UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT TO APPLICATION OR REPORT
Pursuant to Section 12, 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
UNITED DOMINION REALTY TRUST, INC.
(Exact name of registrant as specified in its charter)
AMENDMENT NO. 1
The undersigned registrant hereby amends its Current Report on Form 8-K dated
July 1, 1997, which was filed with the Securities and Exchange Commission on
July 15, 1997, to include the Financial Statements of Real Estate Properties
Acquired, the Consolidated Pro Forma Financial Statements and Notes thereto, and
Exhibits as set forth on the pages attached hereto.
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Real Estate Properties Acquired
(b) Pro Forma Financial Information
(c) Exhibits
(23) Consent of Experts
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this Amendment to be signed on its behalf
by the undersigned, thereto duly authorized.
UNITED DOMINION REALTY TRUST, INC.
(Registrant)
------------------------------------------
Jerry A. Davis
Vice President and Chief Accounting Officer
<PAGE>
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits
Description Location
----------- --------
(a) Financial Statements of Real Estate Properties Acquired 3 through 61
(b) Pro Forma Financial Information 62 through 75
(c) Exhibits
(23) Consents of Independent Public Accountants 76
2
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Trinity Place Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Trinity Place Apartments for the year ended December 31,
1996. This financial statement is the responsibility of the management of
Trinity Place Apartments. Our responsibility is to express an opinion on this
statement based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Trinity Place
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Trinity Place Apartments for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L.P. Martin & Company, P.C.
- -------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 25, 1997
<PAGE>
TRINITY PLACE APARTMENTS
STATEMENT OF RENTAL OPERATIONS
YEAR ENDED DECEMBER 31, 1996
REVENUES FROM RENTAL PROPERTY $ 2,550,732
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 154,047
Repairs and Maintenance 219,655
Utilities 106,970
Property Management Fees 126,013
Other Operating Expenses 210,985
-------------
OTAL RENTAL PROPERTY EXPENSES 817,670
-------------
INCOME FROM RENTAL OPERATIONS $ 1,733,062
=============
The accompanying notes are an integral part of this statement.
<PAGE>
TRINITY PLACE APARTMENTS
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
YEAR ENDED DECEMBER 31, 1996
NOTE 1 - BASIS OF PRESENTATION
Trinity Place Apartments (The Property) consists of a 380 unit garden style
residential apartment community located in Raleigh, North Carolina together with
the existing leases. The assets that comprise the Property have been held as an
investment of Rogers Properties Limited Partnership, a North Carolina limited
partnership (the Owner), throughout the year ended December 31, 1996. The
accompanying financial statement presents the results of rental operations of
the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided from January 1, 1996 to August 31,
1996 through Southeast Apartments Management, Inc. (formerly State Street
Management, Inc.) an affiliate of the owner of the property. Fees for such
services were 5% of gross receipts from operations. United Dominion Realty
Trust, Inc. provided property management services from September 1, 1996 to
December 31, 1996. Fees for such services were 5% of gross receipts from
operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to UDRT of North Carolina, L.L.C., a wholly owned
subsidiary of United Dominion Realty Trust, Inc. on February 28, 1997. This
statement of rental operations has been prepared to be included in a Current
Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTS
4132 INNSLAKE DR
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Stoneybrooke Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Stoneybrooke Apartments for the year ended December 31,
1996. This financial statement is the responsibility of the management of
Stoneybrooke Apartments. Our responsibility is to express an opinion on this
statement based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Stoneybrooke
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Stoneybrooke Apartments for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L.P. Martin & Company, P.C.
- -------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 25, 1997
<PAGE>
STONEYBROOKE APARTMENTS
-----------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 2,754,175
---------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 126,426
Repairs and Maintenance 293,116
Utilities 133,674
Property Management Fees 136,954
Other Operating Expens 189,484
---------------
TOTAL RENTAL PROPERTY EXPENSES 879,654
---------------
INCOME FROM RENTAL OPERATIONS $ 1,874,521
===============
The accompanying notes are an integral part of this statement.
<PAGE>
STONEYBROOKE APARTMENTS
-----------------------
NOTES TO STATEMENT OF RENTAL OPERATIONS
---------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Stoneybrooke Apartments (The Property) consists of a 400 unit garden style
residential apartment community located in Charlotte, North Carolina together
with the existing leases. The assets that comprise the Property have been held
as an investment of Capers Properties Limited Partnership, a North Carolina
limited partnership (the Owner), throughout the year ended December 31, 1996.
The accompanying financial statement presents the results of rental operations
of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided from January 1, 1996 to August 31,
1996 through Southeast Apartments Management, Inc. (formerly State Street
Management, Inc.) an affiliate of the owner of the property. Fees for such
services were 5% of gross receipts from operations. United Dominion Realty
Trust, Inc. provided property management services from September 1, 1996 to
December 31,1996. Fees for such services were 5% of gross receipts from
operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to UDRT of North Carolina, L.L.C., a wholly owned
subsidiary of United Dominion Realty Trust, Inc. on February 28, 1997. This
statement of rental operations has been prepared to be included in a Current
Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Tradewinds Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Tradewinds Apartments for the year ended December 31,
1996. This financial statement is the responsibility of the management of
Tradewinds Apartments. Our responsibility is to express an opinion on this
statement based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Tradewinds
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Tradewinds Apartments for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L.P. MARTIN & COMPANY, P.C.
- -------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 25, 1997
<PAGE>
TRADEWINDS APARTMENTS
STATEMENT OF RENTAL OPERATIONS
YEAR ENDED DECEMBER 31, 1996
REVENUES FROM RENTAL PROPERTY $ 2,557,442
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 176,043
Repairs and Maintenance 283,463
Utilities 153,564
Property Management Fees 127,323
Other Operating Expenses 208,186
--------------
TOTAL RENTAL PROPERTY EXPENSES 948,579
-------------
INCOME FROM RENTAL OPERATIONS $ 1,608,863
=============
The accompanying notes are an integral part of this statement.
<PAGE>
TRADEWINDS APARTMENTS
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
YEAR ENDED DECEMBER 31, 1996
NOTE 1 - BASIS OF PRESENTATION
Tradewinds Apartments (The Property) consists of a 380 unit garden style
residential apartment community located in Wilmington, North Carolina together
with the existing leases. The assets that comprise the Property have been held
as an investment of Wideman Properties Limited Partnership, a North Carolina
limited partnership (the Owner), throughout the year ended December 31, 1996.
The accompanying financial statement presents the results of rental operations
of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided from January 1, 1996 to August 31,
1996 through Southeast Apartments Management, Inc. (formerly State Street
Management, Inc.) an affiliate of the owner of the property. Fees for such
services were 5% of gross receipts from operations. United Dominion Realty
Trust, Inc. provided property management services from September 1, 1996 to
December 31, 1996. Fees for such services were 5% of gross receipts from
operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to UDRT of North Carolina, L.L.C., a wholly owned
subsidiary of United Dominion Realty Trust, Inc. on February 28, 1997. This
statement of rental operations has been prepared to be included in a Current
Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Lotus Landing Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Lotus Landing Apartments for the year ended December 31,
1996. This financial statement is the responsibility of the management of Lotus
Landing Apartments. Our responsibility is to express an opinion on this
statement based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Lotus Landing
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Lotus Landing Apartments for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L.P. MARTIN & COMPANY, P.C.
- -------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
LOTUS LANDING APARTMENTS
------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 1,696,932
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 170,888
Repairs and Maintenance 294,914
Utilities 121,634
Property Management Fees 84,588
Other Operating Expenses 274,868
-------------
TOTAL RENTAL PROPERTY EXPENSES 946,892
-------------
INCOME FROM RENTAL OPERATIONS $ 750,040
=============
The accompanying notes are an integral part of this statement.
<PAGE>
LOTUS LANDING APARTMENTS
------------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Lotus Landing Apartments (The Property) consists of a 260 unit garden style
residential apartment community located in Orlando, Florida together with the
existing leases. The assets that comprise the Property have been held as an
investment of American Capitol Group I Assets, Limited Partnership, a Delaware
limited partnership (the Owner), throughout the year ended December 31, 1996.
The accompanying financial statement presents the results of rental operations
of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through Union Management Company USA,
Inc., an affiliate of the owner of the property. Fees for such services were 5%
of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to United Dominion Realty Trust, Inc. on July 1, 1997.
This statement of rental operations has been prepared to be included in a
Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Orange Oaks Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Orange Oaks Apartments for the year ended December 31,
1996. This financial statement is the responsibility of the management of Orange
Oaks Apartments. Our responsibility is to express an opinion on this statement
based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Orange Oaks
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Orange Oaks Apartments for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L.P. MARTIN & COMPANY, P.C.
- ----------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
ORANGE OAKS APARTMENTS
----------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 1,201,039
------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 111,839
Repairs and Maintenance 171,850
Utilities 90,231
Property Management Fees 61,565
Other Operating Expenses 198,998
------------
TOTAL RENTAL PROPERTY EXPENS 634,483
============
INCOME FROM RENTAL OPERATIONS $ 566,556
============
The accompanying notes are an integral part of this statement.
<PAGE>
ORANGE OAKS APARTMENTS
----------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Orange Oaks Apartments (The Property) consists of a 192 unit garden style
residential apartment community located in Tampa, Florida together with the
existing leases. The assets that comprise the Property have been held as an
investment of American Capitol Group I Assets, Limited Partnership, a Delaware
limited partnership (the Owner), throughout the year ended December 31, 1996.
The accompanying financial statement presents the results of rental operations
of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through Union Management Company USA,
Inc., an affiliate of the owner of the property. Fees for such services were 5%
of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to United Dominion Realty Trust, Inc. on July 1, 1997.
