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As filed with the Securities and Exchange Commission on July 31, 1998
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) JUNE 18, 1998
Commission File Number: 1-6064
ALEXANDER'S, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 51-0100517
(State or other jurisdiction of incorporation) (I.R.S. Employer
Identification Number)
PARK 80 WEST, PLAZA II, SADDLE BROOK, NEW JERSEY 07663
(Address of principal executive offices) (Zip Code)
(201)587-8541
(Registrant's telephone number, including area code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
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This Form 8-K/A amends Alexander's, Inc. Form 8-K previously filed to include
certain required financial statements and pro forma financial information
ITEM 1. NOT APPLICABLE.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On June 18, 1998, Alexander's, Inc. ("Alexander's")
increased its interest in the Kings Plaza Mall (the "Mall") to
100% by acquiring Federated Department Store's 50% interest.
The purchase price was approximately $28,000,000, which was
paid in cash. Alexander's has owned a 50% interest in the Mall
since it was built in 1970.
The two-level Mall contains approximately 430,000
square feet and is part of the Kings Plaza Shopping Center
(the "Center"). The Center, which contains approximately 1.1
million square feet of retail space and a five-level parking
structure, is located at the intersection of Flatbush Avenue
and Avenue U in Brooklyn, NY. In addition to owning the Mall,
Alexander's owns one of the Center's anchor stores, which is
principally leased to Sears. The other anchor store is owned
by Federated and operated as a Macy's department store.
In connection with the acquisition and to fund the
purchase price, Alexander's has completed a $90 million
three-year mortgage loan with Union Bank of Switzerland. The
loan is secured by the Kings Plaza Mall and the Alexander's
anchor store and bears interest at LIBOR plus 1.25%. In
addition, Alexander's expects to complete a $30 million
construction loan with Union Bank of Switzerland, of which
approximately $15 million will be advanced in the future to
partially fund a renovation of the Mall, as will approximately
$15 million for the refurbishment of the Macy's store.
These transactions were arrived at through arms-
length negotiations.
ITEMS 3-6. NOT APPLICABLE.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
There are filed herewith:
(a) The historical Statements of Operations for Kings Plaza
Shopping Center and Marina For The Three Months Ended March
31, 1998 and 1997. The financial statements of Kings Plaza
Shopping Center and Marina for the year ended December 31,
1997 which are included in the Consolidated Financial
Statements of Alexander's Inc., for the year ended December
31, 1997, are incorporated herein by reference.
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(b) The Consolidated Pro Forma Balance Sheet of Alexander's as of
March 31, 1998 and the Consolidated Pro Forma Income Statement
of Alexander's for the Three Months Ended March 31, 1998 and
the Year Ended December 31, 1997, commencing on page 5, to
give pro forma effect to the acquisition of the remaining 50%
interest in Kings Plaza Shopping Center and Marina and the
financings attributable thereto.
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Page
Reference
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Kings Plaza Shopping Center and Marina
Statements of Operations for the Three Months Ended March 31, 1998
and 1997 (unaudited).............................................................. 4
Pro Forma financial information:
Consolidated Pro Forma Balance Sheet at March 31, 1998........................... 7
Consolidated Pro Forma Income Statement for the Three Months Ended
March 31, 1998.....................................................................8
Consolidated Pro Forma Income Statement for the Year Ended December
31, 1997...........................................................................9
Notes to Consolidated Pro Forma Financial Statements...............................10
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ITEMS 8-9. Not Applicable.
