale and total 107,000 leasable square feet with a
combined net book value of $2.6 million.
In August, 1996, the Trust sold, at a gain of $83,000, a 36,000 square foot
portion of undeveloped land adjacent to its Elko, Nevada shopping center. The
proceeds were used to partially pay down the bank line of credit.
Occupancy percentages for the Trust's portfolio are as follows:
September 30, 1996 December 31, 1995 September 30, 1995
------------------ ----------------- ------------------
Retail 94.1% 93.8% 93.1%
Commercial 86.0% 93.1% 93.1%
Industrial 100.0% 100.0% 100.0%
Overall Occupancy 93.9% 93.9% 93.3%
7
<PAGE>
Note C: CAPITAL EXPENDITURES
It is the Trust's practice to capitalize certain costs which exceed $4,000 and
are associated with improvement and rental of real estate investments.
Capitalized costs include third party leasing commissions, tenant improvements
and common area improvements. Capital expenditures for the three and nine
months ended September 1996 and 1995 are as follows:
<TABLE>
<CAPTION>
Quarter Ended Nine Months Ended
September 30, September 30,
------------- -------------
1996 1995 1996 1995
---------------------------- --------------------------
(In thousands)
<S> <C> <C> <C> <C>
Build to Suit capital improvements. . . . . . . . . . . . . . $ 383 $ 181 $3,605 $ 462
Capitalized costs incurred in connection with
leasing previously UNLEASED space . . . . . . . . . . . . . . 15 64 68 96
Capitalized costs incurred in connection with
leasing previously LEASED space . . . . . . . . . . . . . . . 393 564 1,079 1,595
Capitalized costs which relate to
improvements to common areas. . . . . . . . . . . . . . . . . 90 319 161 458
--------- ------- ------ -------
Total Capitalized expenditures. . . . . . . . . . . . . . . . $ 881 $ 1,128 $4,913 $ 2,611
--------- ------- ------ -------
--------- ------- ------ -------
Improvements. . . . . . . . . . . . . . . . . . . . . . . . . $754 $ 994 $4,668 $ 2,229
Leasing commissions . . . . . . . . . . . . . . . . . . . . . 127 134 245 382
--------- ------- ------ -------
Total Capitalized expenditures. . . . . . . . . . . . . . . . $ 881 $ 1,128 $4,913 $ 2,611
--------- ------- ------ -------
--------- ------- ------ -------
</TABLE>
8
<PAGE>
During the three months ended September 30, 1996, the Trust has entered into new
leases which obligate the Trust to fund leasing commissions and tenant
improvements. This obligation relates entirely to new leases in the shopping
center and retail portion of the Trust's portfolio, and consists of the
following:
<TABLE>
<CAPTION>
CAPITALIZED EXPENDITURES ASSOCIATED WITH NEW LEASES
- ------------------------------------------------------------------------------------------------------------
PER PER
AGGREGATE SQUARE AGGREGATE SQUARE
AMOUNT FOOT AMOUNT FOOT
------ -------- ------ --------
<S> <C> <C> <C> <C> <C> <C>
SHOPPING
CENTERS Tenant Leasing
& RETAIL Improvements $ 114,000 $ 6.71 Commissions $ 311,000 $ 3.97
PROPERTIES
</TABLE>
Note D: DEFERRED RENTAL RECEIVABLE
The Trust recognizes income from deferred rental receivable in accordance with
FAS 13. Deferred rental receivable recognized as income was $239,000 and
$258,000 for the quarter ended September 30, 1996 and 1995, respectively.
Deferred rental receivable recognized as income for the nine-month period ended
September 30, 1996 and 1995 was $559,000 and $751,000, respectively.
Note E: DIVIDEND REINVESTMENT PLAN
During the quarter ended September 30, 1996, in accordance with the Trust's
Dividend Reinvestment Plan, $169,000 in dividends and shareholders' additional
cash payments were used to purchase shares in the open market for the
participating shareholders.
During the quarter ended September 30, 1995, in accordance with the Trust's
Dividend Reinvestment Plan, the Trust received $179,000 in dividends and
shareholders' additional cash payments and issued 15,527 shares of beneficial
interest.
9
<PAGE>
Note F: FUNDS FROM OPERATIONS
The Trust considers Funds From Operations to be an alternate measure of the
performance of an equity REIT since such measure does not recognize depreciation
and amortization of real estate assets as operating expenses. Historical cost
accounting for real estate assets implicitly assumes that the value of real
estate assets diminishes predictably over time. Yet, since real estate values
have historically risen or fallen with market conditions, the Trust, along with
most industry investors, have considered presentations of operating results for
real estate companies that use historical cost accounting to be less than fully
informative.
The National Association of Real Estate Investment Trusts (NAREIT) defines Funds
From Operations as net income plus depreciation and amortization of real estate
assets, less gains and losses on sales of property. Funds From Operations does
not represent cash flows from operations as defined by generally accepted
accounting principles and should not be considered a substitute for net income
as an indicator of the Trust's operating performance or for cash flows as a
measure of liquidity.
