UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended October 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________.
Commission File Number 0-18150
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3244091
(State of organization) (IRS Employer Identification No.)
2 World Trade Center, New York, NY 10048
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 392-1054
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None None
Securities registered pursuant to Section 12(g) of the Act:
Units of Limited Partnership Interest
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. [X]
State the aggregate market value of the voting stock held by
nonaffiliates of the registrant. Not Applicable
DOCUMENTS INCORPORATED BY REFERENCE
None
<PAGE>
PART I.
ITEM 1. BUSINESS.
The Registrant, Dean Witter Realty Income Partnership II, L.P. (the
"Partnership"), is a limited partnership formed in September 1984 under
the Uniform Limited Partnership Act of the State of Delaware for the
purpose of investing primarily in income-producing office, industrial and
retail properties.
The Managing General Partner of the Partnership is Dean Witter
Realty Income Properties II Inc. (the "Managing General Partner"), a
Delaware corporation which is wholly-owned by Dean Witter Realty Inc.
The Associate General Partner is Dean Witter Realty Income Associates II,
L.P. (the "Associate General Partner"), a Delaware limited partnership,
the general partner of which is Dean Witter Realty Income Associates II
Inc., a wholly-owned subsidiary of the Managing General Partner. The
Managing General Partner manages and controls all aspects of the business
of the Partnership. The terms of transactions between the Partnership
and its affiliates are set forth in Item 13 below.
The Partnership issued 177,023 units of limited partnership interest
(the "Units") with gross proceeds from the offering of $177,023,000. The
offering has been terminated and no additional Units will be sold.
The proceeds from the offering were used to make equity investments
in six office properties and three retail properties (one of which was
sold in fiscal 1993) which were acquired without permanent mortgage debt.
The properties are described in Item 2 below.
The Partnership considers its business to include one industry
segment, investment in real property.
The Partnership's real property investments are subject to
competition from similar types of properties in the vicinities in which
they are located. In recent years, an oversupply condition has persisted
nationally and many markets have experienced high vacancy rates.
Currently, many real estate markets are beginning to stabilize primarily
due to the continued absence of significant construction activity;
however, the recovery is expected to be slow. Further information
regarding competition in the markets where the Partnership's properties
are located is set forth in Item 7. "Management's Discussion and
Analysis of Financial Condition and Results of Operations".
The Partnership has no employees.
All of the Partnership's business is conducted in the United States.
ITEM 2. PROPERTIES
The Partnership owns directly or through a partnership interest,
the following eight property interests. Generally, the leases pertaining
to the properties provide for pass-throughs to the tenants of their
pro-rata share of certain operating expenses.
<TABLE>
<CAPTION>
Year(s) Acquisition Net Rentable Type of Ownership
Completed/ Cost Area of land and
Property, location and type Acquired ($000) (000 sq. ft.) Improvements
<S> <C> <C> <C> <C>
Framingham Corporate Center 1984/1985,92 $16,073 166 95% general part-
Framingham, MA nership interest1
Office building
Glenhardie Corporate Center
I and II 1979,82/1985 $17,792 126 Fee Interest
Valley Forge, PA
Two office buildings
Century Square, Pasadena, CA 1984/1985 $29,100 206 75% general part-
Office building nership interest2
Wallkill Plaza, Orange County, NY 1986/1986 $18,775 203 Fee Interest
Shopping center
United Services Life Building 1982/1986 $27,000 212 Fee Interest
Bellevue, Washington
Office building
Pavilions at East Lake, Atlanta, GA 1986/1986 $15,600 148 Fee Interest
Shopping center
Taxter Corporate Park 1987,88/1986,88 $7,659 345 14.8% general part-
Westchester County, NY nership interest3
Office building
1. The Managing General Partner owns the remaining 5% limited partnership interest in the partnership.
2. Dean Witter Realty Income Partnership I, L.P., an affiliate of the partnership, owns the remaining
25% general partnership interest. The total cost of the property was $38.8 million.
3. Dean Witter Realty Income Partnership III, L.P. and Dean Witter Realty Income Partnership IV, L.P,
affiliates of the Partnership, own the remaining 44.6% and 40.6% general partnership interests in
the partnership, respectively.
Each property has been built with on-site parking facilities.
</TABLE>
An affiliate of the Partnership is the property manager for Century
Square, Taxter Corporate Park, Framingham Corporate Center, Wallkill
Plaza and the co-property manager for the Glenhardie Corporate Center.
Further information relating to the Partnership's properties is
included in Item 7 and footnotes 4, 5 and 6 to the consolidated financial
statements included in Item 8 below.
ITEM 3. LEGAL PROCEEDINGS.
Neither the Partnership nor any of its properties are subject to any
material pending legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matter was submitted during the fourth quarter of the fiscal year
to a vote of Unit holders.
PART II.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
An established public trading market for the Units does not exist,
and it is not anticipated that such a market will develop in the future.
Accordingly, information as to the market value of a Unit at any given
date is not available. However, the Partnership does allow its limited
partners (the "Limited Partners") to transfer their units if a suitable
buyer can be located.
As of October 31, 1994, there were 28,015 holders of limited
partnership interests.
The Partnership is a limited partnership and, accordingly, does not
pay dividends. It does, however, make quarterly distributions of cash
to its partners. Pursuant to the partnership agreement, distributable
cash, as defined, is paid 90% to the Limited Partners and 10% to the
general partners (the "General Partners").
The Partnership paid quarterly cash distributions during the year
ended October 31, 1994 aggregating $30.00 per Unit to Limited Partners.
The total distribution amounted to $5,900,766, with $5,310,690
distributed to the Limited Partners and $590,076 distributed to the
General Partners. Additionally, in fiscal 1994, the Partnership repaid
$928,139 of deferred distributions owed to the General Partners.
On November 29, 1994, the Partnership paid a cash distribution of
$10.00 per Unit to the Limited Partners. The cash distribution
aggregated $1,966,922 with $1,770,230 distributed to the Limited Partners
and $196,692 distributed to the General Partners. The Partnership also
repaid $928,139 of deferred distributions owed to the General Partners.