This statement of rental operations has been prepared to be included in a
Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
[L.P. MARTIN & COMPANY LETTERHEAD]
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Mallards of Brandywine
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Mallards of Brandywine for the year ended December 31,
1996. This financial statement is the responsibility of the management of
Mallards of Brandywine. Our responsibility is to express an opinion on this
statement based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Mallards of
Brandywine's revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Mallards of Brandywine for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L. P. Martin & Company, P.C.
- --------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
MALLARDS OF BRANDYWINE
STATEMENT OF RENTAL OPERATIONS
YEAR ENDED DECEMBER 31, 1996
REVENUES FROM RENTAL PROPERTY $ 934,392
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 79,852
Repairs and Maintenance 148,412
Utilities 30,634
Property Management Fees 46,737
Other Operating Expenses 150,976
----------
TOTAL RENTAL PROPERTY EXPENSES 456,611
-----------
INCOME FROM RENTAL OPERATIONS $ 477,781
===========
The accompanying notes are an integral part of this statement.
<PAGE>
MALLARDS OF BRANDYWINE
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
YEAR ENDED DECEMBER 31, 1996
NOTE 1 - BASIS OF PRESENTATION
Mallards of Brandywine (The Property) consists of a 168 unit garden style
residential apartment community located in Daytona Beach, Florida together with
the existing leases. The assets that comprise the Property have been held as an
investment of American Capitol Group I Assets, Limited Partnership, a Delaware
limited partnership (the Owner), throughout the year ended December 31, 1996.
The accompanying financial statement presents the results of rental operations
of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through Union Management Company USA,
Inc., an affiliate of the owner of the property. Fees for such services were 5%
of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to United Dominion Realty Trust, Inc. on July 1, 1997.
This statement of rental operations has been prepared to be included in a
Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Forest Creek Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Forest Creek Apartments for the year ended December 31,
1996. This financial statement is the responsibility of the management of Forest
Creek Apartments. Our responsibility is to express an opinion on this statement
based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Forest Creek
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Forest Creek Apartments for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
FOREST CREEK APARTMENTS
------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 517,169
------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 50,168
Repairs and Maintenance 79,899
Utilities 40,678
Property Management Fees 25,813
Other Operating Expense 99,364
------------
TOTAL RENTAL PROPERTY EXPENSES 295,922
------------
INCOME FROM RENTAL OPERATIONS $ 221,247
============
The accompanying notes are an integral part of this statement.
<PAGE>
FOREST CREEK APARTMENTS
------------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Forest Creek Apartments (The Property) consists of a 104 unit garden
style residential apartment community located in Tampa, Florida together with
the existing leases. The assets that comprise the Property have been held as an
investment of American Capitol Group I Assets, Limited Partnership, a Delaware
limited partnership (the Owner), throughout the year ended December 31, 1996.
The accompanying financial statement presents the results of rental operations
of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations
and replacements are capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through Union Management Company, USA
Inc., an affiliate of the owner of the property. Fees for such services were 5%
of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to United Dominion Realty Trust, Inc. on July 1, 1997.
This statement of rental operations has been prepared to be included in a
Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Lakeside Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Lakeside Apartments for the year ended December 31, 1996.
This financial statement is the responsibility of the management of Lakeside
Apartments. Our responsibility is to express an opinion on this statement based
on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Lakeside
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Lakeside Apartments for the year ended December 31, 1996, in conformity with
generally accepted accounting principles.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
LAKESIDE APARTMENTS
-------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 1,374,214
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 86,163
Repairs and Maintenance 177,451
Utilities 105,352
Property Management Fees 68,726
Other Operating Expenses 216,479
-------------
TOTAL RENTAL PROPERTY EXPENSES 654,171
-------------
INCOME FROM RENTAL OPERATIONS $ 720,043
=============
The accompanying notes are an integral part of this statement.
<PAGE>
LAKESIDE APARTMENTS
-------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Lakeside Apartments (The Property) consists of a 210 unit garden style
residential apartment community located in Daytona Beach, Florida together with
the existing leases. The assets that comprise the Property have been held as an
investment of American Capitol Group I Assets, Limited Partnership, a Delaware
limited partnership (the Owner), throughout the year ended December 31, 1996.
The accompanying financial statement presents the results of rental operations
of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Advertising - Advertising costs are expensed when incurred.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through Union Management Company USA,
Inc., an affiliate of the owner of the property. Fees for such services were 5%
of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to United Dominion Realty Trust, Inc. on July 1, 1997.
This statement of rental operations has been prepared to be included in a
Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Pineloch Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Pineloch Apartments for the year ended December 31, 1996.
This financial statement is the responsibility of the management of Pineloch
Apartments. Our responsibility is to express an opinion on this statement based
on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Pineloch
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Pineloch Apartments for the year ended December 31, 1996, in conformity with
generally accepted accounting principles.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
PINELOCH APARTMENTS
-------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 2,704,646
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 360,579
Repairs and Maintenance 288,646
Utilities 206,193
Property Management Fees 100,522
Other Operating Expenses 280,115
-------------
TOTAL RENTAL PROPERTY EXPENSES 1,236,055
-------------
INCOME FROM RENTAL OPERATIONS $ 1,468,591
=============
The accompanying notes are an integral part of this statement.
<PAGE>
PINELOCH APARTMENTS
-------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Pineloch Apartments (The Property) consists of a 440 unit garden style
residential apartment community located in Houston, Texas together with the
existing leases. The assets that comprise the Property have been held as an
investment of Security Capital Pacific Trust, a Maryland real estate investment
trust (the Owner), throughout the year ended December 31, 1996. The accompanying
financial statement presents the results of rental operations of the Property as
a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting princples requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through SCG Realty Services
Incorporated, an affiliate of the owner of the property. Fees for such services
were 3.75% of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to South West Properties, L. P., a wholly owned subsidiary
of United Dominion Realty Trust, Inc. on May 8, 1997. This statement of rental
operations has been prepared to be included in a Current Report on Form 8-K to
be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Seahawk Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Seahawk Apartments for the year ended December 31, 1996.
This financial statement is the responsibility of the management of Seahawk
Apartments. Our responsibility is to express an opinion on this statement based
on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Seahawk
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Seahawk Apartments for the year ended December 31, 1996, in conformity with
generally accepted accounting principles.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
SEAHAWK APARTMENTS
------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 1,568,203
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 186,030
Repairs and Maintenance 182,574
Utilities 76,339
Property Management Fees 58,552
Other Operating Expenses 158,569
------------
TOTAL RENTAL PROPERTY EXPENSES 662,064
------------
INCOME FROM RENTAL OPERATIONS $ 906,139
============
The accompanying notes are an integral part of this statement.
<PAGE>
SEAHAWK APARTMENTS
------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Seahawk Apartments (The Property) consists of a 224 unit garden style
residential apartment community located in Houston, Texas together with the
existing leases. The assets that comprise the Property have been held as an
investment of Security Capital Pacific Trust, a Maryland real estate investment
trust (the Owner), throughout the year ended December 31, 1996. The accompanying
financial statement presents the results of rental operations of the Property as
a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Estimates- The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through SCG Realty Services
Incorporated, an affiliate of the owner of the property. Fees for such services
were 3.75% of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to South West Properties, L. P., a wholly owned subsidiary
of United Dominion Realty Trust, Inc. on May 8, 1997. This statement of rental
operations has been prepared to be included in a Current Report on Form 8-K to
be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Anderson Mill Oaks Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Anderson Mill Oaks Apartments for the year ended December
31, 1996. This financial statement is the responsibility of the management of
Anderson Mill Oaks Apartments. Our responsibility is to express an opinion on
this statement based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Anderson Mill
Oaks Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Anderson Mill Oaks Apartments for the year ended December 31, 1996, in
conformity with generally accepted accounting principles.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
ANDERSON MILL OAKS APARTMENTS
-----------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 2,486,965
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 298,713
Repairs and Maintenance 405,269
Utilities 159,379
Property Management Fees 92,636
Other Operating Expenses 196,135
-------------
TOTAL RENTAL PROPERTY EXPENSES 1,152,132
-------------
INCOME FROM RENTAL OPERATIONS $ 1,334,833
=============
The accompanying notes are an integral part of this statement.
<PAGE>
ANDERSON MILL OAKS APARTMENTS
-----------------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
- ------------------------------
Anderson Mill Oaks Apartments (The Property) consists of a 350 unit garden style
residential apartment community located in Austin, Texas together with the
existing leases. The assets that comprise the Property have been held as an
investment of Security Capital Pacific Trust, a Maryland real estate investment
trust (the Owner), throughout the year ended December 31, 1996. The accompanying
financial statement presents the results of rental operations of the Property as
a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through SCG Realty Services
Incorporated, an affiliate of the owner of the property. Fees for such services
were 3.75% of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to South West Properties, L. P., a wholly owned subsidiary
of United Dominion Realty Trust, Inc. on March 25, 1997. This statement of
rental operations has been prepared to be included in a Current Report on Form
8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Post Oak Ridge Apartments
We have audited the accompanying statement of rental operations (as
defined in Note 2) of Post Oak Ridge Apartments for the year ended December 31,
1996. This financial statement is the responsibility of the management of Post
Oak Ridge Apartments. Our responsibility is to express an opinion on this
statement based on our audit.
We conducted our audit 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 statement is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis for our opinion.
The statement was prepared for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for inclusion in a
Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described
in Note 4, and is not intended to be a complete presentation of Post Oak Ridge
Apartments' revenues and expenses.
