<PAGE>
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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): AUGUST 1, 1996
SECURITY CAPITAL PACIFIC TRUST
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
MARYLAND 0-4254 74-6056896
(STATE OR OTHER (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
JURISDICTION OF IDENTIFICATION NO.)
INCORPORATION)
7777 MARKET CENTER AVENUE, EL PASO, TEXAS 77912
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (915) 877-3900
NOT APPLICABLE
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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<PAGE>
Item 5. Other Events
ACQUISITIONS:
The following acquisitions of multifamily properties, including three
properties under contract, were or will be made by Security Capital Pacific
Trust (PTR) from unrelated parties. PTR acquired, or will acquire, these
properties because PTR and its REIT manager, Security Capital Pacific
Incorporated believe that multifamily property investments in the western
United States present excellent long term opportunities for consistent rental
increases, high occupancies and value appreciation.
PTR acquired Westcourt Village (formerly Cedarbrook) apartments on March 27,
1996 from a bank which had previously foreclosed on the property. Westcourt
Village is a 515 unit, moderate income complex located in San Bernardino
County, California. PTR acquired this property for approximately $12.7
million, net of a deferred maintenance credit. At date of purchase, the
property's occupancy rate was 83.7%.
PTR acquired Ocean Crest apartments on March 29, 1996 from a limited
partnership. Ocean Crest is a 300 unit, moderate income complex located in San
Diego, California. PTR acquired this property for approximately $15.6 million.
At date of purchase, the property's occupancy rate was 91.3%.
PTR acquired Timberline apartments on April 17, 1996 from a limited
partnership. Timberline is a 130 unit, moderate income complex located in
Portland, Oregon. PTR acquired this property for approximately $7.0 million.
At date of purchase, the property's occupancy rate was 95.4%.
PTR acquired Club Pacifica apartments on April 23, 1996 from a corporation.
Club Pacifica is a 264 unit, moderate income complex located in San Diego,
California. PTR acquired this property for approximately $14.3 million. At
date of purchase, the property's occupancy rate was 94.3%.
PTR acquired The Crossing apartments on May 21, 1996 from a corporation. The
Crossing is a 296 unit, moderate income complex located in Corona, California.
PTR acquired this property for approximately $14.9 million. At date of
purchase, the property's occupancy rate was 89.2%.
PTR acquired Mission Springs apartments on May 31, 1996 from a corporation.
Mission Springs is a 736 unit, middle income complex located in Ontario,
California. PTR acquired this property for approximately $38.5 million. At
date of purchase, the property's occupancy rate was 94.6%.
PTR acquired Quail Ridge apartments on June 13, 1996 from a limited
partnership. Quail Ridge is a 396 unit, moderate income complex located in the
San Francisco, California. PTR acquired this property for approximately $17.6
million. At date of purchase, the property's occupancy rate was 91.4%.
PTR acquired The Newpointe apartments on July 10, 1996 from a Trust. The
Newpointe is a 160 unit, moderate income complex located in Orange County,
California. PTR acquired this property for approximately $9.4 million. At date
of purchase, the property's occupancy rate was 97.5%.
PTR has entered into a contract with a limited partnership, scheduled to
close in August, 1996, to purchase Brighton apartments. PTR's earnest money
has become non-refundable and acquisition of this property is likely. However,
there can be no assurance that the property will be acquired. Brighton is a
233 unit moderate income complex located in Portland, Oregon and on May 8,
1996 was 97% occupied. The anticipated cost of the property is approximately
$11.2 million.
PTR has entered into a contract with a limited partnership, scheduled to
close in August, 1996, to purchase El Dorado apartments. PTR's earnest money
has become non-refundable and acquisition of this property is likely. However,
there can be no assurance that the property will be acquired. El Dorado is a
448 unit moderate income complex located in San Diego, California and on June
14, 1996 was 95% occupied. The anticipated cost of the property is
approximately $29.6 million. PTR anticipates assuming a mortgage note payable
in the amount of $16.8 million in connection with the acquisition.