Funds From Operations, calculated in accordance with NAREIT's 1995 guidelines,
for the three and nine months ended September 30, 1996 and 1995, respectively,
is as follows:
Three Months Nine Months
Ended Ended
September 30, September 30,
------------- -------------
1996 1995 1996 1995
------------------- --------------------
Net Income $ 2,794 $ 2,772 $ 9,479 $ 7,363
Less: Gains on sales of real
estate investments (83) (47) (1,115) (47)
Plus: Real property depreciation 2,472 2,474 7,404 7,345
Amortization of tenant
improvements costs 228 176 649 458
Amortization of leasing
commission costs 187 70 349 236
--------- --------- -------- --------
Funds From Operations $ 5,598 $ 5,445 $16,766 $15,355
--------- --------- -------- --------
--------- --------- -------- --------
During September, 1996, the Trust sold, at a gain of $75,000, marketable
securities the Trust held. This gain has been included in the calculation of
Funds From Operations.
10
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Certain statements in Management's Discussion and Analysis of Financial
Condition and Results of Operations constitute "forward-looking" statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
Such "forward-looking" statements are subject to known and unknown risks,
uncertainties, and other factors which may cause the actual results,
performance, or achievements of the Trust to be materially different from any
future results, performance, or achievements expressed or implied by such
"forward-looking" statements.
LIQUIDITY AND CAPITAL RESOURCES
The Trust anticipates that cash flows provided by operations and other sources
available to the Trust will continue to provide adequate funds for all current
principal and interest payments as well as dividend payments in accordance with
REIT qualification requirements. Cash on hand, borrowings under the existing
bank line of credit, as well as other debt and equity alternatives, will provide
the necessary funds to achieve future growth.
The Trust's indenture executed in connection with the Trust's senior notes and
bank line of credit contain certain covenants (including minimum shareholders'
equity, maximum ratio of debt to net worth and income coverage requirements)
which impose certain limitations on the incurrence of debt and other
restrictions.
As of September 30, 1996, the Trust had approximately $13 million available
under its $45 million bank line of credit. This facility can be used to fund
acquisitions and other cash requirements. The interest rate under the facility
is either LIBOR plus 1.6% or the participating banks' reference rate, at the
Trust's election. The bank line of credit expires May 31, 1998, at which time
the Trust intends to replace or renew it. The weighted average interest rate on
September 30, 1996 and 1995 was 7.23% and 7.59%, respectively.
As of September 30, 1996, the Trust had commitments under several new leases
which call for approximately $1.5 million in future real estate improvements and
leasing commissions. These expenditures will be paid from operating cash flows
and borrowings under the line of credit.
11
<PAGE>
FUNDS FROM OPERATIONS
As noted in Footnote F of the NOTES TO FINANCIAL STATEMENTS, the Trust considers
Funds From Operations to be an alternate measure of the performance of an equity
REIT.
Funds From Operations (1995 NAREIT definition) increased $153,000, or 3%, to
$5,598,000 for the three months ended September 30, 1996, from $5,445,000 for
the comparable period in 1995. The major components of this increase are
increased recoveries from tenants partially offset by decreased minimum rents
and increased property operating costs.
For the nine-month period ended September 30, 1996, Funds From Operations
increased $1,411,000, or 9%, to $16,766,000, from $15,355,000 for the comparable
period in 1995. Increased minimum rents, percentage rents, recoveries from
tenants and other income as well as decreased interest expense partially offset
by increased property operating costs comprise the major factors for this FFO
growth.
RESULTS OF OPERATIONS
COMPARISON OF QUARTER ENDED SEPTEMBER 30, 1996 AND 1995
Net income for the three months ended September 30, 1996 was $2,794,000, or
$0.16 per share, up slightly from $2,772,000, or $0.16 per share, for the
comparable period in 1995.
The major components for this increase were increased recoveries from tenants
and other income, partially offset by increased property operating costs,
depreciation and amortization and decreased minimum rents.
Recoveries from tenants increased $723,000 from $1,150,000 for the quarter ended
September 30, 1995 to $1,873,000 for the comparable quarter in 1996. This
increase is partially offset by increased property operating costs during the
same period. For the three month period ended September 30, 1996, property
operating costs increased $628,000 to $2,203,000 up from the 1995 same quarter
figure of $1,575,000. Increased recoveries as well as increased costs result
primarily from recoverable paving work performed on several shopping centers
during the summer of 1996.
12
<PAGE>
COMPARISON OF NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
Net income increased $2,116,000, or 29%, to $9,479,000 from $7,363,000 for the
comparable period in 1995. On a per share basis, net income increased $0.12, or
27%, from $0.44 for the nine month period in 1995 to $0.56 for the comparable
period in 1996. The gains recorded on the sale of two properties comprise
approximately one-half of this increased net income. Other factors include
increased minimum rents, percentage rent, recoveries from tenants, other income
and decreased interest expense, partially offset by increased property operating
costs and depreciation and amortization.