In our opinion, the statement referred to above presents fairly, in all
material respects, the revenues and operating expenses, as described in Note 2,
of Post Oak Ridge Apartments for the year ended December 31, 1996, in conformity
with generally accepted accounting principles.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
POST OAK RIDGE APARTMENTS
-------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
REVENUES FROM RENTAL PROPERTY $ 2,988,522
-------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 278,931
Repairs and Maintenance 369,890
Utilities 264,985
Property Management Fees 110,378
Other Operating Expenses 286,213
-------------
TOTAL RENTAL PROPERTY EXPENSES 1,310,397
-------------
INCOME FROM RENTAL OPERATIONS $ 1,678,125
=============
The accompanying notes are an integral part of this statement.
<PAGE>
POST OAK RIDGE APARTMENTS
--------------------------
NOTES TO THE STATEMENT OF RENTAL OPERATIONS
-------------------------------------------
YEAR ENDED DECEMBER 31, 1996
----------------------------
NOTE 1 - BASIS OF PRESENTATION
Post Oak Ridge Apartments (The Property) consists of a 486 unit garden
style residential apartment community located in Lewisville, a suburb northwest
of Dallas, Texas together with the existing leases. The assets that comprise the
Property have been held as an investment of Security Capital Pacific Trust, a
Maryland real estate investment trust (the Owner), throughout the year ended
December 31, 1996. The accompanying financial statement presents the results of
rental operations of the Property as a stand-alone entity.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue and Expense Recognition - The accompanying statement of rental
operations has been prepared using the accrual method of accounting. Certain
expenses such as depreciation, amortization, income taxes and mortgage interest
expense are not reflected in the statement of rental operations, as required by
Rule 3-14 of Regulation S-X of the Securities and Exchange Commission.
Repairs and Maintenance - Repairs and maintenance costs are expensed as
incurred, while significant improvements, renovations and replacements are
capitalized.
Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY MANAGEMENT FEES
Property management services were provided through SCG Realty Services
Incorporated, an affiliate of the owner of the property. Fees for such services
were 3.75% of gross receipts from operations.
NOTE 4 - SALE OF PROPERTY
The property was sold to South West Properties, L. P., a wholly owned subsidiary
of United Dominion Realty Trust, Inc. on March 27, 1997. This statement of
rental operations has been prepared to be included in a Current Report on Form
8-K to be filed by United Dominion Realty Trust, Inc.
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Trinity Place Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Trinity Place Apartments for the two months ended February 28, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 25, 1997
<PAGE>
TRINITY PLACE APARTMENTS
------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
TWO MONTHS ENDED FEBRUARY 28, 1997
----------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 486,537
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 25,674
Repairs and Maintenance 55,626
Utilities 21,704
Property Management Fees 24,122
Other Operating Expenses 28,152
----------
TOTAL RENTAL PROPERTY EXPENSES 155,278
----------
INCOME FROM RENTAL OPERATIONS $ 331,259
==========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Stoneybrooke Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Stoneybrooke Apartments for the two months ended February 28, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 25, 1997
<PAGE>
STONEYBROOKE APARTMENTS
-----------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
TWO MONTHS ENDED FEBRUARY 28, 1997
----------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 480,901
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 21,071
Repairs and Maintenance 54,682
Utilities 25,837
Property Management Fees 24,192
Other Operating Expenses 28,464
-----------
TOTAL RENTAL PROPERTY EXPENSES 154,246
-----------
INCOME FROM RENTAL OPERATIONS $ 326,655
===========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Tradewinds Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Tradewinds Apartments for the two months ended February 28, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 25, 1997
<PAGE>
TRADEWINDS APARTMENTS
---------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
TWO MONTHS ENDED FEBRUARY 28, 1997
----------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 433,803
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 29,341
Repairs and Maintenance 41,702
Utilities 31,391
Property Management Fees 21,761
Other Operating Expenses 30,864
----------
TOTAL RENTAL PROPERTY EXPENSES 155,059
----------
INCOME FROM RENTAL OPERATIONS $ 278,744
==========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Lotus Landing Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Lotus Landing Apartments for the six months ended June 30, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
LOTUS LANDING APARTMENTS
------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
SIX MONTHS ENDED JUNE 30, 1997
------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 884,314
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 85,444
Repairs and Maintenance 152,819
Utilities 61,619
Property Management Fees 45,859
Other Operating Expenses 131,053
----------
TOTAL RENTAL PROPERTY EXPENSES 476,794
----------
INCOME FROM RENTAL OPERATIONS $ 407,520
==========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Anderson Mill Oaks Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Anderson Mill Oaks Apartments for the two months ended February 28,
1997, in accordance with Statements on Standards for Accounting and Review
Services issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
ANDERSON MILL OAKS APARTMENTS
-----------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
TWO MONTHS ENDED FEBRUARY 28, 1997
----------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 412,770
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 53,600
Repairs and Maintenance 41,585
Utilities 26,516
Property Management Fees 15,094
Other Operating Expenses 35,066
------------
TOTAL RENTAL PROPERTY EXPENSES 171,861
----------
INCOME FROM RENTAL OPERATIONS $ 240,909
==========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCONTANTS
4132 INNSLAKE DRIVE
GLENN ALLEN, VIRGINIA 23060
PHONE: (804) 366-2626
FAX: (804) 346-9311
Independent Auditors' Report
To the Owners of
Post Oak Ridge Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Post Oak Ridge Apartments for the two months ended February 28, 1997,
in accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L.P.MARTIN & COMPANY, P.C.
- ------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
POST OAK RIDGE APARTMENTS
-------------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
TWO MONTHS ENDED FEBRUARY 28, 1997
----------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 503,849
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 49,600
Repairs and Maintenance 63,308
Utilities 44,652
Property Management Fees 19,391
Other Operating Expenses 53,454
----------
TOTAL RENTAL PROPERTY EXPENSES 230,405
----------
INCOME FROM RENTAL OPERATIONS $ 273,444
==========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Accountants' Compilation Report
To the Owners of
Pineloch Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Pineloch Apartments for the four months ended April 30, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L. P. Martin & Company, P.C.
- --------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
PINELOCH APARTMENTS
STATEMENT OF RENTAL OPERATIONS
FOUR MONTHS ENDED APRIL 30, 1997
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 897,791
-----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 126,400
Repairs and Maintenance 92,878
Utilities 74,279
Property Management Fees 33,327
Other Operating Expenses 120,384
-----------
TOTAL RENTAL PROPERTY EXPENSES 447,268
-----------
INCOME FROM RENTAL OPERATIONS $ 450,523
===========
<PAGE>
[L.P. MARTIN & COMPANY LETTERHEAD]
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Accountants' Compilation Report
To the Owners of
Seahawk Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Seahawk Apartments for the four months ended April 30, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L. P. Martin & Company, P.C.
- --------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
June 11, 1997
<PAGE>
SEAHAWK APARTMENTS
STATEMENT OF RENTAL OPERATIONS
FOUR MONTHS ENDED APRIL 30, 1997
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 531,957
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 64,332
Repairs and Maintenance 55,533
Utilities 22,982
Property Management Fees 20,069
Other Operating Expenses 58,760
----------
TOTAL RENTAL PROPERTY EXPENSES 221,676
----------
INCOME FROM RENTAL OPERATIONS $ 310,281
==========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Accountants' Compilation Report
To the Owners of
Orange Oaks Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Orange Oaks Apartments for the six months ended June 30, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L. P. Martin & Company, P.C.
- --------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
ORANGE OAKS APARTMENTS
STATEMENT OF RENTAL OPERATIONS
SIX MONTHS ENDED JUNE 30, 1997
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 612,597
-----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 55,920
Repairs and Maintenance 98,354
Utilities 58,424
Property Management Fees 31,926
Other Operating Expenses 95,499
-----------
TOTAL RENTAL PROPERTY EXPENSES 340,123
-----------
INCOME FROM RENTAL OPERATIONS $ 272,474
===========
<PAGE>
[L.P. MARTIN & COMPANY LETTERHEAD]
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Accountants' Compilation Report
To the Owners of
Mallards of Brandywine
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Mallards of Brandywine for the six months ended June 30, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L. P. Martin & Company, P.C.
- --------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
MALLARDS OF BRANDYWINE
STATEMENT OF RENTAL OPERATIONS
SIX MONTHS ENDED JUNE 30, 1997
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 474,841
------------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 39,926
Repairs and Maintenance 79,039
Utilities 14,603
Property Management Fees 24,406
Other Operating Expenses 70,450
------------
TOTAL RENTAL PROPERTY EXPENSES 228,424
------------
INCOME FROM RENTAL OPERATIONS $ 246,417
============
<PAGE>
[L.P. MARTIN & COMPANY LETTERHEAD]
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Accountants' Compilation Report
To the Owners of
Forest Creek Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Forest Creek Apartments for the six months ended June 30, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L. P. Martin & Company, P.C.
- --------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
FOREST CREEK APARTMENTS
-----------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
SIX MONTHS ENDED JUNE 30, 1997
------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 262,886
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 25,084
Repairs and Maintenance 45,328
Utilities 20,188
Property Management Fees 13,383
Other Operating Expenses 46,462
---------
TOTAL RENTAL PROPERTY EXPENSES 150,445
---------
INCOME FROM RENTAL OPERATIONS $ 112,441
==========
<PAGE>
L.P. MARTIN & COMPANY
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 346-2626
FAX: (804) 346-9311
Independent Accountants' Compilation Report
To the Owners of
Lakeside Apartments
We have compiled the accompanying statement of rental operations
exclusive of mortgage interest expense, depreciation, amortization and income
taxes of Lakeside Apartments for the six months ended June 30, 1997, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial
statements information that is the representation of the management and owners.
We have not audited or reviewed the accompanying financial statement and,
accordingly, do not express an opinion or any other form of assurance on it.
Management has elected to omit substantially all of the disclosures
required by generally accepted accounting principles. If the omitted disclosures
were included in the financial statement, they might influence the user's
conclusions about the results of operations. Accordingly, this financial
statement is not designed for those who are not informed about such matters.
