SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter ended
September 30, 1998 Commission file #0-17708
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(Exact name of registrant as specified in its charter)
Illinois 36-3467497
(State of organization) (IRS Employer Identification No.)
900 N. Michigan Ave., Chicago, IL 60611
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code 312/915-1987
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 [ ]
<PAGE>
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Financial Statements . . . . . . . . . . . . . . . 3
Item 2. Management's Discussion and
Analysis of Financial Condition and
Results of Operations. . . . . . . . . . . . . . . 12
PART II OTHER INFORMATION
Item 5. Other Information. . . . . . . . . . . . . . . . . 14
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . 15
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1998 AND DECEMBER 31, 1997
(UNAUDITED)
ASSETS
------
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1998 1997
-------------- ------------
<S> <C> <C>
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . $ 6,240,549 6,115,185
Interest, rents and other receivables . . . . . . . . . . . . . . . . 34,548 30,653
----------- -----------
Total current assets. . . . . . . . . . . . . . . . . . . . . 6,275,097 6,145,838
----------- -----------
Investment in unconsolidated venture, at equity . . . . . . . . . . . . 292,070 282,080
----------- -----------
$ 6,567,167 6,427,918
=========== ===========
<PAGE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED BALANCE SHEETS - CONTINUED
LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
-----------------------------------------------------
SEPTEMBER 30, DECEMBER 31,
1998 1997
-------------- ------------
Current liabilities:
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,740 40,000
------------ -----------
Total current liabilities . . . . . . . . . . . . . . . . . . 8,740 40,000
------------ -----------
Commitments and contingencies
Total liabilities . . . . . . . . . . . . . . . . . . . . . . 8,740 40,000
Partners' capital accounts (deficits):
General partners:
Capital contributions . . . . . . . . . . . . . . . . . . . . . . 20,000 20,000
Cumulative cash distributions . . . . . . . . . . . . . . . . . . (238,785) (238,785)
Cumulative net earnings (losses). . . . . . . . . . . . . . . . . (260,069) (266,889)
------------ -----------
(478,854) (485,674)
------------ -----------
Limited partners:
Capital contributions, net of offering costs. . . . . . . . . . . 29,696,495 29,696,495
Cumulative cash distributions . . . . . . . . . . . . . . . . . . (20,142,970) (20,142,970)
Cumulative net earnings (losses). . . . . . . . . . . . . . . . . (2,516,244) (2,679,933)
------------ -----------
7,037,281 6,873,592
------------ -----------
Total partners' capital accounts (deficits) . . . . . . . . . 6,558,427 6,387,918
------------ -----------
$ 6,567,167 6,427,918
============ ===========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(UNAUDITED)
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
-------------------------- --------------------------
1998 1997 1998 1997
----------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
Income:
Rental income . . . . . . . . . . . . . . . . . $ -- 335,580 -- 1,527,637
Interest income . . . . . . . . . . . . . . . . 76,455 95,278 221,769 238,991
Other income. . . . . . . . . . . . . . . . . . 20,588 -- 70,744 --
----------- ---------- ---------- ----------
97,043 430,858 292,513 1,766,628
----------- ---------- ---------- ----------
Expenses:
Mortgage and other interest . . . . . . . . . . -- 206,615 -- 627,498
Property operating expenses . . . . . . . . . . -- 105,966 -- 593,582
Professional services . . . . . . . . . . . . . 410 2,699 64,701 18,562
Amortization of deferred expenses . . . . . . . -- 25,629 -- 105,222
Management fees to corporate general partner. . -- -- -- 4,752
General and administrative. . . . . . . . . . . 49,909 67,651 170,062 201,386
----------- ---------- ---------- ----------
50,319 408,560 234,763 1,551,002
----------- ---------- ---------- ----------
46,724 22,298 57,750 215,626
Partnership's share of earnings (loss) from
operations of unconsolidated ventures . . . . . 51,096 34,520 112,759 (26,191)
Venture partner's share of venture's
operations. . . . . . . . . . . . . . . . . . . -- (51) -- (1,757)
----------- ---------- ---------- ----------
Earnings before gain on sale of
investment property . . . . . . . . . . 97,820 56,767 170,509 187,678
Gain on sale of investment property, net of
venture partner's share of gain of $37,708. . . -- -- -- 3,733,116
----------- ---------- ---------- ----------
<PAGE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF OPERATIONS - CONTINUED
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
-------------------------- --------------------------
1998 1997 1998 1997
----------- ---------- ----------- ----------
Earnings (loss) before Partnership's
share of extraordinary item . . . . . . 97,820 56,767 170,509 3,920,794
