<PAGE>
PAGE 1
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 June 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 33-13375
IDS LIFE ACCOUNT RE
OF
IDS LIFE INSURANCE COMPANY
(Exact name of registrant as specified in its charter)
MINNESOTA 41-0823832
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
IDS TOWER 10, MINNEAPOLIS, MINNESOTA 55440-0010
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (612) 671-3309
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 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>
PAGE 2
The Registrant is a separate account of IDS Life Insurance Company
(IDS Life) established pursuant to the insurance laws of the State
of Minnesota for the purposes of funding real estate variable
annuity contracts. Unless otherwise specifically noted, the
information set forth herein only relates to the operations of the
Registrant (the "Account") and not to the operations of IDS Life.
PART 1 - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
<PAGE>
PAGE 3
IDS LIFE ACCOUNT RE
of
IDS LIFE INSURANCE COMPANY
BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
(unaudited)
<S> <C> <C>
Assets:
Cash $ 905,286 $ 586,729
Receivable from IDS Life for contracts sold -- 300,000
Investments in unconsolidated joint ventures,
at fair value (cost of $35,905,592 and
$35,858,482 at June 30, 1996
and December 31, 1995, respectively) 23,690,070 24,150,472
Participation in mortgage loan, at fair
value (cost of $3,047,188 at June 30, 1996
and December 31, 1995) 2,838,363 2,966,207
Accrued interest on participation in mortgage loan (9,366) (5,401)
Investment in wholly-owned real estate
property:
Building, at fair value (cost of $14,224,843
and $14,174,329 at June 30, 1996 and
December 31, 1995, respectively) 12,438,779 12,380,339
Land, at fair value (cost of $3,915,263
at June 30, 1996 and December 31, 1995) 3,915,263 3,915,263
Deferred borrowing costs, net of accumulated
amortization of $170,503 and $157,577 at
June 30, 1996 and December 31, 1995, respectively 10,953 23,879
Other assets 36,678 43,135
Total assets $43,826,026 $44,360,623
Liabilities:
Payable to IDS Life for:
Operating expenses $ 41,918 $ 76,619
Contract terminations 4,547 271,318
Accrued mortality and expense risk fee 35,995 40,420
Accrued asset management fee 44,993 50,525
Liabilities related to wholly-owned
real estate property:
Accounts payable and other liabilities 153,640 244,937
Accrued real estate taxes 99,105 --
Mortgage payable 7,726,368 7,770,339
Total liabilities 8,106,566 8,454,158
Contract Owners' Equity:
Net assets applicable to Variable Annuity
contracts in accumulation period $35,719,460 $35,906,465
Accumulation units outstanding 35,880,047 36,353,929
Net asset value per accumulation unit $ 0.99 $ 0.99
See accompanying notes to financial statements.
<PAGE>
PAGE 4
IDS LIFE ACCOUNT RE
of
IDS LIFE INSURANCE COMPANY
STATEMENTS OF OPERATIONS
(unaudited)
For the six months ended
June 30, June 30,
1996 1995
Income:
Interest income $ 133,350 $ 132,643
Account's equity in earnings of
unconsolidated joint ventures 1,004,262 964,461
Rental income 1,241,144 1,197,496
Unrealized (depreciation) of participation
in mortgage loan (127,844) (5,231)
Unrealized appreciation of investment in wholly-owned
real estate property -- 44,889
Unrealized appreciation (depreciation) of
investments in unconsolidated joint ventures (507,511) 63,824
Total income 1,743,401 2,398,082
Expenses:
Asset management fee 292,741 287,847
Mortality and expense risk fee 234,193 230,277
Amortization of deferred organizational
and borrowing costs 12,926 12,926
Revolving loan interest -- 100,736
Other operating expenses 36,069 31,941
Operating expenses related to wholly-owned
real estate property:
Interest 368,000 371,882
Utilities 85,491 104,175
Repairs and maintenance 95,406 105,222
Property and other taxes 105,398 96,660
Salaries 94,136 80,218
Management fees 56,980 58,439
Other 70,216 83,000
Total expenses 1,451,556 1,563,323
Net income $ 291,845 $ 834,759
See accompanying notes to financial statements.