/s/ L. P. Martin & Company, P.C.
- --------------------------------
L. P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
August 7, 1997
<PAGE>
LAKESIDE APARTMENTS
--------------------
STATEMENT OF RENTAL OPERATIONS
------------------------------
SIX MONTHS ENDED JUNE 30, 1997
------------------------------
(See Independent Accountants' Compilation Report)
REVENUES FROM RENTAL PROPERTY $ 708,537
----------
RENTAL PROPERTY EXPENSES:
Real Estate Taxes 43,081
Repairs and Maintenance 84,024
Utilities 52,096
Property Management Fees 36,745
Other Operating Expenses 122,180
----------
TOTAL RENTAL PROPERTY EXPENSES 338,126
----------
INCOME FROM RENTAL OPERATIONS $ 370,411
==========
<PAGE>
UNITED DOMINION REALTY TRUST, INC.
CONSOLIDATED PRO FORMA FINANCIAL STATEMENTS
(UNAUDITED)
The following unaudited consolidated pro forma balance sheet at June
30, 1997 gives effect to the acquisition by the Company of a portfolio of five
apartment communities acquired on July 1, 1997 and other acquisitions made by
the Company during 1996 and 1997. Other than the five apartment communities
acquired on July 1, 1997 all acquisitions are reflected in the Company's
historical unaudited consolidated balance sheet at June 30, 1997 included in the
Company's quarterly report on Form 10-Q for the quarter then ended.
The unaudited consolidated pro forma statements of operations for the
twelve months ended December 31, 1996 and the six months ended June 30, 1997
gives effect to the following 1997 acquisitions as if they had occurred at the
beginning of each period presented: (i) the acquisition of Crosswinds Apartments
(formerly Tradewinds Apartments), Stoney Pointe Apartments (formerly
Stoneybrooke Apartments) and Dominion Trinity Place Apartments, (formerly
Trinity Place Apartments) on February 28, 1997, (ii) the acquisition of Anderson
Mill Oaks Apartments acquired on March 25, 1997, Oak Ridge Apartments (formerly
Post Oak Ridge Apartments) acquired on March 27, 1997, and Green Oaks Apartments
(formerly Pineloch Apartments) and Skyhawk Apartments (formerly Seahawk
Apartments) acquired on May 8, 1997, and (iii) the acquisition of a portfolio of
five apartment communities acquired on July 1, 1997 which consists of Lakeside
Apartments, Mallards of Brandywine Apartments, Lotus Landing Apartments, Orange
Oaks Apartments and Forest Creek Apartments.
In addition, the unaudited consolidated pro forma statement of
operations for the twelve months ended December 31, 1996 gives effect to the
following acquisitions as if they had occurred on January 1, 1996: (i) the
acquisition of Steeplechase Apartments and Westland Park Apartments on March 7,
1996 and May 9, 1996, respectively (as previously reported on Form 8-K dated
October 31, 1996), (ii) the acquisition of a portfolio of 18 apartment
communities on August 15, 1996 as previously reported on Form 8-K dated August
15, 1996, and (iii) the acquisition of 44 apartment communities owned by South
West Property Trust Inc. on December 31, 1996 (as previously reported on Form
8-K dated December 31, 1996).
The unaudited consolidated pro forma statements of operations have been
prepared by the management of the Company. The unaudited consolidated pro forma
statements of operations are not necessarily indicative of the results that
would have occurred had the acquisitions been completed on the dates indicated,
nor are purported to be indicative of future results. The unaudited consolidated
pro forma statements of operations should be read in conjunction with the
Company's audited consolidated financial statements for the year ended December
31, 1996 (included in the Company's Form 10-K for the twelve months ended
December 31, 1996) and its unaudited consolidated financial statements as of
June 30, 1997 and for the six months then ended (included in the Company's Form
10-Q for the quarterly period ended June 30, 1997) and the accompanying notes
thereto.
62
<PAGE>
<PAGE>
UNITED DOMINION REALTY TRUST, INC.
CONSOLIDATED PRO FORMA BALANCE SHEETS
JUNE 30, 1997
(In thousands, except for share data)
(Unaudited)
<TABLE>
<CAPTION>
Acquisition of
Historical (1) Florida Portfolio Pro Forma
------------------- ------------------- -------------
<S> <C>
Assets
Real estate owned:
Real estate held for investment $ 2,135,654 $ 36,000 (2) $ 2,171,654
Less: accumulated depreciation 181,662 181,662
--------------- ------------------- ----------------
1,953,992 36,000 1,989,992
Real estate under development 62,716 62,716
Real estate held for disposition 85,431 85,431
Cash and cash equivalents 8,296 8,296
Other assets 33,220 33,220
-------------- ------------ ------------
Total assets $ 2,143,655 $ 36,000 $ 2,179,655
============== ============= ==============
Liabilities and shareholders' equity
Notes payable-secured $ 389,106 $ $ 389,106
Notes payable-unsecured 626,242 36,000 (3) 662,242
Distributions payable to common shareholders 22,037 22,037
Accounts payable, accrued expenses and other liabilities 54,511 54,511
-------------- ------------ ------------
Total liabilities 1,091,896 36,000 1,127,896
Minority interest of unitholders in operating partnership 2,021 2,021
Shareholders' equity:
Preferred stock, no par value; $25 liquidation preference,
25,000,000 shares authorized;
4,200,000 shares 9.25% Series A Cumulative Redeemable 105,000 105,000
6,000,000 shares 8.60% Series B Cumulative Redeemable 150,000 150,000
Common stock, $1 par value; 150,000,000 shares authorized
87,274,566 shares issued and outstanding (81,982,551 in 1996 87,275 87,275
Additional paid-in-capital 882,257 882,257
Notes receivable from officer-shareholders (9,198) (9,198)
Distributions in excess of net income (165,596) (165,596)
-------------- ------------ ------------
Total shareholders' equity 1,049,738 0 1,049,738
-------------- ------------ ------------
Total liabilities and shareholders' equity $ 2,143,655 $ 36,000 $ 2,179,655
============== ============= ==============
</TABLE>
63
See accompanying notes.
<PAGE>
UNITED DOMINION REALTY TRUST, INC.
NOTES TO CONSOLIDATED PRO FORMA BALANCE SHEET
JUNE 30, 1997
(UNAUDITED)
Basis of Presentation
The accompanying unaudited consolidated pro forma balance sheet assumes the
completion as of June 30, 1997 of the acquisition by the Company on July 1,
1997 of a portfolio of five apartment communities containing 934 apartment
homes, for an aggregate purchase price of approximately $36.0 million, including
closing costs (the "Florida Portfolio") and additional borrowings under bank
lines of credit of approximately $36.0 to fund the acquisition.
(1) Represents the Company's Historical Balance Sheet contained in its
Quarterly Report on Form 10-Q for the six months ended June 30, 1997.
(2) Represents the acquisition by the Company of the Florida Portfolio for an
aggregate purchase price of approximately $36.0 million, including closing
costs.
(3) Represents bank line borrowings by the Company of approximately $36.0
million at a weighted average interest rate of 6.41% (represents the
Company's market interest rate for short-term bank borrowings at the time
of acquisition) to fund the Florida Portfolio described in Note 2.
64
<PAGE>
UNITED DOMINION REALTY TRUST, INC.