Extraordinary item, net of venture
partner's share of $820 . . . . . . . . . . . . -- -- -- (81,123)
----------- ---------- ---------- ----------
Net earnings (loss) . . . . . . . . . . . $ 97,820 56,767 170,509 3,839,671
=========== ========== ========== ==========
Net earnings (loss) per limited
partnership interest:
Earnings before gain on sale
of investment property. . . . . . . . $ 2.74 1.60 4.78 5.27
Net gain on sale of investment
property. . . . . . . . . . . . . . . -- -- -- 108.01
Net extraordinary item. . . . . . . . . -- -- -- (2.35)
----------- ---------- ---------- ----------
$ 2.74 1.60 4.78 110.93
=========== ========== ========== ==========
Cash distributions per limited
partnership interest. . . . . . . . . . $ -- -- -- 212.00
=========== ========== ========== ==========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 1998 AND 1997
(UNAUDITED)
<CAPTION>
1998 1997
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 170,509 3,839,671
Items not requiring (providing) cash or cash equivalents:
Amortization of deferred expenses . . . . . . . . . . . . . . . . . . -- 105,222
Partnership's share of operations of unconsolidated ventures. . . . . (112,759) 26,191
Venture partner's share of venture's operations, gain on sale or
disposition of investment property and extraordinary item . . . . . -- 38,645
Total gain on sale of investment property . . . . . . . . . . . . . . -- (3,770,824)
Extraordinary item. . . . . . . . . . . . . . . . . . . . . . . . . . -- 81,943
Net asset decrease in the sale of investment property . . . . . . . . -- 67,999
Changes in:
Interest, rents and other receivables . . . . . . . . . . . . . . . . . (3,895) (18,541)
Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- (91,892)
Note receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- 14,152
Accrued rents receivable. . . . . . . . . . . . . . . . . . . . . . . . -- 12,117
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . (31,260) (37,658)
Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . -- (6,333)
Accrued real estate taxes . . . . . . . . . . . . . . . . . . . . . . . -- (281,889)
Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . . . -- (62,381)
------------ -----------
Net cash provided by (used in) operating activities . . . . . . . 22,595 (83,578)
------------ -----------
Cash flows from investing activities:
Additions to investment properties. . . . . . . . . . . . . . . . . . . . -- (125,720)
Partnership's distribution from unconsolidated venture. . . . . . . . . . 102,769 --
Payment of deferred expenses. . . . . . . . . . . . . . . . . . . . . . . -- (28,593)
Cash proceeds from sale of investment property,
net of selling expenses . . . . . . . . . . . . . . . . . . . . . . . . -- 8,922,472
------------ -----------
Net cash provided by (used in) investing activities . . . . . . . 102,769 8,768,159
------------ -----------
<PAGE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
1998 1997
------------ ------------
Cash flows from financing activities:
Principal payments on long-term debt. . . . . . . . . . . . . . . . . . . -- (205,120)
Distributions to venture partner. . . . . . . . . . . . . . . . . . . . . -- (77,638)
Distributions to limited partners . . . . . . . . . . . . . . . . . . . . -- (7,253,790)
Distributions to general partners . . . . . . . . . . . . . . . . . . . . -- (2,851)
----------- -----------
Net cash provided by (used in) financing activities . . . . . . . -- (7,539,399)
----------- -----------
Net increase (decrease) in cash and cash equivalents . . . . . . 125,364 1,145,182
Cash and cash equivalents, beginning of year. . . . . . . . . . . 6,115,185 4,841,921
------------ -----------
Cash and cash equivalents, end of period. . . . . . . . . . . . . $ 6,240,549 5,987,103
============ ===========
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest . . . . . . . . . . . . . . . . $ -- 633,831
============ ===========
Non-cash investing and financing activities:
Total sales proceeds from sale of investment property:
Total sales proceeds, net of selling expenses . . . . . . . . . . . . $ -- 16,053,577
Prepayment penalties. . . . . . . . . . . . . . . . . . . . . . . . . -- (81,943)
Payoff of mortgage loans and accrued interest . . . . . . . . . . . . -- (7,049,162)
------------ -----------
Cash proceeds from sale of investment properties. . . . . . . . . $ -- 8,922,472
============ ===========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1998 AND 1997
(UNAUDITED)
GENERAL
Readers of this quarterly report should refer to the Partnership's
audited financial statements for the year ended December 31, 1997 which are
included in the Partnership's 1997 Annual Report on Form 10-K (File No. 0-
17708) dated on March 21, 1998, as certain footnote disclosures which would
substantially duplicate those contained in such audited financial
statements have been omitted from this report. Capitalized terms used but
not defined in this quarterly report have the same meaning as in the
Partnership's 1997 Annual Report on Form 10-K.
