SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT PURSUANT TO
SECTION 14(d)(4) OF THE SECURITIES EXCHANGE ACT OF 1934
CIGNA INCOME REALTY-I
LIMITED PARTNERSHIP
(Name of Subject Company)
CIGNA INCOME REALTY-I
LIMITED PARTNERSHIP
(Name of Person(s) Filing Statement)
UNITS OF INTEREST
(Title of Class of Securities)
NONE
(CUSIP Number of Class of Securities)
John D. Carey
CIGNA Realty Resources, Inc.-Tenth
900 Cottage Grove Road, South Building
Bloomfield, Connecticut 06002
(860) 726-6000
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of the Person(s) Filing Statement)
Copy to:
W. Christian Drewes, Esq.
Kelley Drye & Warren LLP
101 Park Avenue
New York, New York 10178
(212) 808-7800
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Index to Exhibits Located at Page 7
## NY28/COLLO/72831.25
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ITEM 1. SECURITY AND SUBJECT COMPANY.
The name of the subject company is CIGNA Income Realty-I
Limited Partnership, a Delaware limited partnership (the "Partnership"). The
address of the Partnership's principal executive offices is 900 Cottage Grove
Road, South Building, Bloomfield, Connecticut 06002. The title of the class of
equity securities to which this statement relates is units of limited
partnership interest in the Partnership (the "Units").
ITEM 2. TENDER OFFER OF THE BIDDER.
This Statement relates to a tender offer by Everest Realty
Investors, LLC, a California limited liability company (the "Bidder"), to
purchase up to 80,000 of the Units at a purchase price of $115 per Unit, less
the amount of any Distributions (as defined in the Offer to Purchase referred to
below) per Unit, if any, made by the Partnership after any Distributions made
after the distribution from operations for the third quarter of 1996 and before
the date on which the Bidder purchases the Units tendered pursuant to the Offer
(as defined below) and less any Partnership transfer fees, upon the terms and
subject to the conditions set forth in the Offer to Purchase, dated November 18,
1996 (the "Offer to Purchase"), and the related Agreement of Transfer and Letter
of Transmittal (the "Letter of Transmittal", which, together with the Offer to
Purchase, constitute the "Offer"). The address of the Bidder's principal
executive office, according to the Offer to Purchase, is 3280 E.
Foothill Blvd., #320, Pasadena, California 91107.
ITEM 3. IDENTITY AND BACKGROUND.
(a) Name and Business Address. The person filing this
Statement is the Partnership, the name and business address of which are set
forth in Item 1 above.
(b) Arrangements with Executive Officers, Directors or
Affiliates. Certain contracts, agreements, arrangements and understandings
between the Partnership and its affiliates or their respective officers and
directors are described in the Partnership's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995, in Item 10 ("Directors and Executive
Officers of the Registrant"), Item 12 ("Security Ownership of Certain Beneficial
Owners and Management"), and Item 13 ("Certain Relationships and Related
Transactions"). A copy of such sections of the Partnership's Form 10-K is filed
as Exhibit 1 hereto and is incorporated herein by reference.
(c) Arrangements with the Bidder or Affiliates. On May 28,
1996, Everest Investors 3, LLC ("Everest 3"), an affiliate of the Bidder
according to the Offer to Purchase, commenced an offer to purchase up to 4.9% of
the outstanding Units of the Partnership for a purchase price of $80 per Unit,
less any distributions made by the Partnership after April 30, 1996. Pursuant to
such offer, Everest 3 received tenders for an aggregate of 1,822.9 Units
(representing approximately .93% of the outstanding Units of the Partnership).
Everest 3 submitted Agreements of Transfer to the Partnership to effect the
acquisition of such 1,822.9 Units. The Partnership initially refused to process
the submitted transfers on the grounds that
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Everest 3 had not complied with the requirements of the Limited Partnership
Agreement dated as of October 15, 1985, pursuant to which the Partnership was
formed (as amended or supplemented, the "Partnership Agreement"), relating to
the transfer. Everest 3 disputed this position and on November 7, 1996, entered
into an agreement with the General Partner of the Partnership and the
Partnership's transfer agent pursuant to which (i) the Partnership agreed to
accept Everest 3's Agreement of Transfer, (ii) Everest 3 would be recognized as
a substitute limited partner for 849.9 Units effective as of October 1, 1996,
and for an additional 973 Units effective as of November 1, 1996, and (iii)
Everest 3 would indemnify the Partnership, the General Partner and their
affiliates, pay the Partnership's transfer fee and jointly request with the
General Partner that certain tendering limited partners execute and deliver a
properly executed Partnership transfer form. Except as set forth above, to the
Partnership's knowledge, neither the Partnership nor its affiliates are party to
any past, present or proposed material contracts, arrangements, understandings,
relationships, or negotiations with the Bidder or its executive officers,
directors or affiliates.
ITEM 4. THE SOLICITATION OR RECOMMENDATION.
(a) This Statement relates to a recommendation by the
Partnership for holders of Units to reject the Offer. A letter to the
Unitholders of the Partnership communicating the Partnership's recommendation is
filed as Exhibit 2 hereto and is incorporated herein by reference.
(b) The Partnership has recommended rejection of the Offer
primarily for two reasons: (1) the Partnership believes that the Offer price of
$115 per Unit, less certain amounts, is inadequate; and (2) the Offer to
purchase is limited to 80,000 Units, representing only approximately forty
percent (40%) of outstanding Units. In reaching its determination, the
Partnership considered a number of factors, including:
(i) Based on the information set forth more fully in
the Partnership's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1996 (a copy of which is attached
hereto as Exhibit 3 and incorporated herein by reference), and
on the General Partner's estimate of property values as of the
date hereof, the Partnership is estimated to have a current
net asset value of approximately $167 per Unit (before
deducting expenses relating to the sale of the Partnership's
properties and liquidating the Partnership). The Offer price
of $115 (before deducting certain transactional costs, which
will reduce the net value of the Offer to Unitholders) is only
sixty-nine percent (69%) of the net asset value, which
represents a significant discount from the net asset value.