<PAGE>
PTR has entered into a contract with a general partnership, scheduled to
close September, 1996, to purchase Oakwood apartments. PTR's earnest money has
become non-refundable and acquisition of this property is likely. However,
there can be no assurance that the property will be acquired. Oakwood is a 948
unit moderate income complex located in San Jose, California and on April 19,
1996 was 98.5% occupied. The anticipated cost of the property is approximately
$64.8 million. PTR anticipates assuming a mortgage note payable in the amount
of $47.7 million in connection with the acquisition.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBIT
(a) Financial Statements:
Combined Statements of Revenues and Certain Expenses for Certain
Multifamily Properties with Independent Auditors' Report thereon.
(b) Pro Forma Financial Information:
Pro Forma Balance Sheet as of March 31, 1996 (unaudited)
Pro Forma Statement of Earnings for the year ended December 31, 1995
(unaudited)
Pro Forma Statement of Earnings for the three months ended March 31,
1996 (unaudited)
(c) Exhibit:
Exhibit 23.1--Independent Auditors' Consent
2
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT NOT BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED THEREUNTO DULY AUTHORIZED.
Security Capital Pacific Trust
/s/ James W. Kluber
By: _________________________________
James W. Kluber
Vice President
August 1, 1996
Date: _________________________
3
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
PRO FORMA FINANCIAL STATEMENTS
(UNAUDITED)
The following unaudited pro forma financial statements for Security Capital
Pacific Trust (PTR) reflect the acquisition by PTR of the proprieties
disclosed in this Form 8-K, Item 5. The pro forma financial statements have
been prepared based upon certain pro forma adjustments to the historical
financial statements of PTR.
The accompanying unaudited pro forma balance sheet as of March 31, 1996 has
been prepared as if the operating properties acquired, or under contract to be
acquired, subsequent to March 31, 1996 had been acquired as of the balance
sheet date.
The accompanying unaudited pro forma statements of earnings for the year
ended December 31, 1995 and for the three months ended March 31, 1996 have
been prepared as if (i) the operating property acquisitions, including three
operating properties under contract, reported in this Form 8-K, Item 5 had
occurred as of January 1, 1995. Interest expense was adjusted to reflect the
cost of pro forma line of credit borrowings that would have been required for
these pro forma acquisitions.
The unaudited pro forma financial statements do not purport to be indicative
of the results which would actually have been obtained had the transactions
described above been completed on the dates indicated or which may be obtained
in the future. The unaudited pro forma financial statements should be read in
conjunction with the combined statement of revenues and certain expenses for
certain multifamily properties included herein and the financial statments of
PTR.
F-1
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
PRO FORMA BALANCE SHEET
MARCH 31, 1996
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
PRO FORMA
ASSETS HISTORICAL ADJUSTMENTS PRO FORMA
------ ---------- ----------- ----------
<S> <C> <C> <C>
Real Estate.............................. $1,930,632 $207,193(a) $2,137,825
Less accumulated depreciation............ 90,158 -- 90,158
---------- -------- ----------
1,840,474 207,193 2,047,667
Mortgage notes receivable................ 14,764 -- 14,764
---------- -------- ----------
Total investments.................... 1,855,238 207,193 2,062,431
Cash and cash equivalents................ 8,338 (5,708)(b) 2,630
Accounts receivable...................... 3,047 -- 3,047
Other assets............................. 23,311 -- 23,311
---------- -------- ----------
Total assets......................... $1,889,934 $201,485 $2,091,419
========== ======== ==========
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
<S> <C> <C> <C>
Liabilities:
Line of credit......................... $ 36,250 $137,000(b) $ 173,250
Long term debt......................... 350,000 -- 350,000
Mortgages payable...................... 157,570 64,485(b) 222,055
Dividends payable...................... -- -- --
Accounts payable....................... 24,488 -- 24,488
Accrued expenses and other liabilities. 26,504 -- 26,504
---------- -------- ----------
Total liabilities.................... 594,812 201,485 796,297
---------- -------- ----------
Shareholders' Equity:
Series A Preferred shares (9,200,000
convertible shares authorized and
issued; stated liquidation preference
of
$25 per share)........................ 230,000 -- 230,000
Series B Preferred shares (4,200,000
shares issued; stated liquidation
preference of $25 per share).......... 105,000 -- 105,000
Common shares (72,375,819 shares
issued)............................... 72,376 -- 72,376
Additional paid-in capital............. 952,679 -- 952,679
Deficit (excess) of distributions to
net earnings.......................... (62,996) -- (62,996)
Treasury shares (164,950 shares)....... (1,937) -- (1,937)
---------- -------- ----------
Total shareholders' equity........... 1,295,122 -- 1,295,122
---------- -------- ----------
Total liabilities and shareholders'
equity.............................. $1,889,934 $201,485 $2,091,419
========== ======== ==========
</TABLE>
See accompanying notes to pro forma financial statements.
