SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- -----
EXCHANGE ACT OF 1934.
For the quarterly period ended March 31, 1997
------------------
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- -----
EXCHANGE ACT OF 1934.
For the transition period from to
------------ ------------
Commission file number 2-85270
-------
BALCOR EQUITY PENSION INVESTORS-I
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Illinois 36-3240345
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2355 Waukegan Road
Bannockburn, Illinois 60015
- ---------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (847) 267-1600
--------------
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
----- -----
<PAGE>
BALCOR EQUITY PENSION INVESTORS-I
(AN ILLINOIS LIMITED PARTNERSHIP)
BALANCE SHEETS
March 31, 1997 and December 31, 1996
(UNAUDITED)
ASSETS
1997 1996
--------------- -------------
Cash and cash equivalents $ 26,592,615 $ 50,292,449
Accounts and accrued interest receivable 491,814 704,044
Prepaid expenses 5,064 126,457
Deferred expenses, net of accumulated
amortization of $191,271 in 1997
and $252,417 in 1996 76,509 388,847
--------------- -------------
27,166,002 51,511,797
--------------- -------------
Investment in real estate:
Land 2,977,313 4,398,007
Buildings and improvements 21,957,573 48,195,641
--------------- -------------
24,934,886 52,593,648
Less accumulated depreciation 5,091,772 19,285,033
--------------- -------------
Investment in real estate, net
of accumulated depreciation 19,843,114 33,308,615
---------------- -------------
$ 47,009,116 $ 84,820,412
=============== =============
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 222,388 $ 302,533
Due to affiliates 92,364 97,196
Accrued real estate taxes 50,820
Security deposits 50,576 182,178
--------------- -------------
Total liabilities 416,148 581,907
--------------- -------------
Commitments and contingencies
Limited Partners' capital (359,229
Partnership Interests issued and
outstanding) 47,086,489 84,282,848
General Partner's deficit (493,521) (44,343)
--------------- -------------
Total partners' capital 46,592,968 84,238,505
--------------- -------------
$ 47,009,116 $ 84,820,412
=============== =============
The accompanying notes are an integral part of the financial statements.
<PAGE>
BALCOR EQUITY PENSION INVESTORS-I
(AN ILLINOIS LIMITED PARTNERSHIP)
STATEMENTS OF INCOME AND EXPENSES
for the quarters ended March 31, 1997 and 1996
(UNAUDITED)
1997 1996
--------------- -------------
Income:
Rental $ 1,317,073 $ 3,718,639
Service 378,463 385,443
Interest on short-term investments 272,318 158,684
--------------- -------------
Total income 1,967,854 4,262,766
--------------- -------------
Expenses:
Depreciation 417,091 925,556
Amortization of deferred expenses 312,338 28,477
Property operating 1,540,061 1,949,695
Real estate taxes 96,098 287,429
Property management fees 67,323 178,665
Administrative 135,227 103,964
--------------- -------------
Total expenses 2,568,138 3,473,786
--------------- -------------
(Loss) income before gain on sale of
property and affiliate's minority
interest in income from joint venture (600,284) 788,980
Gain on sale of property 5,888,095
Affiliate's minority interest in
income from joint venture (32,567)
--------------- -------------
Net income $ 5,287,811 $ 756,413
=============== =============
Net income allocated to General Partner $ 64,501 $ 160,143
=============== =============
Net income allocated to Limited Partners $ 5,223,310 $ 596,270
=============== =============
Net income per Limited
Partnership Interest (359,229 issued
and outstanding) $ 14.54 $ 1.66
=============== =============
Distribution to General Partner $ 513,679 $ 89,980
=============== =============
Distribution to Limited Partners $ 42,419,669 $ 809,824
=============== =============
Distribution per Limited Partnership
Interest:
Taxable $ 10.00 $ 1.75
=============== =============
Tax-exempt $ 134.30 $ 2.33
=============== =============
The accompanying notes are an integral part of the financial statements.