Based on these estimates, the Partnership believes that the
Offer price is inadequate. The net asset value is an estimate
of the amount Unitholders of the Partnership would receive per
Unit if the Partnership's assets were sold at their appraised
values without reduction for selling expenses as of the close
of the year, and sales proceeds along with the other funds of
the Partnership were distributed in a liquidation of the
Partnership. There can be no assurance that
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the estimated net asset value will be realized by the
Partnership or Unitholders upon liquidation, or that
Unitholders would realize the estimated net asset value if
they attempted to sell their Units because a public market for
the Units does not exist. However, as has been reported
previously in the Partnership's periodic reports to
Unitholders, following a decline in the late 1980's and early
1990's, real estate markets are experiencing a period of
recovery as evidenced by an increase in the Partnership's
estimated net asset value in each of the past three (3) years
(see Exhibit 4 attached hereto and incorporated herein by
reference). It is the General Partner's view that the
Partnership's net asset value will continue to increase as
rental rates increase and occupancy levels stabilize in a
continuing real estate market recovery.
(ii) The Partnership has been considering, and
continues to consider, various alternatives designed to
maximize value to Unitholders. In this connection, while the
Partnership has not yet determined whether a disposition of
all or any substantial part of its assets at this time is the
appropriate way to proceed, the Partnership has been
approached by and, through the General Partner, is currently
engaged in discussions with a potential purchaser for the
possible sale of all of the assets and liabilities of the
Partnership. See Item 7(a), "Certain Negotiations and
Transactions of the Subject Company" elsewhere herein. The
Partnership will continue to explore these alternatives
because it believes that a return to Unitholders in excess of
the Offer price of $115 per Unit is obtainable. Of course,
there can be no assurance at this time that any such
transaction will be consummated, as discussions are ongoing
and approval of the holders of a majority of the Units would
be required. Accordingly, while actively exploring the
prospect of a near-term sale of all of the assets and
liabilities of the Partnership for an amount that would yield
a return in excess of the Offer price as outlined above, the
Partnership intends to continue its plan of orderly
liquidation and wrap-up of the Partnership's business over an
estimated period of three to four years by continuing to
maintain stable occupancy rates (see Exhibit 5 attached hereto
and incorporated herein by reference), controlling leasing
exposure (see Exhibit 6 attached hereto and incorporated
herein by reference), maintaining steady cash flow and
distributions (see Exhibit 7 attached hereto and incorporated
herein by reference) and positioning the Partnership's
properties for a sale that will yield the maximum attainable
value to Unitholders.
(iii) The Offer is to purchase only 80,000 of the
outstanding Units, representing only approximately forty
percent (40%) of all outstanding Units. Accordingly, a
majority of Unitholders will not have an opportunity to tender
all of their Units pursuant to the Offer. Under the terms of
the Offer, if more than 80,000 of the outstanding Units are
tendered while the Offer remains open, the Bidder will acquire
only a portion of each tendering Unitholder's Units, on a pro
rata basis. Hence, no Unitholder, regardless of the timing or
the terms of
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<PAGE>
his or her tender, can be assured of disposing of all of his
or her Units under the terms of the Offer, even if the Offer
were consummated.
ITEM 5. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
No person or class of persons has been employed or retained or
is to be compensated by the Partnership or any person acting on its behalf to
make solicitations or recommendations to Unitholders in connection with the
Offer. No director, executive officer or employee of the Partnership or any
affiliate of the Partnership will be additionally compensated for making
solicitations or recommendations to Unitholders in connection with the Offer,
but may be reimbursed for out-of-pocket expenses incurred in connection
therewith.
ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES.
(a) The Partnership has not effected any transaction in the
Units during the 60-day period prior to the date of this Statement. To the best
of the Partnership's knowledge, no executive officer, director or affiliate of
the Partnership has effected any transaction in the Units during the 60-day
period prior to the date of this Statement. The Partnership has no subsidiaries.
(b) To the best of the Partnership's knowledge, neither the
Partnership nor any executive officer, director or affiliate of the Partnership
intends to tender any Units which are held of record or beneficially owned by
such persons to the Bidder pursuant to the Offer.
ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY THE SUBJECT COMPANY.
(a) The Partnership has been approached by and, through the
General Partner of the Partnership, is currently engaged in negotiations with
Koll General Partner Services ("Koll") in connection with a proposed purchase of
all of the assets and liabilities of the Partnership. Koll has made an offer, on
behalf of Glenborough Realty Trust Incorporated, to purchase all of the assets
and liabilities of the Partnership, as reflected on the Partnership's June 30,
1996 balance sheet for a purchase price of $28,000,000, an amount equal to
approximately ninety percent (90%) of the net asset value as of December 31,
1995. This offer is subject to the requisite approval of the Unitholders under
the Partnership Agreement and receipt of a fee of $560,000 at closing. There can
be no assurance at this time that a sale to Glenborough Realty Trust
Incorporated, or any other alternative, will be consummated; however, the
Partnership intends to continue these negotiations with Koll and to consider any
other alternative that may become available for enhancing value to Unitholders.
(b) None.
ITEM 8. ADDITIONAL INFORMATION TO BE FURNISHED.
None.
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<PAGE>
ITEM 9. MATERIALS TO BE FILED AS EXHIBITS.
Exhibit No. Description
1 Excerpts of Item 10, Item 12 and Item 13 of the
Partnership's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995
2 Letter of Recommendation to Unitholders, dated December 2, 1996
3 The Partnership's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1996
4 Reported Net Asset Value of the Partnership's Assets for 1993, 1994,
1995 and 1996
5 Occupancy Levels of Partnership's Properties for 1994, 1995 and 1996
6 Projected Leasing Exposure of Partnership's Properties for 1997, 1998
7 Quarterly Cash Distributions to Unitholders for 1994, 1995 and 1996
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[/TABLE]
<PAGE>
SIGNATURE
After reasonable 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.
