<PAGE>
FORM 8-K/A
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
FEBRUARY 29, 1996
Date of Report
(Date of Earliest Event Reported)
PACIFIC REAL ESTATE INVESTMENT TRUST
(Exact name of registrant as
specified in its charter)
0-8725 CALIFORNIA 94-1572930
(Registration (State or Other (IRS Employer
file Jurisdiction of Identification
Number) Incorporation) Number)
1010 EL CAMINO REAL #210, MENLO PARK CA 94025
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(415) 327-7147
(800) 366-6707...Wats line for all states
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
(a) The Trust was organized to acquire, manage and ultimately sell
income-producing real properties. In the course of its business,
Menlo Center, located in Menlo Park, California, was sold on
February 29, 1996.
TERMS OF ORIGINAL ACQUISITION
The Trust acquired redevelopment project over a four-year period from
1984 to 1988. The Trust acquired four adjacent parcels of land for
$3,210,000 and ground leased a fifth parcel of land at an annual ground rent
of approximately $75,000. The Trust's mortgage loan encumbering the property
owned by the Trust was from Prudential Insurance Company for $11,000,000,
secured by a first Deed of Trust on the property.
TERMS OF DISPOSITION AND FINANCING
Menlo Center was sold for $16,200,000. After payment of the existing
first loan balance of approximately $10,730,102, estimated expense related
to the sale of $550,000 the proceeds to the Trust were approximately
$4,934,920. The Trust remains liable to the buyers for an annual net
operating income subsidy. This subsidy represents a minimum yield to the
buyers of 8.50% pa on its invested equity capital at acquisition.
CARRYING AMOUNT AT DATE OF SALE
At the date of sale, the carrying amount of land and improvements,
depreciation and deferred financing fees for financial statement
purposes was $14,617,000.
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<TABLE>
<CAPTION>
PACIFIC REAL ESTATE INVESTMENT TRUST
------------
PRO FORMA CONSOLIDATED BALANCE SHEET (UNAUDITED)
DECEMBER 31,1995
ASSETS
HISTORICAL PRO FORMA PRO FORMA
---------- --------- ---------
ADJUSTMENTS
-----------
(NOTE 1)
-----------
<S> <C> <C> <C>
Investment in commercial properties:
Land ............................ $ 14,308,000 $ (9,707,000) $ 14,308,000
Buildings and improvements ...... 56,345,000 (21,307,000) 56,214,000
Accumulated depreciation ........ (18,375,000) 956,000 (16,040,000)
------------ ----------- -----------
Operating properties - net ...... 52,278,000 (30,058,000) 54,478,000
Mortgage notes receivable .................... 6,565,000 0 5,190,000
Tenant and other notes receivable - net ....... 246,000 0 1,596,000
Cash .......................................... 308,000 0 666,000
Restricted cash ............................... 100,000 0 100,000
Accounts receivable (net of allowance of
$146,000 in 1995 and $103,000 in 1994) ........ 891,000 (90,000) 801,000
Deferred lease commissions - net .............. 742,000 200,000 542,000
Deferred financing costs - net ................ 440,000 (142,000) 298,000
Other assets .................................. 1,305,000 0 1,305,000
----------- ----------- ----------
Total ................. $ 62,875,000 $ (14,993,000) $ 47,882,000
----------- ----------- ----------
----------- ----------- ----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Mortgage loans .......................... $ 36,818,000 $ (10,738,000) $ 26,080,000
Short-term notes ........................ 11,190,000 500,000 10,690,000
Security deposits ....................... 231,000 (85,000) 146,000
Accounts payable and other liabilities .. 566,000 (6,000) 560,000
----------- ----------- -----------
Total liabilities .... 48,805,000 (11,329,000) 37,476,000
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Commitments and contingencies ................