<PAGE>
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IDS LIFE ACCOUNT RE
of
IDS LIFE INSURANCE COMPANY
STATEMENTS OF OPERATIONS
(unaudited)
For the three months ended
June 30, June 30,
1996 1995
Income:
Interest income $ 65,970 $ 66,321
Account's equity in earnings of
unconsolidated joint ventures 497,491 423,914
Rental income 599,606 622,818
Unrealized appreciation (depreciation) of
investments in unconsolidated joint ventures (507,511) 63,824
Total income 655,556 1,176,877
Expenses:
Asset management fee 146,506 143,212
Mortality and expense risk fee 117,205 114,569
Amortization of deferred organizational
and borrowing costs 6,463 6,463
Revolving loan interest -- 57,541
Other operating expenses 3,418 13,048
Operating expenses related to wholly-owned
real estate property:
Interest 183,797 185,703
Utilities 38,227 29,393
Repairs and maintenance 54,661 63,710
Property and other taxes 49,552 47,130
Salaries 45,758 43,512
Management fees 28,907 29,347
Other 32,364 37,624
Total expenses 706,858 771,252
Net income (loss) $ (51,302) $ 405,625
See accompanying notes to financial statements.
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IDS LIFE ACCOUNT RE
of
IDS LIFE INSURANCE COMPANY
STATEMENTS OF CASH FLOWS
(unaudited)
For the six months ended
June 30, June 30,
1996 1995
Cash flows from operating activities:
Net Income $ 291,845 $ 834,759
Adjustments to reconcile net income to net cash
used in operating activities:
Account's equity in earnings of unconsolidated
joint ventures (1,004,262) (964,461)
Change in accrued interest on participation
in mortgage loan 3,965 (729)
Amortization of organizational and borrowing costs 12,926 12,926
Change in unrealized depreciation of investments
in unconsolidated joint ventures 507,511 (63,824)
Change in unrealized depreciation (appreciation) of
participation in mortgage loan 127,844 5,231
Change in unrealized appreciation of investment
in wholly-owned real estate property -- (44,889)
Change in other assets 6,457 10,387
Change in payable to IDS Life for operating expenses (34,701) 10,076
Change in accrued mortality and expense risk fee (4,425) 579
Change in accrued asset management fee (5,532) 722
Change in payables and other liabilities related
to wholly-owned real estate property 7,808 82,238
Total adjustments to net income (382,409) (951,744)
Net cash used in operating activities (90,564) (116,985)
Cash flows from investing activities:
Capital improvements to wholly-owned real estate property (58,440) (63,651)
Distributions received from joint ventures 957,153 781,867
Net cash provided by investing activities 898,713 718,216
Cash flows from financing activities:
Proceeds from sales of accumulation units 2,126,433 13,270,097
Payments for contract terminations (2,572,054) (11,100,702)
Decrease in mortgage payable (43,971) (40,001)
Change in payable to IDS Life for revolving loan -- (2,100,000)
Change in payable to IDS Life for revolving loan interest -- (7,646)
Contribution for Monmouth renovation loan (joint venture) -- (354,076)
Net cash used in financing activities (489,592) (332,328)
Net increase in cash 318,557 268,903
Balance of cash at beginning of year 586,729 204,859
Balance of cash at end of period $ 905,286 $ 473,762
Supplemental cash flow disclosure:
Cash paid for mortgage interest & revolving loan $ 368,000 $ 472,618
See accompanying notes to financial statements.
