SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Act of 1934
For the period
ended December 29, 1995 Commission File Number 0-10206
JMB INCOME PROPERTIES, LTD. - VIII
----------------------------------------------------
(Exact name of registrant as specified in its charter)
Illinois 36-3075978
(State of organization)(I.R.S. Employer Identification No.)
900 N. Michigan Ave., Chicago, Illinois60611
(Address of principal executive office)(Zip Code)
Registrant's telephone number, including area code 312-915-1987
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
- ------------------- -------------------------
None None
Securities registered pursuant to Section 12(g) of the Act:
LIMITED PARTNERSHIP INTERESTS
(Title of Class)
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 by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K X
State the aggregate market value of the voting stock held by non-affiliates
of the registrant. Not applicable.
Documents incorporated by reference: None
<PAGE>
TABLE OF CONTENTS
Page
----
PART I
Item 1. Business. . . . . . . . . . . . . . . . 1
Item 2. Properties. . . . . . . . . . . . . . . 4
Item 3. Legal Proceedings . . . . . . . . . . . 6
Item 4. Submission of Matters to a
Vote of Security Holders. . . . . . . . 6
PART II
Item 5. Market for the Partnership's
Limited Partnership Interests and
Related Security Holder Matters . . . . 6
Item 6. Selected Financial Data . . . . . . . . 7
Item 7. Management's Discussion and
Analysis of Financial Condition and
Results of Operations . . . . . . . . . 9
Item 8. Financial Statements and
Supplementary Data. . . . . . . . . . . 13
Item 9. Changes in and Disagreements
with Accountants on Accounting and
Financial Disclosure. . . . . . . . . . 36
PART III
Item 10. Directors and Executive Officers
of the Partnership. . . . . . . . . . . 36
Item 11. Executive Compensation. . . . . . . . . 39
Item 12. Security Ownership of Certain
Beneficial Owners and Management. . . . 40
Item 13. Certain Relationships and
Related Transactions. . . . . . . . . . 41
PART IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K . . . . . . . . 41
SIGNATURES . . . . . . . . . . . . . . . . . . . . 42
i<PAGE>
PART I
ITEM 1. BUSINESS
All references to "Notes" are to Notes to Consolidated Financial
Statements contained in this report.
The registrant, JMB Income Properties, Ltd.-VIII (the "Partnership"),
was a limited partnership formed in mid-1980 and governed by the Revised
Uniform Limited Partnership Act of the State of Illinois to invest in
improved income-producing commercial and residential real property. The
Partnership sold $80,000,000 in Limited Partnership Interests (the
"Interests") commencing on January 26, 1981 pursuant to a Registration
Statement on Form S-11 under the Securities Act of 1933 (Registration No.
2-69116). A total of 80,000 Interests were sold to the public at $1,000
per Interest. The offering closed on May 27, 1981. No Limited Partner has
made any additional capital contribution after such date. The Limited
Partners of the Partnership shared in their portion of the benefits of
ownership of the Partnership's real property investments according to the
number of Interests held.
The Partnership was engaged solely in the business of the acquisition,
operation and sale and disposition of equity real estate investments. Such
equity investments were held by fee title, leasehold estates and/or through
joint venture partnership interests. The Partnership's real estate
investments were located throughout the nation and it had no real estate
investments located outside the United States. A presentation of
information about industry segments, geographic regions, raw materials or
seasonality was not applicable and would not have been material to an
understanding of the Partnership's business taken as a whole. The
Partnership made a liquidating distribution to its Limited Partners on
December 29, 1995, and terminated its operations and dissolved the
Partnership effective December 31, 1995. At sale of a particular property,
the proceeds, if any, were generally distributed or reinvested in existing
properties rather than invested in acquiring additional properties.
(Reference is also made to Note 1.)
The Partnership made the real property investments set forth in the
following table:
<PAGE>
<TABLE>
<CAPTION>
NAME, TYPE OF PROPERTY DATE OF SALE OR
AND LOCATION SIZE PURCHASE DISPOSITION DATE TYPE OF OWNERSHIP
- ---------------------- ---------- ---------------------------- ---------------------
<S> <C> <C> <C> <C>
Carillon Shopping
Village
shopping center
Houston, Texas. . . 188,000 8-22-80 5-18-95 fee ownership of land
sq.ft. and improvements (through
g.l.a. joint venture partnerships)
(c)
Arizona Bank Plaza
office building
Tucson, Arizona . . 179,500 9-24-80 1-31-86 fee ownership of land and
sq.ft. improvements
n.r.a.
University Mall
shopping center
Carbondale, Illinois 334,000 1-1-81 8-13-87 fee ownership of land and
sq.ft. improvements (through joint
g.l.a. venture partnership)
Clackamas Town Center
shopping center
Clackamas County,
Oregon. . . . . . . 435,000 1-20-81 1-30-92 fee ownership improvements
sq.ft. and ground leasehold
g.l.a. interest in land (through
joint venture partnerships)
Georgia Square
Shopping Mall
shopping center
Athens, Georgia . . 475,000 2-11-81 10-31-93 fee ownership of land and
sq.ft. improvements (through joint
g.l.a. venture partnership) (b)
Laurel Centre Mall
shopping center
Laurel, Maryland. . 382,000 5-1-81 12-1-86 fee ownership of land and
sq.ft. improvements (through joint
g.l.a. venture partnership)
Town and Country Center
shopping center
Houston, Texas. . . 370,000 2-16-83 12-5-95 fee ownership of land and
sq.ft. improvements (through joint
g.l.a. venture partnerships)(a)(d)
<PAGE>
<FN>
- -----------------------
(a) Reference is made to Note 4 for the former outstanding principal
balances and a description of the long-term mortgage indebtedness secured
by this real property investment.
(b) The Partnership sold its interest in the Georgia Square Partnership
in November, 1993. Reference is made to Notes 3(c) and 6(a).
(c) The Partnership, through its joint venture investment, sold this
property in May, 1995. Reference is made to Notes 3(b) and 6(b).
(d) The Partnership, through its joint venture investment, disposed of
this investment in December, 1995. Reference is made to Notes 3(d) and
6(c).
/TABLE
<PAGE>
The Partnership's former real property investments were subject to
competition from similar types of properties (including, in certain areas,
properties owned or advised by affiliates of the General Partners) in the
respective vicinities in which they were located. Such competition was
generally for the retention of existing tenants. Additionally, the
Partnership was in competition for new tenants in markets where significant
vacancies were present. Approximate occupancy levels for the properties
are set forth in the table in Item 2 below to which reference is hereby
made. The Partnership maintained the suitability and competitiveness of
its properties in its markets primarily on the basis of effective rents,
tenant allowances and service provided to tenants.
On May 18, 1995, the Partnership, through Carillon Associates, sold
the Carillon Shopping Village. The purchaser was not affiliated with the
Partnership or its General Partners. Reference is made to the
Partnership's report on Form 8-K (File No. 0-10206) for May 18, 1995, which
description is hereby incorporated herein by reference. Reference is made
to Note 6(b) for a further description of such transaction.
On December 5, 1995, the lender for the Town and Country Center
realized upon its mortgage security interest and took title to the
property. Reference is made to the Partnership's report on Form 8-K (File
No. 0-10206) for December 5, 1995, which description is hereby incorporated
herein by reference. Reference is also made to Note 6(c) for a further
description of such transaction.
The terms of transactions between the Partnership, the General
Partners and their affiliates are set forth in Item 11 below to which
reference is hereby made for a description of such terms and transactions.
ITEM 2. PROPERTIES
The Partnership owned directly or through joint venture partnerships
the properties or interests in the properties referred to under Item 1
above to which reference is hereby made for a description of said
properties.
The following is a listing of principal businesses or occupations
carried on in and approximate occupancy levels by quarter during fiscal
years 1995 and 1994 for the Partnership's investment properties owned
during 1995:
<PAGE>
<TABLE>
<CAPTION>
1994 1995
--------------------------------------------------
At At At At At At At At
Principal Business3/31 6/30 9/3012/31 3/31 6/30 9/30 12/31
---------------------- ---- --------- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1. Carillon Shopping
Village
Houston, Texas . . . Retail 69% 66% 66% 66% 66% N/A N/A N/A
2. Town and Country
Center
Houston, Texas . . . Retail 73% 74% 76% 74% 65% 63% 65% N/A
<FN>
- --------------------
An "N/A" indicates that the property was not owned by the Partnership at the end of the quarter.
/TABLE
<PAGE>
ITEM 3. LEGAL PROCEEDINGS
The Partnership is not subject to any material pending legal
proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders during
fiscal years 1994 and 1995.
PART II
ITEM 5. MARKET FOR THE PARTNERSHIP'S LIMITED PARTNERSHIP INTERESTS
AND RELATED SECURITY HOLDER MATTERS
Immediately prior to the dissolution of the Partnership, there were
7,142 record holders of Interests in the Partnership. On December 29, 1995,
the Partnership made a liquidating distribution and subsequently terminated
its operations and dissolved the Partnership effective December 31, 1995.
There had been no public market for Interests and it had not been
anticipated that a public market for Interests would develop. Upon
request, the Managing General Partner provided information relating to a
prospective transfer of Interests to an investor desiring to transfer his
Interests. The price to be paid for the Interests, as well as any other
economic aspects of the transaction, was subject to negotiation by the
investor.
Reference is made to Item 6 below for a discussion of cash
distributions made to the Limited Partners.
<PAGE>
<TABLE>
ITEM 6. SELECTED FINANCIAL DATA
JMB INCOME PROPERTIES, LTD.-VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
PERIOD ENDED DECEMBER 29, 1995 (IMMEDIATELY PRIOR TO FINAL LIQUIDATING DISTRIBUTION) AND
YEARS ENDED DECEMBER 31, 1994, 1993, 1992 AND 1991
(NOT COVERED BY INDEPENDENT AUDITORS' REPORT)
<CAPTION>
1995 1994 1993 1992 1991
-------------------------- ----------------------- ------------
<S> <C> <C> <C> <C> <C>
Total income . . . . .$ 7,054,301 9,134,551 16,056,668 16,229,605 16,133,971
======================== ======================== ============
Operating earnings
(loss). . . . . . . .$(33,910,539) (3,193,294) (1,335,686) (1,958,141) (1,529,914)
Partnership's share
of operations of
unconsolidated
venture . . . . . . . -- (107) (13,373) (129,922) 275,664
Venture partners'
share of ventures'
operations. . . . . . 26,602,923 1,786,041 779,017 1,360,914 671,530
------------------------ ------------------------ ------------
Net operating
earnings (loss) . . . (7,307,616) (1,407,360) (570,042) (727,149) (582,720)
Gain on sale or
disposition of
interest in
investment
properties, net
of venture
partners' share . . . 2,080,546 -- 11,903,432 7,543,513 --
------------------------ ------------------------ ------------
Net earnings
(loss). . . . . . . .$ (5,227,070) (1,407,360) 11,333,390 6,816,364 (582,720)
======================== ======================== ============
Net earnings (loss)
per Interest (b):
Net operating
earnings (loss). .$ (171.98) (16.89) (6.84) (8.73) (6.99)
Gain (loss) on sale
or disposition of
interest in invest-
ment properties,
net of venture
partners' share. . 25.75 -- 147.30 93.35 --
------------------------ ------------------------ ------------
$ (146.23) (16.89) 140.46 84.62 (6.99)
======================== ======================== ============
1995 1994 1993 1992 1991
-------------------------- ----------------------- ------------
Total assets . . . . .$ 19,240,703 83,249,718 94,891,494 101,921,127 107,443,709
Long-term debt
(net of unamor-
tized discounts). . .$ -- 29,651,372 30,174,276 45,736,499 46,966,001
Cash distributions
per Interest
(c) (d). . . . . . .$ -- 115.00 8.00 96.00 16.00
======================== ======================== ============
<FN>
- ---------------
(a) The above selected financial data should be read in conjunction with the financial statements and
the related notes appearing elsewhere in this annual report.
(b) The net earnings (loss) per Interest is based on the number of Interests outstanding at the end of
each period (80,005). Reference is made to Note 5 for a description of allocations of net earnings and losses.
(c) Cash distributions from the Partnership were generally not equal to Partnership income (loss) for
financial reporting or Federal income tax purposes. Each Partner's taxable income (or loss) from the Partnership
in each year is equal to his allocable share of the taxable income (loss) of the Partnership, without regard to
the cash generated or distributed by the Partnership. Accordingly, cash distributions to the Limited Partners
since the inception of the Partnership have not resulted in taxable income to such Limited Partners and have
therefore represented a return of capital.
(d) This amount does not include the final liquidating cash distribution of $19,216,401 ($240.19 per
Limited Partnership Interest) to the Limited Partners paid by the Partnership on December 29, 1995.
/TABLE
<PAGE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
On January 26, 1981, the Partnership commenced an offering of
$80,000,000 pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933. All Interests were subscribed and issued between
January 26, 1981 and May 27, 1981 pursuant to the public offering from
which the Partnership received gross proceeds of $80,000,000.
After deducting selling expenses and other offering costs, the
Partnership had approximately $72,050,000 with which to make investments in
income producing commercial real property, to pay legal fees and other
costs (including acquisition fees) related to such investments and for
working capital. A portion of such proceeds was utilized to acquire the
properties described in Item 1 above.
Carillon Shopping Village
The Partnership sold the Carillon Shopping Village in May 1995 to an
unaffiliated third party. The sale price was $7,400,000 (before selling
costs) and was paid in cash at closing. Pursuant to the March 1994
purchase agreement with the former third party limited partner of Carillon
(Note 6(b)), the non-interest bearing promissory notes held by the former
third party in the amounts of $544,500 and $5,500 from the Partnership and
the Managing General Partner, respectively, were paid as of the sale date.
Additionally, based on net sale proceeds of $6,971,561, the former third
party limited partner of Carillon received $145,685 and $1,472 from the
Partnership and the Managing General Partner, respectively.
Town & Country Center
During December 1995, the lender realized upon its security for its
non-recourse loan, which included the land, buildings and related
improvements of the Town and Country Center ("the Property") as described
below. The Property was approximately 76% occupied (including temporary
tenants) on the disposition date. The Property, through a joint venture
with an affiliated partnership ("T&C"), which was in turn a partner in a
joint venture ("Town & Country") with the developer of the center, was the
Partnership's last remaining investment property on the disposition date.
As previously reported, the Property faced strong competition from,
among others, the Town and Country Village, a multi-building retail project
encompassing over sixty acres contiguous to the Property. Although not all
tenants at this project will compete directly with the mall tenants at the
Property, a number of tenants that in the past have occupied space in
enclosed regional malls have recently signed leases for free-standing space
in Town and Country Village, and these stores are now scheduled to open in
1996.
Over the past year, Town & Country had prepared and evaluated a plan
for an extensive renovation and re-merchandising of the Property for the
long-term stability and enhancement of the Property's occupancy and revenue
potential. In connection with the plan, Town & Country approached a number
of national and regional tenants to lease space at the Property. In
discussions with these tenants, a majority of them indicated that, in
addition to significant tenant leasing incentives, a major renovation of
the Property would be essential for them to lease space at the Property.
Accordingly, the Partnership worked extensively with an architectural firm
and marketing personnel to determine the most effective redevelopment plan
to improve the Property. Focus group studies on the area residents further
supported this concept. A condition to undertaking a redevelopment of the
Property was to have been Town & Country's obtaining extensions of the
agreements for the department stores to continue operating their stores at
the Property. The Partnership believed that the renovation and re-
merchandising of the Property was viable and that it would be the best
strategy to enhance value. Accordingly, during this process, it remained
the Partnership's intent to hold the Property as a long-term investment.
Town & Country completed its evaluation of an extensive redevelopment
of the center in early September 1995. The total cost for such a
redevelopment, including obtaining tenant leases for the mall space and
extensions of the department store operating agreements, was estimated to
be in excess of $25 million. However, many of the retail tenants
considered integral to a successful re-merchandising of the Property upon
completion of a renovation had now become unwilling to take further space
in the Houston market even if given significant tenant leasing incentives.
The continued sluggishness in the Houston economy in recovering from the
previous recession, as well as the intense competition in the Property's
trade area, appear to be among the factors dissuading prospective retail
tenants from committing to lease space at the Property. In addition, the
projected return on the estimated cost was not expected to be sufficient to
warrant an investment of this magnitude.
Given Town & Country's level of debt, the strong competition that the
Property faced, and the significant cost that would have been required to
lease, renovate and re-merchandise the Property, Town & Country decided in
September 1995 not to commit any additional capital to pay continued
operating deficits of the property, including funding for debt service
payments, unless it could obtain a modification to the existing non-
recourse mortgage loan. Consequently, Town & Country remitted to the
lender only the amount of cash flow from property operations after expenses
rather than the full debt service payment required for the month of
September 1995. Town & Country approached the lender to discuss the
possibility of a modification to the existing loan to eliminate, or reduce
significantly, future operating deficits. However, the lender was
unwilling to modify the loan. On September 13, 1995, the lender notified
Town & Country that it was in default and that the lender intended to
realize upon its security for the mortgage loan as soon as possible. Due
to the uncertainty of the Partnership's ability to recover the net carrying
value of the Town & Country Center, the Partnership made, as a matter of
prudent accounting practice, a provision at September 30, 1995 for value
impairment of the Town & Country Center of $30,114,810 (of which the
Partnership's share was $5,505,933) for financial reporting purposes as of
September 30, 1995. Such provision reduced the net carrying value of the
investment property to the then outstanding balance of the related non-
recourse mortgage note.
