UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Period Ended: May 31, 1996 Commission File Number: 1-6833
------------ ------
MGI PROPERTIES
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 04-6268740
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
One Winthrop Square, Boston, Massachusetts 02110
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 422-6000
-------------------------
N/A
- --------------------------------------------------------------------------------
Former name, former address and former
fiscal year, if changed since last report.
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
--- ---
Common shares outstanding as of July 10, 1996: 11,550,095
Page 1 of 14 pages
Exhibit Index appears on Page 13
<PAGE>
MGI PROPERTIES
INDEX
PART I: FINANCIAL INFORMATION Page No.
--------
Item 1: Financial Statements
Consolidated Balance Sheets 3
Consolidated Statements of Earnings 4
Consolidated Statements of Cash Flow 5
Consolidated Statements of Changes in Shareholders' Equity 6
Notes to Consolidated Financial Statements 7
Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
Exhibit A: Computation of Earnings Per Share 12
PART II: OTHER INFORMATION
Items 1 - 6 13
Signatures 14
- 2 -
<PAGE>
MGI PROPERTIES
PART I -- FINANCIAL INFORMATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
May 31, 1996 November 30, 1995
(unaudited)
- ------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Real estate, at cost $315,353,000 $293,469,000
Accumulated depreciation and amortization (40,618,000) (36,375,000)
- ------------------------------------------------------------------------------------------
Net investments in real estate 274,735,000 257,094,000
Cash 1,521,000 2,456,000
Short-term investments, at cost 4,202,000 4,589,000
Accounts receivable 3,608,000 3,354,000
Other assets 9,277,000 7,158,000
- ------------------------------------------------------------------------------------------
$293,343,000 $274,651,000
==========================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Mortgage and other loans payable $96,110,000 $84,506,000
Other liabilities 6,178,000 5,905,000
- ------------------------------------------------------------------------------------------
Total liabilities 102,288,000 90,411,000
Deferred gain -- real estate -- 3,700,000
Shareholders' equity:
Preferred shares -- $1 par value; 6,000,000 shares authorized;
none issued -- --
Common shares -- $1 par value; 17,500,000 shares authorized;
11,538,095 issued (11,502,271 at November 30, 1995) 11,538,000 11,502,000
Additional paid-in capital 166,852,000 166,348,000
Undistributed net income 12,665,000 2,690,000
- ------------------------------------------------------------------------------------------
Total shareholders' equity 191,055,000 180,540,000
- ------------------------------------------------------------------------------------------
$293,343,000 $274,651,000
==========================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
- 3 -
<PAGE>
MGI PROPERTIES
CONSOLIDATED STATEMENTS OF EARNINGS
(unaudited)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
Three Months Ended Six Months Ended
---------------------------- --------------------------------
May 31, 1996 May 31, 1995 May 31, 1996 May 31, 1995
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCOME
Rental and other income $13,122,000 $11,161,000 $25,815,000 $21,882,000
Interest on investment securities 100,000 122,000 185,000 322,000
Other -- 16,000 6,000 32,000
- ------------------------------------------------------------------------------------------------------------------------
Total Income 13,222,000 11,299,000 26,006,000 22,236,000
- ------------------------------------------------------------------------------------------------------------------------
EXPENSES
Property operating expenses 3,381,000 2,840,000 6,753,000 5,654,000
Real estate taxes 1,591,000 1,403,000 3,102,000 2,795,000
Depreciation and amortization 2,238,000 2,024,000 4,550,000 4,063,000
Interest 2,075,000 1,399,000 3,966,000 2,811,000
General and administrative 746,000 713,000 1,479,000 1,387,000
- ------------------------------------------------------------------------------------------------------------------------
Total expenses 10,031,000 8,379,000 19,850,000 16,710,000
- ------------------------------------------------------------------------------------------------------------------------
Income before net gain 3,191,000 2,920,000 6,156,000 5,526,000
Net gain 9,350,000 -- 9,350,000 1,400,000
- ------------------------------------------------------------------------------------------------------------------------
Net income $12,541,000 $2,920,000 $15,506,000 $6,926,000
========================================================================================================================
PER SHARE DATA
Income before net gain $0.28 $0.25 $0.54 $0.48
Net gain 0.81 -- 0.81 0.12
