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 December 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 0-18151
DEAN WITTER REALTY GROWTH PROPERTIES, L.P.
(Exact name of registrant as specified in governing instrument)
Delaware 13-3286866
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) 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 Interests
(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 files pursuant to Item 405 of Regulation
S-K (section 229.405 of this chapter) 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
PART I.
ITEM 1. BUSINESS
The Registrant, Dean Witter Realty Growth Properties, L.P. (the
"Partnership") is a limited partnership formed in March 1985 under the
Uniform Limited Partnership Act of the State of Delaware for the purpose
of investing primarily in income-producing commercial and residential
properties.
The Managing General Partner of the Partnership is Dean Witter Realty
Growth Properties Inc., a Delaware corporation, which is wholly-owned
by Dean Witter Realty Inc. ("Realty"). The Associate General Partner is
Dean Witter Realty Growth Associates, L.P., a Delaware limited
partnership (the "Associate General Partner"), the general partner of
which is the Managing General Partner. The Managing General Partner
manages and controls all aspects of the Partnership's operations. The
terms of transactions between the Partnership and its affiliates are set
forth in Item 13 below.
The Partnership issued 78,594 units of limited partnership interests
(the "Units") with gross proceeds of $78,594,000. The offering has been
terminated and no additional Units will be sold. The proceeds from the
offering were used to make leveraged investments in three office
properties (one of which was lost through foreclosure in 1992), an
industrial park and a hotel. The properties are described in Item 2
below.
The Partnership considers its business to include one industry
segment, investment in real property. Financial information regarding
the Partnership is set forth in the Partnership's financial statements
in Item 8 below.
The Partnership's real property investments are subject to
competition from similar types of properties located in the same
geographic areas. 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.
<PAGE>
ITEM 2. PROPERTIES.
The Partnership's principal offices are located at Two World Trade
Center, New York, New York, 10048. The Partnership has no other offices.
The Partnership owns, through partnership interests, the following
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>
Net Rentable Year(s) Acquisition Type of ownership
Area Completed/ Cost of land and
Property, location and type (000 sq. ft) Acquired ($000) improvements
<S> <C> <C> <C> <S>
Bayport Plaza
Tampa, FL 45.8% indirect
Office building1 259 1984/1985 $26,206 General Partnership
interest in a part-
nership which owns
the building.
Hotel1 448 rooms 1985/1985 $11,178 91.6% indirect
general partnership
interest in a
partnership which
owns the hotel.
Braker Center, Phase III
North Austin, TX
Warehouse building1 150 1985/1985 $3,848 99% General Part-
nership interest.
Four office/R&D buildings1 100 1986/1985 - 49.5% indirect
general part-
nership interest in
a partnership which
owns the property.
Land 28 acres NA/1985 $10,108 99% general part-
nership interest.
Peninsula Office Park1 379 1972-82/1985 $6,026 49.9% indirect
San Mateo, CA general part-
Six office buildings nership interest
and restaurant in two limited
partnerships
which own the
buildings.
<FN>
1. The property is subject to a mortgage loan. See note 6 to the consolidated
financial statements in Item 8.
</TABLE>
Each property has been built with on-site parking facilities.
ITEM 3. LEGAL PROCEEDINGS.
Neither the Partnership nor any of its properties is 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 REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
An established public trading market for the Units does not exist,
and it is not anticipated that such a market will develop in the near
future. Accordingly, information as to the market value of a Unit at any
given date is not available. However, the Partnership does allow limited
partners, (the "Limited Partners") to transfer their units.
As of December 31, 1994 there were 6,175 holders of limited
partnership interests.
The Partnership is a limited partnership and, accordingly, does not
pay dividends. However, the Partnership Agreement permits distributions
of "Distributable Cash" to its partners. Pursuant to the Partnership
Agreement, distributable cash from operations is to be paid 96% to the
Limited Partners, after the Managing General Partner has received a
management fee of 6.25% of distributable cash. The Managing General
Partner did not receive a management fee in 1994, 1993 or 1992 because
the Partnership did not pay a cash distribution in any of those years.
Sale or refinancing proceeds will generally be distributed (i) to the
Limited Partners until they have received a return of their capital
contributions; (ii) to the General Partners until they have received
1.01% of the amount distributed to the Limited Partners; (iii) 99% of any
remaining amounts to the Limited Partners and 1% to the General Partners
until the Limited Partners have received cumulative distributions in an
amount sufficient to provide a 6% cumulative annual return on their
adjusted capital contributions; and (iv) 85% to the Limited Partners and
15% to the General Partners after the Managing General Partner receives
a brokerage fee, if earned, not in excess of 3% of the aggregate gross
sales prices of all properties. During the year ended December 31, 1994
and December 31, 1993, the Partnership did not distribute any sale or
refinancing proceeds.
Taxable income and tax loss generally are allocated to the partners
in proportion to the distribution of distributable cash (after payment
of the Managing General Partner's management fee) or sale or financing
proceeds (or 96% to the Limited Partners and 4% to the General Partners
if there is no distributable cash).
<PAGE>
<TABLE>
ITEM 6. SELECTED FINANCIAL DATA.
The following sets forth a summary of selected financial data for
the Partnership:
Dean Witter Realty Growth Properties, L.P.
Years ended December 31:
<CAPTION>
1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C>
Total revenues $ 28,095,985 $ 27,391,611 $ 28,243,603 $ 29,502,208 $ 28,204,143
Loss before extra-
ordinary item $ (1,105,050) $ (5,550,240) $ (6,421,433) $ (7,331,621) $ (9,154,344)
Extraordinary item $ - $ - $ 422,123 $ - $ -
Net loss $ (1,105,050) $ (5,550,240) $ (5,999,310) $ (7,331,621) $ (9,154,344)
Per unit of Limited
Partnership interest:
Loss before extra-
ordinary item $ (13.50) $ (67.79) $ (78.44) $ (89.55) $ (111.82)
Extraordinary gain $ - $ - $ 5.16 $ - $ -
Net loss $ (13.50) $ (67.79) $ (73.28) $ (89.55) $ (111.82)
Cash distributions paid $ - $ - $ - $ - $ 20.00
Total assets $ 55,097,988 $ 58,385,005 $ 87,483,150 $100,445,904 $103,764,100
Long-term debt $ 54,936,984 $ 57,844,135 $ 84,193,991 $ 92,305,541 $ 91,312,230
<FN>
Note: The above financial data should be read in conjunction with the consolidated financial statements
and the related notes appearing in Item 8.
</TABLE>
ITEM 7. MANAGEMENTS' DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
Liquidity and Capital Resources
The Partnership raised $78,594,000 in a public offering which was
terminated in 1986. The Partnership has no plans to raise additional
capital.
