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Previous: RESIDENTIAL FUNDING MORTGAGE SECURITIES I INC, 424B5, 1996-04-08 |
Next: FALCON CABLE SYSTEMS CO, 8-K, 1996-04-08 |
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 2)
------------------------------
BALCOR REALTY INVESTORS 86--SERIES I,
A REAL ESTATE LIMITED PARTNERSHIP
(Name of Subject Company)
METROPOLITAN ACQUISITION VII, L.L.C.
MAP VII ACQUISITION CORPORATION
INSIGNIA FINANCIAL GROUP, INC.
(Bidders)
LIMITED PARTNERSHIP INTERESTS
(Title of Class of Securities)
NONE
(Cusip Number of Class of Securities)
------------------------------
JOHN K. LINES, ESQ.
GENERAL COUNSEL AND SECRETARY
INSIGNIA FINANCIAL GROUP, INC.
ONE INSIGNIA FINANCIAL PLAZA
GREENVILLE, SOUTH CAROLINA 29602
(803) 239-1675
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
------------------------------
COPY TO:
JOHN A. HEALY, ESQ.
ROBERT E. KING, JR., ESQ.
ROGERS & WELLS
200 PARK AVENUE
NEW YORK, NEW YORK 10166
(212) 878-8000
------------------------------
Index to Exhibits Located at Page 4
<PAGE> 2
This Amendment No. 2 amends and supplements the Tender Offer Statement
on Schedule 14D-1 originally filed with the Commission on March 11, 1996, as
amended by Amendment No. 1 filed with the Commission on April 2, 1996 (the
"Schedule") by Metropolitan Acquisition VII, L.L.C. (the "Purchaser"), MAP VII
Acquisition Corporation and Insignia Financial Group, Inc., relating to the
tender offer of the Purchaser to purchase up to 17,937 of the outstanding
limited partnership interests ("Interests") of Balcor Realty Investors 86 --
Series I, a Real Estate Limited Partnership, an Illinois limited partnership,
at $155.00 per Interest, net to the seller in cash, upon the terms and subject
to the conditions set forth in the Offer to Purchase dated March 11, 1996 and
the related Assignment of Partnership Interest (copies of which were filed as
Exhibits (a)(2) and (a)(3), respectively, to the Schedule). Unless the context
otherwise requires, capitalized terms used but not defined in this Amendment
No. 2 have the meanings ascribed to them in the Schedule.
Item 10 of the Schedule is hereby amended and supplemented to include
the following information.
ITEM 10. ADDITIONAL INFORMATION.
(f) The Offer has been extended to 5:00 p.m., New York time, on
Friday, April 12, 1996. On Monday, April 8, 1996, the Purchaser issued a press
release announcing such extension and reporting that approximately 1,452
Interests had been tendered pursuant to the Offer as of the close of business
on April 8, 1996. A copy of the press release has been filed as Exhibit (a)(5)
to this Amendment No. 2 and is incorporated herein by reference in its
entirety.
Item 11 of the Schedule is hereby supplemented to include the exhibits
listed below.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(5) Text of press release issued by the Purchaser on April 8, 1996.
(f)(1) Excerpts from the report, dated November 27, 1995, of Alex. Brown &
Sons Incorporated.
2
<PAGE> 3
SIGNATURES
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: April 8, 1996
METROPOLITAN ACQUISITION VII, L.L.C.
By: MAP VII ACQUISITION CORPORATION,
its managing member
By: /s/ JEFFREY L. GOLDBERG
-----------------------------------
Jeffrey L. Goldberg
Vice President
MAP VII ACQUISITION CORPORATION
By: /s/ JEFFREY L. GOLDBERG
-----------------------------------
Jeffrey L. Goldberg
Vice President
INSIGNIA FINANCIAL GROUP, INC.
By: /s/ FRANK M. GARRISON
-----------------------------------
Frank M. Garrison
Executive Managing Director
3
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<S> <C>
(a)(5) Text of press release issued by the Purchaser on April 8, 1996.
(f)(1) Excerpts from the report, dated November 27, 1995, of Alex. Brown & Sons Incorporated.
</TABLE>
4
<PAGE> 1
EXHIBIT 99.(a)(5)
METROPOLITAN ACQUISITION VII, L.L.C.