The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
The accompanying consolidated financial statements include $112,759
and ($26,191), respectively, of the Partnership's share of total property
operations of $1,082,397 and ($251,415) for unconsolidated properties for
the nine months ended September 30, 1998 and 1997, respectively, which are
held for sale or disposition or have been sold or disposed of during the
past two years.
TRANSACTIONS WITH AFFILIATES
The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Corporate General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of their employees and certain of their officers, and for
other direct expenses relating to the administration of the Partnership and
the operation of the Partnership's investments. Fees, commissions and
other expenses required to be paid by the Partnership (and its consolidated
venture) to the General Partners and their affiliates as of September 30,
1998 and for the nine months ended September 30, 1998 and 1997 were as
follows:
Unpaid at
September 30,
1998 1997 1998
------- ------ -------------
Property management fees. . . $ -- 47,206 --
Management fees to
corporate general partner. . -- 4,752 --
Insurance commissions . . . . 1,922 2,892 --
Reimbursement (at cost) for
out-of-pocket salary and
salary-related expenses
related to the on-site
personnel and for other
costs for the Partnership
and its investment
properties . . . . . . . . . 59,151 23,874 6,855
------- ------- ------
$61,073 78,724 6,855
======= ======= ======
<PAGE>
PALM DESERT TOWN CENTER
Occupancy at the portion of the shopping center in which the
Partnership owns an interest decreased to 84% at September 30, 1998 down
from 88% at December 31, 1997. Sales at the center have been negatively
impacted during the last several quarters by new competition in the
center's trade area. The increased competition has resulted in lower
effective rents upon re-leasing of space. The center will continue to be
subject to increased competition from new developments that are expected to
be opening in the vicinity in the near future. The property has been
operating at an approximately break-even level. The joint venture
continues to consider a possible expansion of the mall and restructuring of
the ground lease and mortgage loan.
The Partnership and Carlyle-XVI entered into an agreement with the
unaffiliated venture partner, effective January 1, 1998, pursuant to which
the Partnership and Carlyle-XVI granted the unaffiliated venture partner an
option to acquire their interests in the joint venture (the "Option
Agreement"). Pursuant to the Option Agreement, the unaffiliated venture
partner had the right (but not the obligation) to purchase all (but not
less than all) of the Partnership's and Carlyle-XVI's interests in the
joint venture by giving notice of its exercise of the option during the
term of the option, which was originally scheduled to expire July 15, 1998
but was extended through August 14, 1998 pursuant to a first amendment to
the Option Agreement with substantially the same terms as the original
agreement. The Option Agreement terminated and expired on August 14, 1998
with the unaffiliated venture partner failing to exercise this option. In
consideration for the option, the unaffiliated venture partner was required
to pay $58,333 for each month of the option term. The Partnership and
Carlyle-XVI received their allocable shares of the consideration for the
option of which the Partnership's share was approximately $71,000.
Concurrently with the execution of the Option Agreement, the joint venture
made a distribution to the Partnership and Carlyle-XVI in the aggregate
amount of approximately $740,000 (of which the Partnership's share was
approximately $105,000), which represented undistributed net cash flow of
the joint venture through the end of 1997. All other funds and net cash
flow of the joint venture during the term of the option were held by the
joint venture for its use. Upon the expiration of the Option Agreement,
the rights and obligations of the parties subsequent to expiration of the
Option Agreement are governed by the terms of the joint venture partnership
agreement without regard to changes previously affected by the terms of the
Option Agreement. The Partnership and Carlyle-XVI are continuing
negotiations with the unaffiliated venture partner and the lender for the
property (who is also the ground lessor) with respect to a restructuring of
the ground lease and loan for the property and a sale of the Partnership's
and Carlyle-XVI's interests, in the joint venture, although there can be no
assurance that a sale of the interests, will be completed or, if completed,
will be on terms similar to those contemplated by the Option Agreement.