</TABLE> <PAGE>
PAGE 7
IDS LIFE ACCOUNT RE
of
IDS LIFE INSURANCE COMPANY
June 30, 1996
NOTES TO FINANCIAL STATEMENTS
(unaudited)
1. GENERAL
In the opinion of the management of IDS Life, the
accompanying unaudited financial statements for IDS Life
Account RE (the "Account") contain all adjustments
(consisting of only normal recurring adjustments) necessary
to present fairly its balance sheets as of June 30, 1996 and
December 31, 1995; statements of operations for the three and
six months ended June 30, 1996 and 1995; and the statements
of cash flows for the six months ended June 30, 1996 and
1995. These statements are condensed and therefore do not
include all of the information and footnotes required by
generally accepted accounting principles for complete
financial statement disclosure. The statements should be read
in conjunction with the Account's financial statements as of
and for the year ended December 31, 1995 and the notes
thereto contained in the Account's prospectus dated April 30,
1996. The results of operations for the six months ended
June 30, 1996 are not necessarily indicative of the results
expected for the full year.
2. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURES
Unconsolidated Joint Ventures - Summary Information
Summary information for the Account of its investments in
unconsolidated joint ventures for the six months ended
June 30, 1996 and 1995 is as follows:
For the six months ended
June 30
1996 1995
Account's share of net
investment income from
unconsolidated joint ventures $ 1,004,262 $ 964,461
Total net investment income of
unconsolidated joint ventures $12,741,658 $12,180,848
Total income of unconsolidated
joint ventures $21,940,000 $22,550,000
<PAGE>
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Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Financial Condition and Results of Operations
For the Six Months Ended June 30, 1996 Compared to the Six Months
Ended June 30, 1995 -
Net assets decreased from $35,906,465 at December 31, 1995 to
$35,719,460 at June 30, 1996. During this same time period, the
accumulation unit value remained constant at $.99. The Account
experienced net terminations amounting to $445,621 for the six
months ended June 30, 1996 compared to net sales
of $2,169,395 for the six months ended June 30, 1995. The net
terminations for the six months ended June 30, 1996 include
approximately $1,800,000 for accumulation units purchased by IDS
Life, which has been used to pay for contract surrenders, as
discussed more fully below.
Recorded net income for the six months ended June 30, 1996 was
$291,845 compared to $834,759 for the six months ended June 30,
1995.
Interest income for the six months ended June 30, 1996 primarily
represents income earned on the Account's investment in the
participation in a mortgage loan (Riverpoint Shopping Center).
Income generated from participation in the mortgage loan remained
relatively unchanged compared to the corresponding period in 1995.
The Silo Electronic store (12,100 sq. ft.) at Riverpoint Shopping
Center vacated its space in the third quarter 1995, and the
borrower is pursuing its legal remedies regarding such unpaid
amounts. The borrower re-leased the space to a book store for
three months at a substantially lower rent. The borrower
subsequently leased the space to Old Navy Clothing Co.
at a substantially lower rent, for five years with rent commencing
on July 1, 1996. As a result of this vacancy, the borrower had
notified the lenders that it is experiencing financial difficulties
and had approached the lenders regarding a loan modification.
During July 1996, the lenders and borrower have reached an
agreement in principle to defer payment of a portion of the
scheduled debt service payments from September 15, 1995 to July 15,
1996. In conjunction with the agreement in principle, the scheduled
maturity date of the loan would be accelerated to December 31,
1997. In addition, the lenders would agree to accept, at certain
dates through June 30, 1997, repayment of the loan at specified
amounts (all at premiums to the current principal balance).
However, there can be no assurance that such agreement will be
finalized under these terms or any others. As of the date of this
report, certain escrow payments and participation interest are due
to the lenders; however, the borrower is current in its monthly
debt service payments. Subsequent to the end of the quarter, the
borrower notified the lenders that a tenant, which operates a dry
cleaning plant at the site, has leaked a chemical associated with
the dry cleaning process that can cause environmental problems if
not handled properly. The borrower is currently performing tests to
assess the extent of the contamination. At this time it is not
possible to reasonably estimate the cost of any required
remediation. The Lenders do not currently expect that the value of
the borrowers property has been materially impaired, however, there
can be no assurance that the contamination will not have a material
impact on the value of the Lender's security until more information
becomes available. For the six months ended June 30, 1996, the
Account recognized net unrealized depreciation of participation in
mortgage loan of $127,844 as a result of lower effective rents
achieved from the mortgage property upon releasing, as discussed
above. For the six months ended June 30, 1996, the Account
recognized net unrealized depreciation of investments in
unconsolidated joint ventures of approximately $507,511, primarily
due to a decrease in current assets at Monmouth Associates.