The Partnership anticipates making regular distributions to its
partners in the future.
Sale or financing proceeds will be distributed, to the extent
available, first, to each Limited Partner, until there has been a return
of the Limited Partner's capital contribution plus cumulative
distributions of distributable cash and sale or refinancing proceeds in
an amount sufficient to provide a 9% cumulative annual return on the
Limited Partner's adjusted capital contribution. Thereafter, any
remaining sale or financing proceeds will be distributed 85% to the
Limited Partners and 15% to the General Partners after the Managing
General Partner receives a brokerage fee of up to 3% of the selling price
of any equity investment.
Taxable income generally is allocated in the same proportions as
distributions of distributable cash or sale or financing proceeds. In
the event there is no distributable cash or sale or financing proceeds,
taxable income is allocated 90% to the Limited Partners and 10% to the
General Partners. Any tax loss will be allocated 90% to the Limited
Partners and 10% to the General Partners.
<PAGE>
<TABLE>
ITEM 6. SELECTED FINANCIAL DATA.
The following sets forth a summary of the selected financial data for the
Partnership:
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
<CAPTION>
For the years ended October 31, 1994, 1993, 1992, 1991 and 1990
1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C>
Total revenues $ 18,995,554 $ 15,392,848 $ 19,024,121 $ 16,701,176 $ 17,237,642
Net income $ 3,961,466 $ 747,552 $ 3,664,354 $ 2,817,986 $ 4,469,393
Net income per
Unit of
limited
partnership
interest $ 20.14 $ 4.25 $ 18.63 $ 14.33 $ 22.72
Cash distributions
paid per Unit
of limited
partnership
interest $ 30.00 $ 29.52 $ 15.00 $ 26.25 $ 70.00
Total assets at
October 31 $137,953,991 $141,748,117 $150,891,740 $160,145,548 $159,481,855
</TABLE>
The above financial data should be read in conjunction with the
consolidated financial statements and the related notes appearing in Item
8.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Liquidity and Capital Resources
The Partnership raised $177,023,000 in a public offering which was
terminated in 1985. The Partnership has no plans to raise additional
capital.
The Partnership has purchased six properties (one of which was sold
in May 1993) and made three investments in partnerships on an all-cash
basis. The Partnership's acquisition program has been completed. No
additional investments are planned.
Many real estate markets are stabilizing, primarily due to the
continued absence of significant construction activity. However, the
recovery of office properties will be slow because tenant demand is weak
as a result of continued downsizing by many major corporations.
Increased consumer spending has helped the retail property market
although increased interest rates have slowed spending recently. Most
geographic regions of the country are improving, with the exception of
Southern California, where the impact of the defense industry reductions
has not been offset by growth in other industries.
Real estate markets are generally divided into sub-markets by
geographic location and property type. Not all sub-markets have been
affected equally by the above factors.
The Partnership's liquidity depends on the cash flow from operations
of its properties, expenditures for tenant improvements and leasing
commissions in connection with the leasing of vacant space. In 1994, all
of the Partnership's properties generated positive cash flow from
operations, and it is anticipated that they will continue to do so.
In 1994, the Partnership's cash flow from operations and
distributions received from its joint venture investment exceeded
distributions to partners, its joint venture investment, and capital
expenditures. The high occupancy level and limited turnover of leases
at the properties in the portfolio has resulted in an increase in the
Partnership's cash reserves through October 31, 1994. Consequently, in
1994 the Partnership increased the Limited Partners' distribution rate
from 2% to 4% per Unit. In 1995, the Partnership expects that cash flows
from operations and distributions received from its joint venture
investment will exceed distributions to partners at the 4% per Unit rate.
However, the excess will not be sufficient to fully fund certain capital
improvements; these will be funded from Partnership cash reserves.
Additionally, through November 1994, the Partnership has repaid
$1,856,278 of the deferred distributions owed to the General Partners.
The Partnership expects to repay the remaining $1,856,278 of deferred
distributions in fiscal 1995.
In 1994, the Partnership incurred approximately $2,367,000 of tenant
and building improvements, including approximately $1,091,000 at
Glenhardie Corporate Center and approximately $755,000 at United Services
Life Building.
Subsequent to year-end, the lease term of Countrywide Credit, the
largest tenant at the Century Square office building, was extended from
March 2000 to March 2010. The rental rate will remain constant over the
next five years rather than increasing, as provided for under the
original leases.
In fiscal 1993, the Partnership concluded that there was a decline
in the value of the Taxter Corporate Park property, and that the decline
was other-than-temporary. Accordingly, the general partners of the
partnership which owns the property recorded a loss on impairment of its
investment in the property of approximately $27.8 million at October 31,
1993. The Partnership's share of this loss, which was included in equity
in earnings (loss) of joint ventures was approximately $4.1 million.
In February 1992, the Partnership established a $5,000,000 line of
credit with a bank. Borrowings bore interest payable monthly, at prime
plus three quarters percent. In June 1993, the loan balance of
$4,250,035 was repaid in full from proceeds from the sale of the Sardis
Crossing retail property.
On November 29, 1994, the Partnership paid a cash distribution of
$10.00 per Unit to the Limited Partners. The cash distribution
aggregated $1,966,922 with $1,770,230 distributed to the Limited Partners
and $196,692 distributed to the General Partners.
Operations
Fluctuations in the Partnership's operating results for the year
ended October 31, 1994 compared to 1993 and for the year ended October
31, 1993 compared to 1992 are primarily attributable to the following:
The decrease in rental income in 1994 as compared to 1993 is
primarily due to the sale of the Sardis Crossing property in May 1993 and
lower rents recognized at Glenhardie Corporate Center I and Wallkill
Plaza in 1994, offset by higher rental income at the United Services Life
Building and the Framingham Corporate Center. The increase in rental
income in 1993 as compared to 1992 is primarily due to increased rents
recognized at Century Square and Pavilions at East Lake in 1993,
partially offset by the loss of rental income from the sale of the Sardis
Crossing property.