The Partnership used the proceeds from the offering to make
leveraged investments in four properties (one of which was lost through
foreclosure in July 1992). No additional investments are planned.
Many real estate markets are stabilizing or improving, primarily due
to the continued absence of significant construction activity. However,
the recovery of the office market has been and may continue to be slow
because tenant demand is weak as a result of continued downsizing by many
major corporations. Increases in import/export sales could provide
support for continuing absorption of space. Improvement in the economy
and lack of new construction in the hotel market is slowly resulting in
increased occupancy and room rates.
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 upon 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 property investments generated positive cash flow
from operations.
The Partnership's current cash balances are being reserved primarily
for (1) the replacement of certain furniture, fixture and equipment and
working capital reserves at the hotel which it is required to maintain
pursuant to the hotel management agreement and (2) the cost of tenant
improvements and leasing commissions at the Peninsula Office Park
investment and at Braker Center at which there are also required cash
reserves. Other than these reserves, the Partnership's current cash
reserves are nominal.
In May 1994, the partnerships that own the Peninsula Office Park
properties completed an extension and modification agreement for mortgage
loans on the properties. Under this agreement, the lender agreed to
reduce the interest accrual and pay rates under the loans to 9.5%, and
8.25%, respectively, and to extend the maturity dates to December 1,
1996. The borrowers may further extend the maturity dates of the
modified loans if they make partial paydowns of the mortgage debt.
During the revised loan term, the borrowers are prohibited from making
cash distributions to the Partnership and the Partnership's joint venture
partner.
The Partnership has lent $170,222 to the Peninsula Office Park
investment as of December 31, 1994. The loan bears interest at the prime
rate plus 1%.
In October 1994, the Partnership completed an extension and
modification agreement for the mortgage loan encumbering one of the
warehouse facilities at Braker Center. See note 6 to the consolidated
financial statements in Item 8.
In December 1994, the partnership which owns the four office/R&D
buildings at Braker Center was in default on its loan. The partnership
has two general partners; i) L.S. Braker Associates ("Braker
Associates"), a subsidiary of the Partnership, and ii) an unaffiliated
partner. The unaffiliated general partner caused the partnership to file
for protection under Chapter 11 of the United States Bankruptcy Code.
Braker Associates had not consented to the filing and the unaffiliated
general partner has initiated litigation to compel it to do so. The
ultimate outcome of the partnership's Chapter 11 reorganization is
uncertain.
Hyatt Corporation manages the hotel at Bayport Plaza. Pursuant to
the management agreement, the Partnership may terminate the agreement if
the hotel does not achieve a defined level of operating profit for two
consecutive years after the fifth year of operations. As of December 31,
1994, Hyatt has not met this performance standard, and therefore could
be subject to termination. In 1994, the Partnership initiated legal
action against Hyatt to enforce this provision and certain other
provisions under the management agreement.
As of December 31, 1994, the Partnership has borrowed $5,453,745
including accrued and unpaid interest from an affiliate of Realty. The
loan bears interest at the prime rate (8.5% as of December 31, 1994).
The Partnership has not paid a distribution to the Partners since
the fourth quarter of 1990 and does not expect to pay a distribution in
1995. Through December 31, 1990, the General Partners have deferred
receipt of cash distributions of $262,316.
Operations
Fluctuations in the Partnership's operating results for the year
ended December 31, 1994, compared to 1993 and 1993 compared to 1992 are
primarily attributable to the following:
The hotel's operating revenue increased during 1994 as compared to
1993 as a result of an increased average daily room rate, higher
occupancy and an increase in food and beverage income. The hotel's
average occupancy rate was 69% in 1994 as compared to 62% in 1993. The
increase in occupancy was primarily related to an increase in group room
sales. Food and beverage revenue increased primarily due to greater
banquet sales, in-room dining sales and outlet beverage sales. The
higher operating revenue led to higher hotel operating expenses. The
hotel's operating revenue increased during 1993 as compared to 1992 as
a result of an increased average daily room rate of $113 during 1993 as
compared to $107 during 1992 and an increase in food and beverage income.
The decreases in rental income, property operating expenses,
interest expense, depreciation and amortization in 1994 as compared to
1993 and 1993 as compared to 1992 are attributable to the change from
consolidation to the equity method of accounting for the Partnership's
investment in the Bayport Plaza office building in July 1993 and the sale
of a building at Braker Center in October 1993.
Interest and other income was higher in 1993 as compared to 1994 and
1992 primarily due to approximately $138,000 of lease cancellation fees
received from two tenants at the Bayport Plaza office building in 1993.
Equity in net losses of partnerships was lower in 1993 as compared
to 1994 and 1992 as a result of lower rental revenue recognized at the
Peninsula Office Park in 1993.
General and administrative expenses were higher in 1993 as compared
to 1994 and 1992 as a result of increased legal fees incurred in
connection with the restructuring of the Bayport Plaza Office building
investment in 1993.
The loss on sale of real estate represents the loss from the sale
of the warehouse distribution facility at Braker Center in October 1993.
The extraordinary gain from early extinguishment of debt resulted
from the foreclosure of the Carolina Place office building in July 1992.
A summary of the hotel, office and warehouse/research and
development building markets where the Partnership properties are located
and the performance of each property is as follows:
The hotel market in the Westshore area of Tampa Bay, FL continued
to improve during 1994 as a result of improvements in the economy and a
lack of new supply. As described above, revenues and profits at the
Bayport Plaza Hyatt Regency Hotel increased in 1994.
The Bayport Plaza Office Building, located in the same project as
the Hotel, is in an improved office market due to a lack of new
construction. The market vacancy rate for Class A buildings in the
Westshore market is approximately 11%. However, the downtown Tampa
market is significantly weaker, and may adversely impact the Westshore
market. As of December 31, 1994, occupancy at the property was
approximately 93%. The property is leased to 32 tenants including
Prudential Insurance and the Federal Insurance Company whose leases
expire in 2001 and 2000, respectively.
Braker Center, located in the Austin, TX industrial market, consists
of four office/research and development buildings and one bulk warehouse.
The industrial building market in Austin continues to remain strong. The
current market vacancy rate is 5%, which has resulted in new development
of warehouse space. An estimated 559,000 square feet of new warehouse
space is currently under construction. As of December 31, 1994,
occupancy at the four office/research and development buildings is
approximately 85% and the occupancy at the bulk warehouse is 100%. These
buildings are leased to 17 tenants. Dell Computer, whose lease expires
in 1996 is the major tenant.