F-2
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
PRO FORMA STATEMENT OF EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1995
----------------------------------------------
HISTORICAL
---------------------
ACQUISITIONS
CURRENT PRO FORMA PTR
PTR REPORT (C) ADJUSTMENTS PRO FORMA
-------- ------------ ----------- ---------
<S> <C> <C> <C> <C>
Revenues:
Rental income.................. $262,473 $35,277 $ -- $297,750
Interest....................... 2,400 -- (298)(d) 2,102
-------- ------- --------- --------
264,873 35,277 (298) 299,852
-------- ------- --------- --------
Expenses:
Rental expenses................ 73,808 11,404 -- 85,212
Real estate taxes.............. 21,326 2,359 -- 23,685
Property management fees paid
to affiliates................. 8,912 1,381 (59)(e) 10,234
Depreciation................... 36,685 -- 4,716 (f) 41,401
Interest....................... 19,584 4,998 11,382 (g) 35,964
REIT management fee paid to
affiliate..................... 20,354 -- 562 (h) 20,916
General and administrative..... 952 -- -- 952
Provision for possible loss on
investments................... 420 -- -- 420
Other.......................... 1,136 -- -- 1,136
-------- ------- --------- --------
183,177 20,142 16,601 219,920
-------- ------- --------- --------
Earnings from operations......... 81,696 15,135 (16,899) 79,932
Gain on sale of investments, net. 2,623 -- -- 2,623
-------- ------- --------- --------
Net earnings..................... 84,319 15,135 (16,899) 82,555
Less Preferred share dividends... 21,823 -- -- 21,823
-------- ------- --------- --------
Net earnings attributable to
common shares............... $ 62,496 $15,135 $ (16,899) $ 60,732
======== ======= ========= ========
Weighted average common shares
outstanding (i)................. 67,052 67,052
======== ========
Per common shares amounts:
Net earnings attributable to
common shares............... $ 0.93 $ 0.91
======== ========
</TABLE>
See accompanying notes to pro forma financial statements.
F-3
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
PRO FORMA STATEMENT OF EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31, 1996
-------------------------------------------
HISTORICAL
--------------------
ACQUISITIONS
CURRENT PRO FORMA PTR PRO
PTR REPORT (C) ADJUSTMENTS FORMA
------- ------------ ----------- -------
<S> <C> <C> <C> <C>
Revenues:
Rental income..................... $75,809 $9,040 $ -- $84,849
Interest.......................... 547 -- (74)(d) 473
------- ------ -------- -------
76,356 9,040 (74) 85,322
------- ------ -------- -------
Expenses:
Rental expenses................... 20,340 3,040 -- 23,380
Real estate taxes................. 7,103 565 -- 7,668
Property management fees paid to
affiliates....................... 2,854 359 (26)(e) 3,187
Depreciation...................... 10,618 -- 1,174(f) 11,792
Interest.......................... 6,520 1,241 2,846(g) 10,607
REIT management fee paid to
affiliate........................ 5,555 -- 151(h) 5,706
General and administrative........ 276 -- -- 276
Other............................. 170 -- -- 170
------- ------ -------- -------
53,436 5,205 4,145 62,786
------- ------ -------- -------
Earnings from operations............ 22,920 3,835 (4,219) 22,536
Gain on sale of investments, net.... 2,923 -- -- 2,923
------- ------ -------- -------
Net earnings........................ 25,843 3,835 (4,219) 25,459
Less Preferred share dividends...... 6,388 -- -- 6,388
------- ------ -------- -------
Net earnings attributable to
common shares.................... $19,455 $3,835 $ (4,219) $19,071
======= ====== ======== =======
Weighted average common shares
outstanding (i).................... 72,211 72,211
======= =======
Per common shares amounts:
Net earnings attributable to
common shares.................... $ 0.27 $ 0.26
======= =======
</TABLE>
See accompanying notes to pro forma financial statements.