- ------------------------------------------------------------------------------------------------------------------------
Net income $1.09 $0.25 $1.35 $0.60
========================================================================================================================
Weighted average shares outstanding 11,535,008 11,484,293 11,526,406 11,479,645
========================================================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
- 4-
<PAGE>
MGI PROPERTIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(unaudited)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------
Six Months Ended May 31,
---------------------------------
1996 1995
- -----------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $15,506,000 $ 6,926,000
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization expense 4,550,000 4,063,000
Net gain (9,350,000) (1,400,000)
Other (1,576,000) (1,042,000)
- -----------------------------------------------------------------------------------------
Net cash provided by operating activities 9,130,000 8,547,000
- -----------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions of real estate (19,183,000) (10,074,000)
Additions to real estate (2,832,000) (2,629,000)
Construction in progress -- (3,079,000)
Deferred tenant charges (443,000) (1,154,000)
Net proceeds from sales of real estate interests 6,072,000 4,738,000
Other (460,000) 308,000
- -----------------------------------------------------------------------------------------
Net cash used in investing activities (16,846,000) (11,890,000)
- -----------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Additions to mortgage and other loans payable, net 14,000,000 1,000,000
Repayment of mortgage and other loans payable (2,396,000) (705,000)
Cash distributions (5,531,000) (5,051,000)
Proceeds from issuance of common shares 321,000 150,000
- -----------------------------------------------------------------------------------------
Net cash provided by (used in) financing activities 6,394,000 (4,606,000)
- -----------------------------------------------------------------------------------------
Net decrease in cash and short-term investments (1,322,000) (7,949,000)
- -----------------------------------------------------------------------------------------
CASH AND SHORT-TERM INVESTMENTS
Beginning of period 7,045,000 12,892,000
- -----------------------------------------------------------------------------------------
End of period $ 5,723,000 $ 4,943,000
========================================================================================
</TABLE>
See accompanying notes to consolidated financial statements.
- 5 -
<PAGE>
MGI PROPERTIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited)
- -----------------------------------------------------------------------------
Additional
Common Paid-In Undistributed
Shares Capital Net Income
- -----------------------------------------------------------------------------
Balance at November 30, 1995 $11,502,000 $166,348,000 $ 2,690,000
Net income -- -- 15,506,000
Distributions -- -- (5,531,000)
Options exercised and other 36,000 504,000 --
- -----------------------------------------------------------------------------
Balance at May 31, 1996 $11,538,000 $166,852,000 $12,665,000
=============================================================================
See accompanying notes to consolidated financial statements.
- 6 -
<PAGE>
MGI PROPERTIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Note 1: The results of the interim period are not necessarily indicative of
- ------- results to be expected for the entire fiscal year. The figures
contained in this interim report are unaudited and may be subject to
year-end adjustments. Certain prior year amounts have been reclassified
to conform with the current year presentation. In the opinion of
management, all adjustments necessary for a fair presentation of
financial position and results of operations have been included and
such adjustments include only the normal accruals.
Note 2: On June 18, 1996, the Board of Trustees declared a cash dividend of
- ------- $.25 per common share payable on July 11, 1996 to shareholders of
record on July 1, 1996. This dividend payment will aggregate $2.9
million.
Note 3: Cash paid for interest amounted to $4.0 million and $3.1 million for
- ------- six-month periods ended May 31, 1996 and May 31, 1995, respectively.
Note 4: At May 31, 1996, options to purchase an aggregate of 820,911 common
- ------- shares at exercise prices ranging from $7.375 to $16.75 per share were
outstanding under MGI's stock option plans for key employees and
trustees. All options outstanding at May 31, 1996 expire by March 2006.
Note 5: MGI intends to qualify for the year ended November 30, 1996 as a
- ------- real estate investment trust under the provisions of Sections 856-860
of the Internal Revenue Code of 1986, as amended. Accordingly, no
provision has been made for Federal income taxes.
