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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)
American Industrial Properties REIT
(Name of Issuer)
Common Shares of
Beneficial Interest,
par value $.10 per share
(Title of Class of Securities)
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026791-10-3
(CUSIP Number)
Stuart J.M. Breslow
Morgan Stanley, Dean Witter, Discover & Co.
1585 Broadway
New York, New York 10036
(212) 761-4000
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
February 12, 1998
(Date of Event which Requires Filing of
this Statement)
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If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the subject of this Schedule
13D, and is filing this statement because of Rule 13d-1(b)(3) or (4), check
the following: [ ]
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SCHEDULE 13D
CUSIP No. 026791-10-3 Page 2 of Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Morgan Stanley, Dean Witter, Discover & Co.
IRS #39-314-5972
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
120,231
8 SHARED VOTING POWER
NUMBER OF SHARES
BENEFICIALLY OWNED BY EACH 1,879,422
REPORTING PERSON WITH
9 SOLE DISPOSITIVE POWER
120,231
10 SHARED DISPOSITIVE POWER
1,879,422
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,999,653
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
17.9%
14 TYPE OF REPORTING PERSON*
IA, CO, HC
*SEE INSTRUCTIONS BEFORE FILLING OUT!
SEC 1746 (9-88) 2 of 7
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SCHEDULE 13D
CUSIP No. 026791-10-3 Page 3 of Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Morgan Stanley Asset Management Inc.
IRS # 13-304-0307
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF SHARES
BENEFICIALLY OWNED BY EACH 8 SHARED VOTING POWER
REPORTING PERSON WITH
1,879,422
9 SOLE DISPOSITIVE POWER
10 SHARED DISPOSITIVE POWER
1,879,422
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,879,422
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.8
%
14 TYPE OF REPORTING PERSON*
IA, CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
SEC 1746 (9-88) 2 of 7
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SCHEDULE 13D
CUSIP No. 026791-10-3 Page 5 of Pages
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The Morgan Stanley Real Estate Special Situations Fund II, L.P.
IRS # 13-3962643
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
8 SHARED VOTING POWER
NUMBER OF SHARES
BENEFICIALLY OWNED BY EACH 652,415
REPORTING PERSON WITH
9 SOLE DISPOSITIVE POWER
10 SHARED DISPOSITIVE POWER
652,415
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
652,415
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.8%
14 TYPE OF REPORTING PERSON*
PN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
SEC 1746 (9-88) 2 of 7
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Item 1. Security and Issuer.
The class of equity securities to which this statement relates is
the common shares of beneficial interest, $.10 par value per share (the "Common
Shares"), of American Industrial Properties REIT, a Texas real estate investment
trust (the "Issuer"). The principal executive offices of the Issuer are located
at 6210 North Beltline Road, Suite 170, Irving Texas 75063-2656. On October 16,
1997, the Issuer effectuated a reverse 5 for 1 split of the Common Shares. All
share and share percentage amounts herein have been adjusted to reflect the
reverse stock split.
Item 2. Identity and Background.
This statement is being filed by (i) Morgan Stanley, Dean
Witter, Discover & Co., a Delaware corporation ("MSDWD") and an investment
adviser registered with the Securities and Exchange Commission with offices at
1585 Broadway, New York, New York 10036, (ii) Morgan Stanley Asset Management
Inc., a Delaware corporation ("MSAM") and an investment adviser registered
with the Securities and Exchange Commission with offices at 1221 Avenue of the
Americas, New York, New York 10020 and (iii) The Morgan Stanley Real Estate
Special Situations Fund II, L.P. ("MSRESSF II"), a Delaware limited
partnership with its office at 1221 Avenue of the Americas, New York, New York
10020, the general partner of which is MS Real Estate Special Situations GP
Inc., a wholly-owned subsidiary of MSDWD.
During the last five years, none of MSDWD, MSAM and MSRESSF II
have been (i) convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors), or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
The Morgan Stanley Real Estate Special Situations Fund I, L.P.
("MSRESSF I"), previously a reporting person, currently holds less than 5% of
the outstanding Common Shares.
Item 3. Source and Amount of Funds or Other Consideration.
The funds used to acquire the Common Shares were obtained from the
working capital of MSDWD and MSRESSF II, respectively. The amounts of the
consideration for the acquisitions are set forth in Item 5. MSAM has not
contributed its own assets in connection with the purchases described herein.
MSAM is an investment adviser to MSRESSF II and the other clients referred to in
Item 5 below (collectively with MS Real Estate Special Situations Inc.
("MSRESSI"), the wholly-owned subsidiary through which MSDWD holds Common
Shares, the "Investors").
Item 4. Purpose of Transaction.
