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): December 31, 1997
WEINGARTEN REALTY INVESTORS
------------------------------------------------------
(Exact name of registrant as specified in its charter)
____________________________________
(Commission File Number)
Texas 74-1464203
------------------ ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2600 Citadel Plaza Drive, P.O. Box 924133, Houston, Texas 77292-4133
- --------------------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 866-6000
--------------
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
During the year ended December 31, 1997, Weingarten Realty Investors (the
"Company") acquired eight retail centers, three industrial projects and its
joint venture partner's 85% interest in four other retail centers.
Additionally, the Company acquired the second phase of a retail center it
already owned and completed the funding of acquisition costs for a retail
center upon execution of leases and satisfaction of other conditions.
Material factors considered in each of the acquisitions made by the Company
include historical and prospective financial performance of the center, credit
quality of the tenancy, local and regional demographics, location and
competition, ad valorem tax rates, condition of the property and the related
anticipated level of capital expenditures required. The total investment in
acquisitions during 1997 was $111.0 million. Audited financial statements and
unaudited pro forma financial information on these properties are submitted in
ITEM 7. below.
ITEM 7. FINANCIAL STATEMENTS, PROFORMA FINANCIAL INFORMATION AND EXHIBITS
The following financial statements, pro forma financial statements and
exhibits are filed as part of this report:
(a) and (b) Financial statements of businesses acquired and pro forma
financial information:
1. Rainbow Plaza Shopping Center
(i) Independent Auditors' Report
(ii) Statement of Revenue and Certain Expenses for the period
from January 1, 1997 to October 22, 1997
(iii) Notes to Statement of Revenue and Certain Expenses
<PAGE>
2. AMRESCO/Weingarten Joint Venture
i. Mesquite Center, Ltd. (A Joint Venture)
(a) Report of Independent Auditors
(b) Financial Statements for the Three Years Ended
December 31, 1997
(c) Notes to Financial Statements
ii. Eastdale Center, Ltd. (A Joint Venture)
(a) Report of Independent Auditors
(b) Financial Statements for the Three Years Ended
December 31, 1997
(c) Notes to Financial Statements
iii. Coronado Center, Ltd. (A Joint Venture)
(a) Report of Independent Auditors
(b) Financial Statements for the Three Years Ended
December 31, 1997
(c) Notes to Financial Statements
iv. Tempe Valley Plaza, Ltd. (A Joint Venture)
(a) Report of Independent Auditors
(b) Financial Statements for the Three Years
Ended December 31, 1997
(c) Notes to Financial Statements
3. Pro Forma Condensed Financial Statement (unaudited) of
Weingarten Realty Investors, the Acquired Properties
and Other Acquisitions.*
(a) Pro Forma Condensed Statement of Consolidated Income for the
Year Ended December 31, 1997
(b) Notes and Significant Assumptions
- ---------------
* A Pro Forma Consolidated Balance Sheet as of December 31, 1997 is not
presented as all acquisitions covered by this Current Report on Form 8-K
were completed prior to December 31, 1997 and, accordingly, are reflected
in the Consolidated Balance Sheet included in the Company's Annual Report
on Form 10-K for the year then ended.
RAINBOW PLAZA SHOPPING CENTER
STATEMENT OF REVENUE AND CERTAIN EXPENSES FOR THE PERIOD FROM JANUARY 1, 1997
TO OCTOBER 22, 1997 AND INDEPENDENT AUDITORS' REPORT
INDEPENDENT AUDITORS' REPORT
To the Board of Trust Managers and Shareholders of
Weingarten Realty Investors:
We have audited the accompanying statement of revenue and certain expenses of
Rainbow Plaza Shopping Center (the "Plaza") for the period from January 1,
1997 to October 22, 1997. This statement of revenue and certain expenses is
the responsibility of Plaza's management. Our responsibility is to express an
opinion on the statement of revenue and certain expenses 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 statement of revenue and certain
expenses is free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the statement.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
The accompanying statement of revenue and certain expenses was prepared for
the purpose of complying with the rules and regulations of the Securities and
Exchange Commission for inclusion in the current report on Form 8-K of
Weingarten Realty Investors. Certain expenses (described in Note 1) that
would not be comparable to those resulting from the proposed future operations
of the property are excluded and the statement is not intended to be a
complete presentation of the revenue and expenses of the property.
In our opinion, the statement of revenue and certain expenses presents fairly,
in all material respects, the revenue and certain expenses, as defined above,
of Rainbow Plaza Shopping Center for the period from January 1, 1997 to
October 22, 1997.