The increase in equity in earnings (loss) of joint venture in 1994
compared to 1993 and the decrease in equity in earnings (loss) of joint
venture in 1993 compared to 1992 are due primarily to the Partnership's
share of the writedown for other than temporary impairment in value of
Taxter Corporate Park of approximately $4.1 million in the fourth quarter
of 1993. The decrease in equity in earnings (loss) of joint venture in
1993 compared to 1992 was partially offset by a real estate tax refund
recognized at Taxter Corporate Park in the fourth quarter of 1993.
The increase in interest and other income in 1993 compared to 1992
is primarily due to the receipt of lease cancellation income totaling
$289,000 at the Glenhardie Corporate Center and the United Services Life
Building in 1993.
The decrease in property operating expenses in 1994 compared to 1993
is primarily attributable to lower utility and repair and maintenance
expenses at the Glenhardie office buildings in 1994 and the sale of the
Sardis Crossing property in 1993, partially offset by increased legal
fees incurred in connection with the lawsuit against a construction
contractor at the Century Square office building. The increase in
property operating expenses in 1993 compared to 1992 is primarily
attributable to increased costs relating to higher average occupancies
at United Services Life and Pavilions at East Lake properties in 1993,
and legal fees incurred in 1993 at Century Square.
The increase in depreciation in 1994 compared to 1993 corresponds
to increased expenditures for tenant improvements in 1994.
The decrease in amortization in 1994 compared to 1993 is due to a
substantial portion of leasing commissions becoming fully amortized in
1993 at the United Services Life and Pavilions at East Lake properties,
and the sale of the Sardis Crossing property. These decreases are
partially offset by amortization on leasing commissions incurred
primarily at the United Services Life Building, Glenhardie Corporate
Center and Pavilions at East Lake in fiscal 1993 and 1994. The increase
in amortization in 1993 compared to 1992 is primarily due to increased
expenditures for leasing commissions at Framingham Corporate Center and
the United Services Life building in 1992, and the Glenhardie Corporate
Center and the United Services Life building in 1993.
The decreases in interest expense in 1994 compared to 1993 and 1993
compared to 1992 is due to the repayment of the bank loan in June 1993.
The decrease in interest expense in 1993 compared to 1992 is also due to
a decrease in the effective interest rate on the Partnership's debt
during 1993.
A summary of the markets in which the Partnership's office
properties are located and the performance of each property is as
follows:
The Boston suburban office market, the location of the Framingham
Corporate Center, is one of the most active markets in the Boston area.
The current market vacancy rate is approximately 6%. As of October 31,
1994, the building was 99% leased to 13 tenants. Major tenants include
ASB Meditest and Blue Cross/Blue Shield, both of whose leases expire in
1996.
The office market in Westchester County, New York, the location of
Taxter Corporate Park, has experienced a significant decline. The
current vacancy level in the Westchester office market is approximately
25% as many major tenants in the market are consolidating their
operations. It is unlikely that this vacant space will be absorbed in
this market for several years. However, as of October 31, 1994, the
property was 98% leased to 26 tenants. One of the tenants acquired a
long-term leasehold interest in approximately 20% of the space at the
property in 1988. This tenant does not pay rent, but is responsible for
its share of real estate taxes and certain operating expenses. The lease
of Fuji Photo Film, the other major tenant (covering 21% of the
property's space) expires in 1996.
Glenhardie Corporate Center I and II are located in the mid-range
office building market in Valley Forge, Pennsylvania where the vacancy
rate is approximately 14%. As of October 31, 1994, the buildings were
98% leased to 11 tenants. Major tenants include Sun Guard Data
Corporation and Users Inc, whose leases expire in 1998 and 1999,
respectively.
In Pasadena, California, the location of the Century Square office
building, the office market overall vacancy rate is approximately 16%,
and it is expected to face some deterioration in the near term as a
result of downsizing by two large employers in that market. However,
Century Square remained 100% leased during the year. The occupancy of
the property's largest tenant, Countrywide Credit, remained at
approximately 83%.
The office market at Bellevue, Washington, the location of the
United Services Life Building, has experienced minimal space absorption
in 1994, primarily as a result of a slowdown in the local economy and the
availability of sub-lease space. As of October 31, 1994, the building
was 98% leased to 30 tenants. Major tenants include, Asymetrix
Corporation and United Service Life. Asymetrix Corporation's leases
expire in 1996 and 1998 and United Services Life's lease expires in 1995.
A summary of the markets in which the Partnership's retail
properties are located and the leasing status of each property are as
follows:
Pavilions at East Lake is located in an area of suburban Atlanta,
a market which experienced significant retail development in the 1980's.
Retail occupancy in the area eroded during the recession. Additionally,
a new shopping center recently opened which directly competes with the
property. Increased vacancies and downward pressure on rents are
expected to continue in the near term. As of October 31, 1994, the
center was 91% leased to 35 tenants. In the third quarter of 1994, A&P,
the anchor tenant vacated its space. However, A&P is obligated to
continue to pay rent until its lease expires in 2006. A&P is actively
seeking a replacement tenant.
Wallkill Plaza, located in Wallkill, New York, has been affected by
both the recession and new retail development. A regional mall opened
in the area in mid-1992. As a result, rental levels, which have already
experienced a decline, may experience further downward pressure. As of
October 31, 1994, the center was 86% leased to 18 tenants. Anchor
tenants include Bradlees and Shop Rite, both of whose leases expire in
2006.
Inflation
Inflation has been consistently low during the periods presented in
the financial statements and, as a result, has not had a significant
effect on the operations of the Partnership or its properties.