Town & Country also was obligated under a 12% promissory note payable
to an affiliate of the developer which matured June 30, 1993. The
Partnership and the affiliated joint venture partner had reached an
agreement in principle with the developer to extend the original due date
of the promissory note. Although no interest payments were being made
currently, the venture continued to accrue interest on the note at the
original contract rate. As of the date of disposition of the Property,
such promissory note was cancelled and the balance of the note (including
accrued interest) was reflected as a contribution from the unaffiliated
joint venture partner. Reference is also made to Note 6(c).
On December 5, 1995, the lender completed the proceedings to realize
upon its security and took title to the Property in full satisfaction of
its loan. As a result of the disposition of the Property, the Partnership
recognized a gain of approximately $1,831,000 for financial reporting
purposes and approximately $7,657,000 for Federal income tax purposes.
There were no proceeds from the disposition. As all the Partnership's
investment properties had been sold or disposed, the Partnership began
preparations to terminate its affairs by the end of 1995.
At December 29, 1995 (immediately prior to the final liquidating
distribution), the Partnership had cash of $19,240,703. Subsequently, such
cash was utilized for a final liquidating cash distribution of $24,302 to
the General Partners and $19,216,401 to the Limited Partners. On December
31, 1995, following the final distribution, the Partnership terminated its
operations and dissolved.
<PAGE>
RESULTS OF OPERATIONS
The increase in cash and cash equivalents at December 29, 1995 as
compared to December 31, 1994 is primarily due to the Partnership's
retention of the proceeds from the sale of the Carillon Shopping Village in
May 1995 (Note 6(b)).
The decrease in short-term investments at December 29, 1995 as
compared to December 31, 1994 is due to all of the Partnership's
investments in U.S. Government obligations having matured as of December
31, 1995 in preparation for the final liquidating distribution to the
General and Limited Partners as described above (Note 1).
The decreases in interest, rents and other receivables, escrow
deposits, accrued real estate taxes, investment properties, deferred
expenses, accrued rents receivable, accounts payable, accrued interest,
tenant security deposits, note payable, other liabilities, current and
long-term portion of long-term debt, and venture partners' subordinated
equity in ventures at December 29, 1995 as compared to December 31, 1994
are primarily due to the Partnership disposing of the Town and Country
investment property on December 5, 1995 (Note 6(c)). The decreases are
also due to the Partnership's recording a $30,114,810 provision for value
impairment to reduce the net carrying value of the Town & Country Center
(Note 3(d)) and the Partnership's sale of the Carillon Shopping Village in
May 1995 (Note 6(b)).
The decrease in venture partners' deficit in venture at December 29,
1995 as compared to December 31, 1994 is due to the Partnership's sale of
the Carillon Shopping Village in May 1995 (Note 6(b)).
The decreases in rental income, depreciation, property operating
expenses, amortization of deferred expenses and the gain on sale or
disposition of interest in investment property for 1995 as compared to 1994
is primarily due to the Partnership's sale of the Carillon Shopping Village
in May 1995 and the disposition of the Town and Country Center in December
1995 (Note 6). The decreases in rental income, mortgage and other
interest, depreciation, and property operating expenses and the increase in
venture partner's share of venture's operations for 1994 as compared to
1993 are due primarily to the sale of the Partnership's interest in the
Georgia Square venture in October, 1993. Reference is made to Notes 3(c)
and 6(a).
The increase in interest income for 1995 as compared to 1994 is
primarily due to the investment of Carillon sale proceeds received in May
1995 and the increase in the rate of interest earned in 1995 on U.S.
Government obligations. The increase in interest income for 1994 as
compared to 1993 is due primarily to the increase in the Partnership's
average balance in U.S. Government obligations in 1994 due to the temporary
investment of Georgia Square sale proceeds and the increase in the rate of
interest earned on U.S. Government obligations.
The increase in amortization of deferred expenses in 1994 as compared
to 1993 is due primarily to the amortization of deferred lease commissions
resulting from capitalization of leasing expenses in 1993 at the Town &
Country Center.
The increase in provision for value impairment for 1994 as compared to
1993 is caused by the Partnership recording a $335,561 provision at
September 30, 1994 to reduce the net carrying value of Carillon Shopping
Village to the estimated net realizable value of the property. Reference
is made to Note 1.
The increase in general and administrative expenses for 1995 as
compared to 1994 is primarily attributable to an increase in and the
recognition of certain additional prior year reimbursable costs in 1995 and
an increase in certain reimbursable costs, each payable to affiliates of
the General Partners, due to the winding up and dissolution of the
Partnership.
<PAGE>
The changes in venture partners' share of ventures' operations and
provision for value impairment for 1995 as compared to 1994 are primarily
due to the Partnership recording a $30,114,810 provision for value
impairment (of which the venture partners' shares total $24,608,877) to
reduce the net carrying value of the Town & Country Center (Note 1). The
change in venture partners' share of ventures' operations is also due to
the Partnership's sale of the Carillon Shopping Village in May, 1995 and
the disposition of the Town and Country Center in December, 1995 (Note 6).
The decrease in Partnership's share of operations of unconsolidated
venture for 1994 as compared to 1993 is due primarily to the Partnership's
share of certain sale prorations recognized in 1993 related to Clackamas
Town Center which was sold in January, 1992.
The increase in venture partners' share of ventures' operations for
1994 as compared to 1993 is due primarily to the sale of the Partnership's
interest in the Georgia Square venture in October, 1993. Reference is made
to Notes 3(c) and 6(a).
The $11,903,432 Partnership's share of gain on sale of investment
properties in 1993 is the result of sale of the Partnership's interest in
the Georgia Square venture in October, 1993 (see Notes 3(c) and 6(a)).
INFLATION
Due to the decrease in the level of inflation in recent years,
inflation generally has not had a material effect on rental income or
property operating expenses.
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
JMB INCOME PROPERTIES, LTD.-VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
INDEX
Independent Auditors' Report
Consolidated Balance Sheets, at December 29, 1995
(Immediately prior to final liquidating distribution) and
December 31, 1994
Consolidated Statements of Operations, period ended December 29,
1995 (Immediately prior to final liquidating distribution)
and years ended December 31, 1994 and 1993
Consolidated Statements of Partners' Capital Accounts (Deficits),
period ended December 29, 1995 (Immediately prior to final
liquidating distribution) and years ended December 31, 1994
and 1993
Consolidated Statements of Cash Flows, period ended December 29,
1995 (Immediately prior to final liquidating distribution)
and years ended December 31, 1994 and 1993
Notes to Consolidated Financial Statements
SCHEDULES NOT FILED:
All schedules other than those indicated in the index have been
omitted as the required information is inapplicable or the information is
presented in the consolidated financial statements or related notes.
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Partners
JMB INCOME PROPERTIES, LTD. - VIII:
We have audited the consolidated financial statements of JMB Income
Properties, Ltd. - VIII (a limited partnership) and consolidated ventures
as listed in the accompanying index. These consolidated financial
statements are the responsibility of the General Partners of the
Partnership. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.
We conducted our audits 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 statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. 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 audits
provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial position of
JMB Income Properties, Ltd. - VIII and consolidated ventures as of December
29, 1995 (Immediately prior to final liquidating distribution) and December
31, 1994, and the results of their operations and their cash flows for the
period ended December 29, 1995 (Immediately prior to final liquidating
distribution) and for each of the years in the two-year period ended
December 31, 1994, in conformity with generally accepted accounting
principles.
KPMG PEAT MARWICK LLP
Chicago, Illinois
January 22, 1996
<PAGE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED BALANCE SHEETS
DECEMBER 29, 1995 (IMMEDIATELY PRIOR TO FINAL LIQUIDATING DISTRIBUTION)
AND DECEMBER 31, 1994
ASSETS
------
<CAPTION>
1995 1994
------------ -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents (note 1) . . . . . . . . . . . . $19,240,703 10,989,920
Short-term investments (note 1). . . . . . . . . . . . . . -- 2,203,001
Interest, rents and other receivables,
net of allowance for doubtful accounts of
$337,680 in 1994 . . . . . . . . . . . . . . . . . . . . -- 1,316,206
Notes receivable . . . . . . . . . . . . . . . . . . . . . -- 16,427
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . -- 65,941
Escrow deposits. . . . . . . . . . . . . . . . . . . . . . -- 1,024,845
------------ -----------
Total current assets . . . . . . . . . . . . . . . . . 19,240,703 15,616,340
------------ -----------
Investment properties, at cost (notes 2 and 3):
Land. . . . . . . . . . . . . . . . . . . . . . . . . . . -- 11,015,330
Buildings and improvements . . . . . . . . . . . . . . . . -- 94,475,512
------------ -----------
-- 105,490,842
Less accumulated depreciation. . . . . . . . . . . . . . -- 41,561,458
------------ -----------
Total investment properties,
net of accumulated depreciation. . . . . . . . . -- 63,929,384
Venture partners' deficit in venture (note 3). . . . . . . . -- 1,781,162
Investment in unconsolidated venture, at equity
(note 3) . . . . . . . . . . . . . . . . . . . . . . . . . -- 96,905
Deferred expenses (note 1) . . . . . . . . . . . . . . . . . -- 488,332
Accrued rents receivable (note 1). . . . . . . . . . . . . . -- 1,337,595
------------ -----------
$ 19,240,703 83,249,718
============ ===========
<PAGE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED BALANCE SHEETS - CONTINUED
LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
-----------------------------------------------------
1995 1994
------------ -----------
Current liabilities:
Current portion of long-term debt (note 4) . . . . . . . . $ -- 1,514,593
Accounts payable . . . . . . . . . . . . . . . . . . . . . -- 488,574
Accrued interest . . . . . . . . . . . . . . . . . . . . . -- 842,410
Accrued real estate taxes. . . . . . . . . . . . . . . . . -- 1,302,118
------------ -----------
Total current liabilities. . . . . . . . . . . . . . . -- 4,147,695
Tenant security deposits . . . . . . . . . . . . . . . . . . -- 59,061
Note Payable (note 3(b)) . . . . . . . . . . . . . . . . . . -- 544,500
Other liabilities (note 3) . . . . . . . . . . . . . . . . . -- 1,041,764
Long-term debt, less current portion (note 4). . . . . . . . -- 29,651,372
------------ -----------
Total liabilities. . . . . . . . . . . . . . . . . . . -- 35,444,392
Venture partners' subordinated equity in
ventures (note 3). . . . . . . . . . . . . . . . . . . . . -- 23,337,553
Partners' capital accounts (deficits) (note 5):
General partners:
Capital contributions. . . . . . . . . . . . . . . . . . 1,000 1,000
Cumulative net earnings (loss) . . . . . . . . . . . . . 2,850,607 (3,621,627)
Cumulative cash distributions. . . . . . . . . . . . . . (2,827,305) (2,827,305)
------------ -----------
24,302 (6,447,932)
------------ -----------
Limited partners (80,005 interests):
Capital contributions, net of offering costs . . . . . . 72,119,75772,119,757
Cumulative net earnings. . . . . . . . . . . . . . . . . 23,281,876 34,981,180
Cumulative cash distributions. . . . . . . . . . . . . . (76,185,232) (76,185,232)
------------ -----------
19,216,401 30,915,705
------------ -----------
Total partners' capital accounts . . . . . . . . . 19,240,703 24,467,773
------------ -----------
$ 19,240,703 83,249,718
============ ===========
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF OPERATIONS
PERIOD ENDED DECEMBER 29, 1995 (IMMEDIATELY PRIOR TO FINAL LIQUIDATING DISTRIBUTION)
YEARS ENDED DECEMBER 31, 1994 AND 1993
<CAPTION>
1995 1994 1993
------------ ------------ ------------
<S> <C> <C> <C>
Income:
Rental income. . . . . . . . . . . . . . . $ 5,904,440 8,544,630 15,757,538
Interest income. . . . . . . . . . . . . . 1,149,861 589,921 299,130
----------- ----------- -----------
7,054,301 9,134,551 16,056,668
----------- ----------- -----------
Expenses:
Mortgage and other interest. . . . . . . . 3,383,887 3,535,468 5,348,321
Depreciation . . . . . . . . . . . . . . . 2,650,947 3,120,831 3,951,647
Property operating expenses. . . . . . . . 4,130,321 4,881,773 7,607,404
Professional services. . . . . . . . . . . 163,650 129,929 149,726
Amortization of deferred expenses. . . . . 79,056 182,564 191,258
General and administrative . . . . . . . . 442,169 141,719 143,998
Provision for value impairment (note 1). . 30,114,810 335,561 --
----------- ----------- -----------
40,964,840 12,327,845 17,392,354
----------- ----------- -----------
Operating earnings (loss) . . . . . . . (33,910,539) (3,193,294) (1,335,686)
Partnership's share of operations of
unconsolidated venture. . . . . . . . . . . -- (107) (13,373)
Venture partners' share of ventures'
operations (note 3) . . . . . . . . . . . . 26,602,923 1,786,041 779,017
----------- ----------- -----------
Net operating earnings (loss) . . . . . (7,307,616) (1,407,360) (570,042)
----------- ----------- -----------
Gain on sale or disposition of interest
in investment properties, net of
venture partners' share (notes 3 and 6) . . 2,080,546 -- 11,903,432
----------- ----------- -----------
Net earnings (loss) . . . . . . . . . . $(5,227,070) (1,407,360) 11,333,390
=========== =========== ===========
<PAGE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF OPERATIONS - CONTINUED
1995 1994 1993
------------ ------------ ------------
Net earnings (loss) per limited partnership
interest (note 1):
Net operating earnings (loss) . . . . $ (171.98) (16.89) (6.84)
Gain (loss) on sale or disposition of
interest in investment
properties, net of venture partners'
share. . . . . . . . . . . . . . . . 25.75 -- 147.30
----------- ----------- -----------
Net earnings (loss). . . . . . $ (146.23) (16.89) 140.46
=========== =========== ===========
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
PERIOD ENDED DECEMBER 29, 1995 (IMMEDIATELY PRIOR TO FINAL LIQUIDATING DISTRIBUTION)
AND YEARS ENDED DECEMBER 31, 1994 AND 1993
<CAPTION>
GENERAL PARTNERS LIMITED PARTNERS (80,005 INTERESTS)
-------------------------------------------------- ---------------------------------------------------
CONTRI-
BUTIONS
NET NET OF NET
CONTRI- EARNINGS CASH OFFERING EARNINGS CASH
BUTIONS (LOSS) DISTRIBUTIONS TOTAL COSTS (LOSS) DISTRIBUTIONS TOTAL
------- ----------------------- ---------------------- ----------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance
(deficit)
at Decem-
ber 31,
1992. . . .1,000 (3,661,566) (2,800,637) (6,461,203)72,119,757 25,095,089(66,344,618)30,870,228
Cash distri-
butions
($8.00 per
limited
partnership
interest) . -- -- (26,668) (26,668) -- -- (640,040) (640,040)
Net earnings
(note 5). . -- 96,233 -- 96,233 -- 11,237,157 -- 11,237,157
----- ---------- ---------- ---------- ---------- --------------------- ----------
Balance
(deficit)
at Decem-
ber 31,
1993. . . .1,000 (3,565,333) (2,827,305) (6,391,638)72,119,757 36,332,246(66,984,658)41,467,345
Cash distri-
butions
($115.00
per limited
partnership
interest) . -- -- -- -- -- -- (9,200,574)(9,200,574)
Net loss
(note 5). . -- (56,294) -- (56,294) -- (1,351,066) -- (1,351,066)
----- ---------- ---------- ---------- ---------- --------------------- ----------
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS (DEFICITS) - CONTINUED
GENERAL PARTNERS LIMITED PARTNERS (80,005 INTERESTS)
-------------------------------------------------- ---------------------------------------------------
CONTRI-
BUTIONS
NET NET OF NET
CONTRI- EARNINGS CASH OFFERING EARNINGS CASH
BUTIONS (LOSS) DISTRIBUTIONS TOTAL COSTS (LOSS) DISTRIBUTIONS TOTAL
------- ----------------------- ---------------------- ----------------------------------
Balance
(deficit)
at Decem-
ber 31,
1994. . . .1,000 (3,621,627) (2,827,305) (6,447,932)72,119,757 34,981,180(76,185,232)30,915,705
Cash distri-
butions
per limited
partnership
interest. . -- -- -- -- -- -- -- --
Net earnings
(loss)
(note 5). . -- 6,472,234 -- 6,472,234 -- (11,699,304) -- (11,699,304)
------ ---------- ---------- ---------- ---------- --------------------- ----------
Balance
(deficit)
at Decem-
ber 29,
1995 (Im-
mediately
prior to
final
liquidat-
ing distri-
bution) . .$1,000 2,850,607 (2,827,305) 24,302 72,119,757 23,281,876(76,185,232)19,216,401
====== ========== ========== ========== ========== ===================== ==========
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF CASH FLOWS
PERIOD ENDED DECEMBER 29, 1995 (IMMEDIATELY PRIOR TO FINAL LIQUIDATING DISTRIBUTION)
AND YEARS ENDED DECEMBER 31, 1994 AND 1993
<CAPTION>
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
Cash flows from operating activities:
Net earnings (loss). . . . . . . . . . . . $(5,227,070) (1,407,360) 11,333,390
Items not requiring (providing) cash
or cash equivalents:
Depreciation . . . . . . . . . . . . . . 2,650,947 3,120,831 3,951,647
Amortization of deferred expenses. . . . 79,056 182,564 191,258
Amortization of discounts on long-term debt -- -- 447,298