One Insignia Financial Plaza
Greenville, SC 29602
FOR IMMEDIATE RELEASE
INSIGNIA AFFILIATE EXTENDS TENDER OFFERS FOR LIMITED
PARTNERSHIP INTERESTS IN EIGHT BALCOR LIMITED PARTNERSHIPS
GREENVILLE, SOUTH CAROLINA, April 8, 1996 - Metropolitan Acquisition
VII, L.L.C. today announced that it has extended the expiration date of its
outstanding tender offers for limited partnership interests in the following
partnerships: Balcor Realty Investors Ltd. -- 82, Balcor Realty Investors --
83, Balcor Realty Investors -- 84, Balcor Realty Investors 85 -- Series I,
Balcor Realty Investors 85 -- Series III, Balcor Realty Investors 86 -- Series
I, Balcor Equity Properties Ltd. -- VIII, and Balcor Equity Properties -- XII.
The expiration date for each tender offer has been extended to 5:00 p.m., New
York time, on Friday, April 12, 1996. The offers were previously scheduled to
expire at midnight on Friday, April 5, 1996.
Metropolitan reported that as of the close of business on April 5,
1996, approximately 2,867 interests had been tendered pursuant to the BRI 82
offer, approximately 3,163 interests had been tendered pursuant to the BRI 83
offer, approximately 7,064 interests had been tendered pursuant to the BRI 84
offer, approximately 2,272 interests had been tendered pursuant to the BRI
85-I offer, approximately 2,362 interests had been tendered pursuant to the
BRI 85-III offer, approximately 1,452 interests had been tendered pursuant to
the BRI 86-I offer, approximately 1,362 interests had been tendered pursuant to
the BEP VIII offer, and approximately 2,346 interests had been tendered
pursuant to the BEP XII offer.
Metropolitan is a newly-formed Delaware limited liability company. The
managing member of Metropolitan is a wholly-owned subsidiary of Insignia
Financial Group, Inc. (NYSE: IFS). For further information, please contact
either The Herman Group, Inc. at (800) 647-2543 or Beacon Hill Partners, Inc. at
(800) 253-3814, which are acting as Information Agents for the offers.
# # #
<PAGE> 1
BALCOR
BRI-86
LIMITED PARTNERSHIP VALUATION SUMMARY
<TABLE>
<CAPTION>
BALANCE SHEET RECAP WORKING CAPITAL AT SALE DATE
- ------------------- ----------------------------
($000's)
4th Qtr 1995 Balcor
09/30/95 1995 Projection
-------- ------- -----------
<S> <C> <C> <C> <C>
Current Assets:
Cash & Equivalents 998 Cash Flow Activity:
Restr Investment 0 Op cash flow thru sale date 220 880 use 1/4 of Balcor's estimate for 1995
Escrow Deposits 2,377 Sale proceeds none in 4th quarter
Accounts Receivable 35 Refinance proceeds none in 4th quarter
Prepaid Expenses 484 Collateral activity incl in beg working capital
Other 0 Other cash receipt/pmt incl in beg working capital
------ Distributions (149) use actual 4th quarter distribution
3,894 ----- ---
Current Liabilities: 71 880
Accounts Payable 181
Due to Affiliates 27 9/30/95 Working Capital 2,795
Accrued Liabilities 473 Adjust for Joint Venture Interest (652) 40% of Lakeville escrow
Security Deposits 418 Sale Date Working Capital 2,214
Other 0
------
1,099
------
Net Working Capital 2,795
======
Mortgage N/P - Affiliate 0
Mortgage N/P 74,417
<CAPTION>
LIQUIDATION VALUE
- -----------------
Cap Sales Cost of Debt Net Sales BRI-86 PrePmt Net Sales BRI-86
Property Rate Value Sale Payoff Proceeds Share Penalty Proceeds Share