- 7 -
<PAGE>
MGI PROPERTIES
PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
- -------------------------------
Shareholders' equity at May 31, 1996 was $191.1 million, compared to
$180.5 million at November 30, 1995. The increase primarily reflects net income
in excess of distributions. At May 31, 1996, financial liquidity was provided by
$5.7 million in cash and investment securities and by unused lines of credit
aggregating $34.5 million.
During the first six months of fiscal 1996, the Trust acquired four
Massachusetts industrial properties aggregating 364,000 square feet for a
combined purchase price of $18.8 million and acquired a parcel of land located
in Tampa, Florida for $0.4 million. Expenditures for capital and tenant
improvements during the first half of fiscal 1996 totaled $1.4 million and $1.4
million, respectively. Of the capital improvements, $0.9 million is associated
with the renovations of two Boston office properties, with the balance primarily
representing customary capital projects in the residential and retail segments.
Mortgage and other loans payable totaled $96.1 million at May 31, 1996, a
net increase of $11.6 million, compared to $84.5 million at November 30, 1995.
The change represents a combination of the addition of two mortgage loans
totaling $14.0 million, which have an average rate and term of 7.6% and thirteen
years, respectively, the reduction of its outstanding lines of credit balance by
$1.5 million and scheduled payments of principal amortization totaling $0.9
million. Scheduled loan principal payments due within twelve months of May 31,
1996 total $13.9 million, including one of the Trust's lines of credit, which is
now scheduled to mature August 1, 1996. The Trust is currently engaged in
negotiating a new line under generally similar terms and conditions. MGI
believes it will continue to be able to extend or refinance maturing mortgage
loans upon satisfactory terms.
Cash requirements during the second half of fiscal 1996 include
distributions to shareholders, capital and tenant improvements and other leasing
expenditures required to maintain MGI's occupancy levels and other investment
undertakings. On July 2, 1996, the Trust completed the acquisition of 230,000
square feet of office space, 25,000 square feet of retail space plus adjacent
land, currently utilized as a 523 space surface parking lot, located at two
properties in Portland, Maine for a combined price of $31.2 million. The
purchases were made subject to an aggregate of $21.3 million of existing debt,
which bears interest at an average fixed rate of 8.7% and an average maturity of
eight years, and the balance was funded with cash of $9.9 million derived
primarily from advances under the Trust's lines of credit. The office and retail
space is currently 99% leased. Based on current operations, MGI estimates
property operating income will produce an approximate 11.5% initial return prior
to interest expense. On July 1, 1996, the Trust acquired a 60,650 square-foot
industrial facility located in Andover, Massachusetts for $3.9 million. The
facility is 100% leased to a single tenant which is publicly traded on the New
York Stock Exchange. The Trust has also entered into an agreement for the
purchase of a 100,000 square-foot industrial building located in Franklin,
Massachusetts for a price of approximately $5.2 million. The acquisition is
subject to the satisfactory completion of due diligence and is expected to close
late in the third quarter. Additionally, the Trust is contractually committed to
approximately $2.1 million of capital and tenant improvement projects, which are
anticipated to be completed during the balance of fiscal 1996. The Trust has
reserved $1.1 million of the new mortgage proceeds to fund a portion of the
improvements.
- 8 -
<PAGE>
MGI PROPERTIES
PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Principal sources of funds in the future are expected to be from property
operations, mortgaging or refinancing of existing mortgages on properties and
MGI's portfolio of investment securities. Other potential sources of funds
include the proceeds of public or private offerings of additional equity or debt
securities of the Trust or the sale of real estate investments. The cost of new
borrowings or issuances of the Trust's equity securities will be measured
against the anticipated returns of investments to be acquired with such funds.
In lieu of proceeds from real estate sales or the sale of its equity securities,
the Trust presently anticipates that the purchase of additional properties in
fiscal 1996 will be financed primarily by debt and, to a lesser extent, by cash
flow from operations and short-term investments. MGI believes the combination of
available cash and investment securities, the value of MGI's unencumbered
properties and other resources available to it are sufficient to meet its short-
and long-term liquidity requirements.