A portion of the decrease was a result of a $4,000,000 cash
distribution in which the accounts share was $278,800, and the
payment of certain capital and tenant improvements.
Distributions from unconsolidated joint ventures increased for the
six months ended June 30, 1996 compared to June 30, 1995 primarily
due to the Accounts share of Monmouth Associates distributions of
$278,800. The increase was partially offset by decreased
distributions at N/S Associates.
In addition, the Account recorded rental income of $1,241,144 for
the six months ended June 30, 1996 from its wholly-owned real
estate investment, West Springfield Terrace Apartments, compared to
$1,197,496 for the six months ended June 30, 1995, primarily due to
modest increases in effective rental rates over the course of 1995.
Expenses related to the wholly-owned real estate investment totaled
$875,627 for the six months ended June 30, 1996 compared to
$899,596 for the corresponding period in 1995.
For the six months ended June 30, 1996, the Account's recorded
equity in earnings of its unconsolidated joint ventures (N/S
Associates, Monmouth Associates and 1225 Connecticut) was
$1,004,262 compared to $964,461 for the six months ended June 30,
1995. However, after eliminating the effect of the recognition
in the first quarter of 1995 of income attributable to certain
lease<PAGE>
PAGE 9
termination fees received by N/S Associates, the equity in earnings
of unconsolidated joint ventures showed a decrease for the six
months of 1996 of approximately 1.5 percent compared to the
recorded equity in earnings for the six months of 1995. The
decrease is due primarily to lower rental income achieved at
Southridge and Northridge Malls due to lower occupancy.
The decrease in earnings was partially offset by (i) an increase in
interest earned from Monmouth Associates, (ii) an increase in
rental income at 1225 Connecticut due to the property being 100
percent leased, and (iii) lower interest expense from N/S
Associates in 1996 as a result of prepayment charges incurred in
the first quarter of 1995 in connection with the repayment and
refinancing of the mortgage loans on Northridge and Southridge
Malls.
Northridge Mall continues to be adversely affected by the
perception that it is an unsafe place to shop. This perception has
resulted in declining sales and occupancy over a three-year period.
Compounding the problem of declining sales are the high operating
costs for tenants at the mall due to high real estate taxes.
Occupancy has also been affected by tenant bankruptcies during
1993, 1994 and 1995. As of June 30, 1996, occupancy of the mall
shops was approximately 80%, including temporary tenants under
short term leases.
To counter the negative perception of Northridge Mall, N/S
Associates has implemented certain capital improvements and
operational programs to improve the shopping center's safety and
appearance, as well as instituted certain marketing efforts to
enhance its image. Certain recent positive sales trends appear to
indicate a modest improvement; however, elimination of the negative
perception is expected to take some time. In addition, N/S
Associates is seeking to increase occupancy at the shopping center
by aggressively marketing space for new and renewal tenants through
leasing incentives, as well as continuing to cooperate with
existing tenants who need short-term rent reductions in order to
retain occupancy of their space. Part of the leasing strategy
includes targeting certain well-recognized retailers as a group
that would become tenants at the shopping center. It is expected
that the draw of this group of tenants would help the shopping
center gain leasing momentum and aid in future leasing efforts.
Kohl's Department Store, a successful tenant occupying
approximately 66,000 square feet of space at Southridge Mall,
approached N/S Associates regarding an expansion of its tenant
space and a reduction in its overall leasing costs. During the
third quarter of 1995, N/S Associates and Kohl's entered into an
amendment of its lease. Pursuant to the lease amendment, the term
of Kohl's lease has been extended from 2001 until 2015 and the<PAGE>
PAGE 10
tenant space has been increased by approximately 19,000 square feet
to approximately 85,000 square feet, exclusive of storage space.