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KINGS PLAZA SHOPPING CENTER AND MARINA
STATEMENTS OF OPERATIONS
(unaudited)
(amounts in thousands)
For the Three Months Ended
---------------------------------
March 31, 1998 March 31, 1997
-------------- --------------
<S> <C> <C>
REVENUES:
Rents $ 3,787 $ 3,618
Expense reimbursements:
Central heating, cooling, air
handling and electricity 636 631
Real estate taxes 467 396
Common area 1,497 1,351
Parking lot 501 438
Other income 511 527
-------------- --------------
TOTAL REVENUES 7,399 6,961
-------------- --------------
EXPENSES:
Central heating, cooling, air
handling and electricity 1,073 1,093
Real estate taxes 547 427
Common area 932 909
Parking lot 704 644
Insurance 246 262
Rent 18 18
Management fee 194 156
Administrative 423 383
Depreciation and amortization 369 330
-------------- --------------
TOTAL EXPENSES 4,506 4,222
-------------- --------------
OPERATING INCOME 2,893 2,739
Interest and debt expense (156) (190)
-------------- --------------
NET INCOME $ 2,737 $ 2,549
============== ==============
See notes to statements of operations
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KINGS PLAZA SHOPPING CENTER AND MARINA
NOTES TO STATEMENTS OF OPERATIONS
(unaudited)
1. ORGANIZATION AND BUSINESS
Kings Plaza Shopping Center of Avenue U, Inc. (a wholly-owned subsidiary of
Federated Department Stores, Inc. (formerly R.H. Macy & Co. Inc. ("Macy's")) and
Alexander's Department Stores of Brooklyn, Inc. (wholly-owned by Alexander's,
Inc. ("Alexander's")), formed a joint venture for the purpose of owning and
operating the Kings Plaza Shopping Center and Marina ("Center"), including the
energy plant servicing the entire shopping center, but exclusive of the Macy's
and Alexander's stores and land thereunder located in the Center. The
co-venturers each have an undivided 50% interest as tenants in common in the
property and equipment.
2. BASIS OF PRESENTATION
The Statements of Operations for the three months ended March 31, 1998 and
1997 are unaudited. In the opinion of management, all adjustments (which include
only normal recurring adjustments) necessary to present fairly the results of
operations have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These Statements of Operations should be read in
conjunction with the financial statements and notes thereto of the Center, which
are included in the Alexander's 1997 Annual Report to Shareholders and
incorporated herein by reference. The results of operations for the three months
ended March 31, 1998 and 1997 are not necessarily indicative of the operating
results for the full year.
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PRO FORMA FINANCIAL INFORMATION:
The unaudited consolidated pro forma financial information attached
presents: (A) the Consolidated Pro Forma Income Statements of Alexander's, Inc.
("Alexander's") for the year ended December 31, 1997 and for the three months
ended March 31, 1998, as if the acquisition of the remaining 50% interest in
Kings Plaza Shopping Center and Marina (the "Center") and the financings
attributable thereto had occurred on January 1, 1997 and (B) the Consolidated
Pro Forma Balance Sheet of Alexander's as of March 31, 1998, as if the above
acquisition and related financing had occurred on March 31, 1998.
The unaudited consolidated pro forma financial information is not
necessarily indicative of what Alexander's actual results of operations or
financial position would have been had these transactions been consummated on
the dates indicated, nor does it purport to represent Alexander's results of
operations or financial position for any future period.
The unaudited consolidated pro forma financial information should be
read in conjunction with the Consolidated Financial Statements and notes thereto
included in Alexander's Annual Report on Form 10-K for the year ended December
31, 1997 which contains the audited financial statements of Kings Plaza Shopping
Center and Marina, the Consolidated Financial Statements and notes thereto
included in Alexander's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998 and the Statement of Operations of Kings Plaza Shopping Center
and Marina included herein. In management's opinion, all adjustments necessary
to reflect these transactions have been made.