The office market in San Mateo, CA, the location of Peninsula Office
Park, is an improving market characterized by declining vacancy rates,
steady leasing activity, diminishing availability of space greater than
20,000 square feet, and no new speculative construction. As of December
31, 1994, occupancy at the six office buildings is approximately 96%.
However, the 17,000 square foot restaurant is vacant. The property is
leased to 35 tenants. Major tenants include USL Capital, whose lease
expires in 1998.
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 GROWTH PROPERTIES L.P.
INDEX
<CAPTION>
(a) Financial Statements
Page
<S> <C>
Independent Auditors' Report - 1994 11
Independent Auditors' Report 1993-1992 12
Consolidated Balance Sheets at December 31, 1994 and 1993 13
Consolidated Statements of Operations for the years ended 14
December 31, 1994, 1993 and 1992
Consolidated Statements of Changes in Partners' Capital (Deficiency) 15
for the years ended December 31, 1994, 1993 and 1992
Consolidated Statements of Cash Flows for the years ended 16-17
December 31, 1994, 1993 and 1992
Notes to Consolidated Financial Statements 18-30
(b) Financial Statement Schedule
Real Estate and Accumulated Depreciation III 35-37
All other schedules 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
The Partners
Dean Witter Realty Growth Properties, L.P.:
We have audited the accompanying consolidated balance sheet of Dean
Witter Realty Growth Properties, L.P. and consolidated partnerships (the
"Partnership") as of December 31, 1994, and the related consolidated
statements of operations, partners' capital and cash flows for the year
then ended. Our audit also included financial statement schedule III.
These financial statements and the financial statement schedule are the
responsibility of the Partnership's management. Our responsibility is
to express an opinion on the financial statements and the financial
statement schedule 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 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 audit
provides a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly,
in all material respects, the financial position of Dean Witter Realty
Growth Properties, L.P. and consolidated partnerships as of December 31,
1994, and the results of their operations and their cash flows for the
year then ended in conformity with generally accepted accounting
principles. Also, in our opinion, financial statement schedule III, when
considered in relation to the basic financial statements taken as a
whole, presents fairly, in all material respects, the information set
forth therein.
Deloitte & Touche LLP
/s/Deloitte & Touche LLP
New York, New York
March 30, 1995
<PAGE>
Independent Auditors' Report
The Partners
Dean Witter Realty Growth Properties, L.P.
We have audited the accompanying consolidated balance sheet of Dean
Witter Realty Growth Properties, L.P. and consolidated partnerships as
of December 31, 1993 and the related statements of operations, changes
in partners' capital (deficiency) and cash flows for the two years then
ended. These consolidated financial statements are the responsibility
of the Partnership's management. Our responsibility is to express an
opinion on these consolidated financial statements 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, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Dean
Witter Realty Growth Properties, L.P. and consolidated partnerships as
of December 31, 1993 and the results of their operations and their cash
flows for each of the years in the two year period ended December 31,
1993, in conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
/s/ KPMG Peat Marwick LLP
New York, New York
March 25, 1994
<PAGE>
<TABLE>
DEAN WITTER REALTY GROWTH PROPERTIES, L.P.
CONSOLIDATED BALANCE SHEETS
December 31, 1994 and 1993
<CAPTION>
ASSETS 1994 1993
<S> <C> <C>
Real estate, at cost (notes 4, 6 and 7):
Buildings and improvements $ 55,690,646 $ 57,129,839
Land and land improvements 13,161,632 14,917,159
68,852,278 72,046,998
Accumulated depreciation 22,452,497 20,687,639
46,399,781 51,359,359
Cash and short-term investments, at cost,
which approximates market ($2,768,168 and
$1,402,604 restricted as of December 31,
1994 and 1993, respectively) 4,706,167 3,642,942
Deferred expenses, net 1,655,347 1,823,559
Accounts receivable 1,870,771 1,184,355
Other assets 465,922 374,790
$ 55,097,988 $ 58,385,005
LIABILITIES AND PARTNERS' CAPITAL (DEFICIENCY)
Mortgage notes payable (note 6) $ 54,936,984 $ 57,844,135
Accounts payable and accrued expenses (note 8) 4,106,364 3,746,933
Due to affiliates (note 8) 5,876,733 5,532,001
Other liabilities 509,280 642,908
Excess of distributions and losses over
cost of investments in partnerships (note 5) 6,704,781 5,624,202
Minority interests (notes 4 and 5) 1,243,540 2,169,470
73,377,682 75,559,649
Commitments and contingencies
(notes 4, 6 and 7)
Partners' capital (deficiency):
General partners (3,260,230) (3,216,028)
Limited partners ($1,000 per Unit,
78,594 Units issued) (15,019,464) (13,958,616)
Total partners' capital (deficiency) (18,279,694) (17,174,644)
$ 55,097,988 $ 58,385,005
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
DEAN WITTER REALTY GROWTH PROPERTIES, L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
Years ended December 31, 1994, 1993 and 1992
<CAPTION>
1994 1993 1992
<S> <C> <C> <C>
Revenues:
Hotel operating $26,194,316 $23,255,423 $21,879,048
Rental 1,698,704 3,857,816 6,276,094
Interest and other 202,965 278,372 88,461
28,095,985 27,391,611 28,243,603
Expenses:
Hotel operating 20,025,474 19,113,649 18,377,630
Interest (notes 6 and 8) 4,994,853 6,800,694 8,597,615
Property operating 537,138 1,975,311 2,382,611
Amortization 281,710 518,063 710,279
Depreciation 2,129,520 3,031,354 3,470,875
Equity in net losses of partnerships (note 5) 985,769 832,468 890,254
General and administrative (note 8) 274,198 453,699 368,188
29,228,662 32,725,238 34,797,452
Loss before minority interest (1,132,677) (5,333,627) (6,553,849)
Minority interest in losses of
consolidated partnerships 27,627 118,375 132,416
Loss before extraordinary item and loss on
sale of real estate (1,105,050) (5,215,252) (6,421,433)
Loss on sale of real estate (note 4) - (334,988) -
Loss before extraordinary item (1,105,050) (5,550,240) (6,421,433)
Extraordinary item:
Gain on early extinguishment of
debt due to foreclosure (note 4) - - 422,123
Net loss $(1,105,050) $(5,550,240) $(5,999,310)
Per unit of limited partnership interest:
Loss before extraordinary item $ (13.50) $ (67.79) $ (78.44)
Extraordinary item - 5.16
Net loss $ (13.50) $ (67.79) $ (73.28)
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
DEAN WITTER REALTY GROWTH PROPERTIES, L.P.
