<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
- - --- SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 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: 1-9044
DUKE REALTY INVESTMENTS, INC.
State of Incorporation: IRS Employer ID Number:
Indiana 35-1740409
Address of principal executive offices:
8888 Keystone Crossing, Suite 1200
Indianapolis, Indiana 46240
Telephone: (317) 846-4700
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 twelve 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
-------- --------
The number of shares outstanding as of November 11, 1994 was 20,390,869 Common
Shares ($.01 par value).
<PAGE>
DUKE REALTY INVESTMENTS, INC.
INDEX
PART I - FINANCIAL INFORMATION PAGE
- - ------------------------------ ----
ITEM 1. FINANCIAL STATEMENTS
Consolidated Balance Sheets as of September 30, 1994
(Unaudited) and December 31, 1993 3
Consolidated Statements of Operations for the three and nine
months ended September 30, 1994 and 1993 (Unaudited) 4
Consolidated Statements of Cash Flows for the nine months
ended September 30, 1994 and 1993 (Unaudited) 5
Consolidated Statement of Shareholders' Equity for the nine
months ended September 30, 1994 (Unaudited) 6
Notes to Consolidated Financial Statements (Unaudited) 7-8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 9-12
Part II - Other Information
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Defaults Upon Senior Securities 13
Item 4. Submission of Matters to a Vote of Security Holders 13
Item 5. Other Information 13
Item 6. Exhibits and Reports of Form 8-K 13
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
DUKE REALTY INVESTMENTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
September 30, December 31,
1994 1993
------------- ------------
ASSETS (Unaudited)
------
<S> <C> <C>
Real estate investments:
Land and improvements $ 65,791 $ 55,563
Buildings and tenant improvements 541,605 484,813
Construction in progress 34,024 9,726
Land held for development 42,874 42,741
------- -------
684,294 592,843
Accumulated depreciation ( 34,647) ( 23,725)
------- -------
Net real estate investments 649,647 569,118
------- -------
Cash and cash equivalents 33,552 10,065
Accounts receivable, net of allowance of $428 and $304 4,600 4,558
Accrued straight-line rents, net of allowance of $841 and $93 4,461 3,499
Receivables on construction contracts 29,103 15,901
Investments in unconsolidated companies 12,432 14,270
Deferred costs, net of accumulated amortization of $3,300 and $2,973 16,199 12,026
Escrow deposits and other assets 4,760 3,448
------- -------
$754,754 $ 632,885
------- -------
------- -------
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Property indebtedness:
Mortgage loans $286,555 $ 240,135
Construction loans - 4,728
Land contract payable - 3,570
Notes payable - 601
------- -------
286,555 249,034
------- -------
Amounts due subcontractors 17,188 15,482
Note payable on construction contract 1,161 -
Accounts payable 2,010 1,122
Accrued real estate taxes 8,342 8,214
Accrued expenses 3,949 3,363
Other liabilities 3,531 3,629
Tenant security deposits and deferred rents 3,065 3,053
------- -------
Total liabilities 325,801 283,897
------- -------
Minority interest 2,614 1,950
------- -------
Common shares ($.01 par value); 45,000 authorized; 19,546
and 16,046 issued and outstanding 195 160
Additional paid-in capital 460,500 377,450
Distributions in excess of net income ( 34,356) (30,572)
------- -------
Total shareholders' equity 426,339 347,038
------- -------
$754,754 $ 632,885
------- -------
------- -------
</TABLE>
See Accompanying Notes To Consolidated Financial Statements
- 3 -
<PAGE>
DUKE REALTY INVESTMENTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
For the three For the three For the nine For the nine
months ended months ended months ended months ended
September 30, 1994 September 30, 1993 September 30, 1994 September 30, 1993
------------------ ------------------ ------------------ ------------------
<S> <C> <C> <C> <C>
RENTAL OPERATIONS:
Revenues:
Rental income $22,558 $ 4,271 $64,401 $12,896
Interest and other income 300 30 705 85
------- ------- ------- -------
22,858 4,301 65,106 12,981
------- ------- ------- -------
Operating expenses:
Rental expenses 4,427 1,003 13,006 2,962
Real estate taxes 2,081 474 6,282 1,417
Interest expense 5,163 1,914 13,886 5,728
Depreciation and amortization 4,573 1,151 12,711 3,373
General and administrative 692 142 1,614 491
------- ------- ------- -------
16,936 4,684 47,499 13,971
------- ------- ------- -------
Earnings (loss) from rental operations 5,922 (383) 17,607 (990)
------- ------- ------- -------
SERVICE OPERATIONS:
Revenues:
Property management, maintenance