F-4
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
NOTES TO PRO FORMA FINANCIAL STATEMENTS
MARCH 31, 1996
(DOLLARS IN THOUSANDS)
(UNAUDITED)
(a) Represents PTR's multifamily property acquisitions and three multifamily
properties under contract to be acquired subsequent to March 31, 1996, as
follows:
<TABLE>
<CAPTION>
ACQUISITION AQUISITION
PROPERTY DATE COST
-------- -------------- ----------
<S> <C> <C>
Timberline...................................... 4/17/96 $ 7,043
Club Pacifica................................... 4/23/96 14,300
The Crossing.................................... 5/21/96 14,850
Mission Springs................................. 5/31/96 38,500
Quail Ridge..................................... 6/13/96 17,550
Newpointe....................................... 7/10/96 9,400
Brighton........................................ under contract 11,150
Oakwood......................................... under contract 64,800
El Dorado....................................... under contract 29,600
--------
$207,193
========
</TABLE>
(b) Reflects the use of cash on hand of $5,708 and line of credit borrowings
of $137,000 utilized to fund the pro forma acquisition of properties
subsequent to March 31, 1996. Additionally, PTR anticipates assuming
approximately $64,485 in mortgage notes payable upon the purchase of Oakwood
and El Dorado.
(c) Reflects historical revenues and certain expenses, including mortgage
interest if applicable, on properties acquired in 1996, or under contract to
be acquired subsequent to March 31, 1996, reported in this Form 8-K Item 5,
for the year ended December 31, 1995 or for the period from January 1, 1996 to
the earlier of the respective dates of acquisition or March 31, 1996.
Historical revenues and certain expenses exclude amounts which would not be
comparable to the proposed future operations of the properties such as certain
interest expense, interest income, income taxes and depreciation. The
following table reconciles the historical financial information for the Group
A Properties and the Group B Properties (as defined below) to the pro forma
statements of earnings:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31, 1995
------------------------------------------
REAL PROPERTY
RENTAL RENTAL ESTATE MANAGEMENT INTEREST
INCOME EXPENSE TAXES FEES EXPENSE
------- ------- ------ ---------- --------
<S> <C> <C> <C> <C> <C>
Group A Properties (i)............... $18,119 $ 6,122 $1,105 $ 743 $3,725
Group B Properties (ii).............. 17,158 5,282 1,254 638 1,273
------- ------- ------ ------ ------
Totals........................... $35,277 $11,404 $2,359 $1,381 $4,998
======= ======= ====== ====== ======
</TABLE>
F-5
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
NOTES TO PRO FORMA STATEMENTS--(CONTINUED)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED MARCH 31, 1996
----------------------------------------------
PROPERTY
RENTAL RENTAL REAL ESTATE MANAGEMENT INTEREST
INCOME EXPENSE TAXES FEES EXPENSE
------ ------- ----------- ---------- --------
<S> <C> <C> <C> <C> <C>
For the period January 1, 1996
to the earlier of the date of
acquisition or
March 31, 1996:
Group A Properties (i)....... $4,702 $1,599 $250 $208 $ 923
Group B Properties (ii)...... 4,338 1,441 315 151 318
------ ------ ---- ---- ------
Totals..................... $9,040 $3,040 $565 $359 $1,241
====== ====== ==== ==== ======
</TABLE>
(i) Group A Properties consist of the following properties for which an
audited combined statement of revenues and certain expenses for the year
ended December 31, 1995 is presented in this Form 8-K:
<TABLE>
<CAPTION>
PROPERTY LOCATION DATE ACQUIRED
-------- -------- -------------
<S> <C> <C>