CIGNA INCOME REALTY-I LIMITED
PARTNERSHIP
By: CIGNA Realty
Resources, Inc.-Tenth,
General Partner
By: /s/ John D. Carey
John D. Carey, President
Dated: December 2, 1996
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<TABLE>
<CAPTION>
EXHIBIT INDEX
Sequentially
Exhibit No. Description Numbered Page
----------- ----------- -------------
<S> <C> <C>
1 Excerpts of Item 10, Item 12 and Item 13 of the
Partnership's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995
2 Letter of Recommendation to Unitholders, dated
December 2, 1996
3 The Partnership's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1996
4 Reported Net Asset Value of the Partnership's Assets for
1993, 1994, 1995 and 1996
5 Occupancy Levels of Partnership's Properties for 1994,
1995 and 1996
6 Projected Leasing Exposure of Partnership's Properties
for 1997, 1998
7 Quarterly Cash Distributions to Unitholders for 1994,
1995 and 1996
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</TABLE>
<PAGE>
EXHIBIT 1
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The General Partner of the Partnership, CIGNA Realty Resources,
Inc.-Tenth, a Delaware corporation, is an indirect, wholly owned subsidiary of
CIGNA Corporation, a publicly held corporation whose stock is traded on the New
York Stock Exchange. The General Partner has responsibility for and control over
the affairs of the Partnership.
The directors and executive officers of the General Partner as of
February 15, 1996, are as follows:
<TABLE>
<CAPTION>
<S> <C> <C>
Name Office Served Since
R. Bruce Albro Director May 2, 1988
David Scheinerman Director July 25, 1995
Philip J. Ward Director May 2, 1988
John D. Carey President, Controller September 7, 1993
September 4, 1990
Verne E. Blodgett Vice President, Counsel April 2, 1990
Joseph W. Springman Vice President, Assistant Secretary September 7, 1993
David C. Kopp Secretary September 29, 1989
Marcy F. Blender Treasurer August 1, 1994
</TABLE>
There is no family relationship among any of the foregoing directors or
officers. There are no arrangements or understandings between or among said
officers or directors and any other person pursuant to which any officer or
director was selected as such.
The foregoing directors and officers are also officers and/or directors of
various affiliated companies of CIGNA Realty Resources, Inc.-Tenth, including
CIGNA Financial Partners, Inc. (the parent of CIGNA Realty Resources,
Inc.-Tenth), CIGNA Investments, Inc., CIGNA Corporation (the parent of CIGNA
Investments, Inc.) and Connecticut General Corporation (the parent of CIGNA
Financial Partners, Inc.).
The business experience of each of the directors and executive officers of
the General Partner of the Partnership is as follows:
R. BRUCE ALBRO - DIRECTOR
Mr. Albro, age 53, a Senior Managing Director of CIGNA Investment
Management (CIM), joined Connecticut General's Investment Operations in 1971 as
a Securities Analyst in Paper, Forest Products, Building and Machinery.
Subsequently, he served as a Research Department Unit Head, as an Assistant
Portfolio Manager, then as Director of Equity Research and a member of the
senior staff of CIGNA
<PAGE>
Investment Management Company and as a Portfolio Manager in the Fixed Income
area. He then headed the Marketing and Merchant Banking area for CII. Prior to
his current assignment of Division Head, Portfolio Management Division, he was
an insurance portfolio manager, and prior to that, he was responsible for
Individual Investment Product Marketing. In addition, Mr. Albro currently serves
as President of the CIGNA Funds Group and other CIGNA affiliated mutual funds.
Mr. Albro received a Master of Arts degree in Economics from the University of
California at Berkeley and a Bachelor of Arts degree in Economics from the
University of Massachusetts at Amherst.
DAVID SCHEINERMAN - DIRECTOR
Mr. Scheinerman, age 35, was appointed Chief Financial Officer of CIGNA
Individual Insurance, a division with more than $77 billion of life insurance in
force, in July of 1995. Mr. Scheinerman has served in various actuarial and
business management capacities with CIGNA. In 1991 he was appointed Vice
President and Pricing Actuary for CIGNA HealthCare. He has more than 12 years of
financial management experience and has served as Chief Financial Officer of
Crusader Insurance PLC, a CIGNA subsidiary life company in the United Kingdom.
Mr. Scheinerman holds a BA in Mathematics from Rice University and an MBA from
the University of Pennsylvania Wharton School of Business. He is a fellow of the
Society of Actuaries and a member of the American Academy of Actuaries.
PHILIP J. WARD - DIRECTOR
Mr. Ward, age 47, is Senior Managing Director and Division Head of CIGNA
Investment Management (CIM), in charge of the Real Estate Investment Division of
CIM. He was appointed to that position in December 1985. Mr. Ward joined
Connecticut General's Mortgage and Real Estate Department in 1971 and became an
officer in 1976. Since joining the company he has held real estate investment
assignments in Mortgage and Real Estate Production and in Portfolio Management.
Prior to his current position, Mr. Ward held assignments in CIGNA Investments
Inc., responsible for the Real Estate Production area, CIGNA Realty Advisors,
Inc. and Congen Realty Advisory Company, all wholly-owned subsidiaries of CIGNA
Corporation and/or Connecticut General. Mr. Ward has held various positions with
the General Partner. His experience includes all forms of real estate
investments, with recent emphasis on acquisitions and joint ventures. Mr. Ward
is a 1970 graduate of Amherst College with a Bachelor of Arts degree in
Economics. He is a member of the Society of Industrial and Office Realtors, the
National Association of Industrial and Office Parks, the Urban Land Institute
and the International Council of Shopping Centers. He is a member of the Board
of Directors of DeBartolo Realty Corporation.
<PAGE>
JOHN D. CAREY - PRESIDENT, CONTROLLER
Mr. Carey, age 32, joined CIGNA Investment Management-Real Estate as
Controller of Tax Advantaged Investments in 1990. In September 1993, Mr. Carey
was appointed President. Prior to joining CIGNA Investment Management, he held
the position of manager at KPMG Peat Marwick LLP in the audit department and was
a member of the Real Estate Focus Group. His experiences include accounting and
financial reporting for public and private real estate limited partnership
syndications. Mr. Carey is a graduate of Central Connecticut State University
with a Bachelor of Science Degree and is a Certified Public Accountant.
VERNE E. BLODGETT - VICE PRESIDENT, COUNSEL
Mr. Blodgett, age 58, is an Assistant General Counsel of CIGNA Corporation.
He joined Connecticut General Life Insurance Company in 1975 as an investment
attorney and has held various positions in the Legal Division of Connecticut
General Life Insurance Company prior to his appointment as Assistant General
Counsel in 1981. Mr. Blodgett received a Bachelor of Arts degree from Yale
University and graduated with honors from the University of Connecticut School
of Law. He is a member of the Connecticut and the American Bar Associations.