<PAGE>
BALCOR EQUITY PENSION INVESTORS-I
(AN ILLINOIS LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
for the quarters ended March 31, 1997 and 1996
(UNAUDITED)
1997 1996
--------------- -------------
Operating activities:
Net income $ 5,287,811 $ 756,413
Adjustments to reconcile net income
to net cash provided by operating
activities:
Gain on sale of property (5,888,095)
Affiliate's minority interest in
income from joint venture 32,567
Depreciation of properties 417,091 925,556
Amortization of deferred expenses 312,338 28,477
Net change in:
Accounts and accrued interest
receivable 212,230 152,449
Prepaid expenses 121,393 77,215
Accounts payable (80,145) 3,373
Due to affiliates (4,832) 16,034
Accrued real estate taxes 50,820 25,729
Security deposits (131,602) (6,492)
--------------- -------------
Net cash provided by
operating activities 297,009 2,011,321
--------------- -------------
Investing activities:
Proceeds from sale of property 19,575,000
Payment of selling costs (638,495)
---------------
Net cash provided by investing
activities 18,936,505
---------------
Financing activities:
Distribution to Limited Partners (42,419,669) (809,824)
Distribution to General Partner (513,679) (89,980)
Contributions from joint venture
partner - affiliate 45,552
--------------- -------------
Net cash used in financing activities (42,933,348) (854,252)
--------------- -------------
Net change in cash and cash
equivalents (23,699,834) 1,157,069
Cash and cash equivalents at
beginning of year 50,292,449 11,305,552
--------------- -------------
Cash and cash equivalents at
end of period $ 26,592,615 $ 12,462,621
=============== =============
The accompanying notes are an integral part of the financial statements.
<PAGE>
BALCOR EQUITY PENSION INVESTORS-I
(An Illinois Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
1. Accounting Policies:
a) In the opinion of management, all adjustments necessary for a fair
presentation have been made to the accompanying statements for the quarter
ended March 31, 1997, and all such adjustments are of a normal and recurring
nature.
b) A reclassification has been made to the previously reported 1996 financial
statements in order to provide comparability with the 1997 statements. This
reclassification has not changed the 1996 results.
2. Partnership Termination:
The Partnership Agreement provides for the dissolution of the Partnership upon
the occurrence of certain events, including the disposition of all interests in
real estate. During 1996, the Partnership sold four properties. During 1997,
the Partnership sold its remaining two properties, the GSB Office Building and
the 8280 Greensboro Drive Office Building. The Partnership has retained a
portion of the cash to satisfy obligations of the Partnership as well as
establish a reserve for contingencies. The timing of the termination of the
Partnership and final distribution of cash will depend upon the nature and
extent of liabilities and contingencies which exist or may arise. Such
contingencies may include legal and other fees stemming from litigation
involving the Partnership including, but not limited to, the lawsuits discussed
in Note 5 of Notes to the Financial Statements. In the absence of any
contingency, the reserves will be paid within twelve months of the last
property being sold. In the event a contingency exists, reserves may be held by
the Partnership for a longer period of time.
3. Transactions with Affiliates:
Fees and expenses paid and payable by the Partnership to affiliates during the
quarter ended March 31, 1997 are:
Paid Payable
------------ ---------
Reimbursement of expenses to
the General Partner, at cost $25,685 $92,364
4. Property Sale:
In March 1997, the Partnership sold the GSB Office Building in an all cash sale
for $19,575,000. From the proceeds of the sale, the Partnership paid $638,495
in selling costs. The basis of the property was $13,048,410, which is net of
accumulated depreciation of $14,610,352. For financial statement purposes, the
Partnership recognized a gain of $5,888,095 from the sale of this property.
5. Contingencies:
The Partnership is currently involved in a lawsuit whereby the Partnership, the
General Partner and certain third parties have been named as defendants seeking
damages relating to tender offers to purchase interests in the Partnership and
<PAGE>
nine affiliated partnerships initiated by the third party defendants in 1996.