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIENCY)
Years ended December 31, 1994, 1993 and 1992
<CAPTION>
General Limited
Partners Partners Total
<S> <C> <C> <C>
Partners' capital (deficiency)
at January 1, 1992 $ (2,754,046) $(2,871,048) $ (5,625,094)
Net loss (239,972) (5,759,338) (5,999,310)
Partners' capital (deficiency)
at December 31, 1992 (2,994,018) (8,630,386) (11,624,404)
Net loss (222,010) (5,328,230) (5,550,240)
Partners' capital (deficiency)
at December 31, 1993 (3,216,028) (13,958,616) (17,174,644)
Net loss (44,202) (1,060,848) (1,105,050)
Partners' capital (deficiency)
at December 31, 1994 $ (3,260,230) $(15,019,464) $(18,279,694)
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER REALTY GROWTH PROPERTIES, L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended December 31, 1994, 1993 and 1992
<CAPTION>
1994 1993 1992
<S> <C> <C> <C>
Cash flows from operating activities:
Loss before extraordinary item $(1,105,050) $(5,550,240) $(6,421,433)
Extraordinary item - - 422,123
Net loss (1,105,050) (5,550,240) (5,999,310)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation and amortization 2,411,230 3,549,417 4,181,154
Minority interests in joint ventures'
operations (27,627) (118,375) (13,980)
Equity in net losses of partnerships 985,769 832,468 890,254
Loss on sale of real estate - 334,988 -
Gain on early extinguishment of debt - - (422,123)
Decrease (increase) in:
Accounts receivable (695,414) 802,814 112,004
Deferred expenses (253,181) (301,397) (561,217)
Other assets (91,132) 8,153 (28,689)
Increase (decrease) in:
Accounts payable and accrued expenses 511,019 851,475 1,244,699
Due to affiliates 344,732 (203,503) (714,461)
Other liabilities (133,628) 248,666 317,695
Minority interests (350,795) - -
Net cash provided by (used in) operating activities 1,595,923 454,466 (993,974)
Cash flows from investing activities:
Gross proceeds from sale of real estate - 2,500,000 -
Investment in real estate, net (589,225) (1,276,231) (1,161,236)
Distributions from unconsolidated partnerships 94,810 - 151,696
Minority interest in joint ventures'
distributions (46,000) (125,000) -
Effect of change in cash from transfer of
partnership interests (25,932) - -
Effect of change in cash from
consolidation to equity accounting - (144,423) -
Additional investment by minority interest 90,800 - -
Net cash (used in) provided by investing activities (475,547) 954,346 (1,009,540)
Cash flows from financing activities:
(Repayment of) proceeds from mortgage notes payable (57,151) 157,415 340,360
(Repayments of) proceeds from construction
note payable - (1,900,000) 274,735
Borrowings from affiliates - 1,137,234 924,837
Net cash (used in ) provided by financing activities (57,151) (605,351) 1,539,932
Increase (decrease) in cash and short-term
investments 1,063,225 803,461 (463,582)
Cash and short-term investments at beginning
of year 3,642,942 2,839,481 3,303,063
Cash and short-term investments at end of year $ 4,706,167 $ 3,642,942 $ 2,839,481
Supplemental disclosure of cash flow information:
Cash paid for interest $4,854,870 $ 6,149,991 $ 7,679,381
Continued
/TABLE
<PAGE>
<TABLE>
<CAPTION>
1994 1993 1992
<S> <C> <C> <C>
Transfer of partnership interests:
Real estate, net $ 2,963,174 $ - $ -
Deferred expenses, net 139,683 - -
Accounts receivable 9,002 - -
Mortgage note payable (2,850,000) - -
Accounts payable (151,588) - -
Minority interests (136,203) - -
Effect of change in cash from transfer
of partnership interests $ (25,932) $ - $ -
Change from consolidation to equity accounting:
Real estate, net $ - $21,813,229 $ -
Deferred expenses, net - 607,217 -
Accounts receivable - 1,806,742 -
Other assets - 56,675 -
Mortgage note payable - (24,607,271) -
Accounts payable and accrued expenses - (2,417,382) -
Other liabilities - (81,504) -
Excess of distributions and losses
over cost of investment in partnership - 1,186,284 -
Minority interests - 1,491,587 -
Effect of change in cash from
consolidation to equity accounting $ - $ (144,423) $ -
Supplemental disclosure of non-cash
investing activities:
Reduction of due to affiliates and
real estate $ - $ - $ 1,652,634
Foreclosure of real estate:
Balance due on mortgage loan $ - $ - $ 8,726,645
Reduction of real estate - - (7,700,827)
Reductions in other assets,
deferred expenses and accounts receivable - - (603,695)
$ - $ - $ 422,123
<FN>
See accompanying notes to consolidated financial statements.
/TABLE
<PAGE>
DEAN WITTER REALTY GROWTH PROPERTIES, L.P.
Notes to Consolidated Financial Statements
December 31, 1994, 1993 and 1992
1. The Partnership and Current Operations
Dean Witter Realty Growth Properties, L.P. (the "Partnership") was
formed as a limited partnership in 1985 under the laws of the State of
Delaware. The Managing General Partner of the Partnership is Dean
Witter Realty Growth Properties Inc., which is wholly-owned by Dean
Witter Realty Inc. ("Realty").
In 1986, the Partnership issued 78,594 units of limited partnership
interest (the "Units") for $78,594,000. No additional Units will be
sold. The proceeds were used to make investments in income-producing
office, industrial and hotel properties.
Assets of the Partnership are subject to substantial leverage. All
mortgage notes payable are secured by the real estate and are not
general obligations of the Partnership.
The Partnership's current cash balances are being reserved primarily
for (1) the replacement of certain furniture, fixtures and equipment
and working capital at the hotel which it is required to maintain
pursuant to the hotel management agreement and (2) the cost of tenant
improvements and leasing commissions at the Peninsula Office Park
investment at which there is a property-specific cash reserve, the
disposition of which is subject to the approval of both the Partnership
and its joint venture partner. Other than these reserves, the
Partnership's current cash reserves are nominal.
2. Summary of Significant Accounting Policies
The financial statements include the accounts of the Partnership,
Bayport Ltd.'s investment in the Bayport hotel, and Braker Associates
on a consolidated basis. The Partnership's interest in Peninsula/DW
Associates and, effective July 19, 1993, Bayport Ltd's investment in
the Bayport office building are accounted for on the equity method.
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. Cost of
improvements to the properties are capitalized, and repairs are
expensed. Depreciation is recorded on the straight-line method over
the estimated economic useful lives of the properties ranging from 10
to 40 years.
Deferred expenses consist of deferred asset supervisory fees which are
amortized over the terms of the related agreements, deferred commitment
fees which are amortized over related commitment periods, and leasing
commissions which are amortized over the applicable lease terms.