JOSEPH W. SPRINGMAN - VICE PRESIDENT, ASSISTANT SECRETARY
Mr. Springman, age 54, is Managing Director and department head responsible
for asset management. He joined CIGNA's Real Estate operations in 1970. He has
held positions as an officer or director of several real estate affiliates of
CIGNA. His past real estate assignments have included Development and
Engineering, Property Management, Director, Real Estate Operations, Portfolio
Management and Vice President, Real Estate Production. Prior to assuming his
asset management post, Mr. Springman was responsible for production of real
estate and mortgage investments. He received a Bachelor of Science degree from
the U.S. Naval Academy.
DAVID C. KOPP - SECRETARY
Mr. Kopp, age 50, is Secretary of CII, Corporate Secretary of Connecticut
General Life Insurance Company and Assistant Corporate Secretary and Assistant
General Counsel, Insurance and Investment Law of CIGNA Corporation. He also
serves as an officer of various other CIGNA Companies. In August of 1995, he
also assumed responsibility as chief compliance officer for CIGNA HealthCare, a
division of CIGNA Corporation. He joined Connecticut General Life Insurance
Company in 1974 as a commercial real estate attorney and held various positions
in the Legal Department of Connecticut General Life Insurance Company prior to
his appointment as Corporate Secretary in 1977. Mr. Kopp is an honors graduate
of Northern Illinois University and served on the law review at the University
of Illinois College of Law. He is a member of the Connecticut Bar Association
and is Past President of the Hartford Chapter, American Society of Corporate
Secretaries.
MARCY F. BLENDER - TREASURER
Marcy F. Blender, age 39, is Assistant Vice President, Bank Resources of
CIGNA Corporation. In
<PAGE>
this capacity she is responsible for bank relationship management, bank products
and services, bank compensation and control, and bank exposure management. Marcy
joined Insurance Company of North America (INA) in 1979. She has held a variety
of financial and investment positions with INA and later with the merged CIGNA
Corporation before assuming her current responsibilities in 1992. She received a
BA degree from Rutgers University and an MBA from Drexel University. She is a
Certified Public Accountant.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
No person or group is known by the Partnership to own beneficially more
than 5% of the outstanding Units of interest of the Partnership.
There exists no arrangement, known to the Partnership, the operation of
which may at a subsequent date result in a change in control of the Partnership.
As of February 15, 1996, the individual directors, and the directors and
officers as a group, of the General Partner beneficially owned Partnership Units
and shares of the common stock of CIGNA, parent of the General Partner, as set
forth in the following table:
<TABLE>
<CAPTION>
Units Shares
Beneficially Beneficially Percent of
Name Owned(a) Owned(b) Class
<S> <C> <C> <C>
R. Bruce Albro (c) 0 6,653 *
David Scheinerman 0 0 *
Philip J. Ward (d) 0 16,491 *
All directors and officers
Group (8) (e) 0 29,994 *
* Less than 1% of class
(a) No officer or director of the General Partner possesses a right to
acquire beneficial ownership of additional Units of interest of the
Partnership.
(b) The directors and officers have sole voting and investment power over
all the shares of CIGNA common stock they own beneficially.
(c) Shares beneficially owned includes options to acquire 4,487 shares and 1,432 shares which are
restricted as to disposition.
(d) Shares beneficially owned includes options to acquire 8,826 shares and 2,400 shares which are
restricted as to disposition.
(e) Shares beneficially owned by directors and officers include 15,318
shares of CIGNA common stock which may be acquired upon exercise of
stock options and 8,126 shares which are restricted as to disposition.
</TABLE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The General Partner of the Partnership is generally entitled to receive
l% of cash distributions, subordinated to a priority distribution of 6%
non-cumulative, non-compounded return to the limited
<PAGE>
partners on their adjusted invested capital and l% of profits or losses. In
1995, the General Partner received no cash distributions and a share of the
Partnership's net income of $17,030. Reference is also made to the Notes to
Consolidated Financial Statements included in this annual report for a
description of such distributions and allocations. The relationship of the
General Partner (and its directors and officers) to its affiliates is set forth
in Item 10.
CII provided asset management services to the Partnership during 1995
for the Woodlands Tech Center, Westford Corporate Center and Piedmont Plaza at
fees calculated at 6% of gross revenues collected less amounts earned by
independent third party property management companies contracted by CII on
behalf of the Partnership. For Overlook Apartments fees are calculated at 5% of
gross revenues collected less amounts earned by independent third party property
management companies contracted by CII on behalf of the Partnership. In 1995,
CII earned asset management fees amounting to $116,633 for such services, of
which $18,670 was unpaid as of December 31, 1995. Independent third party
property managers earned $194,007 of management fees, of which $11,350 was
unpaid as of December 31, 1995.
A nonrecurring acquisition fee for evaluating and selecting real
property to be acquired equal to the lesser of (1) 5% of the Gross Proceeds from
sales of Units, or (2) the normal and customary charges by third parties for
such services, is to be paid to CII. To date, no such fees have been paid since
no payment is due until priority distributions have been paid as described
above. A subordinated incentive management fee of 9% of adjusted cash from
operations will be payable to CII, but only after the limited partners have
received their priority distributions as described above, the General Partner
has received its 1% distribution described above and acquisition fees have been
paid.
The General Partner and its affiliates may be reimbursed for their
direct expenses incurred in the administration of the Partnership. In 1995, the
General Partner and its affiliates were entitled to reimbursement for such out
of pocket expenses in the amount of $73,010 of which $5,863 was unpaid as of
December 31, 1995.
<PAGE>
EXHIBIT 2
[LETTERHEAD OF THE PARTNERSHIP]
December 2, 1996
Re: Everest Realty Investors, LLC Tender Offer
Dear Unitholders:
You may have recently received an Offer to Purchase dated
November 18, 1996 from Everest Realty Investors, LLC ("Everest"), in which
Everest offered to purchase up to 80,000 (40%) of the currently outstanding
Units of CIGNA Income Realty-I Limited Partnership (the "Partnership") at a
purchase price of $115 per Unit less certain adjustments and expenses (the
"Everest Offer").
THE PARTNERSHIP RECOMMENDS THAT UNITHOLDERS REJECT THE EVEREST
OFFER AND NOT TENDER THEIR UNITS TO EVEREST.