Reaching a mutually acceptable arrangement with the lender with respect to
a restructuring of the ground lease and loan is the primary remaining issue
to be resolved in order for the Partnership and Carlyle-XVI to reach an
agreement for the sale of their interests to the unaffiliated venture
partner.
In the event of such sale, the Partnership could distribute a majority
of the funds it currently holds in reserve, as well as any distributable
proceeds from such sale. In the event that such sale does not occur, the
Partnership may use a portion of the funds held in reserve to pay for its
share of the costs of a possible expansion of the mall and a restructuring
of the ground lease and loan at the property.
The land underlying the shopping center is owned by the lender under
the first mortgage loan. Palm Desert leases the land by assignment of an
existing ground lease which provides for minimum annual rental payments of
$900,000, as well as for additional rental payments for each calendar year
equal to 50% of the amount by which certain of the ground lessee's gross
receipts from the shopping center exceed $6,738,256. Total ground rent
expense for the nine months ended September 30, 1998 and 1997 was $838,078
and $914,664, respectively.
<PAGE>
INVESTMENT IN UNCONSOLIDATED VENTURE
Summary financial information for Palm Desert for the nine months
ended September 30, 1998 and 1997 is as follows:
1998 1997
---------- ----------
Total income . . . . . . . . . . $7,857,210 7,889,968
Expenses applicable to
operating income . . . . . . . 6,774,813 8,141,383
---------- ----------
Net income (loss). . . . . . . . $1,082,397 (251,415)
========== ==========
Partnership's share
of income (loss) . . . . . . . $ 112,759 (26,191)
========== ==========
ADJUSTMENTS
In the opinion of the Corporate General Partner, all adjustments
(consisting solely of normal recurring adjustments) necessary for a fair
presentation have been made to the accompanying figures as of September 30,
1998 and for the three and nine months ended September 30, 1998 and 1997.
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reference is made to the notes to the accompanying financial
statements for additional information concerning the Partnership's
remaining investment property.
The board of directors of JMB Realty Corporation ("JMB"), the
corporate general partner of the Partnership, has established a special
committee (the "Special Committee") consisting of certain directors of JMB
to deal with all matters relating to tender offers for Interests in the
Partnership, including any and all responses to such tender offers. The
Special Committee has retained independent counsel to advise it in
connection with any potential tender offers for Interests and previously
retained Lehman Brothers Inc. as financial advisor to assist the Special
Committee in evaluating and responding to potential tender offers for
Interests.
Commencing in the third quarter of 1997 some of the Holders of
Interests in the Partnership received from unaffiliated third parties an
unsolicited offer to purchase up to 4.9% of the outstanding Interests in
the Partnership between $75 and $100 per Interest. All such offers have
expired. The Special Committee recommended against acceptance of these
offers on the basis that, among other things, the offer prices were
inadequate. As of the date of this report, the Partnership is aware that
5.98% of the Interests have been purchased by all unaffiliated third
parties who have made unsolicited offers for Interests, either pursuant to
such offers or through negotiated purchases. It is possible that other
offers for Interests may be made in the future, although there is no
assurance that any such offer will be made, the terms of any such offer or
whether any such offer will be consummated, amended or withdrawn.