Deloitte & Touche LLP
Houston, Texas
April 2, 1998
<PAGE>
RAINBOW PLAZA SHOPPING CENTER
STATEMENT OF REVENUE AND CERTAIN EXPENSES FOR THE PERIOD FROM JANUARY 1, 1997
TO OCTOBER 22,1997
<TABLE>
<CAPTION>
<S> <C>
REVENUE:
Rental. . . . . . . . . . . . . . . . . $2.308,428
Tenant reimbursements . . . . . . . . . 337,589
Other income. . . . . . . . . . . . . . 2,735
----------
Total revenue . . . . . . . . . . . . . 2,648,752
----------
CERTAIN EXPENSES:
Property operating and maintenance. . . 101,038
Ad valorem Taxes. . . . . . . . . . . . 109,361
----------
Total certain expenses. . . . . . . . . 210,399
----------
EXCESS OF REVENUE OVER CERTAIN EXPENSES $2,438,353
==========
</TABLE>
See accompanying notes to statement of revenue and certain expenses.
<PAGE>
RAINBOW PLAZA SHOPPING CENTER
NOTES TO STATEMENT OF REVENUE AND CERTAIN EXPENSES
FOR THE PERIOD FROM JANUARY 1, 1997 TO OCTOBER 22, 1997
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION - The accompanying statement of revenue and certain expenses
includes the operations of Rainbow Plaza Shopping Center (the "Plaza"), a
280,000 square foot shopping center in Las Vegas, Nevada. The Plaza was
acquired by Weingarten Realty Investors (the "Company") on October 22, 1997
for $30,300,000. The Company is a Texas real estate investment trust, which
is primarily involved in the acquisition, development, and management of real
estate, consisting mostly of neighborhood and community shopping centers.
BASIS OF PRESENTATION - The accompanying statement was prepared to comply with
the rules and regulations of the Securities and Exchange Commission for
inclusion on the Current Report on Form 8-K of the Company.
The accompanying statement of revenue and certain expenses is not
representative of the actual operations for the period presented as certain
expenses that may not be comparable to the expenses expected to be incurred by
the Company in the future operations of the Plaza have been excluded.
Excluded expenses consist of interest, depreciation and amortization, and
general and administrative costs not directly comparable to the future
operations of the Plaza.
REVENUE RECOGNITION - Rental revenue is generally recognized on a
straight-line basis over the life of the lease for operating leases. Tenant
reimbursements (payments for taxes, maintenance and insurance by the lessees
and for an amount based on a percentage of tenants' sales) are estimated and
accrued over the lease year.
USE OF ESTIMATES - The preparation of the financial statement requires
management to make use of estimates and assumptions that affect amounts
reported in the financial statement as well as certain disclosures. Actual
results could differ from those estimates.
2. RENTALS UNDER OPERATING LEASES
Future minimum rental income for non-cancelable operating leases at October
22, 1997, is: $2,888,759 in 1998; $2,872,626 in 1999; $2,833,313 in 2000;
$2,814,030 in 2001; $2,872,903 in 2002; and $25,841,745 thereafter.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
Venturers
Coronado Center, Ltd.
We have audited the accompanying balance sheets of Coronado Center, Ltd. (the
"Joint Venture"), as of December 31, 1997 and 1996, and the related statements
of income, venturers' capital, and cash flows for each of the three years in
the period ended December 31, 1997. These financial statements are the
responsibility of the Joint Venture's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Coronado Center, Ltd., at
December 31, 1997 and 1996, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 1997, in
conformity with generally accepted accounting principles.
Ernst & Young LLP
Houston, Texas
February 20, 1998
<PAGE>
<TABLE>
<CAPTION>
Coronado Center, Ltd.
(A Joint Venture)
Balance Sheets
DECEMBER 31,
1997 1996
---------- ----------
<S> <C> <C>
ASSETS
Property:
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,011,840 $1,011,840
Buildings and improvements . . . . . . . . . . . . . . . . 4,726,643 4,667,712
5,738,483 5,679,552
Less accumulated depreciation. . . . . . . . . . . . . . . 715,379 531,820
---------- ----------
5,023,104 5,147,732
Accrued rent and accounts receivable, net of allowance for
doubtful accounts of $1,736 in 1996. . . . . . . . . . . 83,139 153,142
Lease costs, net of accumulated amortization of $18,672 in
1997 and $10,759 in 1996 . . . . . . . . . . . . . . . . 18,582 13,113
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . 242,578 316,301
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . 2,068 2,964
---------- ----------
Total assets . . . . . . . . . . . . . . . . . . . . . . . $5,369,471 $5,633,252
========== ==========
LIABILITIES AND VENTURERS' CAPITAL
Accounts payable and accrued expenses:
Affiliates . . . . . . . . . . . . . . . . . . . . . . . . $ 23,165 $ 30,402
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . 137,992 147,417
Rentals collected in advance . . . . . . . . . . . . . . . 9,376 8,921
Tenants' security deposits . . . . . . . . . . . . . . . . 13,620 16,592
---------- ----------
Total liabilities. . . . . . . . . . . . . . . . . . . . . 184,153 203,332
Venturers' capital . . . . . . . . . . . . . . . . . . . . 5,185,318 5,429,920
---------- ----------
Total liabilities and Venturers' capital . . . . . . . . . $5,369,471 $5,633,252
========== ==========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Coronado Center, Ltd.