Partnership's share of operations
of unconsolidated venture. . . . . . . -- 107 13,373
Gain on sale or disposition of interest
in investment properties, net of
venture partners' share (note 6) . . . (2,080,546) -- (11,903,432)
Venture partners' share of ventures'
operations . . . . . . . . . . . . . . (26,602,923) (1,786,041) (779,017)
Provision for value impairment . . . . . 30,114,810 335,561 --
Changes in:
Interest, rents and other receivables. . 1,316,206 153,498 95,955
Prepaid expenses . . . . . . . . . . . . 16,719 32,471 35,345
Escrow deposits. . . . . . . . . . . . . 308,797 45,891 (108,624)
Accrued rents receivable . . . . . . . . 162,256 (220,413) (326,446)
Accounts payable . . . . . . . . . . . . (483,028) (122,839) 74,883
Accrued interest . . . . . . . . . . . . 317,457 111,740 (55,918)
Accrued real estate taxes. . . . . . . . (310,043) 122,942 (22,910)
Tenant security deposits . . . . . . . . (525) 2,650 (1,899)
Other liabilities. . . . . . . . . . . . (371,756) 27,883 --
----------- ----------- -----------
Net cash provided by (used in)
operating activities . . . . . . (109,643) 599,485 2,944,903
----------- ----------- -----------
<PAGE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
1995 1994 1993
----------- ----------- -----------
Cash flows from investing activities:
Net sales and maturities (purchases)
of short-term investments. . . . . . . . 2,203,001 19,848,639 (17,423,533)
Additions to investment properties . . . . (211,042) (641,812) (905,392)
Payment of deferred expenses . . . . . . . (10,583) (19,344) (237,531)
Proceeds from sale of interest in
investment properties, net of selling
expenses (note 6). . . . . . . . . . . . 6,973,269 -- 16,625,690
Distributions from unconsolidated venture. 38,759 -- 31,030
----------- ----------- -----------
Net cash provided by (used in)
investing activities . . . . . . 8,993,404 19,187,483 (1,909,736)
----------- ----------- -----------
Cash flows from financing activities:
Principal payments on long-term debt . . . (342,131) (468,090) (669,855)
Payments of notes payable. . . . . . . . . (544,500) -- --
Venture partners' contributions to ventures 262,762 542,811 424,575
Distributions to venture partners. . . . . (9,109) -- (858,654)
Distributions to limited partners. . . . . -- (9,200,574) (640,040)
Distributions to general partners. . . . . -- -- (26,668)
----------- ----------- -----------
Net cash used in financing activities $ (632,978) (9,125,853) (1,770,642)
=========== =========== ===========
Net increase (decrease) in cash and
cash equivalents . . . . . . . . $ 8,250,783 10,661,115 (735,475)
Cash and cash equivalents,
beginning of year. . . . . . . . 10,989,920 328,805 1,064,280
----------- ----------- -----------
Cash and cash equivalents,
end of year. . . . . . . . . . . $19,240,703 10,989,920 328,805
=========== =========== ===========
<PAGE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
1995 1994 1993
----------- ----------- -----------
Supplemental disclosure of cash
flow information:
Cash paid for mortgage and other
interest. . . . . . . . . . . . . . . . . $ 3,066,430 3,423,728 4,956,491
=========== =========== ===========
Non-cash investing and financing activities:
Disposition of investment property
(note 6(c)):
Balance due on long-term debt cancelled. 29,832,145 -- --
Accrued interest due on debt . . . . . . 573,330 -- --
Reduction of investment properties . . . (26,748,688) -- --
Reduction of current assets and liabilities (1,067,455) -- --
Venture partner's deficit in venture . . (758,244) -- --
----------- ----------- -----------
Non-cash gain recognized due to lender realizing
upon security . . . . . . . . . . . . . 1,831,088 -- --
=========== =========== ===========
Purchase of venture partners' interest
(note 3(b)):
Reduction in basis of investment property $ -- 287,144 --
Note payable . . . . . . . . . . . . . . -- 544,500 --
----------- ----------- -----------
Increase in venture partners'
deficit in venture . . . . . . . . . . $ -- 831,644 --
=========== =========== ===========
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
JMB INCOME PROPERTIES, LTD. - VIII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 29, 1995 (IMMEDIATELY PRIOR TO FINAL LIQUIDATING DISTRIBUTION)
AND DECEMBER 31, 1994 AND 1993
(1) OPERATIONS AND BASIS OF ACCOUNTING
The Partnership held (either directly or through joint ventures) an
equity investment portfolio of United States real estate. Business
activities consisted of rentals to a wide variety of commercial and retail
companies, and the ultimate sale or disposition of such real estate
investors or investment groups. The accompanying consolidated financial
statements include the accounts of the Partnership and its ventures,
Carillon Partners, Ltd. ("Carillon") and Carillon's venture, Carillon
Associates, Ltd. ("Associates"), Georgia Square Partnership ("Georgia
Square") (notes 3(c) and 6(b)) and T&C - JMB Partners ("T&C") and T&C's
venture, H & M Associates Ltd. - Houston ("Town and Country") (note 3(e)).
The effect of all transactions between the Partnership and the consolidated
ventures has been eliminated in the consolidated financial statements. The
equity method of accounting has been applied in the accompanying
consolidated financial statements with respect to the Partnership's
interest in Properties Partners. Accordingly, the accompanying
consolidated financial statements do not include the accounts of Properties
Partners.
The Partnership records were maintained on the accrual basis of
accounting as adjusted for Federal income tax reporting purposes. The
accompanying consolidated financial statements have been prepared from such
records after making appropriate adjustments to present the Partnership's
accounts in accordance with generally accepted accounting principles
("GAAP") and to consolidate the accounts of the ventures as described
above. Such GAAP and consolidation adjustments are not recorded on the
records of the Partnership. The net effect of these items for the period
ended December 29, 1995 (immediately prior to final liquidating
distribution) and the year ended December 31, 1994 is summarized as
follows:
<PAGE>
<TABLE>
<CAPTION>
1995 1994
-------------------------------------------------------------
TAX BASIS
GAAP BASIS (Unaudited) GAAP BASIS TAX BASIS
------------ ----------- ------------ -----------
<S> <C> <C> <C> <C>
Total assets . . . . . . . . . $19,240,703 19,240,703 83,249,718 45,526,862
Partners' capital
accounts (deficits)
(note 5)
General partners . . . . . 24,302 24,302 (6,447,932) (6,769,241)
Limited partners . . . . . 19,216,401 19,216,401 30,915,705 27,570,838
Net earnings (loss) (note 5):
General partners . . . . . 6,472,234 6,793,547 (56,294) (68,922)
Limited partners . . . . . (11,699,304) (8,354,441) (1,351,066) (1,654,133)
Net earnings (loss) per
limited partnership
interest . . . . . . . . . . (146.23) (104.42) (16.89) (20.68)
========== ========== ========== ==========
</TABLE>
<PAGE>
The net earnings (loss) per limited partnership interest is based upon
the number of limited partnership interests outstanding at the end of each
period (80,005). Also, because net earnings are computed immediately prior
to dissolution, partners may have on dissolution, an additional capital
gain or loss depending on the Partners' basis for Federal income tax
purposes.
The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Statement of Financial Accounting Standards No. 95 requires the
Partnership to present a statement which classifies receipts and payments
according to whether they stem from operating, investing or financing
activities. The required information has been segregated and accumulated
according to the classifications specified in the pronouncement.
Partnership distributions from its unconsolidated venture were considered
cash flow from operating activities only to the extent of the Partnership's
cumulative share of net earnings. The Partnership recorded amounts held in
U.S. Government obligations at cost, which approximated market. For the
purposes of these statements, the Partnership's policy was to consider all
such amounts held with original maturities of three months or less (none at
December 29, and $10,918,719 at December 31, 1994) as cash equivalents with
any remaining amounts (generally with original maturities of one year or
less) reflected as short-term investments being held to maturity.
Due to the uncertainty of the Partnership's ability to recover the
full net carrying value of the Carillon Shopping Village through future
operations or sale, the Partnership, as a matter of prudent accounting
practice, made a provision for value impairment on such investment property
of $335,561. Such provision at September 30, 1994 was recorded to reduce
the net carrying value of the investment property to the estimated net
realizable value of the property. In addition, as the non-recourse
indebtedness secured by the Town & Country Center was in default as more
fully described in note 3(d), the Partnership made, as a matter of prudent
accounting practice, a provision at September 30, 1995 for value impairment
of the Town & Country Center of $30,114,810 (of which the Partnership's
share was $5,505,933) as it was estimated to be unlikely that the
Partnership would be able to recover the net carrying value of the property
through future operations or sale.
Discounts provided on long-term mortgage notes were amortized over the
terms of the related notes using the interest method.
Deferred expenses consisted primarily of lease commissions which were
amortized over the terms of related leases using the straight-line method.
Although certain leases of the Partnership provided for tenant
occupancy during periods for which no rent was due and/or increases in
minimum lease payments over the term of the lease, the Partnership accrued
prorated rental income for the full period of occupancy on a straight-line
basis.
No provision for State or Federal income taxes had been made as the
liability for such taxes is that of the partners rather than the
Partnership. However, in certain instances, the Partnership had been
required under applicable law to remit directly to the tax authorities
amounts representing withholding from distributions paid to partners.
<PAGE>
(2) INVESTMENT PROPERTIES
The Partnership had acquired, either directly or through joint
ventures (note 3), one office building and six shopping centers as
investments. All the properties have been sold or disposed by the
Partnership at December 29, 1995. The cost of the investment properties
represented the total cost to the Partnership and its ventures plus
miscellaneous acquisitions costs.
Depreciation on the properties had been provided over the estimated
useful lives of the various components as follows:
YEARS
-----
Buildings and improvements
(new or used) -- straight-line . . . . 5-40
Personal property (new or used)
-- straight-line . . . . . . . . . . . 5-10
====
Town & Country Center was pledged as security for the long-term debt,
for which there was no recourse to the Partnership.
Maintenance and repair expenses were charged to operations as
incurred. Significant betterments and improvements were capitalized and
depreciated over their estimated useful lives. Provisions for value
impairment were recorded with respect to the investment properties whenever
the estimated future cash flows from a property's operations and projected
sale were less than the property's net carrying value.
(3) VENTURE AGREEMENTS
The terms of the former venture agreements are summarized as follows:
(a) General
The Partnership was a party to two operating joint venture agreements
during 1995. Pursuant to such agreements, the Partnership made initial
capital contributions of approximately $30,739,000 (before legal and other
acquisition costs and its share of operating deficits as discussed below).
Under certain circumstances, either pursuant to the venture agreements or
due to the Partnership's obligations as a general partner, the Partnership
may have been required to make additional cash contributions to the
ventures.
The Partnership had acquired, through the above ventures, two shopping
malls. The venture properties had been financed under various long-term
debt arrangements as described in note 4.
(b) Carillon
On May 18, 1995, the Partnership sold the Carillon Shopping Village.
Reference is made to note 6(b).
In September, 1980, the Partnership acquired an interest in Carillon
Shopping Village in Houston, Texas through the Associates venture between
Carillon as general partner and an affiliate of the seller as limited
partner. Carillon was a limited partnership consisting of the Partnership
as general partner and a third party, which is not affiliated with the
seller, the Partnership or its General Partners, as limited partner. On
March 28, 1994, the Partnership and the Managing General Partner of the
Partnership purchased the third party's 10% limited partnership interest in
Carillon. The purchase price consisted of non-interest bearing promissory
notes in the amounts of $544,500 from the Partnership and $5,500 from the
Managing General Partner. The notes were scheduled to be due the earlier
of the sale date of the property or January 31, 1996. Also, if a binding
<PAGE>
sale agreement was consummated before January 31, 1996, the third party was
entitled to 10% of any net sale proceeds in excess of $5,500,000. As a
result of this transaction, the Partnership and Managing General Partner
had 99.9% and .1% interest in Carillon, respectively. The portion of the
third party's capital balance, in Carillon, purchased by the Partnership
exceeded the Partnership's promissory note by $287,144 for financial
reporting purposes. This difference had been accounted for as a reduction
to the basis of the investment property. Correspondingly, venture
partners' deficit in venture, in the accompanying financial statements, had
been increased by $831,644.
The Associates' partnership agreement provided that Carillon would be
entitled to receive, on a cumulative basis, distributions of annual cash
flow equal to 9% of outstanding capital contributions; any remaining annual
cash flow would be distributable 60% to Carillon and 40% to the affiliate
of the seller. All operating profits or losses have been allocated 100% to
Carillon.
Net proceeds from the sale under the Associates partnership agreement
were distributed entirely to Carillon as Carillon was to receive: first,
any deficiencies in its cumulative annual preferred return; then, an amount
of proceeds up to the sum of $3,972,500 plus 118% of the additional
contributions.
Prior to the purchase of the third party's interest, in March, 1994,
the Carillon partnership agreement provided that annual cash flow would be
distributable, on a cumulative basis, first, in an amount equal to 8.33% of
outstanding capital contributions, 90% to the Partnership and 10% to the
third party; the third party would then receive an amount which (when added
to any 10% distributions it previously received) equals 12-1/2% of the
total annual cash flow distributed; and any remaining annual cash flow
would be distributed 80% to the Partnership and 20% to the third party.
Operating profits or losses of Carillon were allocated to each partner in
the same ratio as the allocation of annual cash flow. In the event there
was no annual cash flow, operating profits or losses were allocated 90% to
the Partnership and 10% to the third party. In 1993 and to the date of the
Partnership's and the Managing General Partner's purchase of the third
party's 10% limited partnership interest, the Partnership was allocated 90%
of Carillon's operating profits and losses.
(c) Georgia Square
Effective October, 1993, the Partnership sold its partnership
interest in the Georgia Square venture (see note 6(a)).
In February, 1981, the Partnership acquired, through a joint venture
partnership with the seller, an interest in an enclosed mall regional
shopping center and two adjacent stores in Athens, Georgia. Under the
joint venture partnership agreement, the Partnership made a contribution of
$12,700,000 to the joint venture.
Pursuant to an agreement with the joint venture partner, effective
January 1, 1991, the annual cash flow was to be distributed as follows:
the first $1,600,000 before tenant allowances was distributed 62.5% to the
Partnership and 37.5% to the venture partner, then the tenant allowances
and any remaining cash flow was distributed 50% to the Partnership and 50%
to the venture partner. In general, profits and losses of the Partnership
were allocated in accordance with distributions.
An affiliate of the venture partner entered into an agreement to
manage the mall which agreement provided that the manager was entitled to
receive an annual management fee equal to 5% of certain rental income from
the mall.
<PAGE>
(d) Town and Country
On December 5, 1995, the lender realized upon its security for its
non-recourse loan, which included the land, buildings and related
improvements of the Town and Country Center as described below and in note
6(c).
In February, 1983, the Partnership acquired, through an existing joint
venture partnership with an investor and the developer of Town & Country,
an interest in an enclosed shopping center in Houston, Texas. The
Partnership acquired its interest through a joint venture partnership
("T&C") with JMB Income Properties, Ltd-IX ("JMB-IX"), a partnership
sponsored by the Managing General Partner of the Partnership.
The Partnership acquired an interest in T&C for a purchase price of
$24,000,000 of a total of $35,000,000 invested in T&C by the Partnership
and JMB-IX. On December 30, 1992, the T&C venture and the developer each
purchased 50% of the investor's interest in Town & Country for $150,000
each. The property was subject to a first mortgage note in the original
amount of $33,390,000 (see note 4).
The terms of the T&C partnership agreement provided that all of T&C's
share of Town & Country's annual cash flow, net proceeds from sale or
refinancing, profits and losses and tax items are allocated between the
Partnership and JMB-IX based upon the ratio of capital contributions made
by each partner (68.57% by the Partnership and 31.43% by JMB-IX). The T&C
partnership was allocated 73.07% of Town & Country's operating profits and
losses.