<PAGE>
<TABLE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
INDEX
<CAPTION>
Page
<S> <C>
Independent Auditors' Report 12
Consolidated Balance Sheets at October 31, 1994 and 1993 13
Consolidated Statements of Income for the years ended
October 31, 1994, 1993 and 1992 14
Consolidated Statements of Partners' Capital for the
years ended October 31, 1994, 1993 and 1992 15
Consolidated Statements of Cash Flows for the years
ended October 31, 1994, 1993 and 1992 16
Notes to Consolidated Financial Statements 17-23
</TABLE>
<TABLE>
<CAPTION>
Schedule
<S> <C> <C>
Supplementary Income Statement Information X 24
Real Estate and Accumulated Depreciation XI 25-26
All schedules other than those indicated above have been omitted because either
the required information is not applicable or the information is shown in the
consolidated financial statements or notes thereto.
</TABLE>
<PAGE>
Independent Auditors' Report
To The Partners of
Dean Witter Realty Income Partnership II, L.P.:
We have audited the accompanying consolidated balance sheets of Dean
Witter Realty Income Partnership II, L.P. and consolidated partnerships
(the "Partnership") as of October 31, 1994 and 1993, and the related
consolidated statements of income, partners' capital, and cash flows
for each of the three years in the period ended October 31, 1994. Our
audits also included the financial statement schedules listed in the
index at Item 8. These financial statements and financial statement
schedules are the responsibility of the Partnerships' management. Our
responsibility is to express an opinion on the financial statements and
financial statement schedules based on our audits.
We conducted our audits 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 statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. 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 audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly in all
material respects, the financial position of Dean Witter Realty Income
Partnership II, L.P. and consolidated partnerships as of October 31,
1994 and 1993, and the results of their operations and their cash flows
for each of the three years in the period ended October 31, 1994 in
conformity with generally accepted accounting principles. Also in our
opinion, such financial statement schedules, when considered in
relation to the basic consolidated financial statements taken as a
whole, present fairly in all material respects, the information set
forth therein.
/s/Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
New York, New York
January 27, 1995
<PAGE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
CONSOLIDATED BALANCE SHEETS
October 31, 1994 and 1993
<CAPTION>
ASSETS
1994 1993
<S> <C> <C>
Cash and short-term investments, at cost,
which approximates market $ 9,812,279 $ 7,465,589
Real estate, at cost (notes 4, 5 and 7):
Land 18,121,935 18,121,935
Buildings 146,235,433 144,867,183
164,357,368 162,989,118
Accumulated depreciation 43,775,258 37,630,627
120,582,110 125,358,491
Investment in joint venture (notes 6 and 7) 2,759,347 2,646,935
Deferred expenses, net 1,328,063 1,776,242
Other assets 3,472,192 4,500,860
$137,953,991 $141,748,117
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable and accrued liabilities $ 740,683 $ 1,023,493
Security deposits 271,331 340,408
Deferred distributions (note 9) 2,784,417 3,712,556
Minority interests in joint ventures (note 4) 8,489,748 9,064,548
12,286,179 14,141,005
Partners' capital (deficiency) (note 3):
General partners (3,131,626) (2,937,697)
Limited partners ($1,000 per Unit, 177,023 units issued) 128,799,438 130,544,809
Total partners' capital 125,667,812 127,607,112
$137,953,991 $141,748,117
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
CONSOLIDATED STATEMENTS OF INCOME
For the years ended October 31, 1994, 1993 and 1992
<CAPTION>
1994 1993 1992
<S> <C> <C> <C>
Revenues:
Rental (notes 7 and 8) $18,076,876 $18,652,759 $18,502,546
Equity in earnings (loss) of joint venture (note 6) 346,296 (3,810,029) 267,435
Interest and other 572,382 550,118 254,140
18,995,554 15,392,848 19,024,121
Expenses:
Property operating expenses (note 9) 6,866,522 6,993,622 6,647,429
Depreciation 6,309,155 6,250,212 6,260,355
Amortization 561,595 677,917 537,018
Interest (notes 7 and 9) - 183,130 510,663
General and administrative (note 9) 710,712 771,971 845,246
14,447,984 14,876,852 14,800,711
Income before minority interests and gain
on sale of real estate 4,547,570 515,996 4,223,410
Minority interests 586,104 562,451 559,056
Income (loss) before gain on sale of
real estate 3,961,466 (46,455) 3,664,354
Gain on sale of real estate (note 5) - 794,007 -
Net income $ 3,961,466 $ 747,552 $ 3,664,354
Net income per Unit of limited
partnership interest (note 2) $20.14 $4.25 $18.63
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL
For the years ended October 31, 1994, 1993 and 1992
<CAPTION>
Limited General
Partners Partners Total
<S> <C> <C> <C>
Partners' capital (deficiency)
at November 1, 1991 $134,375,755 $(2,660,235) $131,715,520
Net income 3,297,919 366,435 3,664,354
Distributions (2,655,345) (295,039) (2,950,384)
Partners' capital (deficiency)
at October 31, 1992 135,018,329 (2,588,839) 132,429,490
Net income (loss) 752,198 (4,646) 747,552
Distributions (5,225,718) (344,212) (5,569,930)
Partners' capital (deficiency)
at October 31, 1993 130,544,809 (2,937,697) 127,607,112
Net income 3,565,319 396,147 3,961,466
Distributions (5,310,690) (590,076) (5,900,766)
Partners' capital (deficiency)
at October 31, 1994 $128,799,438 $(3,131,626) $125,667,812
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended October 31, 1994, 1993 and 1992
<CAPTION>
1994 1993 1992
<S> <C> <C> <C>
Cash flows from operating activities:
Net income $ 3,961,466 $ 747,552 $ 3,664,354
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 6,309,155 6,250,212 6,260,355
Amortization 561,595 677,917 537,018
Minority interests in joint ventures' operations 586,104 562,451 559,056
Equity in loss (earnings) of joint venture (346,296) 3,810,029 (267,435)
Gain on sale of real estate - (794,007) -
Decrease (increase) in operating assets:
Deferred expenses (113,416) (805,396) (679,318)
Other assets 1,028,668 (123,719) (689,292)
Increase (decrease) in operating liabilities:
Accounts payable and accrued liabilities (282,810) 171,185 (328,955)
Security deposits (69,077) 30,186 (33,947)
Net cash provided by operating activities 11,635,389 10,526,410 9,021,836
Cash flows from investing activities:
Additions to real estate (2,367,774) (693,215) (3,636,182)
Reduction of real estate 835,000 - -
Proceeds from sale of real estate - 6,379,216 -
Additional investment by minority interest 10,358 8,987 171,674
Minority interests in joint ventures' distributions (1,171,262) (991,540) (811,476)
Distributions from Taxter joint venture 461,460 508,352 395,866
Investment in Taxter joint venture (227,576) (127,434) (105,307)
Net cash provided by (used in) investing activities (2,459,794) 5,084,366 (3,985,425)
Cash flows from financing activities:
Cash distributions to partners (5,900,766) (5,422,410) (2,655,345)
Repayment of deferred distributions (928,139) - -
Proceeds (repayment) of loan payable to bank - (4,250,035) 4,250,035
Due to affiliates - - (7,026,544)
Net cash used in financing activities (6,828,905) (9,672,445) (5,431,854)
Increase (decrease) in cash and short-term
investments 2,346,690 5,938,331 (395,443)
Cash and short-term investments at beginning
of year 7,465,589 1,527,258 1,922,701
Cash and short-term investments at end of year $ 9,812,279 $ 7,465,589 $ 1,527,258
Supplemental disclosure of cash flow information:
Cash paid for interest $ - $ 183,130 $ 1,225,666
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
October 31, 1994, 1993 and 1992
1. The Partnership
Dean Witter Realty Income Partnership II, L.P. (the "Partnership") is
a limited partnership organized under the laws of the State of Delaware
in 1984. The Partnership is managed by Dean Witter Realty Income
Properties II Inc. (the "Managing General Partner"). The Partnership's
fiscal year ends on October 31.