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ALEXANDER'S INC. AND SUBSIDIARIES
CONSOLIDATED PRO FORMA BALANCE SHEET
MARCH 31, 1998
(unaudited)
(amounts in thousands)
Reclassification
of Alexander's
Historical 50% Equity Interest Pro Forma Total
Alexander's in the Mall Adjustments Pro Forma
---------- -------- --------- ----------
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ASSETS:
Real estate, net:
Land, building and improvements, net $ 184,088 13,392 $ 13,392 (A) $ 230,286
19,414 (A)
Investment in unconsolidated joint venture 10,708 (10,708) -
---------- -------- --------- ----------
194,796 2,684 32,806 230,286
Cash & cash equivalents 2,700 538 538 (A) 25,376
49,600 (B)
(28,000) (A)
Restricted cash 8,209 - - 8,209
Accounts receivable 475 260 260 (A) 995
Receivable arising from the straight-lining of rents 8,703 858 9,561
Deferred lease and other expenses 12,672 1,264 15,000 (C) 28,936
Deferred debt expense 632 - 2,400 (B) 3,032
Other assets 3,912 460 460 (A) 4,832
========== ======== ========= ==========
$ 232,099 $ 6,064 $ 73,064 $ 311,227
========== ======== ========= ==========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Debt $ 204,359 $ 3,084 $ 3,084 (A) $ 262,527
90,000 (B)
(38,000) (B)
Amount due to Vornado Realty Trust and its affiliates 6,686 6,686
Accounts payable and accrued liabilities 4,265 1,260 1,260 (A) 6,785
Minority interest 600 - 600
Amount due tenants - tax certiorari proceedings 1,720 1,720 (A) 3,440
Other liabilities 2,238 2,238
Due to seller 15,000 (C) 15,000
Equity 13,951 13,951
========== ======== ========= ==========
$ 232,099 $ 6,064 $ 73,064 $ 311,227
========== ======== ========= ==========
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ALEXANDER'S INC. AND SUBSIDIARIES
CONSOLIDATED PRO FORMA INCOME STATEMENT
FOR THE THREE MONTHS ENDED MARCH 31, 1998
(unaudited)
(amounts in thousands except per share amounts)
Historical
----------------------------------
Kings Plaza
Shopping
Center And Pro Forma Total
Alexander's Marina(100%) Adjustments Pro Forma
------------- ----------------- ------------- -------------
<S> <C> <C> <C> <C>
REVENUES:
Property rentals $ 5,631 $ 3,787 $ 40 (D) $ 9,458
Expense reimbursements 998 2,600 3,598
Equity in income of
unconsolidated joint venture 1,378 (1,378)(E) -
Parking lot 501 501
Miscellaneous income 511 511
------------- ----------------- ------------- -------------
TOTAL REVENUES 8,007 7,399 (1,338) 14,068
------------- ----------------- ------------- -------------
EXPENSES
Operating 2,020 3,520 5,540
General and administrative 866 617 1,483
Depreciation and amortization 798 369 (108)(F) 1,309
250 (G)
------------- ----------------- ------------- -------------
TOTAL EXPENSES 3,684 4,506 142 8,332
------------- ----------------- ------------- -------------
OPERATING INCOME 4,323 2,893 (1,480) 5,736
Interest and debt expenses (3,665) (156) (434)(H) (4,255)
Interest and other income 264 264
============= ================= ============= =============
NET INCOME $ 922 $ 2,737 $ (1,914) $ 1,745
============= ================= ============= =============
Net income per share - basic and diluted
(based on 5,001 shares) $ 0.18 $ 0.35
============= =============
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ALEXANDER'S INC. AND SUBSIDIARIES
CONSOLIDATED PRO FORMA INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1997
(unaudited)
(amounts in thousands except per share amounts)
Historical
---------------------------------
Kings Plaza
Shopping
Center And Pro Forma Total
Alexander's Marina(100%) Adjustments Pro Forma
-------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
REVENUES:
Property rentals $ 18,455 $ 14,940 $ 150 (I) $ 33,545
Expense reimbursements 2,668 10,775 13,443
Equity in income of
unconsolidated joint venture 4,246 (4,246)(J) -
Parking lot 2,079 2,079
Miscellaneous income 2,409 2,409
-------------- --------------- --------------- ---------------
TOTAL REVENUES 25,369 30,203 (4,096) 51,476
-------------- --------------- --------------- ---------------
EXPENSES:
Operating 7,459 16,708 24,167
General and administrative 3,933 2,332 6,265
Depreciation and amortization 2,714 1,418 (402)(K) 4,730
1,000 (L)
-------------- --------------- --------------- ---------------
TOTAL EXPENSES 14,106 20,458 598 35,162
-------------- --------------- --------------- ---------------
OPERATING INCOME 11,263 9,745 (4,694) 16,314
Interest and debt expenses (13,430) (710) (1,650)(M) (15,790)
Interest and other income 719 719
Net gain from condemnation proceedings 8,914 8,914
============== =============== =============== ===============
NET INCOME $ 7,466 $ 9,035 $ (6,344) $ 10,157
============== =============== =============== ===============
Net income per share - basic and diluted
(based on 5,001 shares) $ 1.49 $ 2.03
============== ===============
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NOTES TO CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Basis of Pro Forma:
The unaudited Consolidated Pro Forma Financial Statements were prepared to give
pro forma effect to Alexander's acquisition of the remaining 50% interest in the
Center. The column headed "Reclassification of Alexander's 50% Equity Interest
in the Mall" on the Consolidated Pro Forma Balance Sheet reflects the
reclassification of the equity investment into its balance sheet components. The
columns in the Consolidated Pro Forma Income Statements headed "Kings Plaza
Shopping Center and Marina" include the historical operating information for the
three months ended March 31, 1998 and the year ended December 31, 1997.