As of September 30, 1998, the Partnership had cash and cash
equivalents of approximately $6,241,000. Such cash and cash equivalents
are available for capital improvements and other working capital
requirements, including the Partnership's share of the costs for a possible
expansion of the mall and restructuring of the ground lease and loan at
Palm Desert Town Center. The Partnership and its unconsolidated venture
have currently budgeted in 1998 approximately $177,000 (excluding costs of
the possible expansion and restructuring) for tenant improvements and other
capital expenditures. The Partnership's share of such items in 1998 is
currently budgeted to be approximately $19,000 of which approximately
$2,700 has been spent as of September 30, 1998. Actual amounts expended in
1998 may vary depending on a number of factors including, actual leasing
activity, results of property operations, liquidity considerations and
other market conditions over the course of the year and whether the Palm
Desert joint venture proceeds with a possible expansion of the mall and
restructuring of the ground lease and mortgage loan. In addition, although
the Option Agreement, pursuant to which the Partnership and Carlyle-XVI
granted an option to the unaffiliated venture partner to acquire their
interests in the Palm Desert joint venture, has expired, the Partnership,
Carlyle-XVI, the unaffiliated venture partner and the lender (who is also
the ground lessor) for Palm Desert Town Center continue to negotiate with
respect to a restructuring of the ground lease and loan for the property
and a sale of the Partnership's and Carlyle-XVI's interests in the joint
venture. Reaching a mutually acceptable arrangement with the lender with
respect to a restructuring of the ground lease and loan is the primary
remaining issue to be resolved in order for the Partnership and Carlyle-XVI
to reach an agreement for the sale of their interests to the unaffiliated
venture partner. In the event of such sale, the Partnership could
distribute a majority of the funds it currently holds in reserve, as well
as any distributable proceeds from such sale. In the event that such sale
does not occur, as discussed above, the Partnership may use a portion of
the funds held in reserve to pay for its share of the costs of a possible
expansion of the mall and restructuring of the ground lease and loan for
the property.
<PAGE>
The Partnership expects to make a distribution of cash generated from
prior year operations of $60 per Interest in late November 1998.
The primary source of the Partnership's cash flow from operations in
recent years has been from the Houston Industrial Properties and Silber #1.
As a result of the 1997 sale of the Houston Industrial Properties and
Silber #1, the Partnership does not anticipate making any further
distributions of cash generated from operations on a current basis. Future
distributions of the Partnership will depend upon the capital requirements
of the Partnership and the Palm Desert joint venture as well as the terms
of any sale of the Palm Desert Town Center (or the Partnership's interest
therein). Any working capital reserves of the Partnership which are not
ultimately used for working capital purposes would be available for future
distributions.
The affairs of the Partnership are expected to be wound up no later
than December 31, 1999, barring unforeseen economic developments. Although
the Partnership expects to distribute sale proceeds from the disposition of
the Partnership's remaining investment property, aggregate distributions of
sale and refinancing proceeds received by the Holders of Interests over
the entire term of the Partnership will be significantly less than their
original investment of $1,000 per Interest.
RESULTS OF OPERATIONS
Significant fluctuations in the accompanying consolidated financial
statements not otherwise described below are primarily due to the sale of
the Houston Industrial Properties and Silber #1 in March 1997 and the
transfer of title to the 18 Central Shopping Center to the lender in
November 1997.
The other income reported for the three and nine months ended
September 30, 1998 primarily represents the Partnership's share of the
consideration the unaffiliated venture partner of the Palm Desert joint
venture paid during 1998 pursuant to the Option Agreement.
The increase in the Partnership's share of operations of
unconsolidated ventures for the three and nine months ended September 30,
1998 as compared to the same period in 1997 is primarily due to the Palm
Desert property being classified as held for sale or disposition as of
July 1, 1997, and therefore, no longer subject to continued depreciation.
<PAGE>
<TABLE>
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
OCCUPANCY
The following is a listing of approximate occupancy levels by quarter for the Partnership's investment
property owned during 1998:
<CAPTION>
1997 1998
-------------------------------------- ------------------------------
At At At At At At At At
3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31
---- ---- ---- ----- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Palm Desert Town Center
Palm Desert, California . . . . 88% 86% 87% 88% 85% 84% 84%
</TABLE>
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
3-A. Amended and Restated Agreement of Limited Partnership
set forth as Exhibit A to the Prospectus, is hereby incorporated by
reference to Exhibit 3 to the Partnership's Report on Form 10-K for
December 31, 1992 (File No. 0-17708) dated March 19, 1993.
3-B. Acknowledgement of rights and duties of the General
Partners of the Partnership between ABPP Associates, L.P. (a successor
Associated General Partner of the Partnership) and JMB Realty Corporation
as of December 31, 1995 are hereby incorporated by reference to Exhibit 3-B
to the Partnership's Report for September 30, 1996 on Form 10-Q as amended
(File No. 0-17708) dated November 8, 1996.
4-A. Assignment Agreement set forth as Exhibit B to the
Prospectus, a copy of which is hereby incorporated by reference to Exhibit
4-A to the Partnership's Report on Form 10-K for December 31, 1992 (File
No. 0-17708) dated March 19, 1993.