Enclosed is a copy of the Partnership's Schedule 14D-9, filed
today with the Securities and Exchange Commission, in which the reasons and the
basis for the Partnership's recommendation that you reject the Everest Offer are
explained more fully. To summarize:
o The General Partner estimates that the Partnership's current
net asset value is approximately $167 per Unit; the Everest
Offer provides for a purchase price of only $115 per Unit
(less certain adjustments and expenses), less than 69% of the
current net asset value.
o The Partnership is currently engaged in discussions with Koll
General Partner Services ("Koll") regarding a possible sale of
the Partnership assets. Koll has made an offer, on behalf of
Glenborough Realty Trust Incorporated, to purchase all of the
assets and liabilities of the Partnership for $28 million,
which represents approximately ninety percent (90%) of the
Partnership's estimated net asset value as of December 31,
1995 (the "Koll Proposal"). While the Partnership is not
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<PAGE>
yet prepared to recommend such a transaction, and there can be
no assurance at this time that the Koll Proposal will be
consummated, the Partnership intends to continue these
discussions with Koll, and to explore other alternatives that
may become available, because it believes that a return to
Unitholders in excess of the Everest Offer price of $115 per
Unit is obtainable.
o The Everest Offer is to purchase up to 80,000 Units,
representing only approximately 40% of all outstanding Units.
Accordingly, the Everest Offer is not available to a majority
of Unitholders, and no Unitholder, regardless of when he or
she responds, can be assured of disposing of all his or her
Units under the terms of the Everest Offer. By contrast, the
Koll Proposal, if consummated, would provide for a sale of all
of the assets and liabilities of the Partnership.
This letter merely summarizes the Partnership's recommendation
as explained in the enclosed Schedule 14D-9, and is qualified by the information
set forth therein; accordingly, you are urged to read the enclosed Schedule in
its entirety.
If you sell your interest in the Partnership, it may
constitute a taxable event to you. Accordingly, if you wish to consider the
Everest Offer notwithstanding the foregoing recommendation, please consult your
adviser to review your personal tax situation before accepting the Everest Offer
or tendering any of your Units.
Please call the undersigned with any questions you may have
regarding the Everest Offer, the information set forth in the enclosed Schedule
14D-9, the status of your investment, or any other related matter.
Sincerely,
CIGNA INCOME REALTY-I LIMITED
PARTNERSHIP
By: CIGNA Realty
Resources, Inc.-Tenth,
General Partner
By: ____________________________
John D. Carey, President
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Exhibit 3
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1996
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 0-15748
CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Delaware 06-1149695
(State of Organization) (I.R.S. Employer Identification No.)
900 Cottage Grove Road, South Building
Bloomfield, Connecticut 06002
(Address of principal executive offices)
Telephone Number: (860) 726-6000
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
1
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PART I - FINANCIAL INFORMATION
CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, DECEMBER 31,
1996 1995
ASSETS (UNAUDITED) (AUDITED)
<S> <C> <C>
Property and improvements, at cost:
Land and improvements $ 9,557,012 $ 9,552,353
Buildings 27,323,577 27,323,577
Tenant improvements 5,290,988 5,257,538
Furniture and fixtures 826,755 820,904
--------------- ---------------
42,998,332 42,954,372
Less accumulated depreciation 14,129,000 13,104,206
--------------- ---------------
Net property and improvements 28,869,332 29,850,166
Cash and cash equivalents 3,492,956 3,227,503
Accounts receivable (net of allowance of $71,053 in 1996
and $15,158 in 1995) 317,657 300,941
Prepaid expenses and other assets 9,790 9,760
Deferred charges, net 436,872 492,190
--------------- ---------------
Total $ 33,126,607 $ 33,880,560
=============== ===============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses (including $60,663
in 1996 and $24,532 in 1995 due to affiliates) $ 439,109 $ 261,013
Tenant security deposits 118,425 113,188
Unearned income 19,831 25,032
Deferred acquisition fees due to affiliates 2,500,000 2,500,000
--------------- ---------------
Total liabilities 3,077,365 2,899,233
--------------- ---------------
Venture partner's equity in joint venture 2,752,841 2,679,392
--------------- ---------------
Partners' capital:
General Partner:
Capital contributions 1,000 1,000
Cumulative net income 53,795 42,670
--------------- ---------------
54,795 43,670
--------------- ---------------
Limited partners (200,000 Units):
Capital contributions, net of offering costs 45,463,209 45,463,209
Cumulative net income 5,325,691 4,224,350
Cumulative cash distributions (23,547,294) (21,429,294)
--------------- ---------------
27,241,606 28,258,265
--------------- ---------------
Total partners' capital 27,296,401 28,301,935
--------------- ---------------
Total $ 33,126,607 $ 33,880,560
=============== ===============
The Notes to Consolidated Financial Statements are an integral part of these statements.
2
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CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Income:
Base rental income $ 1,115,848 $ 1,155,735 $ 3,391,878 $ 3,480,186
Other income 195,324 226,796 594,673 684,131
Interest income 38,284 43,523 113,954 125,498
------------- ------------- ------------- -------------
1,349,456 1,426,054 4,100,505 4,289,815
------------- ------------- ------------- -------------
Expenses:
Property operating expenses 417,802 423,170 1,294,968 1,229,371
General and administrative 103,587 91,492 311,229 273,866
Fees and reimbursements to affiliates 44,930 49,132 142,379 128,282
Provision for doubtful accounts 49,152 5,458 56,659 9,217
Depreciation and amortization 368,777 412,377 1,109,355 1,229,080
------------- ------------- ------------- -------------
984,248 981,629 2,914,590 2,869,816
------------- ------------- ------------- -------------
Income inclusive of venture
partner's share of venture operations 365,208 444,425 1,185,915 1,419,999
Venture partner's share of venture net income 33,696 39,010 73,449 123,142
------------- ------------- ------------- -------------
Net income $ 331,512 $ 405,415 $ 1,112,466 $ 1,296,857
============= ============= ============= =============
Net income:
General Partner $ 3,315 $ 4,055 $ 11,125 $ 12,969
Limited partners 328,197 401,360 1,101,341 1,283,888
------------- ------------- ------------- -------------
$ 331,512 $ 405,415 $ 1,112,466 $ 1,296,857
============= ============= ============= =============
Net income per Unit $ 1.64 $ 2.01 $ 5.51 $ 6.42
============= ============= ============= =============
Cash distribution per Unit $ 3.42 $ 3.75 $ 10.59 $ 11.70
============= ============= ============= =============
The Notes to Consolidated Financial Statements are an integral part of these statements.