Kohl's is required to pay annual base rent of $9.25 per square
foot, as well as one-half of its pro rata share for real estate
taxes and a fixed amount for common area maintenance expense.
Kohl's is also obligated to pay as additional rent a percentage of
its gross receipts in excess of a minimum amount of annual sales to
be determined after the tenant has occupancy of the entire leased
space. N/S Associates is responsible for paying the costs of
asbestos removal for the tenant space, which is estimated to be
approximately $1,250,000. Kohl's is obligated to pay other costs
associated with the leased space, including tenant improvements and
lease buy-out and relocation costs, if any, of other tenants (one
of whose lease continues until 2001) that currently occupy a
portion of the expansion space. The lease amendment also contains
an operating covenant pursuant to which Kohl's is obligated to
operate its retail store at Southridge Mall until 2005, subject to
earlier termination under certain circumstances. Although the
lease amendment reduces Kohl's overall rent, the expansion of its
space and the extension of its lease term is expected to help
stabilize the shopping center on a long-term basis by ensuring
Kohl's continued occupancy and contribution to customer traffic.
As of June 30, 1996, occupancy of the portion of Southridge Mall
owned by N/S Associates was approximately 91%, including temporary
tenants under short-term leases.
The Account paid asset management and mortality expense risk fees
of $526,934 and $518,124 for the six months ended June 30, 1996 and
1995, respectively.
For the Three Months Ended June 30, 1996 Compared to the Three
Months Ended June 30, 1995 -
Recorded net income (loss) for the three months ended June 30, 1996
was $(51,302) compared to $405,625 for the three months ended
June 30, 1995.
During the three months ended June 30, 1996, $497,491 of income was
attributable to the Account's recorded equity in earnings of its
unconsolidated joint ventures (N/S Associates, Monmouth Associates,
and 1225 Connecticut) compared to $423,914 for the corresponding
three months in 1995. The increase in income is primarily due to
(i) 1225 Connecticut being 100% leased and (ii) lower real estate
taxes at Northridge and Southridge. The increase was partially
offset by lower rental income achieved at Southridge and Northridge
due to lower occupancy.
The Account recorded rental income of $599,606 for the three months
ended June 30, 1996 from its wholly-owned real estate investment,
West Springfield Terrace Apartments, compared to $622,818 for the
three months ended June 30, 1995. The decrease in rental income
for the three month period is a result of lower occupancy during
the second quarter which was partially offset by increased rental
rates over 1995. Expenses related to the
wholly-owned real estate investment totaled $433,266 for the three
months ended June 30, 1996 compared to $436,419 for the
corresponding period in 1995.
The Account paid total asset management and mortality expense risk
fees for the three months ended June 30, 1996 of $263,711 compared
to $257,781 for the corresponding period in 1995.
<PAGE>
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Liquidity and Capital Resources
For the Six Months Ended June 30, 1996 Compared to the Six Months
Ended June 30, 1995 -
At June 30, 1996, the Account had cash of approximately $905,000 as
compared to approximately $587,000 at December 31, 1995. The
Account financed a portion of the contract terminations during the
quarter through additional investments made by IDS Life Insurance
Company (IDS Life). The Account had experienced net contract
terminations in 14 consecutive quarters with net sales (including
accumulation units purchased by IDS Life) in three of the last five
quarters.
The liquidity requirements of the Account have generally been met
by funds provided from the Account's short-term investments, cash
distributions from unconsolidated joint ventures, operating cash
flow, interest income, proceeds from sales of contracts,
borrowings under the line of credit from IDS Life and purchases of
accumulation units by IDS Life discussed below. The primary uses
of funds currently are expected to be for property operating
expenses, asset management and mortality and expense risk fees and
payments for contract terminations.
In March 1994, the Account obtained a revolving line of credit for
up to $10 million from IDS Life to pay for contract surrenders and
other obligations under the contracts. In June 1995, the revolving
credit loan balance of $9,500,000 and accrued interest were repaid
as discussed below.