Results of Operations
- ---------------------
Net income for the fiscal quarter ended May 31, 1996, was $12.5 million,
or $1.09 per share, as compared to $2.9 million, or $.25 per share, in the
corresponding quarter of 1995. Included in the 1996 second quarter net income
was $9.4 million, or $.81 per share, of gain recognized from the sale of MGI's
interests in a 430-unit California apartment complex. Net income for the six
months ended May 31, 1996, was $15.5 million, or $1.35 per share, as compared to
$6.9 million, or $.60 per share, a year ago. Gains included in year-to-date net
income were $9.4 million, or $.81 per share in 1996, compared to $1.4 million,
or $.12 per share in 1995.
Funds from operations ("FFO") totaled $5.4 million, or $.47 per share, in
the second quarter of fiscal 1996, compared to $4.9 million, or $.43 per share,
in the corresponding quarter of 1995. Funds from operations for the six months
ended May 31, 1996 and 1995 were $10.7 million, or $.93 per share, and $9.6
million, or $.84 per share, respectively. MGI has implemented in 1996 the
National Association of Real Estate Investment Trusts recommended changes in the
calculation of FFO. The new definition stipulates that in calculating FFO
leasing costs should be capitalized and not deducted as an expense. This has the
effect of increasing the Trust's FFO by approximately $.02 in the first six
months of fiscal 1996. The comparative period of fiscal 1995 has been restated
to account for reduced leasing expenses which results in the FFO rising from
$.81 per share to $.84 per share. FFO is defined as net income (computed in
accordance with generally accepted accounting principles), excluding gains (or
losses) from debt restructuring and sales of property, plus depreciation and
amortization and after adjustments for unconsolidated partnerships and joint
ventures. MGI believes FFO is an appropriate supplemental measure of operating
performance. The change in FFO, compared to the corresponding period in 1995, is
attributable to the same factors that affected income before net gains in such
periods, with the exception of depreciation and amortization expense.
In comparing the second quarter of fiscal 1996 to that of the previous
year, the increase in net income before net gain of approximately $0.3 million
resulted principally from a $1.2 million increase in property operating income
which is offset, in part, by increases in interest expense and depreciation and
amortization of $0.7 million and $0.2 million, respectively. The increase in
interest expense is due to the higher balance of debt primarily associated with
property acquisitions. Property operating income is defined as rental and other
income less property operating expenses and real estate taxes. The change in
property operating income reflects the additional income from the acquisition of
properties offset, in part, by the effect of the sale of properties. Income from
properties owned throughout the second quarters of both fiscal 1996 and 1995, in
the aggregate, is relatively unchanged.
- 9 -
<PAGE>
MGI PROPERTIES
PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Change in Property Operating Income for Quarter Ended May 31, 1996 Versus
May 31, 1995
- --------------------------------------------------------------------------
<TABLE>
<CAPTION>
Properties Held 1996 and 1995 1996 and 1995
Both Fiscal Years Acquisitions Sales Net Change
----------------- ------------- ------------- ----------
<S> <C> <C> <C> <C>
Industrial $ 13,000 $ 997,000 -- $1,010,000
Office 134,000 205,000 -- 339,000
Apartment (11,000) -- $(292,000) (303,000)
Retail (124,000) 310,000 -- 186,000
---------- ---------- --------- ----------
$ 12,000 $1,512,000 $(292,000) $1,232,000
========== ========== ========= ==========
</TABLE>
The income growth in the industrial segment is primarily due to the seven
acquisitions completed since May 31, 1995. The increase in the retail segment is
due to the contribution of the Bradlees store in Peabody, Massachusetts which
began paying rent in November 1995, offset in part by the effect of increased
vacancy and operating expenses at the comparable retail properties. The office
segment has increased due to higher occupancy and to fourth quarter 1995
acquisitions. The decrease in the apartment segment is due to the sale of the
Posada del Rey Apartments in Metairie, Louisiana in September 1995. The income
from the comparable apartment and industrial properties was relatively unchanged
compared to the second quarter of fiscal 1995.