10-A. First Amendment to Palm Desert Option Agreement by the
Partnership and Carlyle-XVI relating to the unaffiliated venture partner's
option to purchase the Partnership and Carlyle-XVI's interest in the joint
venture dated July 15, 1998 is filed herewith.
27. Financial Data Schedule
(b) No reports on Form 8-K have been filed during the quarter
covered by this report.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XVII
BY: JMB Realty Corporation
(Corporate General Partner)
By: GAILEN J. HULL
Gailen J. Hull, Senior Vice President
Date: November 11, 1998
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person in the capacity
and on the date indicated.
By: GAILEN J. HULL
Gailen J. Hull, Principal Accounting Officer
Date: November 11, 1998
EXHIBIT 10-A
- ------------
(Carlyle - XVII)
FIRST AMENDMENT TO PALM DESERT OPTION AGREEMENT & FIRST AMENDMENT TO
PALM DESERT AGREEMENT FOR PURCHASES AND SALE OF PARTNERSHIP INTERESTS
---------------------------------------------------------------------
THIS FIRST AMENDMENT TO PALM DESERT OPTION AGREEMENT & FIRST
AMENDMENT TO PALM DESERT AGREEMENT FOR PURCHASE AND SALE OF PARTNERSHIP
INTERESTS ("AMENDMENT"), is made and entered into as of the 15th day of
July, 1998, by the following parties, hereinafter referred to as the "JMB
GROUP" or "SELLER":
CARLYLE/PALM DESERT, INC., an Illinois corporation ("MANAGING
PARTNER");
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-XVI, an Illinois
limited partnership ("Carlyle-A"); and
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-XVII, an Illinois
limited partnership ("CARLYLE B");
and also by the following parties, hereinafter referred to as
the "TRIZECHAHN GROUP" or "BUYER";
HAHN/PALM DESERT, INC., a California corporation ("CO-
PARTNER"); and
TRIZECHAHN CENTERS INC., a California corporation, formerly
known as ERNEST W. HAHN, INC., a California corporation ("TRIZECHAHNCO").
R E C I T A L S
---------------
A. Seller and Buyer have entered into that certain agreement,
captioned "PALM DESERT OPTION AGREEMENT", made and entered into on
March 11, 1998, effective as of January 1, 1998 (the "OPTION AGREEMENT").
Unless otherwise defined herein, each capitalized term used herein shall
have the meaning ascribed thereto in the Option Agreement.
B. Seller and Buyer have also entered into that certain agreement,
captioned "PALM DESERT AGREEMENT FOR PURCHASE AND SALE OF PARTNERSHIP
INTEREST", made and entered into on March 11, 1998, effective as of
January 1, 1998 (the "PURCHASE AGREEMENT").
C. Buyer and Seller desire to amend the Option Agreement to extend
the "term of this Option" (as defined in Section 1.2 of the Option
Agreement) to August 14, 1998, on the terms and subject to the conditions
set forth below.
D. Buyer and Seller desire to amend the Purchase Agreement to
provide a credit to Buyer against the "Purchase Price" (as such term is
defined in the Purchase Agreement) in the amount of Sixty One
<PAGE>
Thousand Six Hundred Sixty Seven Dollars ($61,667) at the closing of the
transactions contemplated by the Purchase Agreement, on the terms and
subject to the conditions set forth below.
NOW, THEREFORE, in consideration of the foregoing premises, the
mutual covenants and conditions contained herein, and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Seller and Buyer hereby amend the Option Agreement and the
Purchase Agreement, respectively, as follows:
1. EFFECTIVENESS OF AMENDMENT. Buyer shall pay to Seller
concurrently with the Buyer's execution and delivery of this Amendment, the
sum of One Hundred Twenty Thousand Dollars ($120,000) in immediately
available funds (the "EXTENSION CONSIDERATION"). In the event that Buyer
fails to deliver the Extension Consideration (together with a counterpart
original of this Amendment executed by Buyer) to Seller on or before August
4, 1998, then this Amendment shall be null and void and of no further force
or effect. The Extension Consideration shall be non-refundable and deemed
earned by Seller upon receipt.
2. OPTION AGREEMENT AMENDMENTS. Subject to Paragraph 1 above, the
Parties hereby amend the Option Agreement as follows:
2.1 TERM. In Section 1.2, in the first sentence, change the
words "July 15, 1998" to "August 14, 1998".