Effective May 1, 1995, new contract sales of the Account were
discontinued. Additional purchase payments continue to be accepted
for existing contracts in amounts specified in the Account's
prospectus, whether by means of the previously established bank
authorizations or otherwise. Existing contracts also continue to
be serviced and surrender requests will be honored.
IDS Life continues to purchase accumulation units in order to
maintain the Account and its liquidity. IDS Life makes these
payments so that no contract holder is disadvantaged because sales
of new contracts have been discontinued. The initial payments for
accumulation units that IDS Life made into the Account were used to
pay off the amount that the Account had borrowed under its
revolving line of credit. IDS Life expects to continue to make
additional payments into the Account for accumulation units as
needed in order to fund all of the Account's obligations under the
contracts such as paying death benefits and contract terminations.
As of June 30, 1996, IDS Life had purchased approximately
24,767,643 accumulation units.
By purchasing accumulation units, IDS Life has an ownership
interest in the Account. Since IDS Life does not purchase a
contract, it is not subject to surrender charges. However, IDS
Life, as holder of accumulation units, participates in the increase
or decrease in the value of the Account's investments just as other
owners of accumulation units do. IDS Life may realize a gain or
loss on its accumulation units when redeemed.
<PAGE>
PAGE 12
IDS Life currently expects to hold the accumulation units it
purchases until the surrender of all outstanding contracts or until
the Account's liquidity improves (through, for example, one or more
sales of real estate related investments) thereby permitting the
Account to satisfy its anticipated contract obligations. Because
IDS Life may purchase a significant amount of accumulation units,
IDS Life may be subject to certain conflicts of interest it would
not otherwise have if it had not purchased such accumulation units,
including, among other things, a conflict in approving periodic
valuations of real estate investments made by the Investment
Adviser.
The Account does not intend to acquire additional real estate
related investments and intends to liquidate the real estate
related investments that it currently holds when it becomes
advantageous or necessary to do so. To the extent funds of the
Account are not used to pay obligations of the Account, including
those under existing contracts, or the redemption of accumulation
units purchased by IDS Life, such funds will be invested in short-
term debt instruments and possibly intermediate-term bonds with
maturities of up to five years.
Through June 30, 1996, Monmouth Associates had funded approximately
$24,500,000 of the renovation loan for Monmouth Mall. Fundings of
principal on the loan have been made from cash reserves held by
Monmouth Associates, cash flow from interest and ground rent
payments received from the borrower/lessee and capital
contributions made to Monmouth Associates by its partners pro rata
based upon their respective interests. The aggregate amount of
capital contributions to finance the loan is approximately
$9,830,000. The Account's share of these capital contributions is
approximately $685,000. The aggregate amount of the renovation
loan, including accrued and deferred interest of approximately
$1,300,000, is currently expected to be approximately $28,500,000.
Remaining fundings for the renovation loan are expected to be made
from cash flow and funds currently held by Monmouth Associates.
Monmouth Associates may also be required to make certain additional
loans to pay a portion of the costs of certain tenant improvements
or other ordinary capital expenditures. In addition, Monmouth
Associates may provide additional financing to the borrower/lessee
in order to pay costs to be incurred in connection with the
replacement or expansion of a department store tenant at Monmouth
Mall. However, it is not currently expected that this would occur
during 1996.
The renovation is nearing completion with tenant improvement work
for one of the larger tenants and retainage work remaining. This
large tenant opened in late July. The occupancy of mall shops and
outparcel space at the shopping center as of June 30, 1996 was
approximately 72 percent. However, the mall shops and outparcel
space are approximately 85 percent leased, including a lease for a
tenant whose term will commence after renovation of its tenant
space permits occupancy. Leasing and occupancy at the shopping
center have been adversely affected by tenant bankruptcies
occurring in 1995.