In 1985, the Partnership issued 177,023 units of limited partnership
interest (the "Units") for $177,023,000. No additional Units will be
sold. The proceeds of the offering were used to make equity
investments in income-producing office and retail properties which were
not encumbered by debt when acquired.
2. Summary of Significant Accounting Policies
The financial statements include the accounts of the Partnership and
the Century Square and Framingham Corporate Center joint ventures on
a consolidated basis. The equity method of accounting has been applied
to the Partnership's 14.8% interest in the Taxter Corporate Park
property because of its continuing ability to exert significant
influence.
The Partnership owns a 75% general partnership interest in Century
Square. An affiliate of the partnership, Dean Witter Realty Income
Partnership I, L.P., owns the remaining 25% general partnership
interest.
The Partnership's records are maintained on the accrual basis of
accounting for financial reporting and tax purposes.
The carrying value of real estate includes the purchase price paid by
the Partnership and acquisition fees and expenses. Costs of
improvements to the properties are capitalized, and repairs are
expensed. Depreciation is recorded on the straight-line method.
The Partnership periodically evaluates the recoverability of the net
carrying value of its real estate. The evaluation is based on a review
of expected future cash flows, determination of the Partnership's
expected holding period of these assets and other factors.
Deferred expenses consist primarily of leasing commissions which are
amortized over the applicable lease terms.
Rental income is recognized on a straight-line basis.
The Partnership considers short-term investments with original
maturities of three months or less to be cash equivalents.
Net income per Unit amounts are calculated by dividing net income
allocated to Limited Partners, in accordance with the Partnership
Agreement, by the weighted average number of Units outstanding.
No provision for income taxes has been made in the financial
statements, since the liability for such taxes is that of the partners
rather than the Partnership.
For income tax purposes, Partnership results are reported for the
calendar year. The accounting policies used for tax reporting purposes
differ from those used for financial reporting as follows: (a)
depreciation is calculated using accelerated methods, (b) rental income
is recognized based on the payment terms in the applicable leases, and
(c) writedowns for impairment of real estate are not deductible. In
addition, offering costs are treated differently for tax and financial
reporting purposes. The tax basis of the Partnership's assets and
liabilities is approximately $5.2 million higher than the amounts
reported for financial statement purposes.
3. Partnership Agreement
The Partnership Agreement provides that distributable cash, as defined,
is paid 90% to the Limited Partners and 10% to the General Partners.
Sale or financing proceeds will be distributed, to the extent
available, first, to each Limited Partner, until return of the Limited
Partner's capital contribution plus cumulative distributions of
distributable cash and sale or financing proceeds in an amount
sufficient to provide a 9% cumulative annual return on the Limited
Partner's adjusted capital contribution. Thereafter, any remaining
sale or financing proceeds will be distributed 85% to the Limited
Partners and 15% to the General Partners after the Managing General
Partner receives a brokerage fee of up to 3% of the selling price of
any equity investment.
Taxable income generally is allocated in the same proportions as
distributions of distributable cash or sale or financing proceeds. In
the event there is no distributable cash or sale or financing proceeds,
taxable income is allocated 90% to the Limited Partners and 10% to the
General Partners. Any tax loss is allocated 90% to the Limited
Partners and 10% to the General Partners.
<TABLE>
4. Real Estate Investments
The locations, years of acquisition and net carrying values of the
properties are as follows:
<CAPTION>
Carrying Value
Year of at October 31,
Property Acquisition 1994 1993
<S> <C> <C> <C>
Framingham Corporate Center,
Framingham, MA 1985 $ 18,096,036 $ 19,317,793
Glenhardie I and II,
Valley Forge, PA 1985 15,420,078 15,262,914
Century Square,
Pasadena, CA 1985 33,129,398 35,288,974
Wallkill Plaza,
Orange County, NY 1986 16,084,429 16,482,625
United Services Life Building,
Bellevue, Washington 1986 24,036,993 24,827,318
Pavilions at East Lake,
Atlanta, GA 1986 13,815,176 14,178,867
$120,582,110 $125,358,491
</TABLE>
In fiscal 1994, the Century Square joint venture settled a lawsuit with
the developer of the property relating to certain defects in the
parking structure and heating, ventilation and air conditioning
systems. Pursuant to the settlement, the joint venture received
$835,000 in 1994. The proceeds were distributed to the co-venturers
according to their interests; accordingly, the Partnership received
$626,250. The joint venture will receive an additional $100,000 in
each of fiscal years 1995 and 1996. The Partnership recorded the
proceeds, which represent the recovery of costs incurred and
capitalized to correct the defects, as a reduction of buildings and
improvements.