The same factors which contributed to the increase in income before net
gain for the quarter also explain the $0.6 million increase in income before
gain for the six months ended May 31, 1996. Property operating income has
increased by $2.5 million due to the net of $2.7 million of income contributed
from acquisitions and $0.4 million from comparable properties offset by $0.6
million of income lost due to the 1995 sale of the Posada del Rey Apartment.
Interest expense, however, has increased by $1.2 million over the comparable six
months of 1995 due to debt incurred in connection with the acquisition of
properties. Depreciation and amortization has increased reflecting the greater
number of properties owned. Additionally, general and administrative costs have
increased, reflecting higher personnel costs.
Scheduled lease expirations and completed leasing (in square feet) are as
follows:
Scheduled Expirations
Year-to-Date ---------------------------
Leased at 1996 Remaining Scheduled
May 31, 1996 Leasing 1996 1997
------------ ------------ --------- ---------
Industrial 96.9% 356,800 -- 450,000
Office 94.2% 88,900 35,000 199,000
Retail 96.3% 28,500 75,000 19,000
----- ------- ------- -------
96.3% 474,200 110,000 668,000
===== ======= ======= =======
The fiscal 1997 scheduled lease expirations represent 13.8% of MGI's total
commercial portfolio, which is approximately the same as the percentage of 1996
expirations a year ago at this time. Included in the 1997 expirations is a
97,000 square-foot office tenant in Franklin Township, New Jersey, and based
upon the discussions with the tenant, management presently believes that the
lease can be extended for three or more years albeit at a lower rate than is
currently in effect. Management estimates that the current market rent is
approximately 15% to 20% lower than the current rent.
- 10 -
<PAGE>
MGI PROPERTIES
PART I, ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Forward Looking Statements
- --------------------------
Statements made or incorporated in this Report may include
"forward-looking" statements, estimates or projections within the meaning of
Section 21E of Securities Exchange Act of 1934, as amended, and Section 27A of
the Securities Act of 1933, as amended. It is important to note that the Trust's
actual results of operations or plans could differ materially from those set
forth in such forward-looking statements. Certain factors which may cause such a
difference include those referred to in the Item 1 discussion of the Trust's
business in its Form 10-K report for the year ended November 30, 1995,
including, but not limited to, the captions entitled "Environmental Matters" and
"Competition, Regulation and Other Factors."
Risk Factors
- ------------
Miscellaneous Real Estate Investment Considerations
- ---------------------------------------------------
Real estate investments and operations are subject to a number of factors,
including changes in general economic climate, local conditions (such as an
oversupply of space, a decline in effective rents or a reduction in the demand
for real estate), competition from other available space, the ability of the
owner to provide adequate maintenance, to fund capital and tenant improvements
required to maintain market position and control of operating costs. In certain
markets in which the Trust owns real estate, overbuilding and local or national
economic conditions have combined to produce lower effective rents and/or longer
absorption periods for vacant space. As the Trust re-leases space, certain
effective rents may be less than those earned previously. Management believes
its diversification by property type, reduces, in some measure, the risks
associated with these factors and enhances opportunities for cash flow growth
and capital gains potential, although there can be no assurance thereof.
Furthermore, the major portion of the Trust's properties are now commercial
properties located in the Northeastern region of the United States.
Other Risk Factors
- ------------------
The Trust debt obligations subject to floating interest rates at May 31,
1996 aggregate approximately $16.3 million at an average interest rate of
approximately 7.0% per annum. The Trust's exposure to possible significant
increases in interest rates would adversely affect the net income, funds from
operation and cash available for distribution. Under various federal, state and
local laws and regulations, an owner of real estate or lender may be held liable
for the costs of removal or remediation of certain hazardous or toxic substances
located in, or emanating from, such properties. MGI is not aware of any material
environmental liabilities or violations with respect to any of its properties.
The Trust believes it has operated in a manner that permits it to qualify as a
REIT under the Internal Revenue Code for each taxable year since its formation.