3
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CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(Unaudited)
1996 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 1,112,466 $ 1,296,857
Adjustments to reconcile net income to net
cash provided by operating activities:
Deferred rent credits 15,894 14,738
Provision for doubtful accounts 56,659 9,217
Depreciation and amortization 1,109,355 1,229,080
Venture partner's share of venture's operations 73,449 123,142
Accounts receivable (73,375) 70,942
Accounts payable 198,828 271,392
Other, net 20,314 16,806
--------------- ---------------
Net cash provided by operating activities 2,513,590 3,032,174
--------------- ---------------
Cash flows from investing activities:
Distribution to joint venture partner -- (521,600)
Purchases of property and improvements (82,050) (112,375)
Payment of leasing commissions (45,137) (9,171)
--------------- ---------------
Net cash used in investing activities (127,187) (643,146)
--------------- ---------------
Cash flows from financing activities:
Cash distribution to limited partners (2,120,950) (2,342,030)
--------------- ---------------
Net increase in cash and cash equivalents 265,453 46,998
Cash and cash equivalents, beginning of year 3,227,503 3,404,809
--------------- ---------------
Cash and cash equivalents, end of period $ 3,492,956 $ 3,451,807
=============== ===============
The Notes to Consolidated Financial Statements are an integral part of these statements.
4
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CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Readers of this quarterly report should refer to CIGNA INCOME REALTY-I
LIMITED PARTNERSHIP'S ("the Partnership") audited financial statements for the
year ended December 31, 1995 which are included in the Partnership's 1995 Annual
Report, as certain footnote disclosures which would substantially duplicate
those contained in such audited financial statements have been omitted from this
report.
1. BASIS OF ACCOUNTING
A) BASIS OF PRESENTATION: The accompanying financial statements were prepared
in accordance with generally accepted accounting principles, and reflect
management's estimates and assumptions that affect the reported amounts. It
is the opinion of management that the financial statements presented
reflect all the adjustments necessary for a fair presentation of the
financial condition and results of operations.
B) RECENT ACCOUNTING PRONOUNCEMENT: In 1995, the Financial Accounting
Standards Board issued Statement of Financial Accounting Standards No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of" (the "Statement"). The Statement requires a
writedown to fair value when long-lived assets to be held and used are
impaired. Long-lived assets to be disposed of, including real estate held
for sale, must be carried at the lower of cost or fair value less costs to
sell. In addition, the Statement prohibits depreciation of long-lived
assets to be disposed. Adoption of the Statement in the first quarter of
1996 had no effect on the Partnership's results of operations, liquidity
and financial condition.
C) CASH AND CASH EQUIVALENTS: Short-term investments with a maturity of three
months or less at the time of purchase are reported as cash equivalents.
2. CONSOLIDATED JOINT VENTURE - SUMMARY INFORMATION
The Partnership owns a 73.92% interest in the Westford Office Venture which
owns the Westford Corporate Center in Westford, Massachusetts. The general
partner of the Partnership's joint venture partner is an affiliate of the
General Partner.
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Venture operations information:
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Total income of venture $ 465,585 $ 478,526 $ 1,346,746 $ 1,452,241
Net income of venture 129,203 149,575 281,630 472,168
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<CAPTION>
Venture balance sheet information:
September 30, December 31,
1996 1995
<S> <C> <C>
Total assets $ 11,549,208 $ 11,280,276
Total liabilities 739,300 751,999
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The Venture paid a distribution to the venturers of $2,000,000 in 1995, of
which the Partnership's share was $1,478,400.
5
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CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
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3. DEFERRED CHARGES
Deferred charges consist of the following:
September 30, December 31,
1996 1995
<S> <C> <C>
Deferred leasing commissions $ 1,104,145 $ 1,059,008
Accumulated amortization (688,963) (604,402)
--------------- ----------------
415,182 454,606
Deferred rent credits 21,690 37,584
--------------- ---------------
$ 436,872 $ 492,190
=============== ===============
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<CAPTION>
4. TRANSACTIONS WITH AFFILIATES
An affiliate of the General Partner provided investment property
acquisition services to the Partnership for fees of $2,500,000 which will be
payable from adjusted cash from operations after priority distributions to the
Partners or, if necessary, from sales proceeds.
Other fees and expenses incurred by the Partnership related to the General
Partner or its affiliates are as follows:
Three Months Ended Nine Months Ended Unpaid at
September 30, September 30, September 30,
------------- ------------ -------------
1996 1995 1996 1995 1996
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Property management fees(a)(b) $ 26,849 $ 29,406 $ 83,143 $ 88,421 $ 18,581
Reimbursement (at costs)
for out-of-pocket expenses 18,081 19,726 59,236 39,861 42,082
------------ ------------- ----------- ------------ ------------
$ 44,930 $ 49,132 $ 142,379 $ 128,282 $ 60,663
============ ============= =========== ============ ============
</TABLE>
(a) Included in property management fees is $3,501 and $3,613 for the three
months ended September 30, 1996 and 1995 respectively, and $10,499 and
$11,026 for the nine months ended September 30, 1996 and 1995,
respectively, attributable to the venture partner's share of the Westford
Office Venture.
(b) Does not include on-site management fees earned by independent property
management companies of $45,040 and $50,102 for the three months ended
September 30, 1996 and 1995, respectively, and $142,220 and $149,012 for
the nine months ended September 30, 1996 and 1995, respectively. On-site
property management services have been contracted by an affiliate of the
General Partner on behalf of the Partnership and are paid directly by the
Partnership to the third party companies.
5. SUBSEQUENT EVENTS
On November 15, 1996, the Partnership paid a distribution of $624,000 to
the limited partners.
6
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CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1996, the Partnership's cash and cash equivalents and the
Partnership's share of cash and cash equivalents from the Westford Office
Venture totaled $1,721,611 and $1,309,378, respectively. The Partnership's cash
and cash equivalents were available for working capital requirements, cash
reserves and distributions to partners. The Partnership paid the first quarter
cash distribution of $684,000 or $3.42 per Unit on May 15, 1996, the second
quarter cash distribution of $684,000 or $3.42 per Unit on August 15, 1996, and
the third quarter cash distribution of $624,000 or $3.12 per Unit on November
15, 1996, representative of each quarter's adjusted cash from operations,
inclusive of adjustments to cash reserves. The Partnership's distributions from
operations for the remainder of the year should reflect actual operating results
subject to changes in reserves for liabilities or leasing risk.