Town & Country's net cash flow was distributable as follows: first,
T&C was entitled to receive the cumulative deficiency in its preferred cash
return through 1992; next, the developer was entitled to receive a
cumulative amount equal to its unreimbursed capital contributions used to
fund operating deficits incurred with respect to the property and T&C's
preferential return in prior years; finally, any cash flow in excess of
these preferred amounts was to be distributable 73.07% to T&C and 26.93% to
the developer. The Partnership did not receive any distributions from T&C
in 1995, 1994 or 1993. Any operating deficits were funded by contributions
to the venture by the venture partners in the ratio of their respective
residual ownership percentages.
Upon a sale of the shopping center, T&C was entitled to a preferential
share of the net sale proceeds plus any deficit in T&C's cumulative annual
preferred return. However, there were no distributable proceeds from the
disposition of the property.
Town & Country was also obligated under a 12% promissory note payable
($991,689 outstanding as of December 31, 1994 and 1993) to an affiliate of
the developer which matured June 30, 1993. The Partnership and JMB-IX had
reached an agreement in principle with the developer to extend the original
due date of the promissory note. Although no interest payments were
currently being made, the venture continued to accrue interest on the note
at the original contract rate. As of the date of disposition of the
property, such promissory note was cancelled and the note (including
accrued interest) is treated as a capital contribution by the unaffiliated
venture partner.
Through December 5, 1995 (immediately prior to the disposition), the
Partnership and its affiliated joint venture partner had made interest-
bearing loans aggregating $4,740,437 to the T&C venture to fund operating
deficits at the property pursuant to a proposed amendment to the Town &
Country joint venture agreement. However, such proposed amendment was not
executed prior to termination. The Partnership's portion of these loans
was $3,250,517 (including accrued interest and has been reflected as
contributions to consolidated venture in the consolidated financial
statements and have been netted into the gain on disposition as of December
5, 1995.
<PAGE>
Pursuant to the terms of the joint venture agreement, the Partnership
and its joint venture partners made advances aggregating $1,013,880. The
Partnership's portion of the advance was $347,609 and has been reflected as
contributions to the consolidated venture in the consolidated financial
statements and has been netted into the gain on disposition as of December
5, 1995 (immediately prior to dissolution).
An affiliate of the Managing General Partner of the Partnership had
responsibility for management and leasing of the Town & Country Center
under a management agreement which provided for a management fee based on a
percentage of gross income (as defined) from the property's operations not
to exceed 5% in aggregate.
(4) LONG-TERM DEBT
Long-term debt consisted of the following at December 29, 1995 and
1994:
1995 1994
----------- -----------
11-1/8% mortgage note, satisfied
in December, 1995 by the lender
obtaining title to the colla-
teral (a shopping center in
Houston, Texas); additional
interest paid (approximately
$35,232 and $30,810 for 1994
and 1993, respectively) equal
to 25% of certain rents in
excess of a specific level
(note 6(c)) . . . . . . . . . $ -- 30,174,276
12% promissory note payable to
an affiliate of Town and Country
developer; providing for monthly
payments of interest only until
June 30, 1993 when the outstanding
balance was due and payable
(see note 3(d)) . . . . . . . -- 991,689
----------- ----------
Total debt . . . . . . . . -- 31,165,965
Less current portion of
long-term debt . . . . . -- 1,514,593
----------- -----------
Total long-term debt . . . $ -- 29,651,372
=========== ===========
(5) PARTNERSHIP AGREEMENT
Pursuant to the terms of the Partnership Agreement, net profits or
losses of the Partnership from operations were allocated 96% to the Limited
Partners and 4% to the General Partners. Profits from the sale or
refinancing of investment properties were to be allocated to the General
Partners to the greater of 1% of such profits or the amount of cash
distributable to the General Partners from any such sale or refinancing (as
described below). Losses from the sale or refinancing of investment
properties were to be allocated 1% to the General Partners. The remaining
sale or refinancing profits and losses were to be allocated to the Limited
Partners. During 1995, a reallocation of prior years operating losses was
made among the partners for financial reporting purposes. Such
reallocation did not have an effect on total assets, total partners'
capital or net earnings.
<PAGE>
The Partnership Agreement generally provided that, notwithstanding any
allocation contained in the Agreement, if at any time profits were realized
by the Partnership, any current or anticipated event that would cause the
deficit balance in absolute amount in the Capital Account of the General
Partners to be greater than their share of the Partnership's indebtedness
(as defined) after such event, then the allocation of profits to the
General Partners was to be increased to the extent necessary to cause the
deficit balance in the Capital Account of the General Partners to be no
less than their respective shares of the Partnership's indebtedness after
such event. In general, the effect of this provision was to allow the
deferral of the recognition of taxable gain to the Limited Partners.
The General Partners were not required to make any capital contribu-
tions upon termination of the Partnership. Distributions of cash flow of
the Partnership were allocated 90% to the Limited Partners and 10% to the
General Partners. However, portions of such distributions to the General
Partners were subordinated to the Limited Partners' receipt of a stipulated
return on their contributed capital.
The Partnership Agreement provided that the General Partners were to
receive as a distribution from the sale of a real property by the
Partnership 3% of the selling price, and that the remaining proceeds (net
after expenses and retained working capital) be distributed 85% to the
Limited Partners and 15% to the General Partners. However, the Limited
Partners were to receive 100% of such net sale proceeds until the Limited
Partners (i) had received cash distributions of sale or refinancing
proceeds in an amount equal to the Limited Partners' aggregate initial
capital investment in the Partnership and (ii) had received cumulative cash
distributions from the Partnership's operations which, when combined with
sale or refinancing proceeds previously distributed, equal a 6% annual
return on the Limited Partners' average capital investment for each year
(their initial capital investment as reduced by sale or refinancing
proceeds previously distributed) commencing with the third fiscal quarter
of 1981. Approximately $3,086,000 otherwise payable to the General
Partners was previously distributed to the Limited Partners since 1981
pursuant to the preferential distribution levels described above.
Prior to dissolution, the Partnership paid final liquidating
distributions of $24,302 to the General Partners and $19,216,401 to the
Limited Partners.
(6) SALE OR DISPOSITION OF INVESTMENT PROPERTIES
(a) Georgia Square
On November 3, 1993, the Partnership sold its 50% interest in the
Georgia Square Partnership to the Partnership's unaffiliated joint venture
partner. The sale price of the Partnership's interest was $25,617,949, of
which $16,750,000 (before costs of sale and prorations) was received in
cash at closing. The balance of the sale price was represented by the
buyer's assumption of the Partnership's 50% share of the first mortgage
note ($8,867,949). The Partnership recognized a gain of $11,903,432 for
financial reporting purposes and a gain of $20,439,984 for Federal income
tax reporting purposes in 1993.
(b) Carillon Shopping Village
On May 18, 1995, the Partnership sold the Carillon Shopping Village to
an unaffiliated third party. The sale price was $7,400,000 (before selling
costs) and was paid in cash at closing. As a result of the sale, the
Partnership has recognized in 1995 a gain of $28,954 for financial
reporting purposes, net of the venture partners' share of $1,790,356, and a
gain of approximately $822,000 for Federal income tax purposes.
<PAGE>
Pursuant to the March 1994 purchase agreement with the former third
party limited partner of Carillon (note 3(b)), the non-interest bearing
promissory notes held by the former third party in the amounts of $544,500
and $5,500 from the Partnership and the Managing General Partner,
respectively, were paid as of the sale date. Additionally, based on net
sale proceeds of $6,973,269, the former third party limited partner of
Carillon received $145,854 and $1,473 from the Partnership and the Managing
General Partner, respectively.
(c) Town and Country Center
On December 5, 1995, the lender realized upon its security for its
non-recourse mortgage loan, which included the land, building and related
improvements of the Town and Country Center (the "Property"), in discharge
of the loan. The Property was approximately 76% occupied (including
temporary tenants) on the disposition date. The Property faced strong
competition in its area. Town and Country had prepared and evaluated a
plan for an extensive renovation and re-merchandising of the Property.
Given Town and Country's level of debt, the strong competition that the
Property faced and the significant cost that would have been required to
lease, renovate and re-merchandise the Property, Town and Country decided
in September 1995 not to commit any additional capital to pay continued
operating deficits of the Property, including funding for debt service
payments, without obtaining a modification to the existing non-recourse
mortgage loan. Consequently, Town and Country remitted to the lender only
the amount of cash flow from property operations after expenses rather than
the full debt service payment required for the month of September 1995.
The lender was unwilling to modify the loan and realized upon its security
as a result of the default in the payment of debt service.
As a result of the disposition of the Property to the lender and the
liquidation of the joint ventures mentioned above, the Partnership has
recognized a gain of approximately $1,831,000, net of the venture partners'
shares, for financial reporting purposes and a gain of approximately
$7,657,000, net of the venture partners' shares, for Federal income tax
reporting purposes. The Partnership had previously recorded a provision
for value impairment of approximately $30,115,000 (of which the
Partnership's share was $5,505,933) for financial reporting purposes
relating to the underlying real estate assets. There were no proceeds from
the disposition. Under the terms of the applicable venture agreements,
gain on disposition of the Property and liquidations of joint ventures was
to be allocated according to the respective ownership percentages of the
venture partners (note 3(d)).
(7) LEASES - AS PROPERTY LESSOR
The Partnership had determined that all leases relating to its owned
properties were properly classified as operating leases; therefore, rental
income was reported when earned and the cost of the properties, excluding
the cost of the land, was depreciated over the estimated useful lives.
Leases with tenants ranged in term from one to twenty years and provided
for fixed minimum rent and partial reimbursement of operating costs. In
addition, leases with shopping center tenants provided for additional rent
based upon percentages of tenants' sales volumes. With respect to the
Partnership's shopping center investments, a substantial portion of the
ability of retail tenants to honor their leases was dependent upon the
retail economic sector.
Contingent rent (based on sales by property tenants) included in
consolidated rental income was as follows for the period ended December 29,
1995 and the years ended December 31, 1994 and 1993:
1993 . . . . . . . . $398,373
1994 . . . . . . . . 203,975
1995 . . . . . . . . 56,970
========
<PAGE>
(8) TRANSACTIONS WITH AFFILIATES
The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Managing General Partner
and its affiliates including the reimbursement for salaries and salary
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investments. Fees, commissions and other
expenses required to be paid by the Partnership to the General Partners and
their affiliates for the period ended December 29, 1995 (immediately prior
to final liquidating distribution) and the years ended December 31, 1994
and 1993 are as follows:<PAGE>
<TABLE>
<CAPTION>
UNPAID AT
DECEMBER 31,
1995 1994 1993 1995
-------- -------- -------- --------------
<S> <C> <C> <C> <C>
Property management and
leasing fees . . . . . . . . . $ 237,589 218,143 274,210 --
Insurance commissions. . . . . . 18,898 25,126 41,612 --
Reimbursement (at cost) for
accounting services. . . . . . 65,574 54,864 46,905 --
Reimbursement (at cost) for
portfolio management
services . . . . . . . . . . . 21,508 28,734 10,273 --
Reimbursement (at cost) for
legal services . . . . . . . . 1,761 4,696 7,373 --
Reimbursement (at cost) for
administrative charges and
other out-of-pocket expenses . 45,478 3,230 11,303 --
-------- -------- -------- --------
$390,808 334,793 391,676 --
======== ======== ======== ========
<FN>
The above table reflects that during 1995, the Partnership recognized and paid certain 1994 administrative
charges of approximately $19,489 that had not previously been reimbursed.
</TABLE>
<PAGE>
On December 29, 1995, the Partnership paid final liquidating
distributions of $24,302 to the General Partners and $19,216,401
(approximately $240 per Interest) to the Limited Partners.
Pursuant to the Partnership Agreement, the amount of compensation paid
to affiliates of the General Partners for property management and leasing
services was subject to certain limitations and was paid in accordance with
such limitations.
Effective October 1, 1995, the Managing General Partner of the
Partnership engaged independent third parties to perform certain
administrative services for the Partnership which were previously performed
by, and partially reimbursed to, affiliates of the General Partners. Use
of such third parties did not have a material effect on the operations of
the Partnership.
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
There were no changes of or disagreements with auditors during 1994
and 1995.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP
The Managing General Partner of the Partnership was JMB Realty
Corporation ("JMB"), a Delaware corporation, substantially all of the
outstanding stock of which is owned directly or indirectly, by certain of
its officers and directors and members of their families. JMB had
responsibility for all aspects of the Partnership's operations, subject to
the requirement that sales of real property were to be approved by the
Associate General Partner of the Partnership, AGPP Associates, L.P., an
Illinois limited partnership with JMB as the sole general partner.
Effective December 31, 1995, AGPP Associates, L.P. acquired the general
partnership interest in the Partnership of the Associate General Partner,
Income Associates-VIII P.M., L.P. AGPP Associates, L.P., an Illinois
limited partnership, with JMB as its sole general partner, continues as the
Associate General Partner. The Associate General Partner was directed by a
majority in interest of its limited partners (who are generally officers,
directors and affiliates of JMB or its affiliates) as to whether to provide
its approval of any sale of real property (or any interest therein) of the
Partnership. The Partnership was subject to certain conflicts of interest
arising out of its relationships with the General Partners and their
affiliates as well as the fact that the General Partners and their
affiliates were engaged in a range of real estate activities. Certain
services have been provided to the Partnership or its investment properties
by affiliates of the General Partners, including property management
services and insurance brokerage services. In general, such services were
to be provided on terms no less favorable to the Partnership than could be
obtained from independent third parties and were otherwise subject to
conditions and restrictions contained in the Partnership Agreement. The
Partnership Agreement permitted the General Partners and their affiliates
to provide services to, and otherwise deal and do business with, persons
who were engaged in transactions with the Partnership, and permitted the
Partnership to borrow from, purchase goods and services from, and otherwise
to do business with, persons doing business with the General Partners or
their affiliates. The General Partners and their affiliates were in
competition with the Partnership including, in certain geographical
markets, for tenants for properties and/or for the sale of properties.
Because the timing and amount of cash distributions and profits and losses
of the Partnership were affected by various determinations by the General
Partners under the Partnership Agreement, including whether and when to
sell or refinance a property, the establishment and maintenance of
reasonable reserves, the timing of expenditures and the allocation of
certain tax items under the Partnership Agreement, the General Partners may
have had a conflict of interest with respect to such determinations.
The names, positions held and length of service therein of each
director and the executive and certain other officers of the Managing
General Partner are as follows:
<PAGE>
SERVED IN
NAME OFFICE OFFICE SINCE
- ---- ------ ------------
Judd D. Malkin Chairman 5/03/71
Director 5/03/71
Chief Financial Officer 2/22/96
Neil G. Bluhm President 5/03/71
Director 5/03/71
Burton E. Glazov Director 7/01/71
Stuart C. Nathan Executive Vice President 5/08/79
Director 3/14/73
A. Lee Sacks Director 5/09/88
John G. Schreiber Director 3/14/73
H. Rigel Barber Executive Vice President 1/02/87
Chief Executive Officer 8/01/93
Glenn E. Emig Executive Vice President 1/01/93
Chief Operating Officer 1/01/95
Gary Nickele Executive Vice President 1/01/92
General Counsel 2/27/84
Gailen J. Hull Senior Vice President 6/01/88
Howard Kogen Senior Vice President 1/02/86
Treasurer 1/01/91
There is no family relationship among any of the foregoing directors
or officers. The foregoing directors have been elected to serve a one-year
term until the annual meeting of the Managing General Partner to be held on
June 5, 1996. All of the foregoing officers have been elected to serve
one-year terms until the first meeting of the Board of Directors held after
the annual meeting of the Managing General Partner to be held on June 5,
1996. There are no arrangements or understandings between or among any of
said directors or officers and any other person pursuant to which any
director or officer was elected as such.
JMB is the corporate general partner of Carlyle Real Estate Limited
Partnership-VII ("Carlyle-VII"), Carlyle Real Estate Limited Partnership-IX
("Carlyle-IX"), Carlyle Real Estate Limited Partnership-X ("Carlyle-X"),
Carlyle Real Estate Limited Partnership-XI ("Carlyle-XI"), Carlyle Real
Estate Limited Partnership-XII ("Carlyle-XII"), Carlyle Real Estate Limited
Partnership-XIII ("Carlyle-XIII"), Carlyle Real Estate Limited
Partnership-XIV ("Carlyle-XIV"), Carlyle Real Estate Limited Partnership-XV
("Carlyle-XV"), Carlyle Real Estate Limited Partnership-XVI ("Carlyle-
XVI"), Carlyle Real Estate Limited Partnership-XVII ("Carlyle-XVII"), JMB
Mortgage Partners, Ltd. ("Mortgage Partners"), JMB Mortgage Partners,
Ltd.-II ("Mortgage Partners-II"), JMB Mortgage Partners, Ltd.-III
("Mortgage Partners-III"), JMB Mortgage Partners, Ltd.-IV ("Mortgage
Partners-IV"), Carlyle Income Plus, Ltd. ("Carlyle Income Plus") and
Carlyle Income Plus, Ltd.-II ("Carlyle Income Plus-II") and the managing
general partner of JMB Income Properties, Ltd.-IV ("JMB Income-IV"), JMB
Income Properties, Ltd.-V ("JMB Income-V"), JMB Income Properties, Ltd.-VI
("JMB Income-VI"), JMB Income Properties, Ltd.-VII ("JMB Income-VII"), JMB
Income Properties, Ltd.-IX ("JMB Income-IX"), JMB Income Properties, Ltd.-X
("JMB Income-X"), JMB Income Properties, Ltd.-XI ("JMB Income-XI") JMB
Income Properties, Ltd.-XII ("JMB Income-XII") and JMB Income Properties,
Ltd.-XIII ("JMB Income-XIII"). JMB is also the sole general partner of the
associate general partner of most of the foregoing partnerships. Most of
the foregoing directors and officers are also officers and/or directors of
various affiliated companies of JMB including Arvida/JMB Managers, Inc.