5. Sale of Real Estate
In May 1993, the Partnership sold the Sardis Crossing property for
$6,450,000, less closing costs. The net carrying value of the
property, including deferred costs, was approximately $5,585,000 at the
time of sale. $4,250,035 of the proceeds were used to repay the
Partnership's bank loan, and the remainder was distributed to the
Limited Partners. The gain on the sale ($4.49 per limited partnership
Unit) was allocated 100% to the Limited Partners in accordance with the
Partnership Agreement.
6. Investment in Joint Venture
Taxter Corporate Park, Westchester County, New York
In 1986, the Partnership purchased a 14.8% general partnership interest
in the partnership which owns the property. Affiliates of the
Partnership, Dean Witter Realty Income Partnership III, L.P. and Dean
Witter Realty Income Partnership IV, L.P. purchased the remaining 44.6%
and 40.6% general partnership interests, respectively.
The partners receive cash flow and profits and losses according to
their pro rata shares.
In fiscal 1993, because of continuing weakness in the Westchester
County, New York office market, and the likelihood that such weakness
would persist for several years, the general partners of the
partnership which owns the property concluded that there was a decline
in its value, and that the decline was other-than-temporary.
Accordingly, the partnership which owns the property recorded a loss
on impairment of the property of approximately $27.8 million at October
31, 1993. The Partnership's share of this loss, approximately $4.1
million, was included in equity in earnings (loss) of joint venture in
1993.
Summarized balance sheet information of the joint venture are as
follows:
<TABLE>
<CAPTION>
October 31,
1994 1993
<S> <C> <C>
Land and buildings, net $18,525,138 $17,988,250
Other 1,720,405 1,501,419
Total assets $20,245,543 $19,489,669
Liabilities $ 214,584 $ 218,247
Partners' capital 20,030,959 19,271,422
Total liabilities and capital $20,245,543 $19,489,669
<FN>
/TABLE
<PAGE>
<TABLE>
Summarized results of the operations of the joint venture are as follows:
<CAPTION>
Years ended October 31,
1994 1993 1992
<S> <C> <C> <C>
Rental income $ 6,269,934 $ 6,516,950 $ 6,109,525
Other income 81,301 100,967 187,250
6,351,235 6,617,917 6,296,775
Property operating expenses 3,020,235 2,956,814 3,019,392
Depreciation and amortization 991,163 1,576,393 1,470,390
Loss on impairment of real
estate - 27,828,152 -
4,011,398 32,361,359 4,489,782
Net income (loss) $ 2,339,837 $(25,743,442) $ 1,806,993
Activity in the Investment in Joint Venture is as follows:
Years ended October 31,
1994 1993 1992
Investment at beginning
of year $ 2,646,935 $ 6,837,882 $ 6,861,006
Equity in earnings (loss) 346,296 (3,810,029) 267,435
Distributions (461,460) (508,352) (395,866)
Additional investments 227,576 127,434 105,307
Investment at end of year $ 2,759,347 $ 2,646,935 $ 6,837,882
<FN>
</TABLE>
7. Loan Payable to Bank
In February 1992, the Partnership established a secured revolving credit
facility in the amount of $5,000,000 with a bank. Borrowings bore
interest, payable monthly, at the prime rate plus three quarters percent.
In June 1993, the loan balance of $4,250,035 was repaid in full.
8. Leases
Minimum future rental income under noncancellable operating leases as of
October 31, 1994 is as follows:
Year ending October 31:
1995 $15,656,528
1996 14,681,254
1997 11,781,813
1998 10,302,417
1999 8,014,883
Thereafter 20,533,720
Total $80,970,615
The Partnership has determined that all leases relating to its properties
are operating leases. The lease terms range from three to fifteen years,
and generally provide for fixed minimum rents with rental escalation and/or
expense reimbursement clauses.
Subsequent to year-end, the lease term of Countrywide Credit, the largest
tenant at the Century Square office building, was extended from March 2000
to March 2010. The rental rate will remain constant over the next five
years rather than increasing, as provided for under the original leases.
9. Related Party Transactions
An affiliate of the Managing General Partner provided property
management services for four properties in 1994, six properties in 1993
and five properties in 1992. The Partnership paid the affiliate
management fees of approximately $295,000, $321,000 and $291,000 for
the years ended October 31, 1994, 1993 and 1992, respectively.
Another affiliate of the Managing General Partner performs
administrative functions and processes certain investor and tax
information on behalf of the Partnership. For the years ended October
31, 1994, 1993 and 1992, the affiliate was reimbursed approximately
$523,000, $527,000 and $530,000, respectively, for these services. As
of October 31, 1994, the affiliate was owed approximately $163,000 for
these services.
The Partnership had borrowed funds from an affiliate of the Managing
General Partner. Interest expense, which was calculated at the prime
rate, approximated $297,000 in 1992. The loan was repaid in full in
fiscal 1992.
Through October 31, 1994 and 1993, the General Partners have deferred
receipt of an aggregate amount of $2,784,417 and $3,712,556,
respectively, of distributions to which they are entitled, including
distributions of approximately $148,000 and $295,000 in 1993 and 1992,
respectively. Amounts deferred were charged against partners' capital
and recorded as liabilities owing to the General Partners. In fiscal
1994, the Partnership repaid $928,139 of deferred distributions owed
to the General Partners.