and leasing fees 2,887 - 8,280 -
Construction management and
development fees 1,776 - 4,739 -
Interest and other income 305 - 968 -
------- ------- ------- -------
4,968 - 13,987 -
------- ------- ------- -------
Operating expenses:
Payroll 2,849 - 7,051 -
Maintenance 241 - 728 -
Office and other 609 - 1,818 -
------- ------- ------- -------
3,699 - 9,957 -
------- ------- ------- -------
Earnings from service operations 1,269 - 4,390 -
------- ------- ------- -------
Operating income (loss) 7,191 (383) 21,997 (990)
------- ------- ------- -------
Earnings from property sales (Note 4) 2,063 - 2,198 -
Equity in earnings of unconsolidated companies 415 - 1,008 -
Minority interest in earnings of subsidiaries ( 1,984) - (6,098) -
------- ------- ------- -------
Net income (loss) $ 7,685 $ (383) $19,105 $ (990)
------- ------- ------- -------
------- ------- ------- -------
Net income (loss) per share $ .48 $ (.19) $ 1.19 $ (.48)
------- ------- ------- -------
------- ------- ------- -------
Weighted average number of shares outstanding 16,122 2,045 16,072 2,045
------- ------- ------- -------
------- ------- ------- -------
</TABLE>
See accompanying Notes to Consolidated Financial Statements
- 4 -
<PAGE>
DUKE REALTY INVESTMENTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
For the nine For the nine
months ended months ended
September 30, 1994 September 30, 1993
------------------ ------------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 19,105 $ (990)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation of buildings and tenant improvements 10,956 2,965
Amortization of deferred costs 1,755 408
Minority interest in earnings of subsidiaries 6,098 -
Straight-line rent adjustment (1,710) 144
Accrued straight-line rent reserve 748 -
Earnings from property sales, net (2,198) -
Construction contracts, net (10,335) -
Other accrued revenues and expenses, net 1,724 319
Equity in earnings of unconsolidated companies (1,008) -
------- -------
NET CASH PROVIDED BY OPERATING ACTIVITIES 25,135 2,846
------- -------
Cash flows from investing activities:
Proceeds from property sales 3,454 -
Building, development and acquisition costs (80,577) (18)
Tenant improvements (5,616) (841)
Purchase price reduction payments received - 51
Distributions received from unconsolidated companies 837 -
Deferred costs and other assets (5,454) (351)
------- -------
NET CASH USED BY INVESTING ACTIVITIES (87,356) (1,159)
------- -------
Cash flows from financing activities:
Proceeds from property indebtedness 112,563 86,973
Payments on property indebtedness (79,293) (80,265)
Distributions to shareholders and unitholders (28,055) ( 2,578)
Distributions to minority interest (747) -
Deferred financing costs (1,845) ( 5,827)
Proceeds from issuance of common shares, net 83,085 -
------- -------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 85,708 ( 1,697)
------- -------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 23,487 (10)
------- -------
Cash and cash equivalents at beginning of period 10,065 10
------- -------
Cash and cash equivalents at end of period $ 33,552 $ -
------- -------
------- -------
</TABLE>
See accompanying Notes to Consolidated Financial Statements
- 5 -
<PAGE>
DUKE REALTY INVESTMENTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1994
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
Additional Distributions
Common Paid-in in Excess of
Shares Capital Net Income
---------- ---------- ----------
<S> <C> <C> <C>
Balance at December 31, 1993 $ 160 $377,450 $(30,572)
Proceeds from issuance of common shares, net of
underwriting discounts and offering costs
of $5,290 35 83,050 -
Net income - - 19,105
Distributions to shareholders - - (21,983)
Distributions to unitholders in excess of minority interest - - (906)
-------- -------- --------
Balance at September 30, 1994 $ 195 $460,500 $(34,356)
-------- -------- --------
-------- -------- --------
</TABLE>
See accompanying Notes to Consolidated Financial Statements
- 6 -
<PAGE>
DUKE REALTY INVESTMENTS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
1. FINANCIAL STATEMENTS
The interim condensed consolidated financial statements included herein
have been prepared by Duke Realty Investments, Inc. (the "Company") without
audit. The statements have been prepared in accordance with generally
accepted accounting principles for interim financial information and with
the instructions for form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of
normal recurring adjustments) considered necessary for a fair presentation
have been included. These financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Company's Annual Report to Shareholders.