The Partnership considers short-term investments with original
maturities of three months or less to be cash equivalents.
Rental revenue is recognized on a straight-line basis.
Net loss per Unit amounts are calculated by dividing net loss 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, as the liability for such taxes is that of the partners
rather than the Partnership.
The accounting policies used for tax reporting purposes differ from
those used for financial reporting as follows: (a) depreciation is
calculated using accelerated methods and (b) rental income is
recognized based on the payment terms in the applicable leases. 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 $5.9 million lower than the amounts
reported for financial statement purposes.
3. Partnership Agreement
The Partnership agreement provides that the Limited Partners will
receive 96% of distributable cash remaining after the Managing General
Partner has received a management fee of 6.25% of distributable cash.
Sale or refinancing proceeds will generally be distributed (i) to the
Limited Partners until they have received a return of their capital
contributions; (ii) to the General Partners until the General Partners
have received 1.01% of the amount distributed to the Limited Partners,
and (iii) 99% of any remaining amounts to the Limited Partners and 1%
to the General Partners, until the Limited Partners have received
cumulative distributions sufficient to provide a 6% cumulative annual
return on their adjusted capital contributions; and (iv) 85% to the
Limited Partners after the Managing General Partner receives a
brokerage fee not in excess of 3% of the aggregate gross sales prices
of all properties.
Taxable income (loss) generally will be allocated to the partners in
proportion to the distribution of distributable cash or sale or
financing proceeds (or 96% to the Limited Partners and 4% to the
General Partners if there is no distributable cash).
The Partnership did not pay a cash distribution to the Partners in
1994, 1993 or 1992. Through December 31, 1990, the General Partners
have deferred receipt of cash distributions of $262,316.
4. Investments in Real Estate
Braker Center, Austin, Texas
The Partnership owns a 99% general partnership interest in L.S. Braker
Associates ("Braker Associates"). A partnership consisting of current
and former officers of Realty holds the remaining 1% interest. Braker
Associates owned 50% interests in partnerships which owned three
warehouses, four office/R&D buildings, and a parcel of developable
land. In 1993, one of the warehouses, (which was subject to a $1.9
million mortgage at prime plus one-half percent), was sold at a loss
of approximately $335,000. In October 1994, Braker Associates
exchanged its partnership interest in one of the remaining warehouses
for the interests of its joint venture partner in the other warehouse
and the developable land.
Accordingly, at December 31, 1994, the Partnership owns one of the
warehouses, the undeveloped land, and a 50% interest in the partnership
(the "Office/R&D building partnership") which owns the four office/R&D
buildings at the property.
The buildings owned by the Office/R&D Building partnership are
encumbered by a $6.2 million mortgage loan which is cross-
collateralized and cross-defaulted with loans on approximately 94
projects that are owned by the joint venture partner. Because certain
of the projects failed to make scheduled principal payments, in
December 1994, the lender declared a default. In January 1995, the
joint venture partner caused the Office/R&D Building Partnership to
file for protection under Chapter 11 of the United States Bankruptcy
Code. Braker Associates has not consented to the filing and the joint
venture partner has initiated litigation to compel it to do so. The
ultimate outcome of the Office/R&D Building Partnership's Chapter 11
reorganization is uncertain.
Bayport Plaza Hotel, Tampa, Florida
The Bayport Plaza hotel is part of a mixed-use development consisting
of an office building (see Note 5) and a Hyatt hotel. The Partnership
owns a 99% general partnership interest in Bayport, Ltd.; a partnership
consisting of current and former officers of Realty holds the remaining
1% interest. Bayport, Ltd. owns (after a preferential return as
described below) a 92.5% partnership interest in the partnership which
owns the hotel (the "Hotel Partnership"); affiliates of the developer
of Bayport Plaza own the remaining 7.5%. The Partnership also owns a
46.25% interest in the partnership which owns the office building (the
"Office Partnership"). See Note 5.
Net cash flow from the Hotel Partnership will generally be distributed
99% to Bayport, Ltd. and 1% to the developer until Bayport, Ltd. has
received a 10% cumulative annual preferred return on the amount of its
equity invested in the Hotel Partnership. The balance of any net cash
flow will be distributed 92.5% to Bayport, Ltd. and 7.5% to the
developer. Capital proceeds will generally be distributed: first, 100%
to Bayport, Ltd., until it has received from all distributions a 10%
annual return on the amount of its equity invested in the Hotel
Partnership; second, 100% to Bayport, Ltd., until it has received an
amount equal to its equity invested in the Hotel Partnership; third,
100% to Bayport, Ltd., in the event that the hotel has been previously
disposed of by the other of such partnerships, an amount equal to its
equity invested in the Office or Hotel Partnership that has not been
theretofore returned to Bayport, Ltd.; thereafter, 92.5% to Bayport,
Ltd. and 7.5% to the developer. Taxable income and losses will
generally be allocated in accordance with distributions of net cash
flow and capital proceeds.
An affiliate of Realty has provided a partial loan principal and
operating deficit guarantee to the first mortgage lender on the hotel.
See Note 8.
Hyatt Corporation manages the hotel at Bayport Plaza. Pursuant to the
management agreement, the Partnership may terminate the agreement if
the hotel does not achieve a defined level of operating profit for two
consecutive years after the fifth year of operations. As of December
31, 1994, Hyatt has not met this performance standard, and therefore
could be subject to termination. In 1994, the Partnership initiated
legal action against Hyatt to enforce this provision and certain other
provisions under the management agreement.
Carolina Place, Raleigh, North Carolina
This property, an office building and underlying land, did not generate
sufficient cash flow to pay debt service in full. Accordingly, in July
1992, the first mortgage lender foreclosed on the property. Since the
mortgage loan balance for this property exceeded its carrying costs,
the foreclosure resulted in a non-cash gain of $422,123 which was
reported as an extraordinary item.
5. Investments in and Advances to Partnerships
Bayport Plaza Office Building, Tampa, Florida
In July 1993, the Partnership completed the restructuring of the Office
Partnership and the mortgage on the property. The Office Partnership
received an equity contribution of approximately $6,700,000 from a
third-party investor, which was used to pay down principal on the
mortgage to $20,000,000 from $24,607,271, to establish reserves for
future real estate taxes, and to pay overdue real estate taxes and
certain other expenses aggregating approximately $1,900,000. The
equity investor has also committed up to $2.3 million for future
leasing costs and operating deficits. During 1994 the equity investor
contributed approximately $621,000 pursuant to its commitment. The
equity investor will receive a preferred return on its investment and
a 50% participation in cash flow in excess of the preferred return.
In addition, the mortgage interest rate was reduced from 11.75% to 8.5%
and the maturity was extended to September 1, 1999.