(the general partner of Arvida/JMB Partners, L.P. ("Arvida")), Arvida/JMB
Managers-II, Inc. (the general partner of Arvida/JMB Partners, L.P.-II
("Arvida-II") and Income Growth Managers, Inc. (the corporate general
partner of IDS/JMB Balanced Income Growth, Ltd. ("IDS/BIG")). Most of such
directors and officers are also partners of certain partnerships which are
associate general partners in the following real estate limited
partnerships: Carlyle-VII, Carlyle-IX, Carlyle-X, Carlyle-XI, Carlyle-XII,
Carlyle-XIII, Carlyle-XIV, Carlyle-XV, Carlyle-XVI, Carlyle-XVII, JMB
Income-VI, JMB Income-VII, JMB Income-IX, JMB Income-X, JMB Income-XI, JMB
Income-XII, JMB Income-XIII, Mortgage Partners, Mortgage Partners-II,
Mortgage Partners-III, Mortgage Partners-IV, Carlyle Income Plus, Carlyle
Income Plus-II and IDS/BIG.
The business experience during the past five years of each such
director and officer of the Managing General Partner of the Partnership in
addition to that described above is as follows:
Judd D. Malkin (age 58) is an individual general partner of JMB
Income-IV and JMB Income-V. Mr. Malkin has been associated with JMB since
October, 1969. Mr. Malkin is a director of Urban Shopping Centers, Inc.,
an affiliate of JMB that is a real estate investment trust in the business
of owning, managing and developing shopping centers. He is a Certified
Public Accountant.
Neil G. Bluhm (age 58) is an individual general partner of JMB
Income-IV and JMB Income-V. Mr. Bluhm has been associated with JMB since
August, 1970. Mr. Bluhm is a director of Urban Shopping Centers, Inc., an
affiliate of JMB that is a real estate investment trust in the business of
owning, managing and developing shopping centers. He is a member of the
Bar of the State of Illinois and a Certified Public Accountant.
Burton E. Glazov (age 57) has been associated with JMB since June,
1971 and served as an Executive Vice President of JMB until December, 1990.
He is a member of the Bar of the State of Illinois and a Certified Public
Accountant.
Stuart C. Nathan (age 54) has been associated with JMB since July,
1972. Mr. Nathan is also a director of Sportmart Inc., a retailer of
sporting goods. He is a member of the Bar of the State of Illinois.
A. Lee Sacks (age 62) (President and Director of JMB Insurance Agency,
Inc.) has been associated with JMB since December, 1972.
John G. Schreiber (age 49) has been associated with JMB since
December, 1970 and served as an Executive Vice President of JMB until
December, 1990. Mr. Schreiber is President of Schreiber Investments,
Inc., a company which is engaged in the real estate investing business. He
is also a senior advisor and partner of Blackstone Real Estate Partners, an
affiliate of the Blackstone Group, L.P. Since 1994 Mr. Schreiber has also
served as a Trustee of Amli Residential Property Trust, a publicly-traded
real estate investment trust that invests in multi-family properties. He
holds a Masters degree in Business Administration from Harvard University
Graduate School of Business.
H. Rigel Barber (age 46) has been associated with JMB since March,
1982. He holds a J.D. degree from the Northwestern Law School and is a
member of the Bar of the State of Illinois.
Glenn E. Emig (age 48) has been associated with JMB since December,
1979. Prior to becoming Executive Vice President of JMB in 1993, Mr. Emig
was Executive Vice President and Treasurer of JMB Institutional Realty
Corporation. He holds a Masters Degree in Business Administration from the
Harvard University Graduate School of Business and is a Certified Public
Accountant.
Gary Nickele (age 43) has been associated with JMB since February,
1984. He holds a J.D. degree from the University of Michigan Law School
and is a member of the Bar of the State of Illinois.
Gailen J. Hull (age 47) has been associated with JMB since March,
1982. He holds a Masters degree in Business Administration from Northern
Illinois University and is a Certified Public Accountant.
Howard Kogen (age 60) has been associated with JMB since March, 1973.
He is a Certified Public Accountant.
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
The Partnership had no officers or directors. The General Partners of
the Partnership were entitled to receive a share of cash distributions,
when and as cash distributions were made to the Limited Partners, and a
share of profits or losses. Reference is also made to Notes 5 and 8 for a
description of such transactions, distributions and allocations. In 1995,
1994 and 1993, cash distributions of $24,302, $0 and $26,668 were paid,
respectively, to the General Partners.
JMB Insurance Agency, Inc., an affiliate of the Managing General
Partner of the Partnership, earned and received insurance brokerage
commissions in 1995 aggregating $18,898 in connection with the providing of
insurance coverage for certain of the real property investments of the
Partnership. Such commissions are at rates set by insurance companies for
the classes of coverage provided.
An affiliate of the Managing General Partner provided property
management services to the Partnership for the Carillon Shopping Village in
Houston, Texas and property management and leasing services for the Town &
Country Center in Houston, Texas through the date of their sale or
disposition in 1995. The management fee was calculated at 3.5% and 4%,
respectively, of gross income from the property. In 1995 ,such affiliate
earned property management and leasing fees of $237,589. As set forth in
the Prospectus of the Partnership, the Managing General Partner must
negotiate such agreements on terms no less favorable to the Partnership
than those customarily charged for similar services in the relevant
geographical area (but in no event at rates greater than 5% of the gross
income from a property), and such agreements must be terminable by either
party thereto, without penalty, upon 60 days' notice.
The Managing General Partner and its affiliates were reimbursed for
their salaries, salary-related and direct expenses relating to the
administration of the Partnership and the operation of the Partnership's
real property investments. In 1995, the Managing General Partner was due
reimbursement for such expenses in the amount of $114,832. In addition,
$19,489 of 1994 reimbursements were paid as in 1995.
The Partnership is permitted to engage in various transactions
involving affiliates of the Managing General Partner of the Partnership and
its affiliates. The relationship of the Managing General Partner (and its
directors and officers) to its affiliates is set forth above in Item 10
above and Exhibit 21 hereto.
<PAGE>
<TABLE>
<CAPTION>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) No person or group is known by the Partnership to own beneficially more than 5% of the outstanding
Interests of the Partnership.
(b) Immediately prior to the liquidation of the Partnership, the Managing General Partner, (its officers
and directors and the Associate General Partner) of the Partnership owned as a group the following Interests of
the Partnership:
NAME OF AMOUNT AND NATURE
BENEFICIAL OF BENEFICIAL PERCENT
TITLE OF CLASS OWNER OWNERSHIP OF CLASS
- -------------- ---------- ----------------- --------
<S> <C> <C> <C>
Limited Partnership JMB Realty Corporation 85 Interests directly Less than 1%
Interests
Limited Partnership Managing General Partner, 85 Interests directly Less than 1%
Interests (its officers and
directors) and the
Associate General
Partner as a group
<FN>
No officer or director of the Managing General Partner of the Partnership possessed a right to acquire
beneficial ownership of Interests of the Partnership.
(c) There existed no arrangement, known to the Partnership, the operation of which would have resulted in a
change in control of the Partnership.
/TABLE
<PAGE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There were no significant transactions or business relationships with
the Managing General Partner, affiliates or their management other than
those described in Items 10 and 11 above.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) The Following documents are filed as part of this report:
(1) Financial Statements (See Index to Financial Statements
filed with this report.)
(2) Exhibits.
3-A. The Prospectus of the Partnership dated January
26, 1981, as supplemented February 12, 1981 and May 19, 1981, as filed with
the Commission pursuant to Rules 424(b) and 424(c), is hereby incorporated
herein by reference. Copies of pages 8-16, 116-118 and A-6 to A-18 of the
Prospectus are incorporated by reference to the Partnership's Registration
Statement on Form S-11 (File No. 2-69116) dated May 27, 1981.
3-B. Amended and Restated Agreement of Limited
Partnership set forth as Exhibit A to the Prospectus, is incorporated by
reference to the Partnership's Registration Statement on Form S-11 (File
No. 2-69116) dated May 27, 1981.
10-A.Partnership interest purchase documents and
exhibits thereto relating to the purchase of the unaffiliated third party's
interest in the Carillon Shopping Village in Houston, Texas and subsequent
sale of property are hereby incorporated by reference to the Partnership's
Report on Form 8-K (File No. 0-10206) for May 18, 1995 dated June 1, 1995.
10-B.Disposition documents relating to the Partnership
transferring its interest in the Town & Country Center in Houston, Texas
are filed herewith.
21. List of Subsidiaries
24. Powers of Attorney
27. Financial Data Schedule
99-A.Form 8-K for Carillon Shopping Village
99-B.Form 8-K for Town and Country Center
(b) The following report on Form 8-K was required or filed since
the beginning of the last quarter of the period covered by this report.
(i) The Partnership's report on Form 8-K for December 5,
1995 (describing the disposition of the Partnership's interest in the Town
and Country Center) was filed. This report was dated December 20, 1995.
No annual report or proxy material for the fiscal year 1995 has been
sent to the Partners of the Partnership. An annual report will be sent to
the Partners subsequent to this filing.<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Act of 1934, the Partnership has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
JMB INCOME PROPERTIES, LTD. - VIII
By: JMB Realty Corporation
Managing General Partner
GAILEN J. HULL
By: Gailen J. Hull
Senior Vice President
Date: February 9, 1996
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
By: JMB Realty Corporation
Managing General Partner
JUDD D. MALKIN*
By: Judd D. Malkin, Chairman and
Chief Financial Officer
Date: February 9, 1996
NEIL G. BLUHM*
By: Neil G. Bluhm, President and Director
Date: February 9, 1996
H. RIGEL BARBER*
By: H. Rigel Barber, Chief Executive Officer
Date: February 9, 1996
GLENN E. EMIG*
By: Glenn E. Emig, Chief Operating Officer
Date: February 9, 1996
GAILEN J. HULL
By: Gailen J. Hull, Senior Vice President
Principal Accounting Officer
Date: February 9, 1996
A. LEE SACKS*
By: A. Lee Sacks, Director
Date: February 9, 1996
STUART C. NATHAN*
By: Stuart C. Nathan, Executive Vice President
and Director
Date: February 9, 1996
*By: GAILEN J. HULL, Pursuant to a Power of Attorney
GAILEN J. HULL
By: Gailen J. Hull, Attorney-in-Fact
Date: February 9, 1996
<PAGE>
JMB INCOME PROPERTIES, LTD. - VIII
EXHIBIT INDEX
DOCUMENT
INCORPORATED
BY REFERENCE PAGE
------------- ----
3-A. Pages 8-16, 116-118 and A-6
to A-18 of the Prospectus of
the Partnership dated
January 26, 1981 Yes
3-B. Amended and Restated Agreement
of Limited Partnership Yes
10-A. Sale documents related to
the Sale of Carillon Village
Center Yes
10-B. Disposition documents related
to the Town & Country Center No
21. List of Subsidiaries No
24. Powers of Attorney No
27. Financial Data Schedule No
99-A. Form 8-K for Carillon Village No
99-B. Form 8-K for Town and Country
Center No
SUBSTITUTE TRUSTEE'S DEED
AND BILL OF SALE
THE STATE OF TEXAS }
}
COUNTY OF HARRIS }
WITNESSETH:
RECITALS:
On June 15, 1983, H&M Associates, Ltd. - Houston (the "MORTGAGOR"), a
California limited partnership, executed and delivered to Otto B. Gerlach
as Trustee, a Deed of Trust and Security Agreement (the "DEED OF TRUST") to
secure unto The National Life and Accident Insurance Company, now known as
American General Life and Accident Insurance Company (the "MORTGAGEE"),
among other indebtedness and obligations described therein, payment of the
promissory note (the "NOTE") dated June 15, 1983, in the fact principal
amount of Thirty-Three Million Three Hundred Ninety Thousand Dollars
($33,390,000) executed by Mortgagor, payable to the order of Mortgagee as
the same may have been renewed, extended, rearranged and/or substituted
from time to time. The Deed of Trust covers and affects, among other
property, the real property located in Harris County, Texas, described on
EXHIBIT A attached hereto and hereby made a part hereof, together with all
improvements and fixtures thereon and all rights, privileges and
appurtenances thereto. The Deed of Trust was filed for record in the
Office of the County Clerk ("CLERK'S OFFICE") Of Harris County, Texas under
Clerk's File No. H996585. By this reference, the Deed of Trust is hereby
incorporated herein for all purposes.
Mortgagee is the present legal and equitable owner and holder of the
Note, the Deed of Trust and all liens and security interests securing the
Note.
By instrument filed for record in the Clerk's Office under Clerk's
File No. R662241, Mortgagee removed Otto B. Gerlach as Trustee and removed
each and every other previously designated or appointed original Trustee or
Substitute Trustee and appointed me, Douglas A. Yeager, as Substitute
Trustee.
Mortgagee has requested that I, as Substitute Trustee, enforce the
trust established by the Deed of Trust and foreclose on the property
covered by the Deed of Trust, on account of one or more defaults in the
obligations secured by the Deed of Trust.
Wendell Pattum, acting on my instructions and at Mortgagee's request,
caused written notice to be posted of the time, place and terms of a public
sale of the property covered by the Deed of Trust at the courthouse door of
Harris County, Texas, and a copy of such written notice to be filed in the
Office of the County Clerk of Harris County, Texas, both at least twenty-
one (21) days before the date of the sale.
Alice M. Milsap, acting on my instructions and at Mortgagee's request,
caused notice of such sale to be completed certified mail on each debtor
obligated to pay the debt evidenced by the Note by depositing the notice at
least twenty-one (21) days before the date of sale in the United States
mail, postage prepaid and addressed to such debtor at such debtor's last
known address as shown by Mortgagee's records.
I, as Substitute Trustee, duly held such sale on December 5, 1995, the
first Tuesday in December, 1995, between the hours of 10:00 a.m. and 4:00
p.m. Such sale began not later than three (3) hours after the time stated
in the notice of sale as the earliest time at which the sale would occur.
It occurred in the area designated by the commissioners' court of Harris
County, Texas as the area at the courthouse where sales are to take place
and was conducted in strict accordance with the Deed of Trust, said notice
and the law.
As such sale, the real property described in EXHIBIT A, together with
all improvements and fixtures thereon, all personal property, tangible and
intangible, covered and affected by the Deed of Trust and situated on or
relating to the real property described in EXHIBIT A hereto and
all rights, privileges and appurtenances to such real and personal property
(all of such real property, improvements, fixtures, personal property,
rights, privileges and appurtenances are hereinafter collectively referred
to as the "PROPERTY") were struck off by me, as Substitute Trustee, to the
Grantee named below for the highest and best bid therefor.
DEED AND BILL OF SALE:
NOW, THEREFORE, know all men by these presents, that I, Douglas A.
Yeager, of Harris County, Texas, as Substitute Trustee as aforesaid, as
GRANTOR by virtue of the powers vested in me under the aforementioned Deed
of Trust and in consideration of the premises and the payment by Mortgagee,
as GRANTEE, of the sum of Thirteen Million Eight Hundred Thousand Dollars
($13,800,000) by the crediting of such amount first against the expenses of
advertising, sale and conveyance incurred by Mortgagee, as holder of the
Note, the balance being credited against the Note, the receipt of which is
hereby acknowledged (which consideration has been applied in accordance
with the requirements of the Deed of Trust), have GRANTED, BARGAINED, SOLD
and CONVEYED and by the presents do hereby GRANT, BARGAIN, SELL and CONVEY
the Property unto Grantee, whose address is 2929 Allen Parkway, Houston,
Texas 77019.
TO HAVE AND TO HOLD the Property unto Grantee, and Grantee's
successors and assigns, forever; and I do hereby bind Mortgagor and
Mortgagor's successors and assigns, to warrant and forever defend all and
singular the Property unto Grantee and Grantee's successors and assigns,
against every person whomsoever lawfully claiming or to claim the same or
any part thereof.
IN TESTIMONY WHEREOF, this instrument is executed effective as of
December 5, 1995.
