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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported) January 31, 1996
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SECURITY CAPITAL PACIFIC TRUST
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(Exact Name of Registrant as Specified in its Charter)
Maryland
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(State or Other Jurisdiction of Incorporation)
1-10272 74-6056896
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(Commission File Number) (I.R.S. Employer Identification No.)
7777 Market Center Drive, El Paso, Texas 79912
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(Address of Principal Executive Offices) (Zip Code)
(915) 877-3900
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events.
On January 31, 1996, Security Capital Pacific Trust ("PTR") issued a
press release. A copy of the press release is included as an exhibit hereto and
is incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Sequential
Exhibit No. Document Description Page No.
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12 Statement re Computation of Ratios
99.1 Press Release dated January 31, 1996
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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 hereunto duly authorized.
SECURITY CAPITAL PACIFIC TRUST
Dated: February 6, 1996 By: /s/ James W. Kluber
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James W. Kluber
Vice President and Controller
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Exhibit 12
SECURITY CAPITAL PACIFIC TRUST
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
(Dollar amounts in thousands)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, December 31,
------------------ -----------------------------
1995 1994 1994 1993 1992
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Earnings from Operations $58,548 $33,004 $46,719 $23,191 $ 9,037
Add:
Mortgage interest, net of capitalized interest -- -- 167 116 2,055
Interest on other unsecured debt 14,400 14,021 19,275 3,807 1,159
------- ------- ------- ------- -------
14,400 14,021 19,442 3,923 3,214
------- ------- ------- ------- -------
Earnings as adjusted $72,948 $47,025 $66,161 $27,114 $12,251
======= ======= ======= ======= =======
Combined Fixed Charges
Interest net of capitalized interest $14,400 $14,021 $19,442 $ 3,923 $ 3,214
Capitalized interest 8,597 4,254 6,029 2,818 989
------- ------- ------- ------- -------
Total Fixed Charges 22,997 18,275 25,471 6,741 4,203
======= ======= ======= ======= =======
Ratio of earnings to combined fixed charges 3.2 2.6 2.6 4.0 2.9
======= ======= ======= ======= =======
</TABLE>
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SECURITY CAPITAL
Exhibit 99.1
Press Release
- -For Immediate Release-
SECURITY CAPITAL PACIFIC TRUST
Announces
18.85% Increase in 1995 Per Share Funds from Operations
January 31, 1996--Security Capital Pacific Trust (New York Stock Exchange
Symbol:PTR) reported financial results today for the 1995 calendar year. PTR
Chairman C. Ronald Blankenship announced that for the year ended December 31,
1995, PTR generated Funds from Operations attributable to common shares (FFO) of
$96,978,000 or $1.45 per share, on total revenues of $264,873,000, compared to
$56,833,000 or $1.22 per share, on total revenues of $186,105,000, for the year
ended December 31, 1994. For the year, this resulted in an 18.85% increase in
FFO per common share over 1994. PTR had weighted average common shares
outstanding of 67,052,000 in 1995, compared to 46,734,000 in 1994.
In the fourth quarter of 1995, PTR generated FFO of $27,483,000 or $0.38
per common share, compared to $16,892,000 or $0.34 per common share for the same
quarter of 1994. Total revenues for the fourth quarter were $73,577,000,
compared to $52,909,000 for the same quarter of 1994. The increase in fourth
quarter per share results was accomplished even though PTR's weighted average
common shares outstanding increased 43.24% to 72,211,000 from 50,413,000 in the
fourth quarter of 1994. Mr. Blankenship attributed PTR's solid operating
performance to a highly focused operating strategy, the strength of its target
market cities and continued development of a deep management team.
Mr. Blankenship also said that Constance B. Moore, currently Managing
Director for Operations, is moving from her current position at PTR to become
Co-Chairman of Security Capital Atlantic Incorporated (ATLANTIC). ATLANTIC is a
private real estate operating company focused on becoming the preeminent
developer, owner and operator of moderate income multifamily properties in the
southeastern United States.
Mr. Blankenship said that Managing Director Patrick R. Whelan, who has been
responsible for property-level operations at PTR since 1994, will assume Ms.