Piedmont Plaza Shopping Center produced adjusted cash from operations for
the third quarter of $119,000 after $5,400 of leasing costs. During the quarter,
the property signed a renewal for 1,200 square feet and two new leases
representing 4,600 square feet, increasing leased space to 97%. In reaction to
the reluctance of the property's anchor, Builders Square, to pay 100% of its
billed common area maintenance (CAM) charges, the Partnership has set up a
reserve for Builders Square CAM accounts receivable and has adjusted the CAM
billing accrual for 1996. The total impact of the CAM receivable adjustments to
the third quarter income statement was approximately $53,000. The Partnership
plans to hold the property for the short-term to allow the retail market and
K-Mart (the parent company of the property's anchor tenant) to show signs of
improvement. The Partnership also plans to remain open to opportunities to sell
the property if investor interest returns.
At Westford Corporate Center, adjusted cash from operations for the second
quarter was $270,000 ($199,600 attributable to the Partnership's interest). The
property remains 100% occupied. No capital expenditures have been planned for
the year. During the first quarter, a portion of the 1995 capital expenditures
was reimbursed by the tenants. In addition, adjustments were made to reduce
other income (and the portion of account receivable representing 1995 tenant
reimbursement billings) based on the final calculation of actual 1995 tenant
reimbursable operating expenses. The 1996 estimated billings for tenant expense
reimbursement are based on the annual budget.
Adjusted cash from operations at Woodlands Tech for the third quarter was
$85,000 after $61,700 of capital improvements and tenant leasing costs, and a
$40,000 reduction to cash reserves for leasing costs. After factoring in the
quarter's leasing activity, the property's leased occupancy ended the quarter at
93%. During the third quarter, the property met its leasing goal by leasing the
10,069 square foot vacancy from the first quarter as well as executing a renewal
with a tenant occupying 3,321 square feet. Also, operations for the third
quarter benefitted from the move in of a new 7,522 square foot tenant on July 1,
1996. The lease was executed during the second quarter. Leasing costs estimates
for the remainder of the year have been estimated at approximately $63,000.
Overlook's average occupancy dropped from 98% for the second quarter to 92%
for the third quarter. Year-to-date occupancy averaged 96% for both 1996 and for
the same period of the prior year. The drop in occupancy has been attributed to
heavy competition from new projects currently in lease-up, as well as the timing
of tenant turnover. Adjusted cash from operations for the third quarter totaled
approximately $239,000 including $14,000 of capital expenditures and a $5,000
reduction to cash reserves for capital improvements. Capital expenditures have
been estimated to total approximately $18,000 to $22,000 for the year. The
market in which Overlook operates continues to expand, adding high-end
multi-family, new single family developments and retail. Six properties in the
North Scottsdale market are currently in the lease-up phase and competition from
home ownership is strong as single family home development continues to
increase. In addition to completed projects, approximately 600 multi-family
units are under construction and approximately 1,100 more units are planned. The
Partnership is currently reviewing the property's current and estimated future
operations, rental rate trends in the market, as well as the property's position
in the market, to determine the best window
7
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CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
of opportunity to time a sale of the property. Considering that the planned
liquidation of the Partnership's properties is relatively short-term, the
Partnership may conclude to pursue a sale as early as the first half of 1997.
RESULTS OF OPERATIONS
Rental income decreased approximately $40,000 and $88,000 for the three and
nine months ended September 30, 1996, respectively, as compared with the same
periods of 1995. Woodland Tech lost a large tenant in the first quarter of 1996
and received a $22,000 lease termination fee in the second quarter of 1995,
leading to the $19,000 and $86,000 decrease in rental income for the three and
nine months, respectively. A tenant change at Westford that included a lower
base rate contributed approximately $23,000 and $52,000 to the decrease.
Overlook recorded a $41,000 increase for the nine months, offsetting a portion
of the rental income decrease. The rental rate increases implemented throughout
the year at Overlook accounted for the improvement over the nine-month period,
and also compensated for the third quarter drop in average occupancy.
Other income decreased for the three and nine months ended September 30,
1996, as compared with the same periods of 1995. At Westford, a $42,000
adjustment was recorded in the first quarter of 1996 because the calculation of
actual 1995 billable tenant expense recoveries for common area maintenance (CAM)
was less than the estimated amount accrued and billed throughout 1995. In
addition, the amount billed to tenants for property taxes declined $14,000 as a
result of Westford's lower tax expense. At Piedmont, the calculation of actual
billable CAM was completed during the third quarter 1996 and an adjustment was
recorded to reduce other income and accounts receivable. Based on the adjustment
for 1995 CAM billings, the Partnership reduced the 1996 CAM accrual during the
third quarter. The two CAM adjustments reduced other income at Piedmont Plaza by
$23,000 for the three and nine months ending September 30, 1996.
Interest income decreased for the three and nine months ended September 30,
1996, as compared with the same periods of 1995, due to a decrease in interest
rates on short term investments.
Property operating expenses decreased slightly for the three months and
increased for the nine months ended September 30, 1996, as compared with the
same periods of 1995. In the first quarter, a harsh winter caused snow removal
and maintenance costs to increase at both Westford and Woodlands Tech. Also in
the first quarter, a landscaping project that was previously capitalized was
reclassified to an expense account at Westford. Partially offsetting the first
quarter increase was a decrease in maintenance expense at Piedmont Plaza due to
a first quarter 1995 exterior painting project. During the second quarter, an
HVAC project at Westford and a tax refund recorded in 1995 at Woodlands led to
further increases. In general, fewer carpet replacements at Overlook Apartments
partially offset the increase during the first half of the year and heavily
contributed to the decrease for the third quarter. For the three and nine
months, real estate taxes are up at Piedmont and Overlook and down at Westford
resulting in an overall increase.
General and administrative expenses increased for the three and nine months
ended September 30, 1996, as compared with the previous year, primarily due to
an increase in payroll costs at Overlook Apartments and legal costs at Piedmont.