CONSOLIDATED PRO FORMA STATEMENTS OF OPERATIONS
TWELVE MONTHS ENDED DECEMBER 31, 1996
(In thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Acquisition of
Southeast Portfolio Acquisition of Acquisitions
Previously Reported Southeast Portfolio Previously Reported
on Form 8-K Dated Pro Forma on Form 8-K Dated
Historical(1) August 15, 1996 (2) Adjustments October 31, 1997 (9)
-------------- -------------------- -------------------- -------------------
<S> <C>
Revenues
Rental income $ 242,112 $ 12,917 $ 3,194 (3) $ 1,278
Interest, dividend and other
non-property income 1,707
--------- ----------- ---------- ---------
243,819 12,917 3,194 1,278
Expenses
Rental expenses:
Utilities 17,735 881 218 (3) 50
Repairs and maintenance 40,665 1,462 361 (3) 139
Real estate taxes 17,348 972 240 (3) 114
Property management 5,575 636 (242) (3)(4) 69
Other operating expenses 23,510 965 321 (3)(5) 153
Depreciation of real estate owned 47,410 3,660 (6)
Interest 50,843 6,789 (7)
General and administrative 5,418
Other depreciation and amortization 1,299
Impairment loss on real estate held
for dispositon 290
------- ------- -------- -------
210,093 4,916 11,347 525
------- ------- -------- -------
Income before gains on sales of investments
and minority interest of unitholders
in operating partnership 33,726 8,001 (8,153) 753
Gains on sales of investments 4,346
------ ------- -------- -------
Income before minority interest of
unitholders in operating partnership 38,072 8,001 (8,153) 753
Minority interest of unitholders in operating
partnersip (58)
------ ------- ------- -------
Income before extraordinary item 38,014 8,001 (8,153) 753
======= ======== ======= =======
Dividends to preferred shareholders (9,713)
======= ======== ======= =======
Net income per common share before
extraordinary item $ 0.49
========
Dividends declared per common share $ 0.96
========
Weighted average number of common
shares outstanding 57,482 1,352 (8)
</TABLE>
<TABLE>
<CAPTION>
Acquisitions Acquisition of
Previously Reported South West Acquisition of
on Form 8-K Date Property Trust Inc South West
October 31,1997 Previously Reported Property Trust Inc. Pro Forma
Pro Forma on Form 8-K Dated Pro Forma Before 1997
Adjustments December 31, 1996 (14) Adjustments Acquisitions
------------------ --------------------- -------------------- -------------
<S> <C>
Revenues
Rental income $ 95 (10) $ 82,169 $ $ 341,765
Interest, dividend and other
non-property income 976 2,683
-------- ---------- ---------- ----------
95 83,145 0 344,448
Expenses
Rental expenses:
Utilities 4 (10) 5,492 24,380
Repairs and maintenance 10 (10) 10,818 53,455
Real estate taxes 8 (10) 8,631 27,313
Property management (30) (10)(11) 2,884 (1,089) (15) 7,803
Other operating expenses 11 (10) 10,418 35,378
Depreciation of real estate owned 252 (12) 13,447 2,015 (16) 66,784
Interest 499 (13) 14,126 (1,316) (17) 70,941
General and administrative 3,133 (1,438) (18) 7,113
Other depreciation and amortization 330 1,629
Impairment loss on real estate held
for dispositon 290
-------- ------- -------- -------
754 69,279 (1,828) 295,086
-------- ------- -------- -------
Income before gains on sales of investments
and minority interest of unitholders
in operating partnership (659) 13,866 1,828 49,362
Gains on sales of investments 4,346
------- ------- -------- --------
Income before minority interest of
unitholders in operating partnership (659) 13,866 1,828 53,708
Minority interest of unitholders in operating
partnersip (58)
------- ------ ------ ------
Income before extraordinary item (659) 13,866 1,828 53,650
======= ====== ====== ======
Dividends to preferred shareholders (9,713)
======= ====== ====== ======
Net income per common share before
extraordinary item $ 0.54
=======
Dividends declared per common share $ 0.96
======
Weighted average number of common
shares outstanding 22,671 (19) 81,505
</TABLE>
<TABLE>
<CAPTION>
Acquisition Acquisition
of Option Acquisition of of Florida Pro Forma
Properties(20) Texas Properties(21) Portfolio(23) Adjustments Pro Forma
-------------- --------------------- -------------- ------------ ----------
<S> <C>
Revenues
Rental income $ 7,862 $ 9,748 $ 5,724 $ $ 365,099
Interest, dividend and other
non-property income 2,683
--------- --------- --------- --------- ----------
7,862 9,748 5,724 0 367,782
Expenses
Rental expenses:
Utilities 394 707 389 25,870
Repairs and maintenance 796 1,246 872 56,369
Real estate taxes 457 1,124 499 29,393
Property management 390 362 287 (278) (24) 8,564
Other operating expenses 609 921 941 37,849
Depreciation of real estate owned 4,412 (25) 71,196
Interest 9,929 (26) 80,870
General and administrative 7,113
Other depreciation and amortization 1,629
Impairment loss on real estate held
for dispositon 290
------- ------ -------- -------- --------
2,646 4,360 2,988 14,063 319,143
------- ------ -------- -------- --------
Income before gains on sales of investments
and minority interest of unitholders
in operating partnership 5,216 5,388 2,736 (14,063) 48,639
Gains on sales of investments 4,346
------- ------ -------- ------- -------
Income before minority interest of
unitholders in operating partnership 5,216 5,388 2,736 (14,063) 52,985
Minority interest of unitholders in operating
Partnersip -- -- -- (58)
------- ------ ------- -------- -------
Income before extraordinary item 5,216 5,388 2,736 (14,063) 52,927
======= ====== ======== ======= =======
Dividends to preferred shareholders (9,713)
======= ====== ======== ======== =======
Net income per common share before
extraordinary item $ 0.53
=======
Dividends declared per common share $ 0.96
=======
Weighted average number of common
shares outstanding 81,505
</TABLE>
65
See accompanying notes.
<PAGE>
UNITED DOMINION REALTY TRUST, INC.
CONSOLIDATED PRO FORMA STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1997
(In thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Acquisition Acquisition of Acquisition of
of Option Texas Texas Properties
Historical(1) Properties(20) Properties(21) Adjustments(22)
<S> <C>
Revenues
Rental income $ 185,366 $ 1,401 $ 2,346 $ 473
Interest and other
non-property income 388
----------- --------- ---------- --------
185,754 1,401 2,346 473
Expenses
Rental expenses:
Utilities 12,124 79 168 36
Repairs and maintenance 26,179 152 253 53
Real estate taxes 14,907 76 294 55
Property management 6,074 70 88 18
Other rental expenses 19,289 87 268 48
Real estate depreciation 35,289
Interest 38,919
General and administrative 3,653
Other depreciation and
amortization 845
Impairment loss on real estate
held for disposition --
----------- --------- ---------- --------
157,279 464 1,071 210
Income before gains (losses) on
sales of investments and minority
interest of unitholders
in operating partnership 28,475 937 1,275 263
Gains on sales of investments 3,374
Minority interest of unitholder
in operating partnership (59)
----------- --------- ---------- --------
Income before extraordinary item 31,790 937 1,275 263
=========== ========= ========== ========
Dividends to preferred
shareholders (6,039)
=========== ========= ========== ========
Net income per common share before
extraordinary item $ 0.30
===========
Dividends declared per common
share $.5050
===========
Weighted average number of commmon
shares outstanding 85,967
</TABLE>
66
<TABLE>
<CAPTION>
Acquisition
of Florida Pro Forma
Portfolio(23) Adjustments Pro Forma
<S> <C>
Revenues
Rental income $ 2,943 $ $ 192,529
Interest and other
non-property income 388
-------------- ---------- -----------
2,943 0 192,917
Expenses
Rental expenses:
Utilities 207 12,614
Repairs and maintenance 460 27,097
Real estate taxes 249 15,581
Property management 152 (92)(24) 6,310
Other rental expenses 466 20,158
Real estate depreciation 1,059 (25) 36,348
Interest 2,801 (26) 41,720
General and administrative 3,653
Other depreciation and
amortization 845
Impairment loss on real estate
held for disposition --
-------------- ---------- -----------
1,534 3,768 164,326
Income before gains (losses) on
sales of investments and minority
interest of unitholders
in operating partnership 1,409 (3,768) 28,591
Gains on sales of investments 3,374
Minority interest of unitholder
in operating partnership (59)
-------------- ---------- -----------
Income before extraordinary item 1,409 (3,768) 31,906
============== ========== ===========
Dividends to preferred
shareholders (6,039)
===========
Net income per common share before
extraordinary item $ 0.30
===========
Dividends declared per common
share $ .0505
===========
Weighted average number of commmon
shares outstanding 85,967
</TABLE>
See accompanying notes.
<PAGE>
UNITED DOMINION REALTY TRUST, INC.
NOTES TO CONSOLIDATED PRO FORMA STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND
THE TWELVE MONTHS ENDED DECEMBER 31, 1996
(UNAUDITED)
Basis of Presentation
The unaudited consolidated pro forma statements of operations on this Form 8-K/A
reflect the historical results of the Company adjusted to reflect the operations
of: (i) Crosswinds Apartments (formerly Tradewinds Apartments), Stoney Pointe
Apartments (formerly Stoneybrooke Apartments) and Dominion Trinity Place
Apartments, formerly (Trinity Place Apartments) acquired on February 28, 1997,
(the "Option Properties), (ii) Anderson Mill Oaks Apartments acquired on March
25, 1997, Oak Ridge Apartments (formerly Post Oak Ridge Apartments) acquired on
March 27, 1997, Green Oaks Apartments (formerly Pineloch Apartments) and Skyhawk
Apartments (formerly Seahawk Apartments) acquired on May 8, 1997, (the "Texas
Properties"), (iii) a portfolio of five apartment communities containing 934
apartment homes acquired on July 1, 1997 (the "Florida Portfolio") which consist
of Lakeside Apartments, Mallards of Brandywine Apartments, Lotus Landing
Apartments , Orange Oaks Apartments and Forest Creek Apartments, (iv) 44
apartment communities containing 14,320 apartment homes (excluding 675 under
development) owned by South West Property Trust Inc. ("South West") that were
merged with and into UDR Western Residential, Inc., a wholly-owned subsidiary of
the Company, in a statutory merger (the "Merger") on December 31, 1996, (as
previously reported on Form 8-K dated December 31, 1996 and subsequently amended
on Form 8-K/A No. 1 dated December 31, 1996 which was filed with the Securities
and Exchange Commission on March 17, 1997), (v) Steeplechase Apartments and
Westland Park Apartments acquired on March 7, 1996 and May 9, 1996, (as
previously reported on Form 8-K dated October 31, 1996 and subsequently updated
to reflect results of operations for the twelve months ended December 31, 1996
on Form 8-K/A No. 1 dated December 31, 1996 which was filed with the Securities
and Exchange Commission on March 17, 1997) and (vi) 18 apartment communities
containing 4,508 apartment homes acquired in an August 15, 1996 portfolio
acquisition (the "Southeast Portfolio") (as previously reported on Form 8-K
dated August 15, 1996 and subsequently updated to reflect the results of
operations for the twelve months ended December 31, 1996 on Form 8-K/A No. 1
dated December 31, 1996 which was filed with the Securities and Exchange
Commission on March 17, 1997). The above referenced acquisitions are shown as if
the acquisitions occurred on the first day of each reporting period presented.
The unaudited consolidated pro forma statements of operations on this Form 8-K/A
assume the acquisition during the six months ended June 30, 1997 of 12 apartment
communities containing 3,594 apartment homes for an aggregate purchase price of
approximately $151.1 million, including closing costs as referenced in sections
(i) through (iii) of the above paragraph (the "Properties"). These acquisitions
are assumed to have been purchased with bank line borrowings aggregating $129.1
million with a weighted average interest rate of 6.26% and the assumption of two
mortgage notes payable aggregating $22.0 million with a weighted average
interest rate of 8.39%.