Timberline...................... Portland, Oregon 4/17/96
Club Pacifica................... San Diego, California 4/23/96
The Crossing.................... Corona, California 5/21/96
Newpointe....................... Orange County, California 7/10/96
Brighton........................ Portland, Oregon under contract
Oakwood......................... San Jose, California under contract
</TABLE>
(ii) Group B Properties consist of the following unaudited properties:
<TABLE>
<CAPTION>
PROPERTY LOCATION DATE ACQUIRED
-------- -------- -------------
<S> <C> <C>
Westcourt Village.............. San Bernardino, California 3/27/96
Ocean Crest.................... San Diego, California 3/29/96
Mission Springs................ Ontario, California 5/31/96
Quail Ridge.................... San Francisco, California 6/13/96
El Dorado...................... San Diego, California under contract
</TABLE>
(d) Reflects the elimination of interest income earned on cash and cash
equivalents, which for pro forma purposes was utilized to fund property
acquisitions:
<TABLE>
<CAPTION>
FOR THE FOR THE
YEAR THREE MONTHS
ENDED ENDED
12/31/95 3/31/96
-------- ------------
<S> <C> <C>
Pro Forma utilization of cash and cash
equivalents..................................... $(5,708) $(5,708)
Current interest rate............................ 5.22% 5.22%
Proration factor................................. 1.0 .25
------- -------
Pro Forma interest income adjustment............. $ (298) $ (74)
======= =======
</TABLE>
(e) Reflects the difference between historical property management fee
expense and PTR's management fee expense.
F-6
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
NOTES TO PRO FORMA STATEMENTS--(CONCLUDED)
(f) Reflects pro forma depreciation expense adjustment resulting from
acquired properties, or properties under contract to be acquired, based on the
depreciable basis of PTR's acquisition cost, assuming asset lives ranging from
10 to 40 years. The pro forma depreciation expense adjustment amounts by
property are as follows:
<TABLE>
<CAPTION>
ACQUISITION
---------------------- TWELVE MONTHS THREE MONTHS
PROPERTY DATE COSTS ENDED 12/31/95 ENDED 3/31/96
-------- -------------- ------- -------------- -------------
<S> <C> <C> <C> <C>
Westcourt Village....... 3/27/96 $12,762 $ 256 $ 61
Ocean Crest............. 3/29/96 15,600 316 77
Timberline ............. 4/17/96 7,043 140 35
Club Pacifica........... 4/23/96 14,300 286 72
The Crossing............ 5/21/96 14,850 297 74
Missions Springs........ 5/31/96 38,500 771 192
Quail Ridge............. 6/13/96 17,550 351 87
Newpointe............... 7/10/96 9,400 188 47
El Dorado............... under contract 29,600 592 148
Brighton................ under contract 11,150 223 56
Oakwood................. under contract 64,800 1,296 325
------ ------
$4,716 $1,174
====== ======
</TABLE>
(g) Represents the pro forma interest expense adjustments related to
utilization of line of credit borrowings that would have been required if the
property acquisitions had occurred at January 1, 1995:
<TABLE>
<CAPTION>
TWELVE MONTHS THREE MONTHS
ENDED 12/31/95 ENDED 3/31/96
-------------- -------------
<S> <C> <C>
Pro forma line of credit borrowings for
operating properties acquired or under
contract to be acquired, subsequent to
March 31, 1996............................. $137,000 $137,000
Line of credit borrowings required for 1996
acquisitions made prior to March 31, 1996.. 28,558 28,558
-------- --------
Total pro forma line of credit borrowings... 165,558 165,558
Current interest rate....................... 6.875% 6.875%
Proration factor............................ 1.0 .25
-------- --------
Pro forma interest expense adjustment....... $ 11,382 $ 2,846
======== ========
</TABLE>