The increase in fees and reimbursements to affiliates for the nine months
ended September 30, 1996, as compared with the same period of 1995, was due to
higher reimbursable expenses than the previous year. The decrease for the three
months ended September 30, 1996 was due to timing of reimbursable expenses.
The decrease in depreciation and amortization for the three and nine months
ended September 30, 1996, as compared with the previous year, was primarily the
result of the expiration of useful lives of certain assets at Overlook
Apartments, Woodlands Tech, and Piedmont Plaza. Offsetting the decrease for the
three months at Woodlands Tech was depreciation on tenant
8
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CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
(A DELAWARE LIMITED PARTNERSHIP)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
improvements placed in service in 1996 and late 1995.
The decrease in the venture partner's share of Venture's operation in 1996,
as compared with 1995, was the result of a decrease in Westford's overall
results as described herein.
Provision for doubtful accounts increased for the three and nine months
ended September 30, 1996, as compared with the same periods of 1995. The anchor
at Piedmont Plaza has not yet paid its 1995 CAM billing and the Partnership's
property manager has estimated that 100% of the billing may not be collectible.
Based on the problem with the 1995 Piedmont Plaza anchor tenant CAM billing, the
Partnership has established a reserve for both the 1995 billed amount and the
1996 accrued amounts.
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<CAPTION>
OCCUPANCY
The following is a listing of approximate physical occupancy levels by
quarter for the Partnership's investment properties:
1995 1996
------------------------------------------------- -------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
At 3/31 At 6/30 At 9/30 At 12/31 At 3/31 At 6/30 At 9/30
------- ------- ------- -------- ------- ------- -------
1. Woodlands Tech Center
St. Louis, Missouri 94% 96% 96% 92% 82% 82% 83%
2. Westford Corporate Center
Westford, Massachusetts(a) 100% 100% 100% 100% 100% 100% 100%
3. Piedmont Plaza Shopping Center
Apopka, Florida 95% 95% 95% 95% 95% 94% 94%
4. Overlook Apartments
Scottsdale, Arizona 98% 93% 97% 97% 99% 97% 92%
</TABLE>
(a) See the Notes to Consolidated Financial Statements for information on the
joint venture partnership through which the Partnership has made this real
property investment. The Partnership owns a 73.92% interest in the joint
venture which owns the property.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
27 Financial Data Schedules.
(b) No Form 8-Ks were filed during the three months ended September 30,
1996.
9
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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.
CIGNA INCOME REALTY-I LIMITED PARTNERSHIP
By: CIGNA Realty Resources, Inc. - Tenth,
General Partner
Date: November 13, 1996 By: /s/ John D. Carey
----------------- -----------------
John D. Carey, President
(Principal Executive Officer)
Date: November 13, 1996 By: /s/ Josephine C. Donofrio
----------------- -------------------------
Josephine C. Donofrio, Controller
(Principal Accounting Officer)
10
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EXHIBIT 4
NET ASSET VALUE CHART
<S> <C> <C> <C> <C> <C> <C>
Percent Percent Percent
1993 1994 Change 1995 Change 1996 Change
---- ---- ------ ---- ------ ---- ------
$135 $153 13% $156 2% $166 6%
## NY28/COLLO/72831.25
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EXHIBIT 5
CIGNA INCOME REALTY
OCCUPANCY CHART FOR 1994, 1995, AND 1996:
<S> <C> <C> <C> <C>
WOODLANDS TECH WESTSIDE PIEDMONT PLAZA OVERLOOK
CENTER CORPORATE CENTER SHOPPING CENTER APARTMENTS
ST. LOUIS, MO PHOENIX, AZ (A) APOPKA, FL SCOTTSDALE, AZ
1994
At 03/31 95% 75% 92% 99%
At 06/30 100% 85% 94% 97%
At 09/30 94% 100% 93% 99%
At 12/31 94% 100% 95% 98%
1995
At 03/31 94% 100% 95% 98%
At 06/30 96% 100% 95% 93%
At 09/30 96% 100% 95% 97%
At 12/31 92% 100% 95% 97%
1996
At 03/31 82% 100% 95% 99%
At 06/30 82% 100% 94% 97%
At 09/30 83% 100% 94% 92%
At 11/27 91% 100% 94% 93%
=============== ======================== ======================== ========================== ========================
(a) The Partnership owns a 73.92% Interest in the joint venture which owns the
property.
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## NY28/COLLO/72831.25
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EXHIBIT 6
CIGNA INCOME REALTY
LEASING EXPOSURE FOR 1997 AND 1998:
<S> <C> <C> <C> <C>
WOODLANDS TECH CENTER
NUMBER OF SQUARE FOOTAGE
LEASES OF LEASES PERCENT OF TOTAL
YEAR EXPIRING EXPIRING SQUARE FOOTAGE
1997 2 11,877 13%
1998 4 13,297 14%
================= ===================== ==================== ====================
WESTFORD CORPORATE CENTER
NUMBER OF SQUARE FOOTAGE
LEASES OF LEASES PERCENT OF TOTAL
YEAR EXPIRING EXPIRING SQUARE FOOTAGE
1997 0 0 0%
1998 0 0 0%
================= ===================== ==================== ====================
PIEDMONT PLAZA
NUMBER OF SQUARE FOOTAGE
LEASES OF LEASES PERCENT OF TOTAL
YEAR EXPIRING EXPIRING SQUARE FOOTAGE
1997 1 1,550 1%
1998 2 2,400 2%
================= ===================== ==================== ====================
## NY28/COLLO/72831.25
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<CAPTION>
EXHIBIT 7
CIGNA INCOME REALTY
QUARTERLY CASH DISTRIBUTIONS FOR 1994, 1995 AND 1996:
CASH DISTRIBUTION PER UNIT (A)
-----------------------------------------------------------------------
<S> <C> <C> <C> <C>
QUARTER DATE PAID 1996 1995 1994
------- --------- ---- ---- ----
1st May 15 $3.42 $ 3.45 $ 3.12
2nd August 15 3.42 3.75 3.12
3rd November 15 3.12 3.75 3.12
4th February 15 N/A* 3.75 4.50
------ ------ -------
$9.96 $14.70 $13.86
===== ====== ======
(a) Quarterly distributions are paid 45 days following the end of the calendar quarter.
* To be paid 2/15/97
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## NY28/COLLO/72831.25
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