For presentation purposes in the notes to the unaudited consolidated pro forma
statements of operations for the twelve months ended December 31, 1996 on this
Form 8-K/A, the Southeast Portfolio has been segregated into two components, the
development properties and the non-development properties. There are 14
properties containing 3,196 units which are considered non-development
properties and 4 properties containing 1,312 units which are considered
development properties. The 14 non-development properties were built prior to
1995 and the four development properties had completed units available for
occupancy at various times during 1995 and 1996. For the period presented, the
pro forma adjustments for the four development properties are determined based
upon the weighted average balance of the purchase price outstanding. The
weighted average balance of the purchase price outstanding was calculated by
assuming the properties were financed and acquired by the Company on the dates
on which certificates of occupancy were obtained for each unit during 1995 and
1996.
Also, the unaudited consolidated pro forma statements of operations for the
twelve months ended December 31, 1996 assume the acquisition of the 14
non-development apartment communities contained in the Southeast Portfolio as if
it had occurred on the first day of the reporting period presented. The
unaudited consolidated pro forma statements of operations for the twelve months
ended December 31, 1997 include the effect of debt and equity incurred in
connection with the acquisition of the 14 non-development apartment communities
contained in the Southeast Portfolio which includes: (i) bank lines of credit of
approximately
67
<PAGE>
$14.0 million with a weighted average interest rate of 6.01% (the Company's
market interest rate on short-term bank borrowings in effect at the time of the
acquisition), (ii) the assumption of secured debt encumbering the properties in
the aggregate amount of approximately $75.2 million with a weighted average
interest rate of 7.30%, (iii) Seller financing of approximately $13.9 million
bearing interest of 7.10%, and (iv) the issuance of approximately 934,000 newly
issued shares of the Company's common stock valued at $13.50 (the closing sales
price of the Company's common stock on the date of acquisition) per share for
total consideration of $12.6 million. The unaudited consolidated pro forma
statements of operations for the twelve months ended December 31, 1996 also
assume the acquisition of the four development apartment communities contained
in the Southeast Portfolio. The unaudited consolidated pro forma statements of
operations for the twelve months ended December 31, 1996 include the effects of
debt and equity incurred in connection with the acquisition of the four
development apartment communities contained in the Southeast Portfolio which
includes: (i) bank lines of credit of approximately $11.2 million with a
weighted average interest rate of 6.01% (the Company's market interest rate on
short-term bank borrowings in effect at the time of the acquisition), (ii) the
assumption of secured debt encumbering the properties in the aggregate amount of
approximately $34.6 million with a weighted average interest rate of 6.59%,
(iii) Seller financing of approximately $11.1 million bearing interest of 7.10%
and (iv) the issuance of approximately 746,000 newly issued shares of the
Company's common stock valued at $13.50 per share (the closing sales price of
the Company's common stock on the date of acquisition) for total consideration
of $10.1 million.
The assumption of secured debt encumbering the Southeast Portfolio properties
consists of the following: (i) four mortgage notes payable encumbering specific
properties aggregating $38.6 million, (ii) a $40 million secured senior credit
facility with Wachovia Bank and (iii) a $31.2 million secured senior credit
facility with First Union National Bank, as follows:
Specific Mortgage or Construction Notes Payable:
------------------------------------------------
<TABLE>
<CAPTION>
Loan Interest
Property Name Amount Rate
<S> <C>
Cape Harbor* $ 9,500,000 6.531% (Variable-LIBOR + 1%)
The Village at Cliffdale 10,509,232 7.875%
Rivergate 9,837,246 8.000%
Morganton Place 8,739,750 6.531% (Variable-LIBOR + 1%)
------------
$ 38,586,228
============
</TABLE>
*Construction Note Payable
<TABLE>
<CAPTION>
Cross-Collateralize Secured Notes Payable:
Loan Interest
Lender Amount Rate
<S> <C>
Wachovia Bank** $10,000,000 7.14%
Wachovia Bank** 5,000,000 6.98%
Wachovia Bank** 25,000,000 6.53% (Variable-LIBOR +1%)
First Union National Bank*** 20,000,000 7.75%
First Union National Bank*** 5,000,000 7.38%
First Union National Bank*** 5,000,000 7.50%
First Union National Bank*** 1,232,805 6.61% (Variable-LIBOR +1.18%)
-----------
$71,232,805
============
Total Mortgage Notes Payable $109,819,033
============
</TABLE>
** The $40 million Wachovia Bank senior credit facility is secured by six
properties contained in the Southeast Portfolio. For purposes of this Form
8- K/A, LIBOR is assumed to be 5.53% which represents the 3 month LIBOR on
August 15, 1996, the date of the acquisition. There are two related interest
rate swap agreements with Wachovia Bank in the aggregate notional amount of
$15 million under which the Company pays a fixed-rate of interest and
receives a variable-rate on the notional amounts. The interest rate swaps
effectively change the Company's interest rate exposure from a variable-rate
to a fixed-rate of 7.09% (weighted average) on $15 million of the $40
million senior credit facility.
68
<PAGE>
*** The $31.2 million First Union National Bank senior credit facility is
secured by seven properties contained in the Southeast Portfolio. For
purposes of this Form 8- K/A, LIBOR is assumed to be 5.43% which represents
the 1 month LIBOR on August 15, 1996, the date of the acquisition. There
are three interest rate swap agreements with First Union National Bank in
the aggregate notional amount of $30 million under which the Company pays a
fixed-rate of interest and receives a variable-rate on the notional amounts.
The interest rate swaps effectively change the Company's interest rate
exposure from a variable-rate to a fixed-rate of 7.65% (weighted average) on
$30 million of the $31.2 million senior credit facility.
The unaudited consolidated pro forma statements of operations assume the Merger
with South West occurred on January 1, 1996. The Merger was accounted for as a
purchase in accordance with Accounting Principles Board No. 16. Assets and
liabilities acquired were recorded at their fair values at December 31, 1996 and
the results of operations are included from the date of acquisition. The
unaudited consolidated pro forma statements of operations for the twelve months
ended December 31, 1996 excludes extraordinary items of $10,677,000 included in
the South West Consolidated Statement of Operations which primarily relate to
costs directly attributable to the Merger and are therefore non-recurring. In
connection with the Merger, the Company issued approximately 22.8 million shares
of the Company's common stock at $14.125 per share for all of the outstanding
common stock of South West for an aggregate equity value of approximately $322.1
million. The Company acquired real estate assets of $559.6 million plus other
assets and cash of $8.4 million and $2.7 million, respectively. In addition, the
Company assumed debt totaling approximately $225.0 million, including the
following: (i) a renegotiated unsecured line of credit with an investment bank
in the amount of $69.1 million and a weighted average interest rate of 6.3%,
(ii) an unsecured note payable in the amount of $55.9 million bearing interest
of 7.9%, (iii) two REMIC financings aggregating $94.9 million with a weighted
average interest rate of 7.76%, (iv) one mortgage note payable in the amount of
$5.1 million bearing interest of 8.5%, and (v) other liabilities aggregating
$23.8 million.
In addition to the Merger outlined above, the unaudited consolidated pro forma
statements of operations assume the acquisition of Westland Park and
Steeplechase Apartments with bank line borrowings aggregating $30.2 million and
a weighted average interest rate of 5.98% (the Company's weighted average market
interest rate on short-term bank borrowings in effect at the time of each of the
acquisitions).
The unaudited consolidated pro forma statements of operations are not
necessarily indicative of what the Company's results would have been for the six
months ended June 30, 1997 and for the twelve months ended December 31, 1996 if
the acquisitions had been consummated at the beginning of each period presented,
nor do they purport to be indicative of the results of operations or financial
position in future periods.
(1) Represents the Company's Historical Statements of Operations contained
in its Quarterly Report on Form 10-Q for the six months ended June 30,
1997 and its Annual Report on Form 10-K for the twelve months ended
December 31, 1996.
(2) Represents the actual results of operations for the Southeast Portfolio
as previously reported in the unaudited combined results of operations
for the six months ended June 30, 1996, as appearing in Form 8-K dated
August 15, 1996.
(3) Represents the pro forma results of operations for the Southeast
Portfolio for the 45 day period from July 1, 1996 to August 15, 1996,
which was the period that the properties were not owned by the Company
during 1996 (based on the unaudited combined statement of rental
operations for the 182 day stub period from January 1, 1996 to June 30,
1996). The unaudited combined statement of rental operations was for
the stub period January 1, 1996 to June 30, 1996, as appearing in Form
8-K dated August 15, 1996 (See Note 2 above).
(4) Reflects the net decrease in property management fees for the Southeast
Portfolio. The Company internally managed its apartment properties at
an assumed cost of approximately 2.5% of rental income (based upon 1995
actual information). The Company used 98% of the amount reported as
rental income in calculating the property management fee, as 2% of the
amount reported as rental income is assumed to be other income which is
not subject to management fee.
69
<PAGE>
(5) Represents the net increase in insurance expense to reflect that the
Company insures its apartments for approximately $29.97 per unit more
than the historical insurance expense for the 4,508 apartment units in
Southeast Portfolio. The Southeast Portfolio had four properties
containing 1,312 units under development during 1996. Since the four
properties were under various stages of development during 1996, the
weighted average units outstanding for the period presented is used in
the calculation of the insurance pro forma adjustment. For the twelve
months ended December 31, 1996 the weighted average units outstanding
was 4,437 (3,196 non-development apartment homes and a weighted average
1,241 development apartment homes). The twelve months ended December
31, 1996 includes a pro forma adjustment for 227 out of 366 days.