Minimum rents increased 2%, or $653,000, to $28,607,000 for the nine months
ended September 30, 1996, as compared with $27,954,000 recorded a year earlier.
This increase primarily reflects increased revenue under existing leases and
increased occupancy in both the commercial and retail/shopping center
portfolios.
Recoveries from tenants increased $879,000 from $4,306,000 for the nine months
ended September 30, 1995 to $5,185,000 for the comparable period in 1996. This
increase is partially offset by increased property operating costs during the
same period. For the nine-month period ended September 30, 1996, property
operating costs increased $720,000 to $6,242,000 up from the 1995 same period
figure of $5,522,000. Increased recoveries as well as increased costs result
primarily from recoverable paving work performed on several shopping centers
during the summer of 1996.
Other income increased $208,000 from $410,000 for the nine-month period ending
September 30, 1995 to $618,000 for the same period in 1996. This increase
primarily reflects termination fees received from tenants in seven retail
spaces. To date, the Trust has entered into new leases for four of the seven
spaces. Additionally, this increase reflects a $75,000 gain recorded on the
sale of marketable securities held by the Trust.
Interest expense decreased $214,000 from the nine-month period ending September
30, 1995 of $8,690,000 to $8,476,000 in the comparable 1996 period. The main
factors in this decrease are lower interest rates charged on the Trust's
variable rate bank line of credit and lower outstanding balances on the Trust's
convertible debentures, partially offset by higher outstanding balances under
the bank line of credit.
13
<PAGE>
PART II. OTHER INFORMATION
Items 1 through 5.None
Item 6. Exhibits and reports on Form 8-K
(a) Exhibits
(numbered in accordance with Item 601 of Regulation S-K)
(3) Declaration of Trust, as amended (filed as Exhibit 3.1 to
Registration Statement on Form S-3 No. 33-22893 and
incorporated herein by reference).
(4.1) Form of Indenture relating to the 8% Convertible Debentures
(filed as Exhibit 4.1 to Registration Statement on Form S-3
No. 33-22893 and incorporated herein by reference).
(4.2) Form of Indenture relating to the Senior Notes (filed as
Exhibit 4.1 to Registration Statement on Form S-3 No.
33-71270 and incorporated herein by reference).
(4.3) Form of Senior Notes (filed as Exhibit 4.2 to Registration
Statement on Form S-3 No. 33-71270 and incorporated herein
by reference).
(10.1)* Trust's Nonqualified Stock Option Plan (filed as Exhibit 4.2
to Registration Statement on Form S-8 No. 33-27016 and
incorporated herein by reference).
(10.2)* Trust's Trustee Emeritus Plan (filed as an Exhibit to Proxy
Statement dated March 25, 1986 and incorporated herein by
reference).
(b) Reports on Form 8-K.
None.
* Management contract or compensatory plan or arrangement.
14
<PAGE>
SIGNATURE
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 thereunto duly authorized.
WESTERN INVESTMENT REAL ESTATE TRUST
(Registrant)
By: s/Dennis D. Ryan
------------------------------------
Dennis D. Ryan
Executive Vice President,
Chief Financial Officer
and Trustee
Dated: November 6, 1996
--------------------------------
15
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANTS STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND
BALANCE SHEET AT SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 925
<SECURITIES> 0
<RECEIVABLES> 0<F1>
<ALLOWANCES> 0<F1>
<INVENTORY> 0
<CURRENT-ASSETS> 0<F2>
<PP&E> 399,662
<DEPRECIATION> 69,127
<TOTAL-ASSETS> 341,042
<CURRENT-LIABILITIES> 0<F2>
<BONDS> 143,453
0
0
<COMMON> 242,054
<OTHER-SE> (48,059)<F3>
<TOTAL-LIABILITY-AND-EQUITY> 341,042
<SALES> 0
<TOTAL-REVENUES> 34,924
<CGS> 0
<TOTAL-COSTS> 8,297<F4>
<OTHER-EXPENSES> 9,787<F5>
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8,476
<INCOME-PRETAX> 9,479
<INCOME-TAX> 0
<INCOME-CONTINUING> 9,479
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 9,479
<EPS-PRIMARY> .56
<EPS-DILUTED> .56<F6>
<FN>
<F1>AMOUNT INSIGNIFICANT.
<F2>BALANCE SHEET IS NOT CLASSIFIED.
<F3>AMOUNT REPRESENTS ACCUMULATED DIVIDENDS IN EXCESS OF NET INCOME.
<F4>AMOUNT COMPRISED OF PROPERTY OPERATING COST ($6,242) AND OTHER OPERATING
EXPENSES ($2,055).
<F5>AMOUNT COMPRISED OF DEPRECIATION EXPENSE ($8,481) AND GENERAL AND
ADMINISTRATIVE EXPENSE ($1,306).
<F6>EXERCISE OF THE OUTSTANDING STOCK OPTIONS WOULD NOT HAVE MATERIAL EFFECT ON
EARNINGS PER SHARE.
</FN>
</TABLE>