The defendants continue to vigorously contest this action. The action has been
dismissed with prejudice and plaintiffs have filed an appeal. It is not
determinable at this time whether or not an unfavorable decision in this action
would have a material adverse impact on the Partnership's financial position,
results of operations or liquidity. The Partnership believes that it has
meritorious defenses to contest the claims.
The Partnership is currently involved in a lawsuit whereby the Partnership and
certain affiliates have been named as defendants alleging certain federal
securities law violations with regard to the adequacy and accuracy of
disclosures of information concerning, as well as the marketing efforts related
to, the offering of the Limited Partnership Interests of the Partnership. The
defendants continue to vigorously contest this action. A plaintiff class has
not yet been certified, and no determination of the merits have been made. It
is not determinable at this time whether or not an unfavorable decision in this
action would have a material adverse impact on the Partnership's financial
position, results of operations or liquidity. The Partnership believes that it
has meritorious defenses to contest the claims.
6. Subsequent Events:
(a) In April 1997, the Partnership paid $21,865,781 ($70.00 per Tax-exempt
Interest) to the holders of Tax-exempt Limited Partnership Interests
representing a special distribution of Net Cash Proceeds primarily from the
sale of the GSB Office Building.
(b) In April 1997, the Partnership sold the 8280 Greensboro Drive Office
Building in an all cash sale for $30,000,000. From the proceeds of the sale,
the Partnership paid $691,850 in selling costs. For financial statement
purposes, the Partnership will recognize a gain of approximately $9,500,000
from the sale of this property during the second quarter of 1997.
<PAGE>
BALCOR EQUITY PENSION INVESTORS-I
(An Illinois Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS
Balcor Equity Pension Investors-I (the "Partnership") is a limited partnership
formed in 1983 to make first mortgage loans and to invest in and operate
income-producing real property. The Partnership raised $179,614,500 from sales
of Limited Partnership Interests and utilized these proceeds to fund six loans
and acquire three real property investments. The Partnership accepted deeds in
lieu of foreclosure on two of the loans, acquired one of its collateral
properties at a foreclosure sale and accepted prepayments on the three
remaining loans. The Partnership sold four properties in 1996. In addition, the
Partnership sold one property in March 1997 and sold its remaining property in
April 1997.
Inasmuch as the management's discussion and analysis below relates primarily to
the time period since the end of the last fiscal year, investors are encouraged
to review the financial statements and the management's discussion and analysis
contained in the annual report for 1996 for a more complete understanding of
the Partnership's financial position.
Operations
- ----------
Summary of Operations
- ---------------------
During 1997, the Partnership's income before gain on sale decreased by
approximately $1,389,000 primarily due to the 1996 sales of properties which
were generating income from operations. However, the Partnership recognized a
gain of approximately $5,888,000 on the sale of the GSB Office Building during
1997 which offset this decrease. As a result, net income increased for the
quarter ended March 31, 1997 as compared to the same period in 1996. Further
discussion of the Partnership's operations is summarized below.
1997 Compared to 1996
- ---------------------
Discussions of fluctuations between 1997 and 1996 refer to the quarters ended
March 31, 1997 and 1996, unless otherwise noted.
Rental and service income, depreciation, real estate taxes and property
management fees decreased in 1997 compared to 1996 due to the sales of the
Oxford Square and Oxford Hills apartment complexes and the Park Center and
Pacific Center office buildings in 1996, and, to a lesser extent, the sale of
the GSB Office Building in March 1997.
Increased cash available for short-term investment due to proceeds received in
connection with the 1997 and 1996 property sales prior to distribution to
Partners in 1997 was the primary reason for an increase in interest income on
short-term investments during 1997 as compared to 1996.