10. Subsequent Event
On November 29, 1994, the Partnership paid a cash distribution of
$10.00 per Unit to the Limited Partners. The cash distribution
aggregated $1,966,922 with $1,770,230 distributed to the Limited
Partners and $196,692 distributed to the General Partners. The
Partnership also repaid $928,139 of deferred distributions owed to the
General Partners. The Partnership expects to repay this liability in
full in fiscal 1995. <PAGE>
<TABLE>
SCHEDULE X
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
Supplementary Income Statement Information
For the years ended October 31, 1994, 1993 and 1992
<CAPTION>
Charged to costs and expenses
1994 1993 1992
<S> <C> <C> <C>
Maintenance and repairs $ 361,414 $ 418,663 $ 538,158
Real estate taxes $ 1,640,193 $ 1,616,330 $1,684,640
<FN>
</TABLE>
<PAGE>
<TABLE>
SCHEDULE XI
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
Real Estate and Accumulated Depreciation
October 31, 1994
<CAPTION>
Initial cost to Partnership (A)
Building and
Description Land Improvements Total
<S> <C> <C> <C>
Office Building
Framingham, MA $2,061,399 $21,369,446 $23,430,845
Office Buildings
Valley Forge, PA 2,000,000 16,534,152 18,534,152
Office Building
Pasadena, CA 6,429,000 33,907,000 40,336,000
Shopping Center
Wallkill, NY 2,300,000 17,300,870 19,600,870
Office Building
Bellevue, WA 2,831,536 25,483,828 28,315,364
Shopping Center
Atlanta, GA 2,500,000 13,858,607 16,358,607
$18,121,935 $128,453,903 $146,575,838
</TABLE>
<TABLE>
<CAPTION>
Gross Amount at which
Carried at End of Period (B)
Cost
Capitalized
Subsequent to Building &
Description Acquisition Land Improvements Total
<S> <C> <C> <C> <C>
Office Building
Framingham, MA $5,879,607 $2,061,399 $27,249,053 $29,310,452
Office Buildings
Valley Forge, PA 3,242,543 2,000,000 19,776,695 21,776,695
Office Building
Pasadena, CA 3,386,246 6,429,000 37,293,246 43,722,246
Shopping Center
Wallkill, NY 61,882 2,300,000 17,362,752 19,662,752
Office Building
Bellevue, WA 4,611,146 2,831,536 30,094,974 32,926,510
Shopping Center
Atlanta, GA 600,106 2,500,000 14,458,713 16,958,713
$17,781,530 $18,121,935 $146,235,433 $164,357,368
</TABLE>
<TABLE>
<CAPTION>
Life on which
Depreciation
in Latest Income
Accumulated Date of Date Statement is
Description Depreciation(c) Construction Acquired Computed
<S> <C> <C> <C> <C>
Office Building
Framingham, MA $11,214,416 1984 May 1985 5-40 years
Office Buildings
Valley Forge, PA 6,356,617 1979 July 1985 5-40 years
1982 November 1985
Office Building
Pasadena, CA 10,592,848 1984 October 1985 5-40 years
Shopping Center
Wallkill, NY 3,578,323 1986 August 1986 5-40 years
Office Building
Bellevue, MA 8,889,517 1982 September 1986 5-40 years
Shopping Center
Atlanta, GA 3,143,537 1986 December 1986 5-40 years
$43,775,258
</TABLE>
<TABLE>
Notes:
(A) The initial cost includes the purchase price paid by the Partnership and acquisition fees and
expenses. There is no difference between cost for financial reporting purposes and cost for
federal income tax purpose.
<CAPTION>
(B) Reconciliation of real estate owned
at October 31: 1994 1993 1992
<S> <C> <C> <C>
Balance at beginning of period $162,989,118 $169,734,278 $164,025,311
Additions (deletions) during period:
Acquisition of Minority interest - - 2,072,785
Improvements 2,367,774 693,215 3,636,182
Reduction of real estate (835,000) - -
Cost of real estate sold (6,229,880) -
Write-offs due to lease expirations (164,524) (1,208,495) -
Balance at end of period $164,357,368 $162,989,118 $169,734,278
(C) Reconciliation of accumulated depreciation:
Balance at beginning of period $ 37,630,627 $ 33,818,402 $ 27,558,047
Additions (deletions) during Period:
Depreciation expense 6,309,155 6,250,212 6,260,355
Accumulated Depreciation on real
estate sold (1,229,492) -
Write-offs due to lease expirations (164,524) (1,208,495) -
Balance end of period $ 43,775,258 $37,630,627 $33,818,402
<FN>
</TABLE>
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
None.
PART III.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The Partnership is a limited partnership which has no directors or
officers.
The directors and executive officers of the Managing General Partner
are as follows:
Position with the
Name Managing General Partner
William B. Smith Chairman of the Board of Directors
E. Davisson Hardman, Jr. President and Director
Lawrence Volpe Controller, Assistant Secretary and
Director
Ronald T. Carman Secretary and Director
All of the directors have been elected to serve until the next
annual meeting of the shareholder of the Managing General Partner or
until their successors are elected and qualify. Each of the officers has
been elected to serve until his successor is elected and qualifies.
William B. Smith, age 51, is a Managing Director of Dean Witter
Realty Inc. and has been with Dean Witter Realty Inc. since April 1982.
E. Davisson Hardman, Jr., age 45, is a Managing Director of Dean
Witter Realty Inc. and has been with Dean Witter Realty Inc. since April
1982.
Lawrence Volpe, age 47, is a Director and the Controller of Dean
Witter Realty Inc. He is a Senior Vice President and Controller of Dean
Witter Reynolds Inc., which he joined in 1983.
Ronald T. Carman, age 43, is a Director and the Secretary of Dean
Witter Realty Inc. He is a Senior Vice President and Associate General
Counsel of Dean Witter Reynolds Inc., which he joined in 1984.
There is no family relationship among any of the foregoing persons.
ITEM 11. EXECUTIVE COMPENSATION
The General Partners are entitled to receive cash distributions,
when and as cash distributions are made to the Limited Partners, and a
share of taxable income or tax loss. Descriptions of such distributions
and allocations are in Item 5 above. The General Partners deferred
receipt of cash distributions of $147,520 and $295,039 during the years
ended October 31, 1993 and 1992, respectively. At October 31, 1994 the
General Partners have deferred receipt of a total of $2,784,417 of such
distributions.