Minority interest in joint venture ........... 3,321,000 0 3,321,000
Shareholders' Equity:
Shares of beneficial interest, $10 par
value, authorized: 1995 and 1994,
10,611,863; shares issued and
outstanding: 1995 and 1994; 3,706,845
Additional paid-in capital .................. 11,009,000 0 11,009,000
Distributions in excess of net income ....... (37,328,000) (3,664,000) (40,992,000)
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Shareholders' equity - net .................. 10,749,000 (3,664,000) 7,085,000
----------- ---------- ----------
Total ............... $ 62,875,000 $ (14,993,000) $ 47,882,000
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</TABLE>
See note to pro forma consolidated financial statements.
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PACIFIC REAL ESTATE INVESTMENT TRUST
--------------
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
Historical Pro Forma Pro Forma
-------------- ----------- -------------
Adjustments
-----------
(Note 1)
-----------
<S> <C> <C> <C>
Rental revenues. . . . . . . . . . . . . . . . . . . . . . . . . $ 9,183,000 $ 1,888,000 $ 7,295,000
-------------- ----------- -------------
Operating expenses (including related party amounts
of $694,000, $996,000 and $391,000 in 1995, 1994
and 1993 respectively):
Operating . . . . . . . . . . . . . . . . . . . . . . . . . . 2,145,000 425,000 1,720,000
Property tax. . . . . . . . . . . . . . . . . . . . . . . . . 1,194,000 157,000 1,037,000
General and administrative. . . . . . . . . . . . . . . . . . 609,000 0 609,000
Depreciation and amortization . . . . . . . . . . . . . . . . 2,886,000 607,000 2,279,000
Property management fees. . . . . . . . . . . . . . . . . . . 318,000 69,000 249,000
-------------- ----------- -------------
Total operating expenses . . . . . . . . . . . . . . . . 7,152,000 1,258,000 5,894,000
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Operating income . . . . . . . . . . . . . . . . . . . . . . . . 2,031,000 603,000 1,401,000
-------------- ----------- -------------
Other income/(expense)
Interest income . . . . . . . . . . . . . . . . . . . . . . . 637,000 0 637,000
Interest expense. . . . . . . . . . . . . . . . . . . . . . . (5,364,000) (1,021,000) (4,343,000)
Gain (loss) on sale of options. . . . . . . . . . . . . . . . (213,000) 0 (213,000)
Reincorporation expenses. . . . . . . . . . . . . . . . . . . (139,000) 0 (139,000)
Property acquisition expenses . . . . . . . . . . . . . . . . (75,000) 0 (75,000)
-------------- ----------- -------------
Total other income/(expense) . . . . . . . . . . . . . . (5,154,000) (1,021,000) (4,133,000)
-------------- ----------- -------------
Net loss before minority interest. . . . . . . . . . . . . . . . (3,123,000) (391,000) (2,732,000)
Minority interest in joint venture . . . . . . . . . . . . . . . (325,000) 0 (325,000)
-------------- ----------- -------------
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (3,448,000) $ (391,000) $ (3,057,000)
-------------- ----------- -------------
-------------- ----------- -------------
</TABLE>
See notes to consolidated financial statements.
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BASIS OF PRESENTATION
NOTE 1.
The unaudited statements present: (1) the pro forma consolidated balance
sheet at December 31, 1995 as if the Trust had sold Menlo Center on that
date, and (2) the pro-forma consolidated statement of operations for the year
ended December 31, 1995 as if the Trust had sold Menlo Center on January 1,
1995. The unaudited statements also present the historical figures as
previously reported in the appropriate Form 10-K. Accounts related to Menlo
Center have been eliminated as presented by the pro forma adjustments.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial statements.
Not applicable.
(b) Pro forma Financial Information.
Historical financial information and pro forma
financial information relating to the sale of Menlo Center will be
included within 30 days of this Form 8-K.
(c) Exhibits.
Upon their receipt the Trust will amend its Form 8-K to include
the disposition documents for Menlo Center.
/s/ Wilcox Patterson 3/25/96
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Wilcox Patterson Date
/s/ Robert Ch. Gould 3/25/96
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Robert Ch. Gould Date
/s/ Harry E. Kellogg 3/25/96
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Harry E. Kellogg Date