- -------- ---- ----- ------- ------ --------- ------ ------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Cedar Crest 9.00 19,693 (394) (15,105) 4,194 4,194 0 4,194 4,194
Brighton Townhomes 9.50 9,607 (192) (7,943) 1,472 1,472 0 1,472 1,472
Lake Ridge 10.50 5,211 (104) (4,243) 864 864 (687) 178 178
Lakeside 10.00 10,674 (213) (12,454) 0 0 0 0 0
Lakeville Resort 9.75 26,331 (527) (20,871) 4,933 2,960 (4,931) 2 1
Pines of Cloverlane 10.25 19,295 (386) (14,296) 4,613 4,613 (182) 4,431 4,431
------ ------- ------- ------ ------ ------ ------ ------
Totals 90,811 (1,816) (74,911) 16,077 14,104 (5,799) 10,278 10,277
Working Capital Balance 2,214 2,214
------ ------
Total Liquidation Proceeds 16,318 12,491
GP Share Proceeds 0 0% 0
LP Share Proceeds 16,318 100% 12,491
Per Unit ($) 273 58,791 units 209
% of Original Capital 27% $1,000 original 21%
unit cost
</TABLE>
<PAGE> 2
BALCOR
BRI-86
ASSET VALUATION SUMMARY
<TABLE>
<CAPTION>
PROPERTY INFORMATION MAJOR SALE ASSUMPTIONS
- -------------------- ----------------------
<S> <C>
Property Name Cedar Crest Date of Sale 12/31/95
Location Overland Park, KS Repl Res per unit 400
Type Apartments Cap Rate 9.00
Constructed 1986 Income Growth 3.0%
Units 466 Expense Growth 3.0%
Ownership % 100%
12/95 Debt Balance 15,105 Asset Mgr Gregg Handrich
Prepayment Penalty none Brkr Contact Walt Clements 816-221-2200
Property Tax Rate 1.31%
<CAPTION>
OPERATING RESULTS
- -----------------
($000'S)
ACTUAL ACTUAL BUDGET YTD ANNUALIZED VALUATION
1993 1994 1995 Oct-95 Oct-95 PROFORMA
------ ------ ------ ------ ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Rental Income 2,775 2,929 3,169 2,518 3,022 3,112
Service Income 83 95 82 52 62 64
Other Income 36 38 36 26 31 32
----- ----- ----- ----- ----- -----
Total Income 2,894 3,062 3,287 2,596 3,115 3,209
Income Growth 5.8% 7.3% -5.2% 3.0%
per unit
--------
Operating Expenses 696 868 818 730 876 902 1,936
Expense Growth 24.7% -6.0% 65 7.4% 3.0%
Property Taxes 184 184 191 95 114 258 564
Insurance 38 105 87 93 87 90 192
----- ----- ----- ----- ----- -----
Total Expenses 918 1,157 1,094 983 1,077 1,250
----- ----- ----- ----- ----- -----
Net Operating Income 1,976 1,905 2,193 1,613 2,038 1,959
Capital Expenditures (322) 213 175 160
<CAPTION>
Value
W/Prepmt
Penalty
--------
<S> <C> <C>
Replacement Reserve 186
NOI for cap rate valuation 1,772
Valuation Conclusion 19,693 19,693
Cost of Sale (2%) (394) (394)
Prepayment Penalty 0
Mortgage Payoff (15,105) (15,105)
Net Sales Proceeds 4,194 4,194
------- -------
BRI-86 Share of Proceeds 4,194 4,194
------- -------
<CAPTION>
COMP ANALYSIS
- -------------
Property # Units Sale Date Price Per Unit Comments
- -------- ------- -------- ----- -----------------
<S> <C> <C> <C> <C>
Cedar Crest 466 Dec-95 19,693 42
Essex Place 352 May-94 18,300 52
Millcreek Woods 312 Mar-94 12,175 39
</TABLE>
<PAGE> 3
BALCOR
BRI-86
ASSET VALUATION SUMMARY
<TABLE>
<CAPTION>
PROPERTY INFORMATION MAJOR SALE ASSUMPTIONS
- -------------------- ----------------------
<S> <C>
Property Name Brighton Townhomes Date of Sale 12/31/95
Location Portland, OR Repl Res per unit 400
Type Apartments Cap Rate 9.50
Constructed 1986 Income Growth 3.0%
Units 232 Expense Growth 3.0%
Ownership % 100%
12/95 Debt Balance 7.150 plus 35% contingent interest Asset Mgr Michael Becker
Prepayment Penalty none Brkr Contact John Kennedy 503-241-306