Amortization expense increased during 1997 as compared to 1996 due to the
write-off of the remaining capitalized leasing commissions related to the GSB
Office Building which was sold in March 1997.
<PAGE>
Property operating expense decreased by approximately $410,000 during 1997 when
compared to 1996. The sales of the Oxford Square and Oxford Hills apartment
complexes and the Park Center and Pacific Center office buildings in 1996
resulted in a decrease in property operating expense of $866,000. These
decreases were partially offset by increases of approximately $456,000 as a
result of tenant improvements and parking lot repairs at the GSB Office
Building and tenant and common area improvements at the 8280 Greensboro Drive
Office Building.
Administrative expenses increased in 1997 as compared to 1996 by approximately
$31,000. Increases in accounting and legal fees of approximately $39,000 were
partially offset by a decrease of approximately $14,000 in investor processing
costs.
In March 1997, the Partnership sold the GSB Office Building and recognized a
gain on sale of $5,888,095.
In 1996, the Partnership sold the Pacific Center Office Building which was
owned through a joint venture. As a result, affiliate's minority interest in
income from joint venture ceased.
Liquidity and Capital Resources
- -------------------------------
The cash position of the Partnership as of March 31, 1997 decreased by
approximately $23,700,000 as compared to December 31, 1996 primarily due to
distributions to Partners in January 1997, which were partially offset by the
proceeds received from the sale of the GSB Office Building. Cash flow of
approximately $297,000 provided by operating activities consists primarily of
the cash flow generated from the property operations and interest income on
short-term investments, which were partially offset by administrative expenses.
Cash provided by investing activities of approximately $18,937,000 consists
primarily of net proceeds from the sale of the GSB Office Building. Cash used
in financing activities of approximately $42,933,000 consists of distributions
to Partners. Additionally, in April 1997, the Partnership distributed proceeds
of approximately $21,866,000 primarily from the sale of the GSB Office
Building, as discussed below.
The Partnership classifies the cash flow performance of its properties as
either positive, a marginal deficit or a significant deficit. A deficit is
considered to be significant if it exceeds $250,000 annually or 20% of the
property's rental and service income. The Partnership defines cash flow
generated from its properties as an amount equal to the property's revenue
receipts less property related expenditures. During the quarters ended March
31, 1997 and 1996, the 8280 Greensboro Drive Office Building generated positive
cash flow. The GSB Office Building generated positive cash flow for the quarter
ended March 31, 1996 and a marginal cash flow deficit prior to its sale in
March 1997 due to costs incurred for improvements to prepare the property for
sale. The Partnership sold four properties in 1996 all of which generated
positive cash flow in 1996 prior to their sales. As of March 31, 1997, the
occupancy rate at the 8280 Greensboro Drive Office Building was 99%. This
property was sold in April 1997.
During 1996, the Partnership sold four properties. During March 1997, the
Partnership sold the GSB Office Building in an all cash sale for $19,575,000.
During April 1997, the Partnership sold its remaining property, the 8280
Greensboro Drive Office Building, in an all cash sale for $30,000,000. The
<PAGE>
Partnership has retained a portion of the cash to satisfy obligations of the
Partnership as well as establish a reserve for contingencies. The timing of the
termination of the Partnership and final distribution of cash will depend upon
the nature and extent of liabilities and contingencies which exist or may
arise. Such contingencies may include legal and other fees stemming from
litigation involving the Partnership including, but not limited to, the
lawsuits discussed in Note 5 of Notes to Financial Statements. In the absence
of any contingency, the reserves will be paid within twelve months of the last
property being sold. In the event a contingency exists, reserves may by held by
the Partnership for a longer period of time.
In March 1997, the Partnership sold the GSB Office Building in an all cash sale
for $19,575,000. From the proceeds of the sale, the Partnership paid $638,495
in selling costs. Pursuant to the terms of the sale, the Partnership is
required to retain $500,000 of the proceeds until December 1997. The remaining
proceeds were distributed to the Tax-exempt Limited Partners in April 1997. See
Note 4 of Notes to Financial Statements for additional information.