THE COMPANY
On October 4, 1993, the Company completed the acquisition of substantially
all of the properties and businesses of Duke Associates, a full-service
commercial real estate firm operating primarily in the Midwest. In
connection with the acquisition, the Company effected a 1 for 4.2 reverse
stock split of existing common shares and issued an additional 14,000,833
shares through an offering ("Offering"). All of the share and per share
amounts have been restated to reflect the reverse split.
The following unaudited pro forma information has been prepared assuming
the Offering and the acquisition of the Duke Associates' properties and
businesses had occurred at the beginning of the period presented:
<TABLE>
<CAPTION>
September 30, 1993
-----------------------------
(in thousands, except per share amounts) Nine Months Three Months
Ended Ended
----------- ------------
<S> <C> <C>
Rental revenues $ 60,353 $ 20,487
Earnings from rental operations 14,750 4,939
Earnings from service operations 1,974 704
Operating income 16,724 5,643
Net income 13,072 4,535
Net income per share .81 .28
</TABLE>
On September 29, 1994, the Company issued an additional 3,500,000 shares
through an additional offering ("1994 Offering") and received net proceeds
of $83,085,000. The proceeds of the 1994 Offering were used to pay down the
Company's revolving line of credit and to fund current development costs.
- 7 -
<PAGE>
2. PROPERTY INDEBTEDNESS
The Company has a $60 million revolving credit facility which is available
to fund current development costs and provide working capital. The
revolving line of credit matures on March 31, 1996 and bears interest
payable monthly at LIBOR plus 2%. The Company had no borrowings under the
line at September 30, 1994.
3. RELATED PARTY TRANSACTIONS
The Company provided management, leasing, construction, and other tenant
related services for fees totaling $1.6 million for the nine months ended
September 30, 1994, to partnerships in which certain officers and/or
directors of the Company have ownership interests. Management believes the
terms for such services are equivalent to those available in the market.
The Company has an option to purchase each of the properties owned by these
partnerships.
4. EARNINGS FROM PROPERTY SALES
Included in earnings from property sales is an approximate $2 million gain
which resulted from the exercise of a favorable purchase option. In
September 1994, the Company exercised a favorable option to purchase an
asset of an affiliated company. The asset purchased was a mortgage loan to
a consolidated subsidiary of the Company.
5. SUBSEQUENT EVENTS
On October 4, 1994, a total of 456,375 shares of common stock were issued
in connection with the conversion of units of ownership in Duke Realty
Limited Partnership (the "Operating Partnership"), a consolidated
subsidiary of the Company.
On October 18, 1994, the Company received net proceeds of $9,241,000
related to the issuance of an additional 387,300 shares of common stock as
a result of the exercise of the over-allotment option by the Company's
underwriters pursuant to the 1994 Offering discussed in Note 2.
On November 1, 1994, the Board of Directors declared a dividend of $.47 per
Common Share payable on November 30, 1994, to shareholders of record on
November 16, 1994.
- 8 -
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
THE COMPANY
The Company was formed in 1985 and qualifies as a real estate investment
trust ("REIT") under the provisions of the Internal Revenue Code. The
Company is an open-ended, perpetual-life REIT which owns and operates a
portfolio of commercial properties in the Midwest.
REORGANIZATION AND OFFERING
In October 1993, the Company acquired substantially all of the properties
and businesses of Duke Associates, a full-service commercial real estate
firm operating primarily in the Midwest (the "Reorganization"). In
connection with the acquisition, the Company effected a 1 for 4.2 reverse
stock split relating to its existing shares and subsequently issued an
additional 14,000,833 shares of Common Stock through an offering (the
"Offering"). Substantially all of the $309.3 million of net proceeds of the
Offering were used to repay indebtedness of the reorganized company. As a
result of the Reorganization the company's properties are owned through the
Operating Partnership, of which the Company was the sole general partner
and owner of 78% of the partnership interests ("Units") as of October 1993.
RESULTS OF OPERATIONS - HISTORICAL AND PRO FORMA
The historical results of operations changed dramatically in all respects
for the nine months ended September 30, 1993 to 1994 because of the
Reorganization and Offering discussed above. All operating categories of
revenues and expenses reflect significant increases due to the addition of
properties and businesses purchased in connection with the Reorganization.
The pro forma operating results of the reorganized company are presented in
Note 1 to the consolidated financial statements. The earnings from rental
operations increased from $14.8 million on a pro forma basis for the nine
months ended September 30, 1993 to $17.6 million for the nine months ended
September 30, 1994. This $2.8 million increase is primarily related to an
increase in rental income from expansion of the property portfolio through
development and acquisition activity and increased occupancy of the
properties, offset by the establishment of a reserve for accrued straight-
line rents receivable of $750,000. Since September 30, 1993, the Company
has acquired three properties totaling 680,000 square feet, acquired the
remaining ownership interests of two of its unaffiliated joint venture
partners which included two properties totaling 315,000 square feet, and
developed and placed in service six properties totaling 738,000 square
feet.