(h) Reflects adjustment to PTR's REIT management fee expense related to the
increase in cash flow resulting from acquisition of multifamily properties and
adjustments discussed in (d), (e) and (g) above:
<TABLE>
<CAPTION>
TWELVE MONTHS THREE MONTHS
ENDED 12/31/95 ENDED 3/31/96
-------------- -------------
<S> <C> <C>
Historical earnings from operations from
acquisitions.............................. $15,135 $3,835
Pro Forma adjustments:
Interest income........................... (298) (74)
Property management fees paid to
affiliates............................... 59 26
Interest expense.......................... (11,382) (2,846)
------- ------
3,514 941
REIT management fee percentage............. 16% 16%
------- ------
Pro Forma REIT management fee expense
adjustment................................ $ 562 $ 151
======= ======
</TABLE>
(i) The effect on net earnings per common share assuming conversion of the
Series A Preferred Shares is antidilutive for both the historical and pro
forma amounts.
F-7
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Trustees and Shareholders
Security Capital Pacific Trust:
We have audited the accompanying Combined Statement of Revenues and Certain
Expenses (the Combined Statement) of the Group A Properties described in note
1 for the year ended December 31, 1995. This Combined Statement is the
responsibility of management. Our responsibility is to express an opinion on
this Combined Statement based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the Combined Statement is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the Combined Statement. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation
of the Combined Statement. We believe that our audit provides a reasonable
basis for our opinion.
The accompanying Combined Statement was prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission for inclusion in Form 8-K to be filed by Security Capital Pacific
Trust as described in note 2. The presentation is not intended to be a
complete presentation of the Group A Properties' revenues and expenses.
In our opinion, the Combined Statement referred to above presents fairly, in
all material respects, the combined revenues and certain expenses as described
in note 2 of the Group A Properties for the year ended December 31, 1995, in
conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
Chicago, Illinois
July 11, 1996
F-8
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
GROUP A PROPERTIES
COMBINED STATEMENT OF REVENUES AND CERTAIN EXPENSES
YEAR ENDED DECEMBER 31, 1995 AND THE
PERIOD FROM JANUARY 1, 1996 THROUGH MARCH 31, 1996
(IN THOUSANDS)
<TABLE>
<CAPTION>
PERIOD FROM
JANUARY 1, 1996
THROUGH MARCH 31,
1995 1996 (UNAUDITED)
------- -----------------
<S> <C> <C>
Revenues:
Rental income....................................... $17,512 4,614
Other real estate income............................ 607 88
------- -----
18,119 4,702
------- -----
Certain expenses:
Salaries and benefits............................... 2,236 584
Utilities........................................... 1,207 307
Repairs and maintenance............................. 1,077 269
Management fees (note 3)............................ 744 208
Real estate taxes................................... 1,105 250
Advertising and promotion........................... 475 99
Insurance........................................... 365 105
Interest expense on debt assumed (note 4)........... 3,725 923
Other............................................... 761 234
------- -----
11,695 2,979
------- -----
Revenues in excess of certain expenses............ $ 6,424 1,723
======= =====
</TABLE>
The accompanying notes are an integral part of the combined statement of
revenues and certain expenses.