As a result of the restructuring, the third-party investor obtained a
50% interest in the Office Partnership, and the Partnership's interest
in this partnership was reduced to 46.25%. Affiliates of the developer
own the remaining 3.75%. The Partnership remains the managing general
partner of the partnership, but the equity investor has the right to
approve certain major decisions and financial policies of the
partnership, and under certain circumstances, has the right to cause
the partnership to sell the property after July 1998. Effective July
19, 1993, the Partnership ceased consolidating its investment in the
Bayport Plaza office building partnership and began accounting for it
on the equity method.
The third-party investor is entitled to a monthly minimum distribution
from net cash flow equal to a 6% annual return on its invested capital
in years one and two, and an 8.5% annual return on its invested capital
thereafter. Thereafter, net cash flow will be distributed 20% to
Bayport Ltd. and the developer, based on their respective partnership
interests, and 80% to the third-party investor until the third-party
investor has received an annual return (including the minimum
distribution) of 12% on average capital, and thereafter, 50% to the
third-party investor and 50% to Bayport Ltd. and the developer, based
on Bayport Ltd's and the developer's respective partnership interests.
Capital proceeds will generally be distributed: first, 100% to the
third-party investor until it has received its capital and a 14% annual
return thereon; second, to Bayport Ltd. and the developer until they
have received distributions equal to those to the third-party investor;
thereafter, to Bayport Ltd., the developer and the third-party investor
in proportion to their partnership interests. Taxable income and
losses will generally be allocated in accordance with distributions of
net cash flow and capital proceeds.
As of December 31, 1994, the Partnership has contributed $9,145,691 to
the Bayport Plaza Office Partnership.
<TABLE>
The assets, liabilities and partner's capital (deficit) of the Office
Partnership are summarized as follows:
<CAPTION>
December 31,
1994 1993
Assets
<S> <C> <C>
Land and building, net $20,055,060 $20,212,415
Other (including cash and cash equivalents
of $209,260 and $300,933) 2,596,587 2,873,906
Total assets $22,651,647 $23,086,321
Liabilities and Partners' Capital (Deficit)
Mortgage notes payable $20,000,000 $20,000,000
Other liabilities 479,884 698,227
Partners' capital (deficit) 2,171,763 2,388,094
Total liabilities and
partners' capital (deficit) $22,651,647 $23,086,321
<PAGE>
</TABLE>
<TABLE>
The results of operations are summarized below:
<CAPTION>
Years ended December 31,
1994 1993 1992
<S> <C> <C> <C>
Revenues
Rental $ 4,174,012 $ 3,489,860 $3,463,801
Expenses
Operating 1,496,912 1,661,761 1,364,069
Interest 1,694,223 2,718,415 3,445,026
Depreciation and amortization 1,389,200 1,191,803 1,123,511
4,580,335 5,571,979 5,932,606
Net loss $ (406,323) $(2,082,119) $(2,468,805)
</TABLE>
The accounting policies of the Office Partnership are consistent with those
of the Partnership. The Partnership has determined that all leases relating
to the Office Partnership are operating leases.
Peninsula Office Park
Peninsula/DW Associates, a general partnership owned 98% by the
Partnership and 2% by former and current Realty officers and executives,
owns a 49.9% general partnership interest in two limited partnerships
(the "Joint Venture") which owns Peninsula Office Park, a corporate
office park located in San Mateo, California. The remaining 50.1%
interest in the Joint Venture is owned by the developer of Peninsula
Office Park.
Net cash flow from operations of the Joint Venture and net proceeds from
a sale or refinancing of the property are to be allocated to the Joint
Venture partners in proportion to their ownership interests. For tax
purposes, Peninsula/DW Associates will be entitled to receive all losses
from the Joint Venture until its cumulative loss is equal to
approximately $8,000,000, less any cash distributions previously
received. Thereafter, profits and losses will be allocated to the
partners in proportion to their ownership interests. Profits and losses
for tax purposes and net cash flow from operations and net proceeds from
a sale or refinancing will be allocated to the partners in Peninsula/DW
Associates in accordance with their partnership interests.
In May 1994, the joint venture completed an extension and modification
agreement for the mortgage loans on the Peninsula Office Park properties
which matured in December 1993. The lender agreed to reduce the interest
accrual and pay rates under the loans from 9.875% to 9.5%, and from 9%
to 8.25%, respectively, and to extend the maturity dates to December 1,
1996. The joint venture may further extend the maturity dates of the
modified loans if they make partial paydowns of the mortgage debt.
The Partnership paid a $400,000 fee to the lender as part of the
restructuring.
If the joint venture fails to repay the loans at maturity, it has agreed
not to file for bankruptcy or contest any foreclosure proceedings brought
by the lender.
During the loan term, the joint venture is prohibited from making cash
distributions to the Partnership and the Partnership's joint venture
partner.
As of December 31, 1994 and 1993, the Partnership had lent the Joint
Venture $170,222, at a rate of prime plus 1%. The prime rate as of
December 31, 1994 was 8.5%.
The property's leases generally require tenants to pay their pro rata
share of increases in operating expenses, including real estate taxes and
maintenance costs over base year expenses. The remaining terms of the
existing leases range from one to five years.
<PAGE>
<TABLE>
The assets, liabilities and partners' capital (deficit) of the Joint Venture
are summarized as follows:
<CAPTION>
December 31,
1994 1993
Assets
<S> <C> <C>
Land and building, net $31,777,116 $31,960,301
Other (including cash and cash equivalents
of $3,444,428 and $4,537,604) 7,505,991 8,573,357
Total assets $39,283,107 $40,533,658
Liabilities and Partners' Capital (Deficit)
Mortgage notes payable $41,639,499 $41,332,170
Other liabilities 1,378,615 1,332,690
Partners' capital (deficit) (3,735,007) (2,131,202)
Total liabilities and
partners' capital (deficit) $39,283,107 $40,533,658
</TABLE>
<TABLE>
The results of operations for the Joint Venture are summarized below:
<CAPTION>
Years ended December 31,
1994 1993 1992
<S> <C> <C> <C>
Revenues
Rental $ 7,139,299 $ 8,036,461 $7,328,827
Other 173,956 216,319 209,636
7,313,255 8,252,780 7,538,463
Expenses
Operating 2,606,631 2,698,413 2,453,364
Interest 3,965,753 3,942,166 3,954,189
Depreciation and amortization 2,158,136 2,720,618 2,355,132
8,730,520 9,361,197 8,762,685
Net loss $(1,417,265) $(1,108,417) $(1,224,222)
</TABLE>
The accounting policies of the Joint Venture are consistent with those of
the Partnership. The Partnership has determined that all leases relating to
the Joint Venture are operating leases.