2.2 OPTION CONSIDERATION. Insert the following at the end of
Section 1.3:
"This Option is extended to August 14, 1998, in consideration for
Buyer's payment of the sum of One Hundred Twenty Thousand Dollars
($120,000) in immediately available funds (the "EXTENSION CONSIDERATION")
to Seller, to be allocated among the parties constituting Seller in
proportion to their respective Seller's Partnership Interest, and no
additional Option Consideration shall be required for the period commencing
on July 16, 1998, and ending on August 14, 1998. If this Option is
exercised in accordance with the terms and conditions of this Option
Agreement, then the sum of Sixty One Thousand Six Hundred Sixty Seven
Dollars ($61,667) (the "OPTION CREDIT AMOUNT") shall be credited to Buyer
against the Purchase Price at the closing of the transactions contemplated
by the Purchase Agreement."
3. PURCHASE AGREEMENT AMENDMENTS. Subject to Paragraph 1 above,
the Parties hereby amend the Purchase Agreement as follows:
3.1 OPTION CREDIT AMOUNT. Insert the following as Section
1.21A:
<PAGE>
"1.21A OPTION CREDIT AMOUNT. The sum of Sixty One Thousand Six
Hundred Sixty Seven Dollars ($61,667)."
3.2 PURCHASE PRICE.
3.2.1. Insert the following at the end of Section 2.2.1:
"Notwithstanding anything in the foregoing to the contrary, if Buyer
exercises the Option pursuant to Section 3.1 of the Option Agreement, the
Option Credit Amount shall be credited to Buyer and applied against the
Purchase Price at the closing of the transactions contemplated by this
Purchase Agreement."
3.2.2. Pursuant to Paragraph 3.2.1 above, in Sections
1.8, 2.2.2, 5.2.1 and 7.2, change the words "Purchase Price" to "Purchase
Price (as adjusted by the Option Credit Amount)".
4. OTHER TERMS UNMODIFIED. Except as otherwise expressly set
forth herein, all terms and conditions of the Option Agreement and the
Purchase Agreement, respectively, are ratified, and remain unchanged and in
full force and effect.
5. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, provided each of the parties hereto executes at least one
counterpart; each such counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
Amendment. This letter may be executed in facsimile form (and shall be
promptly followed by a hard copy counterpart original).
[ CONTINUED ON NEXT PAGE ]
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Amendment as of
the date first written above.
SELLER:
CARLYLE/PALM DESERT, INC.,
an Illinois corporation
By: /s/ GLENN E. EMIG
Name: Glenn E. Emig
Title:
CARLYLE REAL ESTATE LIMITED
PARTNERSHIP-XVI,
an Illinois limited partnership
By: JMB REALTY CORPORATION,
a Delaware corporation,
General Partner
By: /s/ GLENN E. EMIG
Name: Glenn E. Emig
Title:
CARLYLE REAL ESTATE LIMITED
PARTNERSHIP-XVII,
an Illinois limited partnership
By: JMB REALTY CORPORATION,
a Delaware corporation,
General Partner
By: /s/ GLENN E. EMIG
Name: Glenn E. Emig
Title:
[ SIGNATURES CONTINUED ON NEXT PAGE ]
<PAGE>
BUYER:
HAHN/PALM DESERT, INC.,
a California corporation
By: /s/ DOUGLAS L. HAGEMAN
Name: Douglas L. Hageman
Title: Senior Vice President
and General Counsel
By: /s/ WENDY M. GODOY
Name: Wendy M. Godoy
Title: Senior Vice President
Finance
TRIZECHAHN CENTERS INC.,
a California corporation
By: /s/ DOUGLAS L. HAGEMAN
Name: Douglas L. Hageman
Title: Senior Vice President
and General Counsel
By: /s/ WENDY M. GODOY
Name: Wendy M. Godoy
Title: Senior Vice President
Finance
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1998 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 6,240,549
<SECURITIES> 0
<RECEIVABLES> 34,548
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 6,275,097
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 6,567,167
<CURRENT-LIABILITIES> 8,740
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 6,558,427
<TOTAL-LIABILITY-AND-EQUITY> 6,567,167
<SALES> 0
<TOTAL-REVENUES> 292,513
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 234,763
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 57,750
<INCOME-TAX> 0
<INCOME-CONTINUING> 170,509
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 170,509
<EPS-PRIMARY> 4.78
<EPS-DILUTED> 4.78
</TABLE>