F-9
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
GROUP A PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUES AND CERTAIN EXPENSES
YEAR ENDED DECEMBER 31, 1995 AND THE PERIOD FROM JANUARY 1, 1996 THROUGH MARCH
31, 1996
(1) OPERATING PROPERTIES
The Combined Statement of Revenues and Certain Expenses (the Combined
Statement) for the year ended December 31, 1995 and the period from January 1,
1996 through March 31, 1996, relates to the operations of the following
properties ("Group A Properties") which have been or are expected to be
acquired by Security Capital Pacific Trust (PTR) from unaffiliated parties:
<TABLE>
<CAPTION>
PURCHASE
ACQUISITION PRICE
MULTIFAMILY PROPERTY METROPOLITAN AREA DATE (IN THOUSANDS)
-------------------- ------------------------- -------------- -------------
<S> <C> <C> <C>
Oakwood................. San Jose, California under contract $ 64,800
Club Pacific............ San Diego, California 4-23-96 14,300
The Crossing............ Corona, California 5-21-96 14,850
New Pointe.............. Orange County, California 7-10-96 9,400
Timberline.............. Portland, Oregon 4-17-96 7,043
Brighton................ Portland, Oregon under contract 11,150
--------
$121,543
========
</TABLE>
(2) BASIS OF PRESENTATION
The accompanying Combined Statement has been prepared on the accrual basis
of accounting. The Combined Statement has been prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission for inclusion in Form 8-K to be filed by PTR. The Combined
Statement is not intended to be a complete presentation of combined revenues
and expenses of the Group A Properties for the year ended December 31, 1995
and the period from January 1, 1996 through March 31, 1996.
The combined statement of revenues and certain expenses excludes certain
amounts which would not be comparable to the proposed future operations of the
properties as follows:
(a)depreciation of the building and improvements;
(b)interest expense related to debt not assumed;
(c)interest income;
(d)income taxes; and
(e)other income and expense items unique to the prior owners.
(3) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Revenue Recognition
Rental income from leasing activities consist of lease payments earned from
tenants under lease agreements with terms of one year or less.
Capitalization Policy
Ordinary repairs and maintenance are expensed as incurred; major
replacements and betterments are capitalized.
Advertising and Promotion
The cost of advertising and promotion is expensed as incurred.
F-10
<PAGE>
SECURITY CAPITAL PACIFIC TRUST
GROUP A PROPERTIES
NOTES TO COMBINED STATEMENT OF REVENUES AND CERTAIN EXPENSES--(CONCLUDED)
YEAR ENDED DECEMBER 31, 1995 AND THE PERIOD FROM JANUARY 1, 1996 THROUGH MARCH
31, 1996
Use of Estimates
The preparation of the Combined Statement in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the Combined Statement and
accompanying notes. Actual results could differ from those estimates.
Unaudited Interim Combined Statement
The Combined Statement of Revenues and Certain Expenses for the period from
January 1, 1996 through March 31, 1996 is unaudited. In the opinion of
management, all adjustments, consisting of normal recurring accruals,
necessary for a fair presentation of the Combined Statement for the interim
period have been included. The results of operations for the interim period
are not necessarily indicative of the results to be expected for the full year
for the Group A Properties.
(4) RELATED PARTY TRANSACTIONS
Approximately $525,000 and $137,000 (unaudited) was accrued and paid in
management fees to affiliates of prior owners in 1995 and 1996, respectively.
(5) DEBT ASSUMPTION
PTR anticipates assuming outstanding debt of approximately $47.7 million in
connection with the acquisition of Oakwood. The debt consists of a 7.75% fixed
rate mortgage note, payable to a financial institution, which requires monthly
principal and interest payments of $350,011 through October 2023.
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EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
Board of Trustees and Shareholders
Security Capital Pacific Trust
We consent to incorporation by reference in the registration statements No.
33-86444 (Form S-3), No. 33-78402 (Form S-3), No. 33-71040 (Form S-3), No. 33-
44631 (Form S-3) and No. 33-25317 (Form S-8) of Security Capital Pacific Trust
of our report dated July 11, 1996 relating to the Combined Statement of
Revenues and Certain Expenses for certain multifamily properties for the year
ended December 31, 1995, which report appear in the current report on Form 8-K
of Security Capital Pacific Trust dated August 1, 1996.
KPMG Peat Marwick LLP
Chicago, Illinois
August 1, 1996