Moore's operating responsibilities. Mr. Blankenship said, "Ms. Moore's move to
ATLANTIC is consistent with our management succession plan. PTR is committed to
attracting and retaining the most talented professionals in our industry. We
believe the best way to do that is to provide individuals with the opportunity
to meet their career expectations by offering challenges that encourage
professional growth."
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SECURITY CAPITAL
Mr. Whelan said PTR's target market has continued to experience strong job
growth which contributes to increased rental rates and strong occupancy levels.
Average occupancy for PTR's total operating portfolio was 94.72% during 1995,
compared to 94.80% in 1994. The multifamily properties that were fully
operational on January 1, 1994, realized an increase in net operating income
(NOI) of 7.75% in 1995, compared to 1994. The increase in NOI reflects a 3.70%
increase in collections and a 1.51% decrease in operating expenses for the same
period. Improved operating efficiencies have reduced PTR's operating expenses as
a percentage of rental income to 40.04% for 1995 from 43.59% in 1994.
Development continues to be an important component of PTR's strategy to
achieve long-term sustainable growth in per share cash flow. R. Scot Sellers,
Managing Director for Investments, said 1995 development starts totaled 4,568
units, at a total expected investment of $227.7 million. In 1995, a total of
1,954 new units, representing a total investment of $80.8 million, achieved
stabilization. Of that number, 717 units, representing $32.1 million, achieved
stabilization in the fourth quarter.
At year end, PTR had a total of 2,368 units in lease-up, representing a
total budgeted investment of $112.5 million. Mr. Sellers said that an additional
1,646 units, representing a total investment of $87.7 million, are expected to
begin lease-up during the first quarter of 1996. Properties in lease-up
represent a significant source of future cash flow growth but will have a
short-term dilutive impact on FFO in 1996.
Mr. Sellers said PTR's development program will continue to focus on
moderate income communities, offering a high level of service to the broadest
yet most underserved segment of the renter population. In 1996, PTR expects to
commence construction on approximately 5,771 units, representing an estimated
investment of $272 million, of which approximately 86.5% will be moderate
income product.
Mr. Sellers also noted that Homestead Village, a component of PTR's
moderate income strategy, outperformed projections for 1995. The corporate
affordable product is designed to offer the best value for temporary corporate
housing in major employment centers. The 12 Homestead Village properties that
were fully operational throughout 1995 achieved an economic occupancy of 84.09%,
ahead of the underwritten occupancy level of 78%. In 1995, PTR completed eight
Homestead properties in five cities, bringing the total number of operating
properties to 20 in five cities at December 31, 1995. At year end, PTR had nine
additional Homestead Village properties under construction and 19 in planning or
under control.
Mr. Blankenship said that after a detailed review of Homestead Village's
successful performance, PTR's Board of Trustees has asked management to evaluate
all options relating to the operation of Homestead Village assets in order to
maximize PTR shareholder value. This would include an analysis of whether
Homestead assets should continue to be developed within PTR, be spun out as a
new stand-alone entity with a target market extending beyond PTR's current
market area, or be offered for sale, merger or disposition to a national
operator. The Board asked that this analysis be completed during 1996. Goldman,
Sachs & Co. has been engaged to advise the Board on this matter. It is possible
that certain actions, if pursued, may require approval of PTR's Board of
Trustees and a possible shareholder vote.
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PTR is the preeminent real estate operating company focusing on the
development, acquisition, operation and long-term ownership of multifamily
properties in the growing markets of the western United States. PTR's primary
objective is generating long-term, sustainable growth in per share cash flow.
PTR will achieve this objective by executing an internal growth strategy that
focuses on maximizing the performance of its core operating portfolio,
developing industry-leading product in targeted submarkets that exhibit strong
job growth and demographic trends and redeploying capital into targeted moderate
income developments with significant prospects for long-term cash flow growth.
As of December 31, 1995, PTR's portfolio included 40,907 operating multifamily
units, 2,368 units in lease-up, 4,904 units under construction, an estimated
4,366 units in planning and land owned or under control for future development
of an expected 8,881 units.