(A Joint Venture)
Statements of Income
YEAR ENDED DECEMBER 31,
1997 1996 1995
--------- -------- --------
<S> <C> <C> <C>
Revenues:
Rents . . . . . . . . . . . . . . . . . . . $696,640 $854,573 $919,764
Interest income . . . . . . . . . . . . . . 3,736 3,992 3,523
--------- -------- --------
Total revenues. . . . . . . . . . . . . . . 700,376 858,565 923,287
Operating expenses:
Ad valorem taxes. . . . . . . . . . . . . . 126,078 136,862 136,721
Repairs and maintenance . . . . . . . . . . 82,117 66,996 69,725
Management fees - Weingarten Realty
Management Company. . . . . . . . . . . . . 35,019 42,929 46,165
Insurance . . . . . . . . . . . . . . . . . 8,593 10,056 10,784
General and administrative. . . . . . . . . 12,473 10,532 10,246
--------- -------- --------
Total operating expenses. . . . . . . . . . 264,280 267,375 273,641
--------- -------- --------
Income before depreciation and amortization 436,096 591,190 649,646
Depreciation and amortization . . . . . . . 192,724 185,590 177,409
--------- -------- --------
Net income. . . . . . . . . . . . . . . . . $243,372 $405,600 $472,237
========= ======== ========
</TABLE>
See accompanying notes
<PAGE>
<TABLE>
<CAPTION>
Coronado Center, Ltd.
(A Joint Venture)
Statements of Venturers' Capital
AMRESCO/
WEINGARTEN
WEINGARTEN RETAIL
TOTAL NOSTAT, INC. PARTNERS, L.P.
<S> <C> <C> <C>
Balance at December 31, 1994 $5,526,325 $ 828,556 $ 4,697,769
Distributions to Venturers . (620,840) (131,817) (489,023)
Contributions from Venturers 213,544 32,032 181,512
Net income for 1995. . . . . 472,237 99,307 372,930
----------- -------------- ----------------
Balance at December 31, 1995 5,591,266 828,078 4,763,188
Distributions to Venturers . (595,657) (129,328) (466,329)
Contributions from Venturers 28,711 4,307 24,404
Net income for 1996. . . . . 405,600 86,344 319,256
----------- -------------- ----------------
Balance at December 31, 1996 5,429,920 789,401 4,640,519
Distributions to Venturers . (526,412) (96,468) (429,944)
Contributions from Venturers 38,438 5,766 32,672
Net income for 1997. . . . . 243,372 44,561 198,811
----------- -------------- ----------------
Balance at December 31, 1997 $5,185,318 $ 743,260 $ 4,442,058
=========== ============== ================
</TABLE>
See accompanying notes
<PAGE>
<TABLE>
<CAPTION>
Coronado Center, Ltd.
(A Joint Venture)
Statements of Cash Flows
YEAR ENDED DECEMBER 31,
1997 1996 1995
---------- ---------- ----------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income. . . . . . . . . . . . . . . . . . . $ 243,372 $ 405,600 $ 472,237
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization . . . . . . . . . 192,724 185,590 177,409
Net effect of changes in operating accounts . . 37,086 36,601 (31,402)
---------- ---------- ----------
Net cash provided by operating activities . . . 473,182 627,791 618,244
INVESTING ACTIVITIES
Property additions. . . . . . . . . . . . . . . (58,931) (21,902) (93,100)
---------- ---------- ----------
Net cash used in investing activities . . . . . (58,931) (21,902) (93,100)
FINANCING ACTIVITIES
Distributions to Venturers. . . . . . . . . . . (526,412) (595,657) (620,840)
Capital contribution from Venturers . . . . . . 38,438 28,711 213,544
---------- ---------- ----------
Net cash used in financing activities . . . . . (487,974) (566,946) (407,296)
---------- ---------- ----------
Net (decrease) increase in cash . . . . . . . . (73,723) 38,943 117,848
Cash at beginning of year . . . . . . . . . . . 316,301 277,358 159,510
---------- ---------- ----------
Cash at end of year . . . . . . . . . . . . . . $ 242,578 $ 316,301 $ 277,358
========== ========== ==========
</TABLE>
See accompanying notes
<PAGE>
Coronado Center, Ltd.