Douglas A. Yeager, Substitute Trustee
THE STATE OF TEXAS }
}
COUNTY OF HARRIS }
This instrument was acknowledged before me on December 5, 1995, by
Douglas A. Yeager, as Substitute Trustee
Kathy Dianne West
Notary Public in and for the
State of Texas
Printed Name: Kathy Dianne West
My Commission Expires: 5/25/96
EXHIBIT A - Real Property
After recording, return to:
Douglas A. Yeager
Liddell, Sapp, Zivley, Hill
& LaBoon, L.L.P.
3400 Texas Commerce Tower
Houston, Texas 77002
- 2 -
EXHIBIT A
H & M ASSOCIATES, LTD. - HOUSTON PROPERTY
(12.8027 ACRES)
Being 12.8027 acres (557,684 square feet) of land out of and part of
tracts of land belonging to H & M Associates, LTD. - Houston as recorded in
the Harris County Clerk File No. F901897 and the Harris County Film Code
No's. ###-##-#### and ###-##-#### and tracts of land conveyed to Town and
Country Commercial Park Limited as recorded in the Harris County Clerk File
No. F355471 and the Harris County Film Code No. 191-83-1955. Said 12.8027
acre tract is out of the George Bellows Survey, Abstract 3 and further
described by metes and bounds (with all bearings and coordinates based on
the Texas Plane Coordinate System, South Central Zone) as follows:
POINT OF COMMENCEMENT (X=3090408.833, Y=723260.134) at the
intersection of the east right-of-way line of West Belt Drive and the north
right-of-way of Queensbury Lane. Said point being the southwest corner of
a tract of land out of said tracts conveyed to said Town & Country
Commercial Park Limited as recorded in the Harris County Clerk File No.
F355471;
THENCE N 87 Degr. 21' 44" E, along the said north right-of-way line
and being the sough property line of said Town & Country Commercial Park
Limited tract a distance of 1046.90 feet to the southeast corner of said
tract and being the southwest corner of said tract conveyed to said Town &
Country Commercial Park Limited as recorded in the Harris County Film Code
No. ###-##-####;
THENCE continuing N 87 Degr. 21' 44" E, along the said north right-
of-way line and being the south property line of said Town & Country
Commercial Park Limited tract a distance of 30.00 feet to the POINT OF
BEGINNING (X=3091484.592, Y=723309.695) at the southeast corner of said
Town & Country Commercial Park Limited tract and being the southwest corner
of a tract of land belonging said H & M Associates, LTD. - Houston as
recorded in the Harris Country Film Code No. 192-88-0290;
THENCE N 02 Degr., 38' 16" W, along the east property line of said
Town & Country Commercial Park Limited tract and the most easterly west
property line of said H & M Associates tract a distance of 3.00 feet to the
most southerly south wall of Parking Structure No. 2;
THENCE continuing N 02 Degr. 38' 16" W, along the said east property
line and said west property line through said Parking Structure No. 2 a
distance of 187.00 feet for a total distance of 190.00 feet to the most
southerly north wall of said Parking Structure No. 2;
THENCE S 87 Degr. 21' 44" W, along the said most southerly north
wall a distance of 2.56 feet to the centerline of the 24' wide north
entrance driveway to said Parking Structure No. 2;
THENCE continuing S 87 Degr. 21' 44" W, along the said most southerly
north wall a distance of 27.44 feet to the said west property line of said
Town & Country Commercial Park Limited tract as recorded in the Harris
County Film Code No. 191-83-1955 and being the said east property line of
said Town & Country Commercial Park Limited tract as recorded in the Harris
County Clerk File No. F355471;
EXHIBIT A
Page 1 of 16
THENCE continuing S 87 Degr. 21' 44" W, along the said most southerly
north wall a distance of 59.92 feet for a total distance of 89.92
feet to an east wall of said Parking Structure No. 2;
THENCE N 02 Degr. 38' 16" W, along the said east wall a distance of
59.69 feet to a south property line of a tract of land belonging to H & M
Associates LTD. - Houston as recorded in the Harris County Film Code No.
###-##-####;
THENCE continuing N 02 Degr. 38' 16" W, along the said east wall a
distance of 3.31 feet for a total distance of 63.00 feet to a north wall of
said Parking Structure No. 2;
THENCE S 87 Degr. 21' 44" W, along the said north wall a distance of
32.67 feet to the east wall of a stairwell for said Parking Structure No.
2;
THENCE N 02 Degr. 38' 16" W, along the said east wall of said
stairwell a distance of 16.30 feet to the northeast corner of said
stairwell;
THENCE S 87 Degr. 21' 44" W, along the north wall of said stairwell a
distance of 9.00 feet to the northwest corner of said stairwell;
THENCE S 02 Degr. 38' 16" E, along the west wall of said stairwell a
distance of 16.30 feet to the said north wall of said Parking Structure No.
2;
THENCE 87 Degr. 21' 44" W, along the said north wall a distance of
150.00 feet to the most westerly east wall of said Parking Structure No. 2;
THENCE N 02 Degr. 38' 16" W, along the said most westerly east wall a
distance of 26.58 feet to the most westerly northeast corner of said
Parking Structure No. 2;
THENCE S 87 Degr. 21' 44" W, along the most northerly north wall of
said Parking Structure No. 2 a distance of 20.44 feet to a west property
line of said H & M Associates, LTD. - Houston tract;
THENCE continuing S 87 Degr. 21' 44" W, along the said most northerly
north wall a distance of 45.56 feet for a total distance of 66.00 feet to
the northwest corner of said Parking Structure No. 2;
THENCE N 02 Degr. 38' 16" W, along a northerly extension of the most
westerly west wall of said Parking Structure No. 2 a distance of 31.17 feet
to a sough wall of Town & Country Mall;
THENCE S 87 Degr. 21' 44" W, along the said south wall of said Town &
Country Mall a distance of 22.67 feet to the most easterly east wall of
Joske's;
THENCE N 02 Degr. 38' 18" W, along the said Joske's wall a distance
of 26.36 feet to a south property line of said H & M Associates, LTD. -
Houston tract as recorded in the Harris County Film Code No. 200-99-1721;
EXHIBIT A
Page 2 of 16
THENCE continuing N 02 Degr. 38' 18" W, along said Joske's wall and
being a west property line of said H & M Associates, LTD. - Houston tract a
distance of 12.79 feet for a total distance of 39.15 feet to an angle point
in said Joske's wall and property line of said H & M Associates, LTD. -
Houston tract;
THENCE S 87 Degr. 21' 42" W, along the said Joske's wall and said
property line a distance of 9.30 feet to an angle point in said Joske's
wall and said property line;
THENCE N 02 Degr. 38' 18" W, along said Joske's wall and said
property line a distance of 22.50 feet to an angle point in said Joske's
wall and said property line;
THENCE N 87 Degr. 21' 42" E, along the said Joske's wall and said
property line a distance of 4.73 feet to an angle point in said Joske's
wall and said property line;
THENCE N 02 Degr. 38' 18" W, along said Joske's wall and said
property line a distance of 27.55 feet to Joske's northeast corner and
being an angle point in said property line;
THENCE S 87 Degr. 20' 44" W, along Joske's north wall and being the
most northerly south property line of said H & M Associates, LTD. - Houston
tract a distance of 301.64 feet to Joske's northwest corner;
THENCE continuing S 87 Degr. 20' 44" W, along the said most northerly
south property line a distance of 31.16 feet for a total distance of 332.80
feet to the most westerly southwest corner of said H & M Associates, LTD. -
Houston tract;
THENCE N 02 Degr. 38' 16" W, along the most westerly west property
line of said H & M Associates, LTD. - Houston tract a distance of 19.99
feet to the south property line of a 14.2531 acre tract of land out of
tracts of land belonging to H & M Associates as recorded in the Harris
County Clerk File No. F901897;
THENCE S 87 Degr. 21' 44" W, along the said south property line of
said 14.2531 acre tract a distance of 39.79 feet;
THENCE N 02 Degr. 38' 16" W, a distance of 132.31 feet;
THENCE S 87 Degr. 21' 44" W, a distance of 74.49 feet to the west
property line of said 14.2531 acre tract;
THENCE N 02 Degr. 38' 16" W, along the said west property line a
distance of 203.68 feet to the south wall of Parking Structure No. 1;
THENCE continuing N 02 Degr. 38' 16" W, along the said west property
line through Parking Structure No. 1 a distance of 465.21 feet to the most
northerly north wall of said Parking Structure No. 1;
THENCE continuing N 02 Degr. 38' 16" W, along the said west property
line a distance of 11.18 feet for a total distance of 680.07 feet to the
northwest corner of said 14.2531 acre tract;
THENCE N 87 Degr. 18' 10" E, along the most northerly north property
line of said 14.2531 acre tract a distance of 119.06 feet to a more
northerly extension of the east wall of said Parking Structure No. 1;
EXHIBIT A
Page 3 of 16
THENCE S 02 Degr. 38' 16" E, along the said northerly extension of
the said east wall a distance of 11.30 feet to the north east corner of
said Parking Structure No. 1;
THENCE continuing S 02 Degr. 38' 16" E, along the said east wall a
distance of 334.71 feet for a total distance of 346.01 feet to a westerly
extension of the north wall of Town & Country Mall;
THENCE N 87 Degr. 21' 44" E, along the said westerly extension a
distance of 39.95 feet to the northwest corner of said Town & Country Mall;
THENCE continuing N 87 Degr. 21' 44" E, along the said north wall a
distance of 6.67 feet to the southwest corner of Neiman Marcus;
THENCE continuing N 87 Degr. 21' 44" E, along Neiman Marcus south
wall a distance of 175.54 feet to Neiman Marcus southeast corner;
THENCE continuing N 87 Degr. 21' 44" E, along the said Town & Country
Mall north wall a distance of 59.70 feet to the northeast corner of said
Town & Country Mall;
THENCE continuing N 87 Degr. 21' 44" E, along an easterly extension
of the said north wall a distance of 26.36 feet for a total distance of
308.22 feet to a southerly extension of the west curb line of the ring road
which lies along the east side of Neiman Marcus;
THENCE N 02 Degr. 28' 16" W, along the said southerly extension and
said west curb line a distance of 151.21 feet to a westerly extension of
the north curb line of the westerly extension of the 30' wide access drive
which lies along the north side of Parking Structure No. 3;
THENCE N 87 Degr. 21' 44" E, along the said westerly extension of
said north curb line and along said north curb line a distance of 111.71
feet to a southerly extension of the west curb line of the 46' wide
entrance drive which lies along the west side of Pad "A";
THENCE N 02 Degr. 38' 16" W, along the said southerly extension of
said west curb line and along said west curb line a distance of 155.00 feet
to the south right-of-way line of Town & Country Way and being a north
property line of said 14.2531 acre tract;
THENCE N 87 Degr. 23' 07" E, along the said south right-of-way line
and said north property line a distance of 23.00 feet to the centerline of
said 46' wide entrance drive;
THENCE S 02 Degr. 38' 16" E, along the said centerline a distance of
169.66 feet to the centerline of the said 30' wide access drive;
THENCE S 87 Degr. 21' 44" W, along the said centerline of said 30'
wide access drive a distance of 117.07 feet to the centerline of said ring
road which lies along the east side of Neiman Marcus;
THENCE S 02 Degr. 38' 16" E, along the said centerline of said ring
road a distance of 222.51 feet to the south curb line of the ring road
which lies along the north side of Marshall Fields;
EXHIBIT A
Page 4 of 16
THENCE S 87 Degr. 21' 44" W, along the said south curb line and a
westerly extension of said south curb line a distance of 44.00 feet to the
east all of said Town & Country Mall;
THENCE S 02 Degr. 38' 16" E, along the said east wall a distance of
19.83 feet to Marshall Fields north wall;
THENCE S 87 Degr. 21' 44" W, along said Marshall Fields north wall a
distance of 43.50 feet to Marshall Fields northwest corner;
THENCE S 02 Degr. 38' 16" E, along Marshall Fields wall a distance of
61.00 feet to an angle point in said Marshall Fields wall;
THENCE S 87 Degr. 21' 44" W, along said Marshall Fields wall a
distance of 15.00 feet to an angle point in said Marshall Fields wall;
THENCE S 02 Degr. 38' 16" E, along said Marshall Fields wall a
distance of 90.33 feet to an angle point in said Marshall Fields wall;
THENCE N 87 Degr. 21' 44" E, along said Marshall Fields wall a
distance of 15.00 feet to an angle point in said Marshall Fields wall;
THENCE S 02 Degr. 38' 16" E, along said Marshall Fields wall a
distance of 61.00 feet to Marshall Fields southwest corner;
THENCE N 87 Degr. 21' 44" E, along said Marshall Fields wall a
distance of 61.00 feet to an angle point in said Marshall Fields wall;
THENCE S 02 Degr. 38' 16" E, along said Marshall Fields wall a
distance of 15.00 feet to an angle point in said Marshall Fields wall;
THENCE N 87 Degr. 21' 44" E, along said Marshall Fields wall a
distance of 90.33 feet to an angle point in said Marshall Fields wall;
THENCE N 02 Degr. 38' 16" W, along said Marshall Fields wall a
distance of 15.00 feet to an angle point in said Marshall Fields wall;
THENCE N 87 Degr. 21' 44" E, along said Marshall Fields wall a
distance of 61.00 feet to Marshall Fields southeast corner;
THENCE N 02 Degr. 38' 16" W, along said Marshall Fields wall a
distance of 43.33 feet to a north wall of Town & Country mall;
THENCE N 87 Degr. 21' 44" E, along the said north wall of said Town &
Country Mall a distance of 39.00 feet to the east wall of Marshall Fields
loading dock;
THENCE N 02 Degr. 38' 16" W, along the said east wall of said loading
dock a distance of 100.20 feet to the north end of said loading dock;
THENCE N 87 Degr. 21' 44" E, a distance of 57.19 feet to the west
wall of Parking Structure No. 3;
EXHIBIT A
Page 5 of 16
THENCE N 02 Degr. 38' 16" W, along the said west wall of said Parking
Structure No. 3 a distance of 288.25 feet to the northwest corner of said
Parking structure No. 3;
THENCE continuing N 02 Degr. 38' 16" W, along an extension of the
said west wall of said Parking structure No. 3 a distance of 22.51 feet for
a total distance of 310.76 feet to the centerline of said 30' wide access
drive which lies along the north side of said Parking Structure No. 3;
THENCE N 87 Degr. 21' 44" E, along the said centerline a distance of
125.97 feet to the east property line of said 14.2531 acre tract of land
out of tracts of land belonging to H & M Associates as recorded in the
Harris County Clerk File No. F901897 and being the west property lien of
said 1.3533 acre tract of land belonging to H & M Associates, LTD. -
Houston as recorded in the Harris County Film Code No. 192-88-0290;
THENCE continuing N 87 Degr. 21' 44" E, along the said centerline a
distance of 30.03 feet for a total distance of 156.00 feet to the
centerline of the 48' wide entrance drive which leads to the speed ram for
said Parking Structure No. 3;
THENCE N 02 Degr. 38' 16" W, along the said centerline of said 48'
wide entrance drive a distance of 169.96 feet to the south right-of-way
line of Town & Country Way;
THENCE N 87 Degr. 20' 16" E, along the said south right-of-way line a
distance of 29.97 feet to the east property line of said 1.3533 acre tract
and being the west property line of a 5.6659 acre tract of land out of
tracts of land belonging to H & M Associates as recorded in the Harris
County Clerk File No. F901897;
THENCE continuing N 87 Degr. 20' 16" E, along the said south right-
of-way line and being the north property line of said 5.6659 acre
tract a distance of 241.58 feet for a total distance of 271.55 feet to the
west right-of-way line of Town & Country Blvd. as deeded by H & M
Associates in the Harris County Film Code No. 186-81-0457;
THENCE S 02 Degr. 50' 36" E, along the said west right-of-way line a
distance of 129.78 feet to an angle point in said west right-of-way line'
THENCE S 02 Degr. 32' 36" E, along the said west right-of-way line a
distance of 416.06 feet to the centerline of the entrance drive to the 32'
wide ring road which lies along the north side of Penney's;
THENCE S 87 Degr. 21' 44" W, along the said centerline of said 32'
wide ring road a distance of 241.36 feet to the said west property line of
said 5.6659 acre tract and said east property line of said 1.3533 acre
tract;
THENCE continuing S 87 Degr. 21' 44" W, along said centerline a
distance of 58.89 feet for a total distance of 300.25 feet to the point of
tangency of a curvature to the right in the said centerline of said 32'
wide ring road;
THENCE along said curve to the right and said centerline of said 32'
wide ring road having a delta of 00 Degr. 32' 18", radius= 164.00 feet,
chord length = 1.11 feet, chord bearing = S 87 Degr. 23' 23" W, tangent
length = 0.56 feet, an arc distance of 1.11 feet to the said west property
line of said 1.3533 acre tract and said east property line of said 14.2531
acre tract;
EXHIBIT A
Page 6 of 16
THENCE continuing along the curve to the right and said centerline
having a delta = 08 Degr. 30' 26", radius = 164.00 feet, chord length =
24.33 feet, chord bearing = N 87 Degr. 59' 45" W, tangent length = 12.20
feet, an arc length of 24.35 feet for a total arc length of 25.46 feet to a
point of tangency of a reverse curve to the left and said centerline;
THENCE along said curve to the left and said centerline having a
delta = 00 Degr. 55' 12", radius = 196.00 feet, chord length = 3.15, chord
bearing = N 84 Degr. 12' 08" W, tangent length = 1.57, an arc length of
3.15 feet to a northerly extension of the west wall of Penney's;
THENCE S 02 Degr. 28' 16" E, along the said northerly extension a
distance of 34.43 feet to Penney's northwest corner;
THENCE continuing S 02 Degr. 38' 16" E, along said Penney's west wall
a distance of 3.60 feet to the said Town & Country Mall north wall;
THENCE continuing S 02 Degr. 38' 16" E, along said Penney's west wall
a distance of 191.28 feet to the north property line of said H & M
Associates, LTD. - Houston tract as recorded in the Harris County Film Code
No. ###-##-####;
THENCE continuing S 02 Degr. 38' 16" E, along said Penney's west wall
a distance of 117.14 feet for a total distance of 346.45 feet to the said
Town & Country Mall south wall;
THENCE 87 Degr. 21' 44" W, along the said south wall a distance of
7.83 feet to the east curb line of the service drive which lies along the
west side of Penney's;
THENCE S 02 Degr. 38' 16" E, along the said curb line and a southerly
projection of said curb line a distance of 80.68 feet to the most southerly
south property line of said H & M Associates, LTD. - Houston tract as
recorded in the Harris County Film Code No. 200-99-1721;
THENCE continuing S 02 Degr. 38' 16" E, along said southerly
extension of said east curb line a distance of 13,02 feet for a total
distance of 93.70 feet to the centerline of the 32' wide ring road which
lies along the south side of Penney's;
THENCE N 87 Degr. 21' 44" E, along the said centerline of said 32"
wide ring road a distance of 35.19 feet to the said east property line of
said Town & Country Commercial Park Limited tract as recorded in the Harris
County Clerk File No. F355471 and being the west property line of said Town
& Country Commercial Park Limited tract as recorded in the Harris County
Film Code No. 191-83-1955;
THENCE continuing N 87 Degr. 21' 44" E, along the said centerline of
said ring road a distance of 30.00 feet to the said east property line of
said Town & Country Commercial Park Limited tract as recorded in the Harris
County Film Code No. 191-83-1955 and being the said most easterly west
property line of said 1.3533 acre tract belonging to H & M Associates,
LTD. - Houston as recorded in the Harris County Film Code No. 192-88-0290;
EXHIBIT A
Page 7 of 16
THENCE continuing N 87 Degr. 21' 44" E, along the said centerline of
said ring road a distance of 12.50 feet for a total distance of 77.69 feet
to a northerly extension of the most easterly east wall of said Parking
Structure No. 2;
THENCE S 02 Degr. 38' 16" E, along the said northerly extension a
distance of 19.00 feet to the most easterly northeast corner of said
Parking Structure No. 2;
THENCE continuing S 02" 38' 16" E, along the said most easterly east
wall of said Parking Structure No. 2 a distance of 187.00 feet for a total
distance of 206.00 feet to the southeast corner of said Parking Structure
No. 2;
THENCE S 87 Degr. 21' 44" W, along the most southerly south wall of
said Parking Structure No. 2 a distance of 3.06 feet to the east side of
the 24' wide south entrance driveway to said Parking Structure No. 2;
THENCE S 02 Degr. 38' 16" E, along the said east side of said 24'
wide driveway a distance of 3.00 feet to the said north right-of-way line
of Queensbury Land and said south property line of said 1.3533 acre tract
belonging to H & M Associates, LTD. - Houston as recorded in the Harris
County File, Code No. ###-##-####;
THENCE S 87 Degr. 21' 44" W, along the said north right-of-way line
and said south property line a distance of 9.44 feet to the POINT OF
BEGINNING and containing 12.8027 acres of land more or less.