No assurance can be given that the Trust will remain so qualified given the
highly technical Code provisions for which there are only limited judicial or
administrative interpretations and the determination of various factors and
circumstances may not be within the Trust's control. If the Trust fails to
qualify as a REIT it would be subject to Federal income tax on its taxable
income at corporate rates.
- 11 -
<PAGE>
MGI PROPERTIES
PART I - EXHIBIT A
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
Three Months Ended May 31, Six Months Ended May 31,
-------------------------- ------------------------
1996 1995 1996 1995
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY
Net income $12,541,000 $2,920,000 $15,506,000 $6,926,000
====================================================================================================
Weighted average number of shares
outstanding during the period 11,535,008 11,484,293 11,526,406 11,479,645
====================================================================================================
Primary earnings per share $1.09 $0.25 $1.35 $0.60
====================================================================================================
ASSUMING FULL DILUTION
Net income $12,541,000 $2,920,000 $15,506,000 $6,926,000
====================================================================================================
Weighted average number of shares
outstanding during the period 11,535,008 11,484,293 11,526,406 11,479,645
====================================================================================================
Earnings per share assuming full dilution $1.09 $0.25 $1.35 $0.60
====================================================================================================
</TABLE>
Note: Outstanding stock options are not taken into account in the computation of
- ---- earnings per share as they are not materially dilutive.
- 12 -
<PAGE>
MGI PROPERTIES
PART II - OTHER INFORMATION
Item 1: Legal Proceedings: Not applicable.
Item 2: Changes in Securities: Not applicable.
Item 3: Defaults upon Senior Securities: Not applicable.
Item 4: Submission of Matters to a Vote of Security Holders:
The following matter was submitted to a vote of shareholders at the
March 21, 1996 Annual Meeting of Shareholders:
The election of two Trustees to serve for a term of three years
expiring on the date of the Trust's Annual Meeting of Shareholders
in 1999. The vote on this was Francis P. Gunning -- 10,388,607
affirmative and 98,714 withheld; and, George M. Lovejoy, Jr. --
10,407,829 affirmative and 79,492 withheld. The election of one
Trustee to serve for a term of one year expiring on the date of the
Trust's Annual Meeting of Shareholders in 1997. The vote on this was
William F. Murdoch, Jr. -- 10,380,269 affirmative and 107,052
withheld.
Item 5: Other Information: Not applicable.
Item 6: Exhibits and Reports on Form 8-K:
a) Exhibits:
Computation of Earnings Per Share (see page 12).
b) Reports on Form 8-K: None.
- 13 -
<PAGE>
MGI PROPERTIES
SIGNATURES
Pursuant to the requirements to 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.
Date: July 10, 1996 /s/ Phillip C. Vitali
------------- ---------------------------------------
Phillip C. Vitali
Executive Vice President and Treasurer
(Chief Financial Officer)
Date: July 10, 1996 /s/ David P. Morency
------------- ---------------------------------------
David P. Morency
Controller
(Principal Accounting Officer)
- 14 -
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-30-1996
<PERIOD-END> MAY-31-1996
<CASH> 5,723
<SECURITIES> 000
<RECEIVABLES> 3,608
<ALLOWANCES> 000
<INVENTORY> 000
<CURRENT-ASSETS> 9,277
<PP&E> 315,353
<DEPRECIATION> (40,618)
<TOTAL-ASSETS> 293,343
<CURRENT-LIABILITIES> 6,178
<BONDS> 96,110
000
000
<COMMON> 11,538
<OTHER-SE> 179,517
<TOTAL-LIABILITY-AND-EQUITY> 293,343
<SALES> 13,122
<TOTAL-REVENUES> 13,222
<CGS> 000
<TOTAL-COSTS> 7,956
<OTHER-EXPENSES> 000
<LOSS-PROVISION> 000
<INTEREST-EXPENSE> 2,075
<INCOME-PRETAX> 3,191
<INCOME-TAX> 000
<INCOME-CONTINUING> 3,191
<DISCONTINUED> 9,350
<EXTRAORDINARY> 000
<CHANGES> 000
<NET-INCOME> 12,541
<EPS-PRIMARY> 1.09
<EPS-DILUTED> 1.09
</TABLE>