Property Tax Rate 1.40%
<CAPTION>
OPERATING RESULTS
- -----------------
($000'S) ACTUAL ACTUAL BUDGET YTD ANNUALIZED VALUATION
1993 1994 1995 Oct-95 Oct-95 PRO FORMA
---------------------------------------------------------------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Rental Income 1,384 1,486 1,534 1,342 1,610 1,659
Service Income 21 23 22 16 19 20
Other Income 24 22 16 25 30 31
----- ----- ----- ----- ----- -----
Total Income 1,429 1,531 1,572 1,383 1,660 1,709
Income Growth 7.1% 2.7% 5.0% 3.0%
per unit
--------
Operating Expenses 506 503 511 429 515 530 2,266
Expense Growth -0.6% 1.6% 0.7% 9.0%
Property Taxes 116 121 130 0 135 580
Insurance 18 47 38 40 38 39 169
----- ----- ----- ----- ----- -----
Total Expenses 640 671 679 469 533 704
----- ----- ----- ----- ----- -----
Net Operating Income 789 860 893 914 1,107 1,005
Capital Expenditures 190 136 144 130
<CAPTION>
Value
W/Prepmt
Penalty
--------
<S> <C> <C>
Replacement Reserve 93
NOI for cap rate valuation 913
Valuation Conclusion 9,607 9,607
Cost of Sale (192) (192)
Prepayment Penalty 0
Mortgage Payoff (7,943) (7,943)
------- -------
Net Sales Proceeds 1,472 1,472
======= =======
BRI-86 Share of Proceeds 1,472 1,472
------- -------
<CAPTION>
COMP ANALYSIS
- -------------
Property # Units Sale Date Price Per Unit
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Brighton Townhomes 232 Dec-95 9,607 41
Meadow Creek 304 Nov-94 12,969 43 All comps are Beaverton, OR
Wood Creek Apts 440 Nov-94 16,956 39 there have not been any
Endicott Woods 174 Dec-94 8,600 49 sales in Portland
</TABLE>
<PAGE> 4
BALCOR
BRI-86
ASSET VALUATION SUMMARY
<TABLE>
<CAPTION>
PROPERTY INFORMATION MAJOR SALE ASSUMPTIONS
- -------------------- ----------------------
<S> <C>
Property Name Lake Ridge Date of Sale 12/31/95
Location Fresno, CA Repl Res per unit 400
Type Apartments Cap Rate 10.50
Constructed 1986 Income Growth 3.0%
Units 200 Expense Growth 3.0%
Ownership % 100%
12/95 Debt Balance 4,243 Asset Mgr Reid Reynolds 708-317-4395
Prepayment Penalty 687 mly Brkr Contact Sheri Yahyavi
Property Tax Rate 1.08% Grubb & Ellis
209-432-5500
<CAPTION>
OPERATING RESULTS
- -----------------
($000'S) ACTUAL ACTUAL BUDGET YTD ANNUALIZED VALUATION
1993 1994 1995 Oct-95 Oct-95 PROFORMA
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Rental Income 1,043 1,038 1,055 844 1,013 1,043
Service Income 19 26 25 17 20 21
Other Income 28 30 23 23 28 28
----- ----- ----- --- ----- -----
Total Income 1,090 1,094 1,103 884 1,061 1,093
Income Growth 0.4% 0.8% -3.8% 3.0%
per unit
--------
Operating Expenses 336 354 368 291 349 360 1,796
Expense Growth 5.4% 4.0% -5.1% 3.0%
Property Taxes 42 43 79 40 48 56 281
Insurance 19 58 48 48 48 49 247
----- ----- ----- --- ----- -----
Total Expenses 397 455 495 379 445 465
----- ----- ----- --- ----- -----
Net Operating Income 693 639 608 505 616 627
Capital Expenditures 63 112 80 76
<CAPTION>
Value
W/Prepmt
Penalty
--------
<S> <C> <C>
Replacement Reserve 80
NOI for cap rate valuation 547
Valuation Conclusion 5,211 5,211
Cost of Sale (2%) (104) (104)
Prepayment Penalty (667)
Mortgage Payoff (4,243) (4,243)
------- -------
Net Sales Proceeds 864 178
======= =======
BRI-86 Share of Proceeds 864 178
======= -------
<CAPTION>
COMP ANALYSIS
- -------------
Property # Units Sale Date Price Per Unit Comments