M/B Written 4/18/83
C&B JOB NO. 7844932
M/B Revised 5/2/83
C&B JOB NO. 7844940
M/B Revised 5/23/83
EXHIBIT A
Page 8 of 16
H&M ASSOCIATES, LTD. - HOUSTON PROPERTY
DEVELOPER TRACT PAD "A"
(0.7363 ACRES)
BEING 0.7363 acres (32,071 square feet) of land out of and part of
14.2531 acre tract out of tracts of land belonging to H & M Associates as
recorded in the Harris County Clerk File No. 901897. Said 0.7363 acre
tract is out of the George Bellows Survey Abstract 3 and is further
described in metes and bounds (with all bearings and coordinates based on
the Texas Plane Coordinate System, South Central Zone) as follows:
POINT OF COMMENCEMENT (X=3090408.833, Y=723260.134) at the
intersection of the north right-of-way line of Queensbury Lane and the east
right-of-way line of West Belt Drive. Said point being a southwest corner
of a tract of land belonging to Town and Country Commercial Park Ltd. as
recorded in the Harris Country Clerk File No. F355471;
THENCE N 02 Degr. 38' 16" W, along the said east right-of-way line
and being a west property line of said Town and Country Commercial Park
Ltd. tract a distance of 1232.25 feet to the northwest corner of said Town
and Country Commercial Park Ltd. tract;
THENCE N 87 Degr. 22' 10" E, along the north property line of said
Town and Country Commercial Park Ltd. tract a distance of 254.99 feet to
the northwest corner of said 14.2531 acre tract belonging to H & M
Associates;
THENCE 87 Degr. 18' 10" E, along the most northerly north property
line of said H & M Associates tract a distance of 224.95 feet to the west
right-of-way of Town and Country Blvd. (100 R.O.W.);
THENCE S 02 Degr. 33' 05" E, along the said west right-of-way line
and being an east property line of said H & M Associates tract a distance
of 39.79 feet to the south right-of-way line of Town and Country Way and
being a north property line of said H & M Associates tract;
THENCE N 87 Degr. 23' 07" E, along the said south right-of-way line
and said north property line a distance of 360.10 feet to an extension of
the east curbline of the 46 foot wide entrance drive which is located the
west side of Pad A and being the POINT OF BEGINNING (X=3091193.041,
Y=724490.044);
THENCE N 87 Degr. 23' 07" E, along the said sough right-of-way line
and said north property line a distance of 206.92 feet to the west property
line of a 1.3533 acre tract belonging to H & M Associates, Ltd. - Houston
as recorded in the Harris County Film Code No. 192-88-0290;
THENCE S 02 Degr. 38' 16" E, along the said west property line a
distance of 154.95 feet to an extension of the north curbline of the 30
foot wide access road between Parking Structure #3 and Pad A;
THENCE S 87 Degr. 21' 44" W, along the said north curbline and
extensions of said north curbline a distance of 206.92 feet to a southerly
extension of the said east curbline of said 46 foot wide entrance drive;
THENCE N 02 Degr. 38' 16" W, along said southerly extension of said
east curbline, along said east curbline and a northerly extension of said
east curbline a distance of 155.03 feet to the POINT OF BEGINNING and
containing 0.7363 acres of land more or less.
M/B Written: 03-31-83
C&B Job No: 78449-39
EXHIBIT A
Page 9 of 16
EASEMENT TRACT I
(PARKING STRUCTURE TRACT)
(LEGAL DESCRIPTION FOR TRACT I)
2.7710 ACRES OF LAND
Being 2.7710 acres (120,704 square feet) of land out of and part of a
tract of land belonging to H & M Associates as recorded in the Harris
County Clerk File No. F901897 and a part of a tract of land belonging to
Town & Country Commercial Park Limited as recorded in Harris County Clerk
File No. F355471. Said 2.7710 acre tract is out of the George Bellows
Survey, Abstract 3 and further described by metes and bounds (with all
bearings and coordinates based on the Texas Plane Coordinate System, South
Central Zone) as follows:
COMMENCING at a 5/8" iron rod (X=3090408.833, Y=723260.134) at the
intersection of the north right-of-way line of Queensbury Lane and the east
right-of-way line of West Belt Drive;
THENCE N 02 Degr. 38' 17" W, along the said east right-of-way line of
West Belt Drive, and being the west property line of said tract of land
belonging to Town & Country Commercial Park Limited, a distance of 1232.25
feet to a 5/8" iron rod;
THENCE N 87 Degr. 22' 10" E, along the most northerly north property
line of said tract of land belonging to Town & Country Commercial Park
Limited, a distance of 254.99 feet to an iron rod being the most northerly
northeast corner of said tract of land and the most northerly corner of
said tract of land belonging to H & M Associates.
THENCE S 02 Degr. 38' 16" E, along the most westerly east property
line of said tract of land belonging to Town & Country Commercial Park
Limited a distance of 11.18 feet to a point on the north wall of Parking
Structure No. 1 for the POINT OF BEGINNING (X=3090607.359, Y=724491.613);
THENCE N 87 Degr. 21' 44" E, along the north wall of parking
Structure No. 1 a distance of 119.06 feet to the northeast corner of this
tract;
THENCE E 02 Degr. 38' 16" E, along the east wall of Parking Structure
No. 1 a distance of 465.21 feet to the southeast corner of this tract;
THENCE S 87 Degr. 21' 44" W, along the south wall of Parking
Structure No. 1 a distance of 314.75 feet to a point said point being
195.69 feet in a westerly perpendicular direction from the said most
westerly east property line of land belonging to Town & Country Commercial
Park Limited and being the southwest corner of this tract;
THENCE N 02 Degr. 38' 16" W, along the west wall of Parking Structure
No. 1 a distance of 250.21 feet to a point;
THENCE S 87 Degr. 21' 44" W, a distance of 59.30 feet to a point on
the said east right-of-way line of West Belt Drive;
THENCE N 02 Degr. 38' 16" W, along the said east right-of-way line, a
distance of 25.77 feet of the most westerly northwest corner of this tract;
EXHIBIT A
Page 10 of 16
THENCE N 87 Degr. 21' 44" E, a distance of 203.30 feet to a point;
THENCE N 02 Degr. 38' 16" W, along the most northerly west wall of
Parking Structure No. 1 a distance of the 189.23 feet to the most easterly
northwest corner of this tract;
THENCE N 87 Degr. 21' 44" E, along the north wall of parking
Structure No. 1 a distance of 51.69 feet to the POINT OF BEGINNING and
containing 2.7710 acres of land more or less.
M/B Written 01/21/83
REVISED: 03/14/83
C&B JOB NO. 7844905
EXHIBIT A
Page 11 of 16
EASEMENT TRACT II
(PARKING STRUCTURE TRACT)
(LEGAL DESCRIPTION FOR TRACT II)
1.7593 ACRES OF LAND
Being 1.7593 acres (76,635 sq. ft.) of land out of and part of tracts
of land belonging to Town & Country Commercial Park Ltd. as recorded in the
Harris County Clerk File No. F355471 and the Harris County File Code No.
###-##-####, and belonging to H & M Associates, Ltd. - Houston as recorded
in the Harris County Film Code Nos. 192-38-0290 and 200-99-1721. Said
1.7593 acre tract is out of the George Bellows Survey, Abstract 3 and is
further described by metes and bounds (with all bearings and coordinates
based on the Texas Plane Coordinate System, South Central Zone) as follows:
POINT OF COMMENCEMENT (X=3090408.833, Y=723260.134) at the
intersection of the north right-of-way line of Queensbury Lane and the east
right-of-way line of West Belt Drive. Said point being a southwest corner
of said Town & Country Commercial Park Ltd. as described in the Harris
County File No. F355471;
THENCE N 87 Degr. 21' 44" E, along the said north right-of-way line
of Queensbury Lane and being the south property line of said Town and
Country Commercial Park Ltd. tracts a distance of 1076.90 feet to the most
easterly southwest cornier of said H & M Associates, Ltd. - Houston tract
as described in the Harris County Film Code No. 192-88-0290 and being the
POINT OF BEGINNING (X=3091484.592, Y=723309.695);
THENCE S 87 Degr. 21' 44" W, along the said north right-of-way line
of Queensbury Lane a distance of 14.56 feet;
THENCE N 02 Degr. 38' 16" W, a distance of 3.00 feet to the south
wall of Parking Structure #2;
THENCE S 87 Degr. 21' 44" W, along the said south wall a distance of
270.11 feet to the most easterly southwest corner of Parking Structure #2;
THENCE N 02 Degr. 38' 16" W, along the most easterly west wall of
Parking Structure #2 a distance of 141.58 feet to the most northerly south
wall of Parking Structure #2;
THENCE S 87 Degr. 21' 44" W, along the said most northerly south wall
a distance of 62.92 feet to the westerly southwest corner of Parking
Structure #2;
THENCE N 02 Degr. 38' 16" W, along the most westerly west wall of
Parking Structure #2 a distance of 135.00 feet to the northwest corner of
Parking Structure #2;
THENCE N 87 Degr. 21' 44" E, along the most northerly north wall of
parking Structure #2 a distance of 45.56 feet to the most easterly west
property line of said H & M Associates, Ltd. - Houston tract as recorded in
the Harris County Film Code No. 200-99-1821;
THENCE N 87 Degr. 21' 44" E, along the said north wall of Parking
Structure #2 a distance of 20.44 feet to the most westerly northeast corner
of Parking Structure #2;
THENCE S 02 Degr. 39' 16" E, along the most westerly east wall of
Parking Structure #2 a distance of 26.58 feet to a north wall of Parking
Structure #2;
THENCE N 87 Degr. 21' 44" E, along the said north wall a distance of
160.00 feet to the west wall of a stairwell for Parking Structure;
THENCE N 02 Degr. 83' 16" W, along the said west wall of said
stairwell a distance of 16.30 feet to the north wall of said stairwell.
EXHIBIT A
Page 12 of 16
THENCE N 87 Degr. 21' 44" E, along the said north wall of said
stairwell a distance of 9.00 feet to the east wall of said stairwell;
THENCE S 02 Degr. 38; 16" E, along the said east wall of said
stairwell a distance of 16.30 feet to the said north wall of Parking
Structure #2;
THENCE N 87 Degr. 21' 44" E, along the said north wall of Parking
Structure #2 a distance of 32.67 feet to a northeast corner of Parking
Structure #2;
THENCE S 02 Degr. 38' 16" E, along an east wall of Parking Structure
#2 a distance of 3.31 feet to the most southerly south property line of
said H & M Associates, Ltd. - Houston tract as recorded in the Harris
County Film Code No. 200-99-1721;
THENCE S 02 Degr. 38' 16" E, along the east wall a distance of 59.69
feet to the most southerly north wall of Parking Structure #2;
THENCE N 87 Degr. 21' 44" E, along the said most southerly north wall
a distance of 89.92 feet to the most easterly west property line of said H
& M Associates, Ltd. - Houston tract as recorded in the Harris County Film
Code No. ###-##-####;
THENCE N 87 Degr. 21' 44" E, along the said most southerly north wall
a distance of 12.50 feet to the most easterly northeast corner of Parking
Structure #2;
THENCE S 02 Degr. 38' 16" E, along the most easterly east wall of
Parking Structure #2 a distance of 187.00 feet to the southeast corner of
Parking Structure #2;
THENCE S 87 Degr. 21' 44" W, along the most southerly south wall of
Parking Structure #2 a distance of 3.06 feet;
THENCE S 02 Degr. 38' 16" E, a distance of 3.00 feet to the said
north right-of-way line of Queensbury Lane;
THENCE S 87 Degr. 21' 44" W, along the said north right-of-way line
of Queensbury Lane a distance of 9.44 feet to the POINT OF BEGINNING and
containing 1.7593 acres of land more or less.
M/B Written: 06-24-82
Revised: 01-10-83
Revised: 3-25-83
C&B Job No. 78449-05
78449-35
Revised: 04-20-83
EXHIBIT A
Page 13 of 16
(PARKING STRUCTURE TRACT III)
(LEGAL DESCRIPTION FOR TRACT III)
2.7914 ACRES OF LAND
(DEVELOPER LAND)
BEING 2.7914 acres (121,595 square feet) of land out of and part of
tracts of land belonging to H & M Associates as recorded in the
Harris County Clerk File No. F901897 and to H & M Associates, Ltd. -
Houston as recorded in the Harris County Film Code No. 192-88-0290. Said
2.7914 acre tract is out of the George Bellows Survey, Abstract 3 and
further described by metes and bounds (with all bearings and coordinates
based on the Texas Plane Coordinate System, South Central Zone) as follows:
POINT OF COMMENCEMENT (X=3090408.833, Y=723260.134) at the
intersection of the north right-of-way line of West Belt Drive and the
north right-of-way line of Queensbury Lane. Said point being a southwest
corner of a tract of land belonging to Town & Country Commercial Park Ltd.
as recorded in the Harris County Clerk File No. F355471;
THENCE N 87 Degr. 21' 44" E, along the said north right-of-way line
of Queensbury Land and being the south property lines of tracts of land
belonging to Town and Country Commercial Park Ltd. as recorded in the
Harris County Clerk File No. F355471 and the Harris Country Film Code No.