MSAM acquired the Common Shares described at Item 5(c) below on
behalf of the Investors for investment purposes, and in order to protect the
investment in the Issuer, its affiliate, MSRESSI has obtained the right to
nominate for election one Trust Manager to the Issuer's Board of Trust Managers
until the Common Shares held by the Investors falls below 5% of the Issuer's
issued and outstanding Common Shares. MSAM, on behalf of the Investors, intends
to continue to consider various alternative courses of action and will in the
future take such actions with respect to the equity ownership in the Issuer as
MSAM deems appropriate in light of the circumstances existing from time to time.
Such actions may include making recommendations to management concerning various
business strategies, acquisitions, dividend policies and other matters, pursuing
a transaction or transactions involving a change in control of the Issuer or
such other actions as it may deem appropriate. Such actions may involve the sale
of all or a portion of the Common Shares beneficially owned by the Investors in
the open market or in privately negotiated transactions to one or more
purchasers.
Item 5. Interest in Securities of the Issuer.
(a) -(b) Incorporated by reference to items (7) - (11) and (13)
of the cover pages. Information regarding the percentage of Common Shares is
based on 11,151,352 Common Shares outstanding as of February 12, 1998, which
number was provided by the Issuer.
(c) Pursuant to the Common Shares Purchase Agreement, dated June
20, 1997 (the "Purchase Agreement"), a copy of which is incorporated by
reference herein as Exhibit 1, the clients named on Exhibit A to the Purchase
Agreement (including for this purpose, MSRESSI) acquired on July 8, 1997 and
July 17, 1997 at a purchase price of $2.45 per share and on December 16, 1997
and February 12, 1998 at a purchase price of $12.25 and $13.625 per share,
repsectively, the number of Common Shares for the aggregate purchase prices set
forth below:
Buyer Number of Common Shares* Aggregate Purchase Price
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MSRESSI 07/08/97 131,654 $1,612,759.05
07/17/97 2,356 $28,858.55
12/16/97 10,523 $128,906.75
02/12/98 18,957 $258,289.13
MSRESSF II 07/08/97 300,233 $3,677,849.35
07/17/97 160,446 $1,965,465.95
12/16/97 73,019 $894,482.75
02/12/98 114,064 $1,554,122.00
Other Clients 07/08/97 603,802 $7,396,569.60
07/17/97 234,994 $2,878,674.05
12/16/97 115,627 $1,416,430.75
02/12/98 233,979 $3,187,963.88
* Totals may differ due to rounding to reflect reverse stock split.
The transactions described above took place in New York, New
York.
Pursuant to separate investment management agreements between
MSAM and each of the clients named on Exhibit A to the Purchase Agreement, MSAM
has been granted voting and dispositive power with respect to the Common Shares
held by each client.
MSDWD, through MSRESSI its wholly-owned subsidiary, exercises
sole voting and dispositive power with respect to all such shares of Common
Shares that it acquired. MSDWD, through MSAM its wholly-owned subsidiary,
exercises voting and dispositive power with respect to the Common Shares
acquired by MSRESSF I, MSRESSF II and the other clients.
Except as disclosed herein, none of MSDWD, MSRESSI, MSAM, MSRESSF
I nor MSRESSF II has effected any transactions in Common Shares during the
preceding 60 days.
As a result of the issuance of additional Common Shares, MSRESSF
I holds less than 5% of the outstanding Common Shares and this statement on
Schedule 13D is hereby terminated with respect to MSRESSF I.
Item 6. Contracts, Arrangements, Understandings or Relationships
with Respect to Securities of the Issuer.
Pursuant to the Agreement attached hereto as Exhibit 2 MSAM, on
behalf of the Investors, has been granted the right to designate one individual
to be nominated as Trust Manager of the Issuer, and the Issuer will recommend
such individual for election to the Board of Trust Managers, until the Common
Shares held by the Investors falls below 5% of the Issuer's issued and
outstanding Common Stock.
MSAM has designated two employees who have been elected as Trust
Managers of the Board of Trust Managers of the Issuer. One of the employees will
not be nominated for a new term in accordance with the Agreement discussed
above. The Trust Manager designated by MSAM will serve on certain committees of
the Board.
Pursuant to a Registration Rights Agreement, dated June 20,
1997, MSRESSI and MSAM, on behalf of the clients, upon the request
of an Investor holding 25% of Common Shares held by the Investors for a shelf
registration statement, may require the Issuer to offer to include the Common
Shares held by such Investor and other Investors in such shelf registration
statement, and, subject to certain conditions, to effect registration of the
Common Shares of the Issuer held by Investors so requesting within 60 days of
the request. The Investors during a five year period may also make up to
three demands that the Issuer file a non-shelf registration statement and,
subject to certain conditions, the shares of Common Shares held by the
Investors may be included in the registration of the Issuer's Common Shares
when the Issuer proposes to register its Common Shares or the shares of other
holders of Common Shares.