<PAGE>
PAGE 13
The Account has a loan outstanding in the principal amount of
approximately $7,726,000 as of June 30, 1996, secured by its
wholly-owned real estate investment, West Springfield Terrace
Apartments. The loan has an original term of seven years and bears
interest at a rate of 9.5 percent per annum. The loan requires
monthly payments of principal and interest aggregating $824,000 per
annum until November of 1996 when the remaining principal balance
of approximately $7,704,000 and any accrued and unpaid interest
will be due and payable. The current budget for capital
expenditures during 1996 is approximately $210,600 for painting,
carpet replacement and other capital costs. During the quarter the
Account began marketing the property for sale. If the Account is
unable to sell the property, prior to the maturity date of the
loan, the Account would then seek to either obtain a loan extension
or seek replacement financing. However, there can be no assurance
the Account will be able to either sell the property or obtain
alternative financing.
In February 1995, N/S Associates obtained a new mortgage loan
secured by Southridge Mall in the principal amount of $35,000,000.
The new mortgage loan has a term of seven years, bears interest at
8.35 percent per annum and requires monthly payments of interest
only prior to maturity. A portion of the proceeds from the new
mortgage loan was used to repay the two mortgage loans secured by
Northridge Mall as well as the mortgage loan previously secured by
Southridge Mall. Remaining net proceeds from the refinancing have
been and will be used to pay tenant improvement and other capital
costs at Northridge and Southridge Malls.
N/S Associates currently expects that it will incur approximately
$2,927,000 in 1996 for tenant improvement, asbestos removal and
other capital items at Northridge and Southridge Malls. The
decrease from last quarter is due primarily to unmet leasing which
resulted in lower tenant improvement costs. Actual amounts expended
in 1996 may vary depending on a number of factors, including actual
leasing activity, results of property operations, liquidity
considerations and market conditions over the course of the year.
N/S Associates undertakes asbestos removal from time to time at
portions of the Northridge and Southridge Malls as tenant spaces
are vacated and prior to occupancy by new tenants. The cost
of tenant improvements, asbestos removal and other capital items
generally will be provided out of cash flows from the properties.
In this regard, N/S Associates reduced the amount of distributions
to its partners in order to retain funds to pay capital items
expected to be incurred in 1996. N/S Associates expended
approximately $1,967,000 for tenant improvements, asbestos removal
and other capital projects in 1995.
At June 30, 1996, real property investments (through two
unconsolidated joint ventures, N/S Associates and 1225 Connecticut
and a wholly-owned property, West Springfield Terrace Apartments),
mortgage loan and land sale-leaseback investments (through an
unconsolidated joint venture, Monmouth Associates, and a
participation in the loan for Riverpoint Center) and short-term
investments represented 71 percent, 27 percent and 2 percent
of total assets, respectively. At June 30, 1995, real property
investments, mortgage loan and land sale-leaseback investments and
short-term investments represented 71 percent, 28 percent and 1
percent of total assets, respectively.<PAGE>
PAGE 14
PART II. OTHER INFORMATION
---------------------------
Item 1. LEGAL PROCEEDINGS
There are no material current or pending legal proceedings
which the Registrant is a party to, or to which the
Registrant's assets are subject.
Item 2. CHANGES IN SECURITIES
Not applicable
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) Exhibits
4.1 Form of Deferred Variable Annuity Contract is
hereby incorporated herein by reference to Exhibit
4 to the Account's Form S-1 (as amended), File
Number 33-13375, filed July 17, 1987.
4.2 Copy of mortgage loan documents relating to West
Springfield Terrace Apartments is hereby
incorporated herein by reference to Exhibit 4.2 to
the Account's Form S-1 (as amended), File Number
33-13375, filed April 12, 1990.
4.3 Copy of the line of credit agreement, dated
March 30, 1994 between IDS Life and the Account
(including a copy of the executed promissory note,
dated March 30, 1994) is hereby incorporated by
reference to Exhibit 4.3 to the Account's Form 10-K
Report for the year ended December 31, 1993, File
Number 33-13375, filed April 5, 1994.