- 9 -
<PAGE>
The earnings from service operations increased from $2.0 million on a pro
forma basis for the nine months ended September 30, 1993 to $4.4 million
for the nine months ended September 30, 1994. This $2.4 million increase
results primarily from increased leasing fees of the managed properties
portfolio and increased construction management and development fees
resulting from increased third party construction and development activity.
In September 1994, the Company exercised a favorable option to purchase an
asset of an affiliated company. The asset purchased was a mortgage loan to
a consolidated subsidiary of the Company. As a result of the exercise of
this favorable option, the Company recognized an approximate $2 million
gain.
Primarily as a result of the gain and the operating increases discussed
previously, net income increased from $13.1 million on a pro forma basis
for the nine months ended September 30, 1993 to $19.1 million for the nine
months ended September 30, 1994
The following table sets forth information regarding the Company's in-
service portfolio of rental properties as of September 30, 1994:
<TABLE>
<CAPTION>
Total Percent
Percent Square of
Type Leased Feet Total
---- ------ ------ -------
<S> <C> <C> <C>
Industrial 94.2% 7,371,000 59.6%
Office 93.4% 3,789,000 30.6%
Retail 93.7% 1,130,000 9.1%
Medical 99.9% 80,000 .7%
----- ---------- ----
94.0% 12,370,000 100.0%
----- ---------- ------
----- ---------- ------
</TABLE>
Management expects occupancy of the above portfolio to remain stable
because only 2.8% and 9.2% of the Company's portfolio is subject to leases
expiring through the remainder of 1994 and 1995, respectively.
FUNDS FROM OPERATIONS
Management believes that Funds From Operations, which is defined by the
National Association of Real Estate Investment Trusts as net income or loss
excluding gains or losses from debt restructuring and sales of property
plus depreciation and amortization, and after adjustments for
unconsolidated partnerships and joint ventures (adjustments for
unconsolidated partnerships and joint ventures are calculated to reflect
Funds From Operations on the same basis), is the industry standard for
reporting the operations of real estate investment trusts. Funds From
Operations were $35.4 million or $1.72 per
- 10 -
<PAGE>
weighted average fully diluted share (assuming all minority interest Units
were exchanged for Common Stock) for the nine months ended September
30, 1994, compared to $30.9 million or $1.51 per fully diluted share on a
pro forma basis for the nine months ended September 30, 1993. This increase
results primarily from portfolio expansion, increased average occupancy of
the portfolio and increased earnings from the service operations.
While management believes that Funds From Operations is the most relevant
and widely used measure of the Company's operating performance, such amount
should not be considered as an alternative to net income as an indicator of
the Company's operating performance, does not represent cash flow from
operations as defined by generally accepted accounting principles, and is
not indicative of cash available to fund all cash flow needs.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities, totaling $25.1 million for the
nine months ended September 30, 1994, represents the primary source of
liquidity to fund distributions to shareholders, unitholders and the
minority interests and to fund recurring costs associated with the
renovation and reletting of the Company's properties. For the nine months
ended September 30, 1994, net cash provided by operating activities was
substantially reduced by a $10.3 million increase in net construction
contracts. This reduction reversed in October 1994 through the collection
of construction receivables. After adjusting for the timing of this
collection, cash provided by operating activities for the nine months ended
September 30, 1994 totaled $35.4 million.
The investing activities of the Company for the nine months ended September
30, 1994 of $87.4 million was primarily the result of costs incurred for
the acquisition and development of ten properties placed in service during
the nine months and eight properties under construction as of September 30,
1994. The estimated remaining development costs for these eight properties
as of September 30, 1994 total $23.4 million.