The acquisition was consummated through a subsidiary of Alexander's and was
recorded under the purchase method of accounting. The purchase costs were
allocated to the acquired assets and assumed liabilities using their relative
fair values as of the closing date, based upon valuations and other studies
which are not yet complete. Accordingly, the initial valuations are subject to
change as such information is finalized. Alexander's believes that any such
changes will not be significant since the allocations were principally to real
estate.
The purchase price and preliminary allocation of the excess of cost over net
assets acquired is as follows: (in thousands)
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Purchase price of the Center $ 28,000
Future fundings by Alexander's for the
refurbishment of the Macy's store 15,000
--------
43,000
--------
Historical value of 50% interest in real estate
being acquired 13,392
Assets and liabilities being acquired:
Cash 538
Accounts receivable 260
Other assets 460
Debt (3,084)
Accounts payable and accrued liabilities (1,260)
Other liabilities (1,720)
--------
Historical net book value of assets acquired 8,586
--------
Excess purchase price to be allocated in accordance
with the acquisition and operating agreement $ 34,414
========
Preliminary allocation of excess:
Allocation to real estate $ 19,414
Allocation to deferred lease and other expense 15,000
--------
$ 34,414
========
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NOTES TO CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
(CONTINUED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
The following adjustments were required to give pro forma effect to the
transactions being reported:
Consolidated Pro Forma Balance Sheet at March 31, 1998:
(A) To allocate the purchase cost of the acquisition of the remaining 50%
interest in the Center to those assets and liabilities acquired.
(B) To record a $90 million mortgage and the use of a portion of the
proceeds to repay existing property debt of approximately $38 million
and pay financing costs of approximately $2.4 million.
(C) To accrue amounts due to the seller in connection with the acquisition
and the related operating agreement.
Consolidated Pro Forma Income Statement for the Three Months Ended March 31,
1998:
(D) To adjust rentals arising from straight-lining of tenant leases that
contain escalations over the lease term.
(E) To eliminate equity in income from unconsolidated joint venture as a
result of acquiring the remaining 50% interest in the Center and
consolidating the operations into Alexander's.
(F) To adjust depreciation expense over the Center's expected useful life
based on the allocation of the purchase price between land and
building.
(G) To record three months of expense on deferred costs being amortized
over 15 years.
(H) To adjust interest expense for the portion of the new mortgage
financing used for the acquisition and interest savings on the debt
repaid.
Consolidated Pro Forma Income Statement for the Year Ended December 31, 1997:
(I) To adjust rentals arising from straight-lining of tenant leases that
contain escalations over the lease term.
(J) To eliminate equity in income from unconsolidated joint venture as a
result of acquiring the remaining 50% interest in the Center and
consolidating the operations into Alexander's.
(K) To adjust depreciation expense for the year ended December 31, 1997
over the Center's expected useful life based on the allocation of the
purchase price between land and building.
(L) To record expense for the year ended December 31, 1997 on deferred
costs being amortized over 15 years.
(M) To adjust interest expense for the portion of the new mortgage
financing used for the acquisition and interest savings on the debt
repaid.
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ALEXANDER'S, INC.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
ALEXANDER'S, INC.
(Registrant)
Date: July 31, 1998 /s/ Joseph Macnow
------------------------------------
JOSEPH MACNOW
Vice President-Chief Financial
Officer and Chief Accounting Officer
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