FOR MORE INFORMATION CONTACT: K. Scott Canon
(800) 982-9293
or
Gerard de Gunzburg
(212) 838-9292
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Security Capital Pacific Trust
Unaudited Financial Results: December 31, 1995
(in thousands, except per share data)
<TABLE>
<CAPTION>
For the three months ended For the twelve months ended
December 31, December 31,
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1995 1994 1995 1994
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Rental income $73,061 $52,369 $262,473 $183,472
Interest income 516 540 2,400 2,633
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73,577 52,909 264,873 186,105
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Expenses:
Rental expenses 27,971 22,351 104,046 79,013
Depreciation 10,523 7,203 36,685 24,614
Interest 5,184 5,421 19,584 19,442
General and administrative,
including REIT management fee 6,050 4,002 21,306 13,966
Provision for possible loss on
investments 200 -- 420 1,600
Other 501 218 1,136 751
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50,429 39,195 183,177 139,386
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Earnings from operations 23,148 13,714 81,696 46,719
Gain on sale of investments, net 2,623 -- 2,623 --
------- ------- -------- --------
Net earnings 25,771 13,714 84,319 46,719
Less preferred share dividends 6,388 4,025 21,823 16,100
------- ------- -------- --------
Net earnings attributable to
common shares: $19,383 $ 9,689 $ 62,496 $ 30,619
======= ======= ======== ========
Weighted average common shares
outstanding 72,211 50,413 67,052 46,734
======= ======= ======== ========
Per common share amounts:
Net earnings attributable to
common shares: $ 0.27 $ 0.19 $ 0.93 $ 0.66
======= ======= ======== ========
Distributions paid $0.2875 $ 0.25 $ 1.15 $ 1.00
======= ======= ======== ========
Reconciliation of Funds From
Operations:
Net earnings attributable to
common shares $19,383 $ 9,689 $ 62,496 $ 30,619
Gain on sale of investments, net (2,623) -- (2,623) --
Depreciation 10,523 7,203 36,685 24,614
Provision for possible loss on
investments 200 -- 420 1,600
------- ------- -------- --------
Funds from operations attributable
to common shares $27,483 $16,892 $ 96,978 $ 56,833
======= ======= ======== ========
Per common share amounts:
Funds from operations attributable
to common shares $ 0.38 $ 0.34 $ 1.45 $ 1.22
======= ======= ======== ========
</TABLE>
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SECURITY CAPITAL
Security Capital Pacific Trust
Unaudited Financial Results: December 31, 1995
(In thousands, except units)
Investment in Real Estate:
<TABLE>
<CAPTION>
12/31/95 12/31/94
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Total Total
Expected Balance Expected Balance
Cost Sheet Cost Sheet
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<S> <C> <C> <C> <C>
In Dollars:
Operating Properties $1,568,009 $1,566,614 $1,103,584 $1,099,818
Developments in lease up:
Completed developments 18,807 18,380 21,826 21,483
Developments under construction 93,672 86,145 52,666 42,781
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Total developments in lease up 112,479 104,525 74,492 64,264
Developments Under Construction 247,704 89,298 151,918 57,620
Developments in Planning 238,634 55,016 252,657 33,194
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Subtotal 2,166,826 1,815,453 1,582,651 1,254,896
Land Held for Future Development n/a 9,669 n/a 7,977
Non Multifamily 30,744 30,744 33,415 33,415
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Total $2,197,570 $1,855,866 $1,616,066 $1,296,288
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No. of No. of
Properties Units Properties Units
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In Units:
Operating Properties 147 40,907 114 30,958
Developments in lease up:
Completed Developments 4 596 5 682
Developments under construction 6 1,772 4 1,101
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Total developments in lease up 10 2,368 9 1,783
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Developments Under Construction 21 4,904 17 3,425
Developments in Planning 17 4,366 21 4,306
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Total 195 52,545 161 40,472
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Increase
12/31/95 12/31/94 (Decrease)
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Debt and Shareholders Equity:
Line of Credit $ 129,000 $ 102,000 $ 27,000
Long Term Debt 200,000 200,000 -
Mortgages Payable 158,054 93,624 64,430
Shareholders' Equity 1,275,668 840,642 435,026
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$1,762,722 $1,236,266 $ 526,456
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Share Information:
Weighted Average Common Shares Outstanding* 67,052 46,734 20,318
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Total Common Shares Outstanding 72,211 50,456 21,755
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*Represents year to date weighted average
</TABLE>
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