- -------- ------- --------- ----- -----------------
<S> <C> <C> <C> <C>
Lake Ridge 200 Dec-95 5,211 26
Bridgewood 150 Apr-95 4,850 32
Reflections 516 Jun-95 18,300 35 REO sale to a REIT
Dakota East 96 Nov-95 2,600 27
Oliveglen 104 May-95 2,150 21 REO Sale
</TABLE>
<PAGE> 5
BALCOR
BRI-86
ASSET VALUE SUMMARY
<TABLE>
<CAPTION>
PROPERTY INFORMATION MAJOR SALE ASSUMPTIONS
- -------------------- ----------------------
<S> <C>
Property Name Lakeside Date of Sale 12/31/95
Location Jacksonville, FL Repl Res per unit 500
Type Apartments Cap Rate 10.00
Constructed 1986 Income Growth 3.0%
Units 416 Expense Growth 3.0%
Ownership % 100%
12/95 Debt Balance 12,454 Asset Mgr Gregg Handrich
Prepayment Penalty none Brkr Contact Bucky Clarkson 904-359-0045
Property Tax Rate 2.25%
<CAPTION>
OPERATING RESULTS
- -----------------
($000'S) ACTUAL ACTUAL BUDGET YTD ANNUALIZED VALUATION
1993 1994 1995 Oct-95 Oct-95 PROFORMA
-------------------------------------------------------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Rental Income 2,247 2,324 2,422 1,928 2,314 2,383
Service Income 19 15 18 9 11 11
Other Income 55 51 56 37 44 46
----- ----- ----- ----- ----- -----
Total Income 2,321 2,390 2,496 1,974 2,369 2,440
Income Growth 3.0% 4.4% -5.1% 3.0%
per unit
--------
Operating Expenses 737 751 776 662 794 818 1,967
Expense Growth 1.0% 3.3% 2.4% 3.0%
Property Taxes 227 224 239 0 240 677
Insurance 34 133 103 121 103 106 256
----- ----- ----- ----- ----- -----
Total Expense 998 1,108 1,118 783 897 1,165
----- ----- ----- ----- ----- -----
Net Operating Income 1,323 1,282 1,378 1,191 1,471 1,275
Capital Expenditures 240 134 190 107
<CAPTION>
Value
W/Prepmt
Penalty
---------
<S> <C> <C>
Replacement Reserve 208
NOI for cap rate valuation 1,067
Valuation Conclusion 10,674 10,674
Cost of Sale (2%) (213) (213)
Prepayment Penalty 0
Mortgage Payoff (12,454) (12,454)
------- -------
Net Sales Proceeds 0 0
======= -------
BRI-86 Share of Proceeds 0 0
------- -------
<CAPTION>
COMP ANALYSIS
- -------------
Property # Units Sale Date Price Per Unit
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Lakeside 416 Dec-95 10,674 26
Southern Pines 200 1995 11,100 56
Sandpiper 376 1995 11,300 30
Lakes of Mayport 216 1995 6,600 31
Pinewood Village 226 1995 7,200 32
</TABLE>
<PAGE> 6
BALCOR
BRI-86
ASSET VALUATION SUMMARY
<TABLE>
<CAPTION>
PROPERTY INFORMATION MAJOR SALE ASSUMPTIONS
- -------------------- ----------------------
<S> <C>
Property Name Lakeville Resort Date of Sale 12/31/95
Location Petaluma, CA Repl Res per unit 350
Type Apartments Cap Rate 9.75
Constructed 1984 Income Growth 3.0%
Units 492 Expense Growth 3.0%
Ownership % 60%
12/95 Debt Balance 20,871 Asset Mgr Reid Reynolds 708-317-4395
Prepayment Penalty 4,931 locked, use mly Brkr Contact Rick Limpert
Property Tax Rate 1.12% Grubb & Ellis
209-432-5500
<CAPTION>
OPERATING RESULTS
- -----------------
($000'S) ACTUAL ACTUAL BUDGET YTD ANNUALIZED VALUATION
1993 1994 1996 Oct-95 Oct-95 PROFORMA
----- ----- ------ ------ ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Rental Income 3,803 3,774 3,852 3,265 3,918 4,036
Service Income 72 84 82 70 84 87
Other Income 70 44 45 30 36 37
----- ----- ----- ----- ----- -----
Total Income 3,945 3,902 3,979 3,365 4,038 4,159
Income Growth -1.1% 2.0% 1.5% 3.0%
per unit