(6) Reflects the net adjustments to depreciation expense to record the
Southeast Portfolio. For the non-development properties, depreciation
is computed on a straight-line basis over the useful lives of the
related assets based upon the actual purchase price allocation of the
Southeast Portfolio. Buildings have been depreciated over 35 years and
other improvements over a weighted average life of 7.1622 years based
upon the initial cost of the non-development properties in the
Southeast Portfolio of $115.7 million. The allocation and useful lives
are as follows for the non-development properties:
Allocation of Useful Life Depreciation
Purchase Price In Years Adjustment*
-------------- ----------- --------------
Building $ 96,637,354 35 $ 1,712,465
Other Improvements 7,296,003 7.1622 631,805
Land 11,739,024 N\A --
----------- -------------
$115,672,381 $ 2,344,270
============ =============
Reflects the net adjustments to depreciation expense to record the
development properties in the Southeast Portfolio. Buildings have been
depreciated over 35 years and other improvements over a weighted
average life of 6.7 years based upon the initial cost of the
development properties in the Southeast Portfolio of $67.0 million. The
allocation and useful lives are as follows for the development
properties:
<TABLE>
<CAPTION>
Weighted Average
Allocation of Allocation of Useful Life Depreciation
Purchase Price Purchase Price** In Years Adjustment*
-------------- ---------------- --------- ------------
<S> <C>
Building $ 57,967,420 $ 54,604,690 35 $ 967,624
Other Improvements 4,048,512 3,768,179 6.7 348,820
Land 4,952,938 4,623,032 N\A --
------------ --------------- -----------
$ 66,968,870 $ 62,995,901 $ 1,316,444
============= ============= ===========
Total $182,641,251 $ 3,660,714
============ ===========
</TABLE>
* The twelve months ended December 31, 1996 includes a pro forma adjustment
for 227 out of 366 days.
** Since the four development properties were under various stages of
construction during 1996, the weighted average balance of the purchase price
outstanding for both periods presented is used in the calculation for the
depreciation expense pro forma adjustment.
(7) Reflects the additional interest expense associated with the acquisition of
the Southeast Portfolio. The additional interest expense associated with the
non-development properties contained in the Southeast Portfolio is as
follows: (i) variable-rate bank debt aggregating $14.0 million used to fund
the acquisition at assumed interest rates equal to market rates in effect at
the time of the acquisition of 6.01%, (ii) the assumption of secured debt in
the amount of $75.2 million which includes two mortgage notes aggregating
$20.3 million and seven cross-collateralized notes aggregating $54.9 million
with a weighted average interest rate of 7.36%, and (iii) the issuance of a
fixed-rate $13.9 million note to the Seller of the Southeast Portfolio
bearing interest of 7.10%.
70
<PAGE>
Weighted Average Interest Expense
Type of Debt Total Debt Interest Rate Adjustment**
------------ ------------ ---------------- ---------------
Bank Lines $ 13,982,880 6.01% $ 521,214
Secured Debt* 75,175,680 7.36% 3,432,639
Note to Seller 13,902,591 7.10% 612,208
------------ -------------
$103,061,151 $ 4,566,061
============ =============
The additional interest expense associated with the acquisition of the
development properties contained in the Southeast Portfolio is as
follows: (i) additional bank debt aggregating $11.2 million used to
fund the acquisition at assumed interest rates equal to market rates in
effect at the time of the acquisition of 6.01%, (ii) the assumption of
various secured debt aggregating $34.6 million bearing a weighted
average interest rate of 6.76% which includes one mortgage note, one
construction note and seven cross-collateralized notes and (iii) the
issuance of a fixed-rate $11.1 million note to the Seller of the
Southeast Portfolio bearing interest of 7.10%.
<TABLE>
<CAPTION>
Development Weighted Average Weighted Average Interest Expense
Property Total Debt Debt Outstanding* Interest Rate Adjustment**
---------- ---------- ----------------- ---------------- ----------------
<S> <C>
Morganton Place $ 12,386,796 $ 12,386,796 6.537781% $ 502,266
Lake Brandt 12,000,041 12,000,041 7.016978% 522,249
Cape Harbor 16,733,447 13,410,168 6.540838% 544,017
Stonesthrow 15,781,975 15,781,975 6.684529% 654,300
------------ --------------- -----------
$ 56,902,259 $ 53,578,980 $ 2,222,832
============ =============== ===========
Total $159,963,410 $ 6,788,893
============= ===========
</TABLE>
* The four development properties were under various stages of construction
during 1996, therefore, the interest expense pro forma adjustment is based
on the weighted average amount of debt outstanding as determined by the
weighted average balance of the purchase price outstanding during each of
the periods presented.
** The twelve months ended December 31, 1996 includes an interest expense
adjustment calculated on 227 days out of 366 days.
(8) Represents the issuance of 1,679,840 shares of the Company's common stock
to the Seller of the Southeast Portfolio at $13.50 per share. The Company
issued 934,165 shares of common stock which were attributable to the
non-development properties in the Southeast Portfolio based upon the
aggregate allocated purchase price. The shares are assumed to have been
outstanding from the beginning of the period presented and includes a pro
forma adjustment for 227 out of 366 days. The Company issued 745,675
shares of common stock which were attributable to the development
properties in the Southeast Portfolio based on the aggregate allocated
purchase price. The shares are assumed to have been issued and outstanding
from the earlier of the beginning of the period presented or the date on
which certificates of occupancy were granted for each unit contained in
the development properties. For the twelve months ended December 31, 1996,
based upon the weighted average balance of the purchase price outstanding
during 1996, the weighted average days the stock related to the
development properties is assumed to have been outstanding 175.92 (out of
366 days).
(9) Represents the actual results of operations for Steeplechase Apartments
and Westland Park Apartments that have been previously reported to the
Securities and Exchange Commission on Form 8-K dated October 31, 1996.
(10) Represents the pro forma adjustments for Westland Park and Steeplechase
Apartments. For Westland Park Apartments this represents the 8 day period
from May 1, 1996 to May 8, 1996, which was the period that the property
was not owned by the Company during 1996 and the period not included in
the actual results of operations in Note 9 (based on the average per day
unaudited statement of rental operations for the 121 day stub period from
January 1, 1996 to April 30, 1996). For Steeplechase Apartments this
represents the 6 day period from March 1, 1996 to March 6, 1996, which was
the period that the property was not owned by the Company during 1996 and
the period not included in the actual results of operations in Note 9
(based on the average per day unaudited statement of rental operations for
the 60 day stub period from January 1, 1996 to February 29, 1996).
71
<PAGE>
(11) Reflects the net decrease in property management fees for Westland Park
and Steeplechase Apartments. The Company internally managed its apartment
properties at an assumed cost of approximately 2.5% of rental income
(based upon 1995 actual information). The Company used 98% of the amount
reported as rental income in calculating the property management fee, as
2% of the amount reported as rental income is assumed to be other income
which is not subject to management fee.
(12) Reflects the net adjustments to depreciation expense to record Westland
Park and Steeplechase Apartments acquisitions at the beginning of the
period presented. Depreciation is computed on a straight-line basis over
the useful lives of the related assets based upon the actual purchase
price allocations of the properties. Buildings have been depreciated over
35 years and other assets over 5, 10 or 20 years depending on the useful
life of the related asset. The weighted average life of other assets for
Westland Park and Steeplechase Apartments is approximately 7.41 years
based upon the initial cost of the properties of $30.2 million. The
allocation and useful lives are as follows:
Allocation of Useful Life Depreciation
Purchase Price in Years Adjustment*
-------------- ----------- ------------
Building $ 25,133,903 35 $ 200,384
Other Improvements 1,375,227 7.405319 51,820
Land 3,689,016 --
------------- ----------
$ 30,198,146 $ 252,204
============= ==========
* The twelve months ended December 31, 1996, includes a pro forma adjustment
for 102.13 (66 days for Steeplechase Apartments and 129 days for Westland
Park Apartments) out of 366 days.
(13) Reflects the additional interest expense associated with the acquisition of
Westland Park and Steeplechase Apartments on variable-rate bank debt
aggregating $30.2 million used to fund the acquisitions at assumed interest
rates equal to market rates in effect at the time of each respective
acquisition.
Interest Expense
Property Total Debt Interest Rate Adjustment*
-------- ---------- ------------- ----------------
Westland Park $ 16,699,276 6.0296% $ 354,891
Steeplechase 13,498,870 5.9144% 143,969
------------- -------------
$ 30,198,146 $ 498,860
============= =============
* The interest expense adjustment for Westland Park and Steeplechase
Apartments is for 129 and 66 days, respectively (based on a 366 day year).
(14) Represents the historical results of operations of South West Property
Trust Inc. for the twelve months ended December 31, 1996, as previously
reported on Form 8-K dated December 31,1996 and subsequently amended on
Form 8-K/A Amendment No. 1 dated December 31, 1996 which was filed with the
Securities and Exchange Commission on March 17, 1997. Certain
reclassifications have been made to South West's historical statements of
operations to conform to the Company's financial statement presentations.
(15) Reflects the net estimated reduction of property management costs of
$1,089,000 for the twelve months ended December 31, 1996 based upon the
identified historical costs for those items which are anticipated to be
eliminated or reduced as a result of the Merger, as follows (in thousands):
Net reduction in salary, benefits and occupancy costs $ 497
Net reduction in travel, entertainment & other 141
Net reduction in other expenses 451
-------
Pro forma adjustment $ 1,089
=======
(16) Represents the net increase in depreciation of real estate owned as a
result of recording the South West real estate assets at fair value versus
historical cost. Depreciation is computed on a straight-line basis over the
estimated useful lives of the related assets which have an estimated
72
<PAGE>
weighted average useful life of approximately 27.6 years. Buildings have
been depreciated over 35 years and other assets over 5, 10 or 20 years
depending on the useful life of the related asset.