The General Partners and their affiliates were paid certain fees and
reimbursed for certain expenses. Information concerning such fees and
reimbursements is contained in Note 9 of the Notes to Consolidated
Financial Statements in Item 8 above.
The directors and officers of the Partnership's Managing General
Partner received no remuneration from the Partnership.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
(a) No person is known to the Partnership to be the beneficial
owner of more than five percent of the Units.
(b) The directors of the Managing General Partner and the officers
and directors of the Managing General Partner as a group own the
following Units as of January 27, 1995:
<TABLE>
<CAPTION>
(1) (2) (3)
<S> <S> <S>
Amount and
Title of Name and Address of Nature of
Class Beneficial Owner Beneficial Ownership
Limited Directors and officers Indirectly: The Associate
Partnership of Managing General General Partner, the limited
Interests Partner, as a group partner of which includes
officers and directors of
Dean Witter Realty Inc. the Managing General
2 World Trade Center Partner, owns 5 Units (.003
New York, NY 10048 percent of class)
</TABLE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
As a result of their being partners of a limited partnership which
is the limited partner of the Associate General Partner, certain current
and former officers and directors of the Managing General Partner also
own indirect partnership interests in the Partnership. The Partnership
Agreement of the Partnership provides that cash distributions and
allocations of income and loss to the general partners be distributed or
allocated 50% to the Managing General Partner and 50% to the Associate
General Partner. The General Partners' share of cash distributions and
income or loss is described in Item 5 above.
All of the outstanding shares of common stock of the Managing
General Partner are owned by Dean Witter Realty Inc. ("Realty"), a
Delaware corporation which is a wholly-owned subsidiary of Dean Witter,
Discover & Co. The general partner of the Associate General Partner is
Dean Witter Realty Income Associates II Inc., which is a wholly-owned
subsidiary of the Managing General Partner. The limited partner of the
Associate General Partner is LSA 84 II L.P., a Delaware limited
partnership. Realty and certain current and former officers and
directors of the Managing General Partner are partners of LSA 84 II L.P.
Additional information with respect to the directors and executive
officers and compensation of the Managing General Partner and affiliates
is contained in Items 10 and 11 above.
The General Partners and their affiliates were paid certain fees and
reimbursed for certain expenses. Information concerning such fees and
reimbursements is contained in Note 9 to the Consolidated Financial
Statements in Item 8 above.
<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM
8-K.
(a) The following documents are filed as part of this Annual Report:
1. Financial Statements (see Index to Financial Statements filed as
part of Item 8 of this Annual Report).
2. Financial Statement Schedules (see Index to Financial Statements
filed as part of Item 8 of this Annual Report).
3. Exhibits
(3) Amended and Restated Agreement of Limited Partnership dated
as of September 6, 1984 set forth in Exhibit A to the
Prospectus included in Registration Statement Number 2-93207
is incorporated herein by reference.
(4) Not applicable.
(9) Not applicable.
(10) Purchase and Sale Agreements for properties purchased were
filed as Exhibits to Form 8-K on June 6, 1985, July 15,
1985, November 13, 1985, February 27, 1986, August 29, 1986,
September 4, 1986, December 16, 1986 and December 30, 1986
and are incorporated herein by reference.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(18) Not applicable.
(19) Not applicable.
(22) Subsidiaries: Century Square Ventures, a California limited
partnership; Framingham Corporate Center LP, a Massachusetts
limited partnership.
(23) Not applicable.
(24) Not applicable.
(25) Not applicable.
(28) Not applicable.
(29) Not applicable.
(b) No forms 8-K were filed by the Partnership during the last quarter
of the period covered by this report.
<PAGE>
<TABLE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
<S> <S>
By: Dean Witter Realty Income Properties II Inc.
Managing General Partner
By: /s/E. Davisson Hardman, Jr. Date: January , 1995
E. Davisson Hardman, Jr.
President
By: /s/Lawrence Volpe Date: January , 1995
Lawrence Volpe
Controller
(Principal Financial and Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
DEAN WITTER REALTY INCOME PROPERTIES II INC.
Managing General Partner
/s/William B. Smith Date: January , 1995
William B. Smith
Chairman of the Board of Directors
/s/E. Davisson Hardman, Jr. Date: January , 1995
E. Davisson Hardman, Jr.
Director
/s/Lawrence Volpe Date: January , 1995
Lawrence Volpe
Director
/s/Ronald T. Carman Date: January , 1995
Ronald T. Carman
Director
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Registrant is a limited partnership which invests in real estate and real
estate joint ventures. In accordance with industry practice, its balance
sheet is unclassified. For full information, refer to the accompanying
audited financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> OCT-31-1994
<PERIOD-END> OCT-31-1994
<CASH> 9,812,279
<SECURITIES> 0
<RECEIVABLES> 3,029,084
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 137,953,991<F1>
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 125,667,812<F2>
<TOTAL-LIABILITY-AND-EQUITY> 137,953,991<F3>
<SALES> 0
<TOTAL-REVENUES> 18,995,554<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 15,034,088
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 3,961,466
<INCOME-TAX> 0
<INCOME-CONTINUING> 3,961,446
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,961,446
<EPS-PRIMARY> 20.14<F5>
<EPS-DILUTED> 0
<FN>
<F1>In addition to cash and receivables, total assets include net investments
in real estate of $120,582,110, investment in joint ventures of $2,759,347,
net deferred expenses of $1,328,063 and other assets of $443,108.
<F2>Other Stockholders' Equity represents partners' capital.
<F3>Liabilities include accounts payable and accrued liabilities of
$740,683, minority interest in joint venture of $8,489,748, and other
liabilities of $3,055,748.
<F4>Total revenue includes rent of $18,076,876, equity in earnings of joint
venture of $346,296, and interest and other revenues of $572,382.
<F5>Represents net income per Unit of limited partnership interest.
</FN>
</TABLE>