--------
Operating Expenses 959 979 1,021 780 936 984 1,960
Expense Growth 2.1% 4.3% -0.3% 3.0%
Property Taxes 279 293 292 153 184 295 599
Insurance 45 169 156 172 156 161 327
----- ----- ----- ----- ----- -----
Total Expenses 1,283 1,441 1,469 1,105 1,276 1,420
----- ----- ----- ----- ----- -----
Net Operating Income 2,662 2,461 2,510 2,260 2,762 2,739
Capital Expenditures 199 422 197 177
<CAPTION>
Value
W/Prepmt
Penalty
--------
<S> <C> <C>
Replacement Reserve 172
NOI for cap rate valuation 2,567
Valuation Conclusion 26,331 26,331
Cost of Sale (2%) (527) (527)
Prepayment Penalty (4,931)
Mortgage Payoff (20,871) (20,871)
------- -------
Net Sales Proceeds 4,933 2
------- =======
BRI-86 Share of Proceeds 2,960 1
------- -------
<CAPTION>
COMP ANALYSIS
- -------------
Property # Units Sale Date Price Per Unit
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Lakeville Resort 492 Dec-95 26,331 54
Shadow Creek 188 Mar-94 12,500 66
CrossBrook 226 Nov-94 12,900 57
</TABLE>
<PAGE> 7
BALCOR
BRI-86
ASSET VALUATION SUMMARY
<TABLE>
<CAPTION>
PROPERTY INFORMATION MAJOR SALE ASSUMPTIONS
- -------------------- ----------------------
<S> <C>
Property Name Pines of Cloverlane Date of Sale 12/31/95
Location Ypsilanti, MI Repl Res per unit 500
Type Apartments Cap Rate 10.25%
Constructed 1975 Income Growth 2.0%
Units 592 Expense Growth 3.0%
Ownership % 100%
12/95 Debt Balance 14,296 Asset Mgr Don Price
Prepayment Penalty 182 mly Brkr Contact Dan Doyle, G&E, (810) 350-9500
Property Tax Rate 2.25%
<CAPTION>
OPERATING RESULTS
- -----------------
($000'S) ACTUAL ACTUAL BUDGET YTD ANNUALIZED VALUATION
1993 1994 1995 Oct-95 Oct-95 PRO FORMA
---------------------------------------------------------------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Rental Income 3,706 3,870 4,103 3,170 3,804 3,880
Service Income 133 137 127 89 107 109
Other Income 58 49 66 65 78 80
----- ----- ----- ----- ----- -----
Total Income 3,897 4,056 4,296 3,324 3,989 4,069
Income Growth 4.1% 5.6% -7.2% 2.0%
per unit
--------
Operating Expenses 1,031 1,090 1,149 1,030 1,236 1,273 2,150
Expense Growth 5.7% 5.4% 7.8% 3.0%
Property Taxes 500 481 607 486 583 434 733
Insurance 39 105 85 110 85 88 148
----- ----- ----- ----- ----- -----
Total Expenses 1,570 1,676 1,841 1,626 1,904 1,795
----- ----- ----- ----- ----- -----
Net Operating Income 2,327 2,380 2,455 1,698 2,085 2,274
Capital Expenditures 311 254 259 200
<CAPTION>
Value
w/Prepmt
Penalty
--------
<S> <C> <C>
Replacement Reserve 296
NOI for cap rate valuation 1,978
Valuation Conclusion 19,295 19,295
Cost of Sale (2%) (386) (386)
Prepayment Penalty (182)
Mortgage Payoff (14,296) (14,296)
Net Sales Proceeds 4,613 4,431
------- -------
BRI-86 Share of Proceeds 4,613 4,431
------- -------
<CAPTION>
COMP ANALYSIS
- -------------
Property # Units Sale Date Price Per Unit
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Pines of Cloverlane 592 Dec-95 19,295 33
Arbor Glen 220 Sep-94 10,300 47 Same submarket, but much newer
Arbor Landings 168 Jan-95 8,900 53 Ann Arbor location is much superior
Park Place at Northville 616 Sep-94 39,860 65 Location is superior, as well as age
Kingsgate 128 Oct-94 3,905 31 Slightly older than subject
Town Center 192 Oct-94 5,700 30 Newer product, no carports
</TABLE>
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