Calculation of fair value of depreciable real estate assets at December 31,
1996 (in thousands):
Purchase price $ 572,281
Less:
Purchase price allocated to cash and other assets (12,690)
Purchase price allocated to land (104,044)
Purchase price allocated to real estate under development* (28,623)
-----------
Pro forma basis of South West's depreciable real estate
held for investment at fair value assets $ 426,924
===========
* At December 31, 1996 South West had one apartment community
containing 315 apartment homes and three additions to
existing properties which will total 360 apartment homes
under development. The historical cost of real estate under
development is assumed to be at fair value.
Calculation of depreciation of real estate owned for the twelve months
ended December 31, 1996 (in thousands):
Depreciation expense based upon an
estimated weighted average useful
life of approximately 27.6 years $ 15,462
Less historical South West depreciation of real
estate owned (13,447)
---------
Pro forma adjustment $ 2,015
========
(17) Represents the estimated net adjustment to interest expense as a result of
the Merger for the twelve months ended December 31, 1996, as follows (in
thousands):
<TABLE>
<CAPTION>
<S> <C>
To adjust amortization of South West's deferred financing costs
which were eliminated in connection
with the Merger $ (1,295)
To adjust the amortization of the premium required to mark
South West's notes payable to fair value (278)
To reflect the additional borrowings of $4.1 million of variable-rate
bank line borrowings used to fund the Merger costs
(at current market interest rates available to
the Company of 6.3%) 257
-----------
Pro forma adjustment $ (1,316)
===========
</TABLE>
(18) Represents the net reduction to general and administrative costs of
$1,438,000 for the twelve months ended December 31, 1996 based upon the
identified historical costs of certain items which are anticipated to be
eliminated or reduced as a results of the Merger, as follows (in
thousands):
Net reduction in salary, benefits and occupancy costs $ 659
Net reduction in duplication of public company
expenses 178
Net reduction in other expenses 601
------
$ 1,438
======
73
<PAGE>
(19) The pro forma weighted average shares outstanding for the twelve months
ended December 31, 1996 is computed as follows (in thousands):
South West's historical weighted average common shares
outstanding 20,937
Plus: effect of South West vested stock options converted
upon Merger 211
Less: dilutive effect of South West stock options
To be eliminated in the Merger (220)
------
South West adjusted weighted average common shares
outstanding 20,928
======
The Company's pro forma weighted average
common shares outstanding 58,834
Issuance of the Company's common stock at an
exchange ratio of 1.0833 for all of the South
West common stock in connection with
the Merger ** 22,671
-------
Pro forma shares 81,505
======
** Weighted average historical South West common shares
outstanding multiplied by the exchange ratio.
(20) Represents the actual results of operations of the Option Properties as
reported elsewhere herein.
(21) Represents the actual results of operations of the Texas Properties as
reported elsewhere herein.
(22) Represents operations of Oak Ridge Apartments (for the 26 day period from
March 1, 1997 to March 26, 1997) and Anderson Mill Oaks Apartments (for
the 24 day period from March 1, 1997 to March 24, 1997), which represents
the period the properties were not owned by the Company during the six
month period ended June 30, 1997 (based on the operating statements of the
properties for the stub period January 1, 1997 to February 28, 1997). The
unaudited combined statements of rental operations were for the stub
period January 1, 1997 to February 28, 1997. Represents operations of
Pineloch Apartments and Seahawk Apartments, (for the 7 day period from May
1, 1997 to May 7, 1997), which represents the period the properties were
not owned by the Company during the six month period ended June 30, 1997
(based on the operating statements of the properties for the stub period
January 1, 1997 to April 30, 1997). The unaudited combined statements of
rental operations were for the stub period January 1, 1997 to April 30,
1997.
(23) Represents the actual results of operations of the Florida Portfolio as
reported elsewhere herein.
(24) Reflects the net reduction in property management fees for the Properties
as reported elsewhere herein. The Company internally manages its apartment
portfolio at an assumed cost of approximately 3.4% of rental income (based
on 1997 actual information for the six months ended June 30, 1997). The
Company uses 96% of the amount reported as rental income in calculating
the property management fee, as approximately 4% (based on 1997 actual
information for the six months ended June 30, 1997) of the amount reported
as rental income is assumed to be other income which is not subject to
management fee.
(25) Reflects the net adjustments to record depreciation expense for the
Properties, at the beginning of each period presented. Depreciation is
computed on a straight-line basis over the useful lives of the related
assets based upon the actual purchase price allocations of the Properties.
Buildings have been depreciated over 35 years and other assets over 5, 10
or 20 years depending on the useful life of the related asset. The
Company's policy is to record a full month of depreciation in the month of
acquisition. The weighted average life of other improvements is
approximately 7.67 years based upon the initial cost of the Properties of
$151.1 million. The allocation and useful lives are as follows (in
thousands of dollars):
74
<PAGE>
<TABLE>
<CAPTION>
Twelve Month Six Month
Useful Life Depreciation Depreciation
Purchase Price In Years Expense Adjustments Expense Adjustment*
-------------- ----------- ------------------- -------------------
<S> <C>
Buildings $ 118,714 35 $ 3,392 $ 814
Other Improvements 7,822 7.67 1,020 245
Land 24,612 n/a -- --
--------- -------- -------
Total $ 151,148 $ 4,412 $ 1,059
========= ======== =======
</TABLE>
* The six months ended June 30, 1997, includes a pro forma adjustment for
2.88 months (1 month for the Option Properties, 2 months for Anderson Mill
Oaks and Oak Ridge Apartments, 4 months for Pineloch Apartments and Seahawk
Apartments, and 6 months for the Florida Portfolio) out of 12 months.
(26) Reflects the additional interest expense associated with the Properties as
reported elsewhere herein which consists of the following: (i)
variable-rate bank debt aggregating approximately $129.1 million used to
fund the acquisitions at assumed interest rates equal to market rates in
effect at the time of each acquisition with a weighted average interest
rate of 6.26% and (ii) the assumption of approximately $22.0 million of
fixed-rate mortgage debt with a weighted average interest rate of 8.39% as
outlined below (in thousands of dollars):
<TABLE>
<CAPTION>
Twelve Month Six Month
Weighted Average Interest Expense Interest Expense
Acquisition Type of Debt Amount Interest Rate Adjustment * Adjustment
------------------ ------------ ------ ---------------- ---------------- ----------------
<S> <C>
Option Properties Bank Lines $ 36,774 6.058% $ 2,228 $ 360 **
Option Properties Secured Debt 22,063 8.389% 1,851 299 **
Texas Properties Bank Lines 56,311 6.291% 3,542 998 ***
Florida Portfolio Bank Lines 36,000 6.410% 2,308 1,144 ****
---------- --------- -----
$ 151,148 $ 9,929 $ 2,801
========== ========= =======
</TABLE>
* The twelve months ended December 31, 1996 includes a pro forma adjustment
for the full year.
** The six months ended June 30, 1997, includes a pro forma adjustment for 59
out of 365 days.
*** The six months ended June 30, 1997, includes a pro forma adjustment for
approximately 103 out of 365 days.
**** The six months ended June 30, 1997, includes a pro forma adjustment for
181 out of 365 days.
75
[LETTERHEAD]
L.P. MARTIN & COMPANY
4132 INNSLAKE DRIVE
GLEN ALLEN, VIRGINIA 23060
PHONE: (804) 348-2828
FAX: (804) 346-9311
CONSENT OF L.P. MARTIN & COMPANY, P.C., INDEPENDENT AUDITORS
The Board of Directors
United Dominion Realty Trust, Inc.
We consent to the incorporation by reference in the previously filed
Registration Statement Form S-3 No. 33-40433, Registration Statement Form S-3
No. 33-32930, Registration Statement Form S-3 No. 333-27221, Registration
Statement Form S-3 No. 33-64275, Registration Statement Form S-3 No. 333-11207,
Registration Statement Form S-3 No. 333-15133, Registration Statement Form S-8
No. 33-47926, Registration Statement Form S-8 No. 33-48000, Registration
Statement Form S-8 No. 33-58201 and Registration Statement Form S-8 No.
333-32829 of United Dominion Realty Trust, Inc. of our report dated June 11,
1997, with respect to the statement of rental operations of Anderson Mill Oaks
Apartments for the year ended December 31, 1996, our report dated June 11, 1997,
with respect to the statement of rental operations of Pineloch Apartments for
the year ended December 31, 1996, our report dated June 11, 1997, with respect
to the statement of rental operations of Post Oak Ridge Apartments for the year
ended December 31, 1996, our report dated June 11, 1997, with respect to the
statement of rental operations of Seahawk Apartments for the year ended
December 31, 1996, our report dated June 25, 1997, with respect to the statement
of rental operations of Tradewinds Apartments for the year ended December 31,
1996, our report dated June 25, 1997, with respect to the statement of rental
operations of Trinity Place Apartments for the year ended December 31, 1996, our
report dated June 25, 1997, with respect to the statement of rental operations
of Stoneybrooke Apartments for the year ended December 31, 1996, our report
dated August 7, 1997, with respect to the statement of rental operations of
Forest Creek Apartments for the year ended December 31, 1996, our report dated
August 7, 1997, with respect to the statement of rental operations of Lakeside
Apartments for the year ended December 31, 1996, our report dated August 7,
1997, with respect to the statement of rental operations of Lotus Landing
Apartments for the year ended December 31, 1996, our report dated August 7,
1997, with respect to the statement of rental operations of Mallards of
Brandywine Apartments for the year ended December 31, 1996, and our report dated
August 7, 1997, with respect to the statement of rental operations of Orange
Oaks Apartments for the year ended December 31, 1996, included in this Form
8-K/A, Amendment to Application or Report on Form 8-K dated July 1, 1997.
/s/ L.P. Martin & Company, P.C.
L.P. Martin & Company, P.C.
Certified Public Accountants
Richmond, Virginia
September 15, 1997