Except for the investment management agreements entered into by
each of MSRESSF I, MSRESSF II and the other clients, each of which grants
voting and dispositive power over the Common Shares to MSAM, there exist no
contracts arrangements, understandings or relations (legal or otherwise)
between the Investors and other persons with respect to finder's fees, joint
ventures, loan or option arrangements, puts or calls, guarantees of profits,
division of profits or loss, or the giving or withholding of proxies.
Item 7. Material to be Filed as Exhibits.
Exhibit 1: Common Share Purchase Agreement dated as of June 20,
1997 between the Issuer and MSAM (incorporated by reference to MSDWD's filing on
Schedule 13D relating to the Common Shares dated July 18, 1997 (the "Schedule
13D")).
Exhibit 2: Agreement dated January 29, 1998 among the Issuer,
MSRESSI and the other parties named therein relating to election of Trust
Managers.
Exhibit 3: Registration Rights Agreement dated as of June 20,
1997 between the Issuer and MSAM (incorporated by reference to the Schedule
13D).
Exhibit 4: Joint Filing Agreement dated July 18, 1997 among
MSDWD, MSAM, MSRESSF I and MSRESSF II (incorporated by reference to the Schedule
13D).
Exhibit 5: Secretary's Certificate authorizing Stuart J.M.
Breslow and Bruce Bromberg to sign on behalf of MSDWD (incorporated by reference
to the Schedule 13D).
SIGNATURES
After reasonable inquiry and to the best knowledge and belief
of the undersigned, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
Date: March 17, 1998
By: /s/ Bruce Bromberg
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Name: Bruce Bromberg
Title: Authorized Signatory
EXHIBIT INDEX
Exhibit No. Description
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1 Common Share Purchase Agreement, dated as of June 20, 1997,
between the Issuers and Morgan Stanley Asset Management Inc.
(incorporated by reference to MSDWD's filing on Schedule 13D
relating to the Common Shares dated July 18, 1997 (the
"Schedule 13D")).
2 Agreement dated January 29, 1998 among the Issuer, MSRESSI and
the other parties named therein relating to election of Trust
Managers.
3 Registration Rights Agreement, dated as of June 20, 1997,
between the Issuer, MS Real Estate Special Situations Inc. and
Morgan Stanley Asset Management Inc.(incorporated by reference
to the Schedule 13D).
4 Joint Filing Agreement, dated July 18, 1997 among Morgan
Stanley, Dean Witter, Discover & Co., Morgan Stanley Asset
Management Inc., The Morgan Stanley Real Estate Special
Situations Fund I, L.P. and The Morgan Stanley Real Estate
Special Situations Fund II, L.P. (incorporated by reference to
the Schedule 13D).
5 Secretary's Certificate authorizing Stuart J.M. Breslow to
sign on behalf of Morgan Stanley, Dean Witter, Discover & Co.
(incorporated by reference to the Schedule 13D).
EXHIBIT 2
AGREEMENT
The undersigned hereby agree that notwithstanding anything in any
prior agreement to the contrary, American Industrial Properties REIT (the
"Trust") shall nominate for election or re-election as Trust Manager at each
annual meeting of shareholders one nominee of Morgan Stanley Asset Management
Inc. and one nominee of ABKB/LaSalle Securities Limited Partnership, as agent
for and for the benefit of particular clients ("ABKB"). The Trust shall have no
further obligation to nominate MSAM's and ABKB's nominee, as applicable, at the
time MSAM's or ABKB's holdings, as applicable, of the Trust's common shares of
beneficial interest ("Shares") fall below 5% of the Trust's issued and
outstanding Shares. Upon determining that a party has fallen below the
threshold, the Trust may require such party's nominee to immediately resign or
the Trust may require that the nominee not seek election at the next annual
meeting of shareholders.
This Agreement shall be governed by and construed in accordance
with the laws of the State of Texas.
This Agreement may be executed in counterparts.
Dated: January 29, 1998
AMERICAN INDUSTRIAL PROPERTIES LASALLE ADVISORS LIMITED
REIT PARTNERSHIP,
as Agent for and for the benefit of
a particular client
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USAA REAL ESTATE COMPANY MS REAL ESTATE SPECIAL
SITUATIONS, INC.
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ABKB/LASALLE SECURITIES LIMITED MORGAN STANLEY ASSET MANAGEMENT
PARTNERSHIP, as Agent for and for the INC., as Agent and Attorney-in-fact
benefit of particular clients for certain designated clients
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