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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) September 22, 1999
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DAMSON/BIRTCHER REALTY INCOME FUND-I
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(Exact name of registrant as specified in its charter)
Pennsylvania
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(State or other jurisdiction of incorporation or organization)
0-13563 13-3264491
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(Commission file Number) (I.R.S. Employer Identification No.)
27611 La Paz Road, P.O. Box 30009, Laguna Niguel, California 92607-0009
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(Address of principal executive offices) (Zip Code)
(949) 643-7700
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(Registrant's telephone number, including area code)
N/A
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(Former name, former address and former fiscal year, if
changed since last report.)
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DAMSON/BIRTCHER REALTY INCOME FUND-I
ITEM 2. DISPOSITION OF ASSETS
Damson/Birtcher Realty Income Fund-I (the "Partnership") recently sold
four of its six properties in two separate transactions, as set forth below:
Ladera-I
On September 22, 1999, the Partnership sold Ladera-I shopping center, in
Albuquerque, New Mexico to CA New Mexico, LLC, a wholly-owned subsidiary of
CenterAmerica Trust ("CenterAmerica"), a Houston-based real estate investment
trust that is not affiliated in any way with the Partnership, its General
Partner or any of its principals or affiliates.
The sale price was $4,424,000.
CenterAmerica and the Partnership were each represented by third-party
brokers in the transaction. The brokers were paid an aggregate $186,803 from the
sale proceeds. The General Partner was not paid a disposition fee in connection
with the transaction. CenterAmerica will not hire the General Partner or any
affiliate to perform asset management or property management services for this
property.
The Rubin Pachulsky Dew Transaction
On September 23, 1999, the Partnership sold Certified Warehouse and
Distribution Center, in Salt Lake City, Utah, Oakpointe Business Center, in
Arlington Heights, Illinois, and Washington Technical Center, in Renton,
Washington to Rubin Pachulsky Dew Properties, LLC ("Rubin Pachulsky Dew") for
$5,100,000, $5,600,000 and $3,950,000, respectively, or an aggregate purchase
price of $14,650,000. Rubin Pachulsky Dew is a third-party real estate
investment entity that is not affiliated in any way with the Partnership, its
General Partner or any of its principals or affiliates.
Rubin Pachulsky Dew was represented by a third-party broker in the
transaction. The broker was paid $146,500 from the sale proceeds. Since the sale
price of Washington Technical Center exceeded the January 1, 1993 appraised
value ($3,400,000), pursuant to the 1993 Amendment of the Partnership Agreement,
the General Partner earned and was paid a property disposition fee of $98,750 in
connection with the sale of that property.
Rubin Pachulsky Dew has hired an affiliate of Birtcher as property
manager for the properties for a fee that is approximately the same as the fee
the Partnership previously paid to the General Partner for property management.
In addition, Rubin Pachulsky Dew has hired an affiliate of Birtcher to provide
certain asset management services for the properties, and will pay an incentive
fee approximately equal to 10% of the profits, if any, after Rubin Pachulsky Dew
has
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DAMSON/BIRTCHER REALTY INCOME FUND-I
received a 15% cumulative annual return on its investment. The incentive fee, if
earned, is not payable until the last property is sold or four years from date
of purchase, whichever comes first. The property management agreement is
cancelable at any time upon 60 days notice, but the incentive fee will survive
termination of the contract.
Summary
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The Partnership realized approximately $14,821,000, or approximately
$152 per $1,000 originally invested in the Partnership, in distributable cash
proceeds from the sale of all four properties, after paying off the Certified
loan (approximately $2,747,000) and deducting for holdbacks (approximately
$511,000), closing costs and prorations totaling approximately $995,000.
Currently, three lawsuits are pending against the Partnership and its
General Partner and certain of its affiliates that seek, among things,
unspecified monetary damages. These lawsuits are discussed in the Partnership's
quarterly and annual reports. Since these cases are in the preliminary discovery
phase, there is unavoidable uncertainty regarding their ultimate resolution. The
Partnership Agreement mandates that the General Partner provide for all of the
Partnership's liabilities and obligations, including contingent liabilities,
before distributing liquidation proceeds to its partners. Therefore, the
Partnership will not distribute liquidation proceeds until the uncertainty
surrounding these lawsuits is sufficiently resolved. The amount and timing of
any distribution of liquidation proceeds will be determined by the General
Partner in light of these and other relevant considerations.
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DAMSON/BIRTCHER REALTY INCOME FUND-I
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
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DAMSON/BIRTCHER REALTY INCOME FUND-I
BY: DAMSON/BIRTCHER PARTNERS By: BIRTCHER PARTNERS,
[General Partner] a California general partnership
By: BIRTCHER INVESTMENTS,
a California general partnership,
General Partner of Birtcher Partners
By: BIRTCHER LIMITED,
a California limited partnership,
General Partner of Birtcher Investments
By: BREICORP,
a California corporation,
formerly known as Birtcher
Real Estate Inc., General
Partner of Birtcher Limited
Date: October 15, 1999 By: /s/ Robert M. Anderson
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Robert M. Anderson
Executive Director
BREICORP
By: LF Special Fund II, L.P.,
a California limited partnership
By: Liquidity Fund Asset Management, Inc.,
a California corporation, General
Partner of LF Special Fund II, L.P.
Date: October 15, 1999 By: /s/ Brent R. Donaldson
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Brent R. Donaldson
President
Liquidity Fund Asset Management, Inc.
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