###-##-#### and belonging to H & M Associates, Ltd. - Houston as recorded
in the Harris County Film Code No. 192-88-0290 and belonging to H & M
Associates as recorded in the Harris County Clerk File No G848103 as
distance of 1347.20 feet to the west right-of-way line of Town and Country
Blvd. as deeded by H & M Associates in Harris County Film Code No. 186-81-
0457 and being out of tracts of land belonging to H & M Associates as
recorded in the Harris County Clerk File Nos. F901897 and G848103;
THENCE N 02 Degr. 32' 36" W, along the said west right-of-way line a
distance of 1062.78 feet to an angle point in said west right-of-way line;
THENCE N 02 Degr. 50' 36" W, along the said west right-of-way line a
distance of 129.78 feet to the sough right-of-way line of Town and Country
Way;
THENCE S 87 Degr. 20' 16" W, along the said south right-of-way line
and being the north property lines of tracts of land belonging to H & M
Associates as recorded in the Harris County Clerk File No. F901897 and to H
& M Associates, Ltd. - Houston as recorded in the Harris Country Film Code
No. ###-##-#### a distance of 301.58 feet to the northeast corner of a
14.2531 acre tract out of tracts of land belonging to said H & M Associates
as recorded in the Harris County Clerk File No. F901897;
THENCE S 02 Degr. 38' 16" E, along the east property line of said
14.2531 acre tract and being the west property line of said H & M
Associates, Ltd. - Houston tract a distance of 192.46 feet to the north
wall of Parking Structure #3 and being the POINT OF BEGINNING
(X=3091408.605, Y=724207.227);
THENCE N 87 Degr. 21' 44" E, along the said north wall a distance of
60.00 feet to the east property line of said H & M Associates, Ltd. -
Houston tract and being the west property line of a 5.6659 acre tract out
of the said H & M Associates tract as recorded in the Harris County Clerk
File No. F901897;
EXHIBIT A
Page 14 of 16
THENCE N 87 Degr. 21' 44" E, along the said north wall a distance of
187.88 feet to the northeast corner of Parking Structure #3;
THENCE S 02 Degr. 38' 16" E, along the east wall of Parking Structure
#3 a distance of 325.25 feet to the southeast corner of Parking Structure
#3;
THENCE S 87 Degr. 21' 44" W, along the south wall of Parking
Structure #3 a distance of 187.88 feet to the said west property line of
said 5.6659 acre tract and being the said east property line of said H & M
Associates, Ltd. - Houston tract;
THENCE S 87 Degr. 21' 44" W, along the said south wall a distance of
60.00 feet to the said west property line of said H & M Associates, Ltd. -
Houston tract and being the said east property line of said 14.2531 acre
tract;
THENCE S 87 Degr. 21' 44" W, along the said south wall a distance of
125.97 feet and being the southwest corner of Parking Structure #3;
THENCE N 02 Degr. 38' 16" W, along the west wall of Parking Structure
#3 a distance of 325.25 feet to the northwest corner of Parking Structure
#3;
THENCE N 87 Degr. 21' 44" E, along the said north wall of Parking
Structure #3 a distance of 125.97 feet and being the POINT OF BEGINNING and
containing 2.7914 acres of land more or less.
M/B Written: 03-29-83
C&B Job No. 78449-031
Revised: 04-20-83
EXHIBIT A
Page 15 of 16
All of Mortgagor's right, title and interest (a) under that certain
Construction, Operation and Reciprocal Easement Agreement ("REA") dated
April 28, 1983, recorded in the Clerk's Office under Clerk's File No.
H920353 and (b) as set forth in three (3) Parking Structure Ownership
Agreements ("PARKING STRUCTURE OWNERSHIP AGREEMENTS") dated April 28, 1983,
recorded in the Clerk's Office under Clerk's File Nos. H920354, H920355 and
H920356.
EXHIBIT A
Page 16 of 16
EXHIBIT 21
LIST OF SUBSIDIARIES
The Partnership has no subsidiaries.
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officers of JMB
Realty Corporation, the managing general partner of JMB INCOME PROPERTIES,
LTD. - VIII, do hereby nominate, constitute and appoint GARY NICKELE,
GAILEN J. HULL, DENNIS M. QUINN or any of them, attorneys and agents of the
undersigned with full power of authority to sign in the name and on behalf
of the undersigned officers a Report on Form 10-K of said partnership for
the fiscal year ended December 31, 1995, and any and all amendments
thereto, hereby ratifying and confirming all that said attorneys and agents
and any of them may do by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this Power of
Attorney the 5th day of February, 1996.
H. RIGEL BARBER
- -----------------------
H. Rigel Barber Chief Executive Officer
GLENN E. EMIG
- -----------------------
Glenn E. Emig Chief Operating Officer
The undersigned hereby acknowledge and accept such power of authority
to sign, in the name and on behalf of the above named officers, a Report on
Form 10-K of said partnership for the fiscal year ended December 31, 1995,
and any and all amendments thereto, the 5th day of February, 1996.
GARY NICKELE
-----------------------
Gary Nickele
GAILEN J. HULL
-----------------------
Gailen J. Hull
DENNIS M. QUINN
-----------------------
Dennis M. Quinn
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officers of JMB
Realty Corporation, the managing general partner of JMB INCOME PROPERTIES,
LTD. - VIII, do hereby nominate, constitute and appoint GARY NICKELE,
GAILEN J. HULL, DENNIS M. QUINN or any of them, attorneys and agents of the
undersigned with full power of authority to sign in the name and on behalf
of the undersigned officers a Report on Form 10-K of said partnership for
the fiscal year ended December 31, 1995, and any and all amendments
thereto, hereby ratifying and confirming all that said attorneys and agents
and any of them may do by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this Power of
Attorney the 5th day of February, 1996.
NEIL G. BLUHM
- ----------------------- President and Director
Neil G. Bluhm
JUDD D. MALKIN
- ----------------------- Chairman and Chief Financial Officer
Judd D. Malkin
A. LEE SACKS
- ----------------------- Director of General Partner
A. Lee Sacks
STUART C. NATHAN
- ----------------------- Executive Vice President
Stuart C. Nathan Director of General Partner
A. Lee Sacks
The undersigned hereby acknowledge and accept such power of authority
to sign, in the name and on behalf of the above named officers, a Report on
Form 10-K of said partnership for the fiscal year ended December 31, 1995,
and any and all amendments thereto, the 5th day of February, 1996.
GARY NICKELE
-----------------------
Gary Nickele
GAILEN J. HULL
-----------------------
Gailen J. Hull
DENNIS M. QUINN
-----------------------
Dennis M. Quinn
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1995 (IMMEDIATELY
PRIOR TO DISSOLUTION) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS INCLUDED IN SUCH REPORT.
</LEGEND>
<CIK> 0000319192
<NAME> JMB INCOME PROPERTIES, LTD. - VIII
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 19,240,703
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 19,240,703
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 19,240,703
<TOTAL-LIABILITY-AND-EQUITY> 19,240,703
<SALES> 5,904,440
<TOTAL-REVENUES> 7,054,301
<CGS> 0
<TOTAL-COSTS> 6,860,324
<OTHER-EXPENSES> 30,720,629
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,383,887
<INCOME-PRETAX> (33,910,539)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,307,616)
<DISCONTINUED> 2,080,546
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,227,070)
<EPS-PRIMARY> (146.23)
<EPS-DILUTED> (146.23)
</TABLE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 18, 1995
JMB INCOME PROPERTIES, LTD. - VIII
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Illinois 0-10206 36-3075978
- ------------------- -------------- --------------------
(State or other) (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Organization
900 N. Michigan Avenue, Chicago, Illinois 60611-1575
-----------------------------------------------------
(Address of principal executive office)
Registrant's telephone number, including area code: (312) 915-1987
- -----------------------------------------------------------------
CARILLON SHOPPING CENTER
Houston, Texas
------------------------------
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On May 18, 1995,
Carillon Associates, Ltd. ("Associates"), a joint venture between
JMB Income Properties Limited - VIII (the "Partnership") its
Managing General Partner and an unaffiliated venture partner,
sold the Carillon Shopping Center (the "Property") located in
Houston, Texas. The purchaser, Richfield Investment Corporation,
is not affiliated with the Partnership or its General Partners
and the sale price was determined by arm's-length negotiation.
The Property is an approximately 182,000 square foot shopping
center and, as of the date of the sale was approximately 66%
occupied.
The sale price of the property was $7,400,000 (before
selling costs and prorations) and was paid in cash at closing.
The Partnership received net proceeds of approximately $6,900,000
upon closing of which its share is $6,200,000 after payment of
certain promissory notes due to the Partnership's former venture
partner in Carillon Partners, Ltd.
The Associates' Partnership Agreement generally provides
that the net proceeds from any sale or refinancing will be
distributed as follows: first, the Partnership will receive any
deficiencies in its cumulative annual preferred return (as
defined); second, the Partnership will receive the next amount of
proceeds up to the sum of $3,972,500 plus 118% of the additional
contributions; and any remaining balance will be distributable
60% to the Partnership and 40% to the unaffiliated venture
partner. The Partnership expects to receive 100% of the net
distributable sale proceeds to the Venture pursuant to the above
referenced provisions. The Partnership estimates that it will
recognize a gain of approximately $100,000 for financial
reporting purposes and approximately $668,000 for Federal income
tax purposes.
The Partnership Agreement provides that the General Partners
shall receive as a distribution from the sale of a real property
by the Partnership 3% of the selling price, and that the
remaining proceeds (net after expenses and retained working
capital) be distributed 85% to the Limited Partners and 15% to
the General Partners. However, the Limited Partners shall
receive 100% of such net sale proceeds until the Limited Partners
(i) have received cash distributions of sale or refinancing
proceeds in an amount equal to the Limited Partners' aggregate
initial capital investment in the Partnership and (ii) have
received cumulative cash distributions from the Partnership's
operations which, when combined with sale or refinancing proceeds
previously distributed, equal a 6% annual return on the Limited
Partners' average capital investment for each year (their initial
capital investment as reduced by sale or refinancing proceeds
previously distributed) commencing with the third fiscal quarter
of 1981. The Limited Partners have not yet received cash
distributions equal to their investment plus a 6% annual return
on such investment. Therefore, no portion of the proceeds of
this sale will be distributed to the General Partners at this
time.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements. Not applicable.
(b) Pro Forma Financial Information - Narrative.
As a result of the sale of the Carillon Shopping Center,
beyond May 18, 1995, there will be no further rental income,
depreciation, property operating expenses, amortization of
deferred expenses or venture partners' share of venture
operations recorded for Associates in the consolidated financial
statements of the Partnership, which for the Partnership's most
recent fiscal year (the year ended December 31, 1994) were
approximately, $1,564,000, $460,000, $1,095,000, $19,000 and
$9,000, respectively. Rental income, depreciation, property
operating expenses, amortization of deferred expenses and venture
partners' share of venture operations for Associates were
approximately $409,000, $108,000, $226,000, $5,000 and $1,000,
respectively, for the three months ended March 31, 1995. Also,
as a result of the sale of the Carillon Shopping Center, there
are no further assets and liabilities related to Associates,
which at March 31, 1995 consisted of cash and other current
assets of approximately $2,398,000; land and buildings and
improvements (net of accumulated depreciation) of approximately
$5,049,000; deferred expenses of approximately $135,000; venture
partner's deficit in venture of approximately $1,780,000; current
liabilities of $108,000 and other liabilities of approximately
$3,000.
(c) Exhibits
10. Purchase Agreement between Carillon Associates,
Ltd. and Richfield Investment Corporation dated March 24, 1995.
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 thereunto duly authorized.
JMB INCOME PROPERTIES, LTD. - VIII
By: JMB Realty Corporation
Managing General Partner
By: GAILEN J. HULL
Gailen J. Hull
Senior Vice President
Dated: June 1, 1995
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 5, 1995
JMB INCOME PROPERTIES, LTD. - VIII
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Illinois 0-10206 36-3075978
- ------------------- -------------- --------------------
(State or other) (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Organization
900 N. Michigan Avenue, Chicago, Illinois 60611-1575
-----------------------------------------------------
(Address of principal executive office)
Registrant's telephone number, including area code: (312) 915-1987
- -------------------------------------------------------------------
TOWN AND COUNTRY CENTER
Houston, Texas
ITEM 2. ACQUISITION OR DISPOSITION OF ASSET. JMB Income Properties, Ltd.
- - VIII (the "Partnership"), in a joint venture with an affiliated
partnership, JMB Income Properties, Ltd.-IX, owned an interest in Town and
Country Center, a 1,054,000 square foot regional shopping center located in
Houston, Texas, through another joint venture ("T&C") with the developer of
the center. The center includes six free-standing buildings and a three-
level enclosed mall, of which T&C owned approximately 370,000 square feet
of mall space (the "Property"). On December 5, 1995, the lender, American
General Life and Accident Insurance Company, realized upon its security for
its non-recourse mortgage loan, which included the land, building and
related improvements of the Property, in discharge of the loan. The
Property was approximately 76% occupied (including temporary tenants) on
the disposition date. As previously reported, the Property faced strong
competition in its area. T&C had prepared and evaluated a plan for an
extensive renovation and re-merchandising of the Property. Given T&C's
level of debt, the strong competition that the Property faced and the
significant cost that would have been required to lease, renovate and re-
merchandise the Property, T&C decided in September 1995 not to commit any
additional capital to pay continued operating deficits of the Property,
including funding for debt service payments, without obtaining a
modification to the existing non-recourse mortgage loan. Consequently, T&C
remitted to the lender only the amount of cash flow from property
operations after expenses rather than the full debt service payment
required for the month of September 1995. The lender was unwilling to
modify the loan and realized upon its security as a result of the default
in the payment of debt service.
As a result of the disposition of the Property to the lender and the
liquidation of the joint ventures mentioned above, the Partnership has
recognized a gain of approximately $9,800,000, excluding the venture
partners' shares, for financial reporting purposes and a gain of
approximately $8,400,000, excluding the venture partners' shares, for tax
reporting purposes. Substantially all of the gain for financial reporting
purposes results from the liquidation of the joint ventures. The
Partnership had previously recorded a $30,115,000 loss on value impairment
for financial reporting purposes relating to the underlying real estate
assets. There are no proceeds from the disposition. Under the terms of
the applicable venture agreements, gain on disposition of the Property and
liquidations of joint ventures is to be allocated according to the
respective ownership percentages of the venture partners. The
Partnership's ownership percentage in the Property was 50.10%.
The Partnership's interest in the Town and Country Center was its only
remaining investment property and due to its disposition, the Partnership
intends to wind up its affairs and liquidate by year-end. The Partnership
will distribute its remaining cash after payment of expenses and
liabilities. It is currently expected that a final liquidating
distribution in excess of $200 per Limited Partnership Interest will be
made in connection with the liquidation and termination of the Partnership.
However, this is an estimate only, and the final liquidating distribution
to the Limited Partners, which will depend upon, among other things,
amounts needed to pay or provide for the Partnership's remaining expenses
and liabilities, may vary from such estimate.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements. Not applicable.
(b) Proforma financial information - Narrative.
As a result of the lender realizing upon its security interest in the
Property, there will be no further rental income, mortgage and other
interest, depreciation and amortization, property operating expenses or
venture partners' share of ventures' operations recorded for the Property,
which for the Partnership's most recent fiscal year (the year ended
December 31, 1994) were approximately $6,912,000, $3,535,000, $2,829,000,
$4,192,000 and $1,795,000, respectively, and for the nine months ended
September 30, 1995 were approximately $4,658,000, $2,641,000, $2,095,000,
$3,096,000 and $16,625,000, respectively. Additionally, there will be no
further provision for value impairment for the Property, which was
approximately $30,115,000 at September 30 1995. Also, there will be no
further assets and liabilities related to the Property, which at December
31, 1994 and September 30, 1995 consisted of (i) land, building and
improvements and deferred expenses (net of accumulated depreciation and
amortization) of approximately $59,342,000 and $27,099,000, respectively;
(ii) cash and other current assets of approximately $3,270,000 and
$2,281,000, respectively; (iii) current portion of long-term debt of
approximately $1,515,000 and $30,824,000, respectively; (iv) other current
liabilities of $2,299,000 and $2,123,000, respectively; (v) other
liabilities of approximately $1,645,000 and $1,099,000, respectively; (vi)
long-term debt less current portion of approximately $29,651,000 and none,
respectively; and (vii) venture partners' subordinated equity of
approximately $23,338,000 and $6,978,000, respectively.
(c) Exhibits.
None
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 thereunto duly authorized.
JMB INCOME PROPERTIES, LTD. - VIII
By: JMB Realty Corporation
Managing General Partner
By: GAILEN J. HULL
Gailen J. Hull
Senior Vice President
Dated: December 20, 1995