The following table sets forth information regarding the Company's
portfolio of rental properties, including the eight properties under
development as of September 30, 1994:
<TABLE>
<CAPTION>
Total Percent
Percent Square of
TYPE LEASED FEET TOTAL
---- ------ ------ -------
<S> <C> <C> <C>
Industrial 92.9% 8,206,000 59.7%
Office 93.7% 3,947,000 28.8%
Retail 94.4% 1,285,000 9.4%
Medical 84.4% 294,000 2.1%
----- ---------- ------
93.1% 13,732,000 100.0%
----- ---------- ------
----- ---------- ------
</TABLE>
- 11 -
<PAGE>
The recurring capital needs of the Company are funded primarily through the
undistributed net cash provided by operating activities. New property
development and acquisition costs are funded through a combination of debt
and equity proceeds. In March 1994, the Company obtained a $60 million
revolving credit facility which is available to fund existing and new
development costs and to provide working capital as needed. In August 1994,
the Company closed on a seven year, $60 million mortgage loan which bears
interest at 8.72%. As of September 30, 1994, the Company has received $48.6
million of funding from this loan with the remaining $11.4 million
anticipated to be received in December 1994. The Company received $92.3
million of net proceeds from the 1994 Offering. A portion of the proceeds
from the mortgage loan and the 1994 Offering was used to retire the
outstanding balance of the line of credit. The remaining proceeds will
fund additional costs on projects currently under construction, costs
related to projects for which construction will commence subsequent to
September 30, 1994 and costs of anticipated acquisitions. In the interim,
the excess proceeds will be invested in interest-bearing cash equivalents.
The Company intends to limit its debt to no more than 50% of its total
market capitalization (defined as the total market value of all shares and
units outstanding plus the outstanding mortgage and construction
indebtedness). The Company's debt to total market capitalization ratio at
September 30, 1994 was 32.3% compared to 35.3% at December 31, 1993.
The mortgage debt outstanding at September 30, 1994 consists of notes
totaling $286.6 million with a weighted average interest rate of 7.23%
maturing at various dates through 2018. Scheduled principal amortization of
mortgage debt totaled $1.1 million for the nine months ended September 30,
1994. Following is a summary of the scheduled future amortization and
maturities of the Company's mortgage debt:
<TABLE>
<CAPTION>
Future
Scheduled Future
Year Amortization Maturities Total
---- ------------ ---------- -----
<S> <C> <C> <C>
1994 $ 385,000 $ - $ 385,000
1995 1,854,000 1,401,000 3,255,000
1996 3,195,000 61,214,000 64,409,000
1997 3,953,000 - 3,953,000
1998 2,223,000 80,972,000 83,195,000
1999 2,423,000 - 2,423,000
2000 2,637,000 246,000 2,883,000
2001 2,291,000 47,015,000 49,306,000
2002 2,494,000 - 2,494,000
2003 251,000 69,389,000 69,640,000
Thereafter - 4,612,000 4,612,000
------------ ------------ -----------
$21,706,000 $264,849,000 $286,555,000
------------ ----------- -----------
------------ ----------- -----------
</TABLE>
The Company pays regular quarterly dividends with a general policy of
distributing no more than 90% of Funds From Operations. The dividend
declared on November 1, 1994 represented 79.7% of third quarter Funds From
Operations.
- 12 -
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
The Compensation Committee of the Board of Directors approved a revision to
the unaffiliated directors' compensation system effective as of November 1,
1994. The seven unaffiliated directors will receive 600 shares of Company
stock annually as compensation as well as $2,500 each for attendance at
regular Board meetings.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A report on Form 8-K dated October 13, 1994 was filed with the Commission
to report under Item 5 the exercise of a favorable option to purchase an
asset of ITI/Duke Joint Venture (an affiliated Company) and to report
under Item 7(c) the joint press release of the Company and Consolidated
Communications, Inc. regarding the sale of ITI/Duke Joint Venture.
- 13 -
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DUKE REALTY INVESTMENTS, INC.
Registrant
Date: NOVEMBER 11, 1994 /s/ Thomas L. Hefner
---------------------- -----------------------------
President and
Chief Executive Officer
/s/ Darell E. Zink, Jr.
-----------------------------
Executive Vice President and
Chief Financial Officer
/s/ Dennis D. Oklak
-----------------------------
Vice President and Treasurer
(Chief Accounting Officer)
-14-
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1993
<PERIOD-START> JAN-01-1994
<PERIOD-END> SEP-30-1994
<CASH> 33,552
<SECURITIES> 0
<RECEIVABLES> 39,433
<ALLOWANCES> (1,269)
<INVENTORY> 0
<CURRENT-ASSETS> 72,015
<PP&E> 684,294
<DEPRECIATION> (34,647)
<TOTAL-ASSETS> 754,754
<CURRENT-LIABILITIES> 39,246
<BONDS> 286,555
<COMMON> 195
0
0
<OTHER-SE> 426,144
<TOTAL-LIABILITY-AND-EQUITY> 754,754
<SALES> 0
<TOTAL-REVENUES> 82,299
<CGS> 44,385
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 6,098
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 12,711
<INCOME-PRETAX> 19,105
<INCOME-TAX> 0
<INCOME-CONTINUING> 19,105
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 19,105
<EPS-PRIMARY> 1.19
<EPS-DILUTED> 1.19
</TABLE>