In April 1997, the Partnership sold the 8280 Greensboro Drive Office Building
in an all cash sale for $30,000,000. From the proceeds of the sale, the
Partnership paid $691,850 in selling costs. The majority of the proceeds are
expected to be distributed to the Tax-exempt Limited Partners in July 1997. See
Note 6 of Notes to Financial Statements for additional information.
Pursuant to the sale agreement for the Oxford Hills Apartments, $250,000 of the
sale proceeds was retained by the Partnership and was unavailable for
distribution until March 1997, at which time the funds were released in full to
the Partnership.
In April 1997, the Partnership paid $21,865,781 ($70.00 per Tax-exempt
Interest) to the holders of Tax-exempt Limited Partnership Interests,
representing a special distribution of Net Cash Proceeds primarily from the
sale of the GSB Office Building. Including the April 1997 distribution, Limited
Partners have received distributions totaling $244.35 per $500.00 Taxable
Interest (of which $231.36 represents Net Cash Receipts and $12.99 represents
Net Cash Proceeds) and $577.77 per $500.00 Tax-exempt Interest (of which
$307.78 represents Net Cash Receipts and $269.99 represents Net Cash Proceeds).
In accordance with the Partnership Agreement, Net Cash Proceeds are allocated
first to the Tax-exempt Limited Partners. Taxable and Tax-exempt Limited
Partners received quarterly distributions from Net Cash Receipts. Since all of
the Partnership's properties have been sold, it is not anticipated that the
Partnership will generate further Net Cash Receipts. Taxable Limited Partners
will not receive further quarterly distributions. Tax-exempt Limited Partners
will receive a future Net Cash Proceeds distribution from the April 1997
property sale. Taxable Limited Partners will not recover all of their original
investment. However, Taxable Limited Partners will share in the amounts
allocated to the Repurchase Fund.
In February 1997, the Partnership discontinued the repurchase of Interests from
Limited Partners.
Inflation has several types of potentially conflicting impacts on real estate
investments. Short-term inflation can increase real estate operating costs
which may or may not be recovered through increased rents and/or sales prices,
depending on general or local economic conditions. In the long-term, inflation
can be expected to increase operating costs and replacement costs and may lead
to increased rental revenues and real estate values.
<PAGE>
BALCOR EQUITY PENSION INVESTORS-I
(An Illinois Limited Partnership)
PART II - OTHER INFORMATION
Item 5. Other Information
- ---------------------------
8280 Greensboro Drive Office Building
- -------------------------------------
As previously reported, the Partnership contracted to sell the 8280 Greensboro
Drive Office Building, McLean, Virginia, to an unaffiliated party, RREEF
America L.L.C.("RREEF"), a Delaware limited liability company. The sale price
is $30,000,000. RREEF assigned all of its rights and obligations under the
agreement of sale to Gateway Coastal Properties, Inc., a California
corporation. The closing was extended and the sale closed on April 22, 1997.
From the proceeds of the sale, the Partnership paid $600,000 as a brokerage
commission to an affiliate of the third party providing property management
services for the property and $91,850 in closing costs. The Partnership
received the remaining proceeds of $29,308,150.
Item 6. Exhibits and Reports on Form 8-K
- ------------------------------------------
(a) Exhibits:
(4) Certificate of Limited Partnership set forth as Exhibit 4.1 to Amendment
No. 2 to the Registrant's Registration Statement on Form S-11 dated October 4,
1983 (Registration No. 2-85270) and Form of Confirmation regarding Interests in
the Registrant set forth as Exhibit 4.2 to the Registrant's Report on Form 10-Q
for the quarter ended September 30, 1992 (Commission File No. 2-85270) are
incorporated herein by reference.