Activity in the excess of distributions and losses over cost of investments
in partnerships is as follows:
<TABLE>
<CAPTION>
Year ended December 31,
1994 1993 1992
<S> <C> <C> <C>
Investment at beginning
of year $ 5,624,202 $3,605,450 $2,563,500
Equity in earnings 985,769 832,468 890,254
Distributions 94,810 - 151,696
Change from consolidation to
equity accounting - 1,186,284 -
Investment at end of year $ 6,704,781 $5,624,202 $ 3,605,450
</TABLE>
The accounting policies employed by the joint venture are the same as those
of the Partnership.
<PAGE>
<TABLE>
6. Mortgage Notes Payable
Mortgage notes payable are as follows:
<CAPTION>
December 31,
1994 1993
<S> <C> <C>
Mortgage note payable secured by the
Bayport Plaza hotel: interest at
7 3/4% through December 1994 and 9%
thereafter, matures December 31, 1996;
interest-only payable monthly through
maturity. $45,000,000 $45,000,000
Mortgage note payable secured by 4
office/research & development buildings
at Braker Center: interest at 10.9%
with a minimum pay rate of 1.25% below
the interest rate, matures December 31,
1996; interest-only payable through
maturity. In default as of December 31,
1994. See Note 4. 6,174,949 5,935,746
Mortgage note payable secured by the
warehouse at Braker Center: interest
at 9.109%, matures July 1, 1995.
Principal and interest of $43,000 is
payable monthly through maturity. 3,762,035 4,058,389
Mortgage note payable secured by the
warehouse/distribution facility at
Braker Center: interest at 9.85%.
Note assumed by unaffiliated joint
venture partner. See Note 4. - 2,850,000
$54,936,984 $57,844,135
</TABLE>
Future principal payments as of December 31, 1994 on the mortgage notes
required during the next five years are $3,762,035 and $51,174,949 in
1995 and 1996, respectively.
<PAGE>
<TABLE>
7. Leases
Minimum future rents receivable under noncancellable operating leases
as of December 31, 1994 are as follows:
<CAPTION>
Year ending December 31
<C> <C>
1995 $ 1,220,463
1996 682,370
1997 324,869
1998 87,455
1999 24,208
Total $ 2,339,365
</TABLE>
The remaining terms of the leases range from less than one year to
five years and generally provide for fixed minimum rent with rental
escalation and/or expense reimbursement clauses.
8. Related Party Transactions
The Partnership borrowed funds from an affiliate of Realty to fund
property operating deficits and capital expenditures at certain
properties. Interest expense, calculated at the prime rate was
$196,923, $127,331 and $108,496 for the periods ended December 31,
1994, 1993 and 1992, respectively. At December 31, 1994 and 1993 the
balances due to the affiliate were $2,830,649 and $2,618,726,
respectively.
Additionally, in conjunction with a 1991 refinancing of the hotel at
Bayport Plaza, an affiliate of Realty guaranteed a maximum of
$5,350,000 of the first mortgage debt. Advances made by the
guarantor to the first mortgage lender under this guaranty (which
constitute loans from the guarantor to the Partnership which must be
repaid by the Partnership) equalled $2,166,098 through December 31,
1994 and 1993. Consequently, the remaining liability of the
guarantor to the lender under the guaranty as of December 31, 1994
was $3,183,902. Taking into account interest accruals, at the prime
rate, as a result of these advances under the guaranty, the
Partnership owed the guarantor $2,623,097 and $2,440,326 as of
December 31, 1994 and 1993, respectively. No portion of this
indebtedness to the affiliate has been repaid to date.
The Managing General Partner is entitled to receive a management fee
based on a percentage of distributable cash. Because there was no
distributable cash flow, the Managing General Partner did not receive
a fee for the years ended December 31, 1994, 1993 or 1992. As of
December 31, 1994 and 1993 $422,987 remained unpaid.
Realty performs administrative functions, processes investor
transactions and prepares tax information for the Partnership. For
the years ended December 31, 1994, 1993 and 1992, Realty incurred
fees of $178,160, $217,714, and 227,556, respectively for these
services. As of December 31, 1994 and 1993, the balances due to
Realty were $840,195 and $544,650, respectively.
An affiliate of the Partnership's joint venture partner at Braker
Center had funded shortfall loans to the property. In 1994, the
balance due to the affiliate of $19,200 was repaid.
Entities controlled by officers of Realty earned approximately
$36,000, $85,000 and $96,000, respectively, for the years ended
December 31, 1994, 1993 and 1992, for providing asset management
services. In May 1994, such entities agreed to terminate these fees.
<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 and has no directors or
executive 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 executive
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 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 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 of Dean Witter,
Discover & Co. and 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 a share of 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 contained in Item 5 above. The
General Partners have not received a cash distribution for the period
1988 through 1993. As of December 31, 1994, the general partners have
deferred receipt of cash distributions of $262,316.
The General Partners and their affiliates were paid certain fees
and reimbursed for certain expenses. Information concerning such fees
and reimbursements are contained in Note 9 of the Notes to the
Consolidated Financial Statements in Item 8 above.
The directors and executive officers of the Partnership's Managing
General Partner received no renumeration 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 executive officers and directors of the Managing General
Partner own the following Units as of December 31, 1994:
Amount and
Nature of
Title of Class Name of Beneficial Owner Beneficial Ownership
Limited William B. Smith *
Partnership
Interests E. Davisson Hardman, Jr. *
All directors and executive *
officers of the Managing
General Partner, as a group
*Owns, by virture of ownership of limited partnership interests in the
Associate General Partner, less than 1% of the Units of the Partnership.
<PAGE>
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 executive officers and directors of the Managing General
Partner also own indirect general 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 Growth Properties Inc. The limited partner of the
Associate General Partner is LSP, L.P., a Delaware limited partnership.
Realty and certain current and former executive officers and directors
of the Managing General Partner are partners of LSP, 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. In addition, affiliates of the
General Partners have ownership interest in certain properties.
Information concerning these transactions is contained in the Notes to
Consolidated Financial Statements in Item 8 above.
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 Schedule (see Index to Financial
Statements filed as part of Item 8 of this Annual Report).
3. Exhibits
(2) Not applicable.
(3)(a) Amended and Restated Agreement of Limited Partnership
dated as of July 12, 1985 set forth in Exhibit A to the
Prospectus included in Registration Statement Number 2-
96767 is incorporated herein by reference.
(3)(b) Certificate of Limited Partnership dated as of July 12,
1985 incorporated by reference in Registration Statement
Number 2-96767 is incorporated herein by reference.