10.1 Copy of Investment Advisory Agreement between IDS
Life and JMB Annuity Advisors is hereby
incorporated herein by reference to Exhibit 10.1 to
the Account's Form S-1 (as amended), File Number
33-13375, filed April 29, 1988.
10.2 Copy of N/S Associates Joint Venture Agreement
together with certain documents relating to the
purchase of an interest in Northridge Mall is
hereby incorporated herein by reference to Exhibit
10.2 to the Account's Form S-1 (as amended), File
Number 33-13375, filed April 29, 1988.
<PAGE>
PAGE 15
10.2.1 Copy of Second Amended and Restated Articles of
Partnership of N/S Associates hereby incorporated
herein by reference to Exhibit 10.2.1 to the
Account's Form S-1 (as amended), File Number
33-13375, filed April 20, 1989.
10.3 Copy of N/S Associates Joint Venture Agreement
together with certain documents relating to the
purchase of an interest in Southridge Mall is
hereby incorporated herein by reference to
Exhibit 10.3 to Form S-1 (as amended), File
Number 33-13375, filed April 29, 1988.
10.4 Copy of Commitment Letter relating to the funding
of a participating mortgage loan secured by
Riverpoint Center is hereby incorporated herein by
reference to Exhibit 10.4 to Form S-1 (as amended),
File Number 33-13375, filed October 11, 1988.
10.5 Copy of Amended and Restated Articles of
Partnership of Monmouth Associates are hereby
incorporated herein by reference to Exhibit 10.5 to
the Account's Form S-1 (as amended), File Number
33-13375, filed April 12, 1990.
10.6 Copy of Agreement together with certain other
documents relating to the purchase of West
Springfield Terrace Apartments is hereby
incorporated herein by reference to Exhibit 10.6 to
Form S-1 (as amended), File Number 33-13375, filed
October 16, 1989.
10.7 Copy of Agreement together with certain documents
relating to the purchase of an interest in 1225
Connecticut Avenue is hereby incorporated herein by
reference to the Account's Form S-1 (as amended),
File Number 33-13375, filed June 29, 1990.
27.1 Financial Data Schedule of the Account for the
period ended June 30, 1996 is filed herewith.
(B) Report on Form 8-K
No reports on Form 8-K were required to be filed by the
Registrant for the three months ended June 30, 1996.
<PAGE>
PAGE 16
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.
IDS LIFE ACCOUNT RE
of
IDS LIFE INSURANCE COMPANY
(Registrant)
Date: August 14, 1996 /S/ Melinda Urion
Melinda S. Urion
Executive Vice President
and Controller
<PAGE>
<PAGE>
PAGE 1
IDS Life Account RE
File No. 33-13375
EXHIBIT INDEX
Exhibit 27.1: Financial Data Schedule.
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
PAGE 1
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL
INFORMATION EXTRACTED FROM THE REGISTRANT'S FORM 10-Q FOR THE
THREE MONTHS ENDED JUNE 30, 1996 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS INCLUDED IN
SUCH REPORT.
<RESTATED>
<CIK>
<NAME>
<MULTIPLIER>
<CURRENCY>
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START>
<PERIOD-END> JUN-30-1996
<PERIOD-TYPE> 6-MOS
<EXCHANGE-RATE>
<CASH> 905286
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 905286
<PP&E> 0
<APPRECIATION> 0
<TOTAL-ASSETS> 43826026
<CURRENT-LIABILITIES> 380198
<BONDS> 7726368
<COMMON> 0
0
0
<OTHER-SE> 35719460
<TOTAL-LIABILITY-AND-EQUITY> 43826026
<SALES> 1241144
<TOTAL-REVENUES> 1743401
<CGS> 0
<TOTAL-COSTS> 849363
<OTHER-EXPENSES> 234193
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 368000
<INCOME-PRETAX> 291845
<INCOME-TAX> 291845
<INCOME-CONTINUING> 291845
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 291845
<EPS-PRIMARY> 0
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</TABLE>