(10) Material Contracts:
(a) Agreement of Sale and attachment thereto relating to the sale of Oxford
Square Apartments, Casselberry, Florida, previously filed as Exhibit (2) to the
Registrant's Report on Form 8-K dated July 5, 1996 is incorporated herein by
reference.
(b) Agreement of Sale and attachment thereto relating to the sale of Oxford
Hills Apartments, St. Louis County, Missouri, previously filed as Exhibit (2)
to the Registrant's Report on Form 8-K dated October 16, 1996 is incorporated
herein by reference.
(c) (i) Agreement of Sale and attachment thereto relating to the sale of GSB
Office Building, Bala Cynwyd, Pennsylvania, previously filed as Exhibit (2) to
the Registrant's Report on Form 8-K dated December 2, 1996 is incorporated
herein by reference.
(ii) First Amendment to Agreement of Sale relating to the sale of the GSB
Office Building, Bala Cynwyd, Pennsylvania, previously filed as Exhibit (99)(a)
to the Registrant's Report on Form 8-K dated January 6, 1997 is incorporated
herein by reference.
<PAGE>
(iii) Second Amendment to Agreement of Sale relating to the sale of the GSB
Office Building, Bala Cynwyd, Pennsylvania, previously filed as Exhibit (99)(b)
to the Registrant's Report on Form 8-K dated January 6, 1997 is incorporated
herein by reference.
(iv) Letter dated January 30, 1997 relating to the sale of the GSB Office
Building, Bala Cynwyd, Pennsylvania, previously filed as Exhibit (10)(c)(iv) to
the Registrant's Report on Form 10-K for the year ended December 31, 1996 is
incorporated herein by reference.
(d) (i) Agreement of Sale dated March 11, 1997 and attachment thereto relating
to the sale of the 8280 Greensboro Drive Office Building, McLean, Virginia,
previously filed as Exhibit (10)(d)(iii) to the Registrant's Report on Form
10-K for the year ended December 31, 1996 is incorporated herein by reference.
(ii) Letter Agreement dated March 12, 1997 relating to the sale of the 8280
Greensboro Drive Office Building, McLean, Virginia, previously filed as Exhibit
(10)(d)(iv) to the Registrant's Report on Form 10-K for the year ended December
31, 1996 is incorporated herein by reference.
(iii) Second Amendment to Agreement of Sale relating to the sale of the 8280
Greensboro Drive Office Building, McLean, Virginia, previously filed as Exhibit
(10)(d)(v) to the Registrant's Report on Form 10-K for the year ended December
31, 1996 is incorporated herein by reference.
(iv) Third Amendment to Agreement of Sale relating to the sale of the 8280
Greensboro Drive Office Building, McLean, Virginia, is attached hereto.
(27) Financial Data Schedule of the Registrant for the quarter ending March 31,
1997, is attached hereto.
(b) Reports on Form 8-K: No reports were filed on Form 8-K during the quarter
ended March 31, 1997.
<PAGE>
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.
BALCOR EQUITY PENSION INVESTORS-I
By: /s/Thomas E. Meador
-----------------------------
Thomas E. Meador
President and Chief Executive
Officer (Principal Executive
Officer) of Balcor Equity Partners-I,
the General Partner
By: /s/Jayne A. Kosik
------------------------------
Jayne A. Kosik
Managing Director and Chief Financial
Officer (Principal Accounting Officer)
of Balcor Equity Partners-I, the
General Partner
Date: May 14, 1997
-----------------
<PAGE>
THIRD AMENDMENT TO AGREEMENT OF SALE
THIS THIRD AMENDMENT TO AGREEMENT OF SALE (this "Amendment") is made and
entered into as of this day of April, 1997, by and between GATEWAY COASTAL
PROPERTIES, INC., a California corporation (the "Purchaser") and TYSONS CORNER
LIMITED PARTNERSHIP, an Illinois limited partnership ("Seller").