(4)(a) Amended and Restated Agreement of Limited Partnership
dated as of July 12, 1985 set forth in Exhibit A to the
Prospectus included in Registration Statement Number 2-
96767 is incorporated herein by reference.
(4)(b) Certificate of Limited Partnership dated as of July 12,
1985 incorporated by reference in Registration Statement
Number 2-96767 is incorporated herein by reference.
(9) Not applicable.
(10) Not applicable.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(16) Letter regarding change in certifying accountant.
Incorporated by reference in the Partnership's Current
Report on Form 8-K dated December 31, 1994.
(18) Not applicable.
(19) Not applicable.
(21) Subsidiaries:
TWC Eleven Limited Partnership, a Florida Limited
Partnership.
L.S. Braker Associates, a Texas Limited Partnership.
(22) Not applicable.
(23) Not applicable.
(24) Not applicable.
(27) Financial Data Schedule.
(28) Not applicable.
(99) Not applicable.
(b) Reports on Form 8-K
Report dated December 15, 1994 of the change in the Partnership's
Independent Auditor for the year ending December 31, 1994.
(c) See 3a. above.
(d) 1. Financial Statements of TWC Ten Limited Partnership an
office building located in Tampa, Florida. To be filed by
10K/A when received from TWC Ten Limited Partnership.
2. Financial Statements of Peninsula Office Park, an office
complex located in San Mateo, California. To be filed by
10-K/A when received from Peninsula Office Park.
<PAGE>
<TABLE>
SCHEDULE III
DEAN WITTER REALTY GROWTH PROPERTIES, L.P.
Real Estate and Accumulated Depreciation
December 31, 1994
Initial cost to Partnership (A)
___________________________________________________
<CAPTION>
Buildings &
Description Encumbrances Land Improvements Total
<S> <C> <C> <C> <C>
Warehouse
Austin, TX 3,762,035 666,455 3,181,552 3,848,007
Office/R&D
Austin, TX 6,174,949 - - -
Land & Improvements
Austin, TX - 9,974,576 133,809 10,108,385
Hotel
Tampa, FL 45,000,000 4,836,077 6,341,650 11,177,727
54,936,984 15,477,108 9,657,011 25,134,119
</TABLE>
<TABLE>
Gross Amount at which
Carried at End of Period (B)
__________________________________________________
<CAPTION>
Costs
Capitalized
Subsequent to Buildings &
Description Acquisition Land Improvements Total
<S> <C> <C> <C> <C>
Warehouse
Austin, TX 1,090,568 710,746 4,227,829 4,938,575
Office/R&D
Austin, TX 5,272,231 1,603,544 3,668,687 5,272,231
Land and Improvements
Austin, TX (3,919,396) 6,188,989 - 6,188,989
Hotel
Tampa, FL 41,274,756 4,658,353 47,794,130 52,452,483
43,718,159 13,161,632 55,690,646 68,852,278
/TABLE
<PAGE>
<TABLE>
<CAPTION>
Life on which
Depreciation
Accumulated in Latest Income
Depreciation Date of Date Statement is
Description (C) Construction Acquired Computed
<S> <C> <C> <C>
Warehouse
Austin, TX 1,169,007 1985 July 1985 40 years
Office/R&D
Austin, TX 974,933 1986 July 1985 40 years
Land and Improvements
Austin, TX - 1985 July 1985 N/A
Hotel
Tampa, FL 20,308,557 1985 July 1985 40 and 15 years
22,452,497
</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 December 31: 1994 1993 1992
<S> <C> <C> <C>
Balance at beginning of period 72,046,998 102,378,331 113,534,652
Additions during period:
Improvements 589,225 1,277,638 1,161,236
Write-offs - (1,406) (2,973,756)
Other - - -
Real estate lost through foreclosure - - (9,343,801)
Real estate lost through transfer of
Partnership interest (3,783,945) - -
Sale of real estate - (2,975,644) -
Change from consolidation to equity
accounting - (28,631,921) -
Balance at end of period 68,852,278 72,046,998 102,378,331
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
(C) Reconciliation of accumulated depreciation:
1994 1993 1992
<S> <C> <C> <C>
Balance at beginning of period 20,687,639 24,615,633 24,108,854
Depreciation expense 2,129,520 3,031,354 3,470,875
Retirements - (1,321,122)
Write-off due to foreclosure - - (1,642,974)
Write-off due to transfer of
Partnership interest (364,662) - -
Write-off due to sale of real estate - (140,656) -
Change from consolidation to equity
accounting - (6,818,692) -
Balance end of period 22,452,497 20,687,639 24,615,633
</TABLE>
<PAGE>
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 GROWTH PROPERTIES, L.P.
By: Dean Witter Realty Growth Properties Inc.
Managing General Partner
By: /s/E. Davisson Hardman, Jr. Date: March 31, 1995
E. Davisson Hardman, Jr.
President
By: /s/Lawrence Volpe Date: March 31, 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 GROWTH PROPERTIES INC.
Managing General Partner
/s/William B. Smith Date: March 31, 1995
William B. Smith
Chairman of the Board of Directors
/s/E. Davisson Hardman, Jr. Date: March 31, 1995
E. Davisson Hardman, Jr.
Director
/s/Lawrence Volpe Date: March 31, 1995
Lawrence Volpe
Director
/s/Ronald T. Carman Date: March 31, 1995
Ronald T. Carman
Director
<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>
<CIK> 0000765923
<NAME> DEAN WITTER REALTY GROWTH PROPERTIES L.P.
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> DEC-31-1994
<CASH> 4,706,167
<SECURITIES> 0
<RECEIVABLES> 1,870,771
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 55,097,988<F1>
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> (18,279,694)<F2>
<TOTAL-LIABILITY-AND-EQUITY> 55,097,988<F3>
<SALES> 0
<TOTAL-REVENUES> 28,095,985<F4>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 24,206,182
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,994,853
<INCOME-PRETAX> (1,105,050)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,105,050)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,105,050)
<EPS-PRIMARY> (13.50)<F5>
<EPS-DILUTED> 0
<FN>
<F1>In addition to cash and receivables, total assets include net investments
in real estate of $46,399,781, net deferred expenses of $1,655,347 and
other assets of $465,922.
<F2>Represents partners' capital deficiency.
<F3>Liabilities include mortgage notes payable of $54,936,984,
investments in unconsolidated Partnerships of $6,704,781, due to
affiliates of $5,876,733, minority interests of $1,243,540,
accounts payable and other liabilities of $4,615,644.
<F4>Total revenue includes hotel operating revenue of $26,194,316; rental
revenue of $1,698,704 and interest and other revenue of $202,965.
<F5>Represents net loss per Unit of limited partnership interest.
</FN>
</TABLE>