W I T N E S S E T H:
WHEREAS, Seller and RREEF America L.L.C., a Delaware limited liability
company ("RREEF") are parties to that certain Agreement of Sale, dated March
11, 1997, which Agreement has been amended pursuant to (i) a letter amendment
executed by Seller and RREEF as of March 12, 1997, and (ii) a Second Amendment
to Agreement of Sale executed by Seller and RREEF as of March 20, 1997
(collectively, the "Agreement"):
WHEREAS, RREEF assigned all of its rights and obligations as Purchaser
under the Agreement of Sale to Purchaser, pursuant to an Assignment and
Assumption of Agreement and Purchase of Sale, dated as of March 21, 1997,
between RREEF and Purchaser; and
WHEREAS, Seller and Purchaser desire to amend the Agreement in accordance
with the terms of this Amendment.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. All terms not otherwise defined herein shall have the meanings ascribed to
each in the Agreement.
2. With respect to Paragraph 8 of the Agreement, the Closing Date is hereby
changed from April 16, 1997 to April 22, 1997.
3. With respect to Paragraph 26.4 of the Agreement, the date for Seller's
delivery of Tenant Certificates or Seller Tenant Certificates from non-Major
Tenants is hereby changed from April 10, 1997 to April 15, 1997.
4. Purchaser hereby acknowledges that Seller has satisfied its obligation to
deliver to Purchaser a Tenant Certificate from Major Tenant, and each such
Tenant Certificate has been reviewed and approved by Purchaser; provided that,
with respect to the Tenant Certificate from Deltek Systems, Inc., Seller agrees
to escrow the amount of $13,867 with the Title Insurer until such time as
Deltek delivers notice to Purchase that such dispute has been resolved.
5. Seller hereby confirms that the issue raised in Section 9 of the Manpower
estoppel regarding the installation of new carpeting refers to the same issue
raised as an outstanding tenant improvement for Manpower (in the maximum amount
of $5000) on Exhibit N to the Agreement.
6. Except as amended and modified hereby, the Agreement shall be and remain
unmodified and in full force and effect in accordance with its terms, and each
and every one of its provisions, as amended and modified by this Amendment, are
hereby adopted, ratified and affirmed. In the event of any conflict between
the Agreement, or any other document, and this Amendment, the terms, conditions
and provisions hereof shall govern.
<PAGE>
7. This Amendment may be executed in counterparts each of which shall be
deemed an original, but all of which, when taken together shall constitute one
and the same instrument. To facilitate the execution of this Amendment, Seller
and Purchaser may execute and exchange by telephone facsimile counterparts of
the signature pages, with each facsimile being deemed an "original" for all
purposes.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first set forth above.
PURCHASER:
GATEWAY COSTAL PROPERTIES, INC. a California
corporation
By: /s/Margaret O. Shuler
------------------------------
Name: Margaret O. Shuler
------------------------------
Its: Vice President & Secretary
------------------------------
SELLER:
TYSONS CORNER LIMITED PARTNERSHIP, an Illinois
limited partnership
By: /s/John K. Powell, Jr.
------------------------------
Name: John K. Powell, Jr.
------------------------------
Its: Senior Vice President
------------------------------
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 26593
<SECURITIES> 0
<RECEIVABLES> 492
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 27089
<PP&E> 24935
<DEPRECIATION> 5092
<TOTAL-ASSETS> 47009
<CURRENT-LIABILITIES> 416
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 46593
<TOTAL-LIABILITY-AND-EQUITY> 47009
<SALES> 0
<TOTAL-REVENUES> 7856
<CGS> 0
<TOTAL-COSTS> 1703
<OTHER-EXPENSES> 865
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 5288
<INCOME-TAX> 0
<INCOME-CONTINUING> 5288
<DISCONTINUED> 0
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<CHANGES> 0
<NET-INCOME> 5288
<EPS-PRIMARY> 14.54
<EPS-DILUTED> 14.54
</TABLE>