(A Joint Venture)
Notes to Financial Statements
December 31, 1997
1. NATURE OF JOINT VENTURE AND TERMS OF JOINT VENTURE AGREEMENT
Coronado Center, Ltd. (the "Joint Venture"), was organized on August 23, 1993
by predecessor partners to Amresco/Weingarten Retail Partners, L.P.
("Amresco"), a Delaware limited partnership, as limited partner and Weingarten
Nostat, Inc. ("Nostat"), a Texas corporation, as general partner. Amresco and
Nostat are, collectively, the "Venturers." The business purposes of the Joint
Venture include, but are not limited to, owning, refurbishing, operating,
managing, and leasing a shopping center (the "Center") located in El Paso,
Texas. The ownership interests of Amresco and Nostat in the Joint Venture are
85% and 15%, respectively.
For financial reporting and federal income tax purposes, net income is
generally allocated to the Venturers in amounts equal to distributable funds
(as defined in the Joint Venture Agreement (the "Agreement")) received by each
of the Venturers during the period. Net losses shall be allocated 60% to
Amresco and 40% to Nostat.
Distributable funds are determined quarterly and distributed in the following
priority:
(a) A cumulative return of 8% annual simple interest on Amresco's capital
contributions.
(b) A cumulative return of 8% annual simple interest on Nostat's capital
contributions.
(c) Remaining distributable funds shall be distributed 60% to Amresco and
40% to Nostat.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
balance sheet dates.
PROPERTY
Property is carried at cost. Depreciation is computed using the straight-line
method based on estimated useful lives of 5 to 40 years. Repairs and
maintenance are charged to expense.
LEASE COSTS
Lease costs are amortized primarily on a straight-line basis over the lives of
leases.
<PAGE>
Rental Revenue
Rental revenue is generally recognized on a straight-line basis over the life
of the lease. Contingent rentals (payments for taxes, insurance, and
maintenance by the lessees and for an amount based on a percentage of the
tenants' sales) are estimated and accrued over the lease year.
INCOME TAXES
Income taxes are not provided because each of the Venturers reports its share
of taxable income or loss in its tax return.
3. RENTALS UNDER OPERATING LEASES
The Center's lease terms range from 3 years for smaller tenant spaces to 30
years for larger tenant spaces. In addition to minimum lease payments, most of
the leases provide for contingent rentals.
Minimum future rental income on noncancelable operating leases as of December
31, 1997 is: $504,087 in 1998; $234,847 in 1999; $165,955 in 2000; $108,560 in
2001; $68,109 in 2002; and $110,427 thereafter. The future minimum lease
payments do not include estimates for contingent rentals. Such contingent
rentals aggregated $103,386, $223,587 and $268,095 in 1997, 1996 and 1995,
respectively.
4. DISTRIBUTIONS TO VENTURERS
As described in Note 1, the Agreement provides for preferential distribution
of distributable funds to Amresco, which is cumulative from year to year.
Required distributions to Nostat, after satisfaction of Amresco's preference,
are also cumulative. In accordance with the Agreement, Amresco and Nostat
received a distribution of $94,327 and $15,156, respectively, in 1997 based on
distributable funds of the Joint Venture at December 31, 1996. See Note 8 for
additional information.
5. RELATED PARTY TRANSACTIONS
Weingarten Realty Management Company ("WRMC") is the manager of the shopping
center. WRMC is an affiliate of Nostat because both WRMC and Nostat are wholly
owned subsidiaries of Weingarten Realty Investors ("WRI"). The Joint Venture
pays WRMC a monthly management fee equal to 5% of gross income and a lump-sum
leasing fee generally equal to 4% of net minimum rental, less certain
exclusions defined in the Agreement. WRMC also receives fees for performing
certain other operating and administrative functions, including in-house legal
services. In addition, the Joint Venture reimbursed WRI for development costs.
The total paid to WRMC and WRI during 1997, 1996 and 1995 was $65,791, $36,305
and $58,054, respectively.
6. MAJOR TENANT
Walgreens, C.R. Anthony's, and Furr's Supermarket, the major tenants of the
shopping center, lease a total of 66,014 square feet or approximately 52% of
the lease premises. Revenues for the years ended December 31, 1997, 1996 and
1995 were, respectively, $6,813, $120,330 and $132,922 for Walgreens,
$176,278, $150,867 and $151,480 for C.R. Anthony's, and $147,986, $117,781 and
$131,507 for Furr's Supermarket. Receivables at December 31, 1997 and 1996
were, respectively, $7,639 and $400 for Walgreens, $23,329 and $1,814 for C.R.
Anthony's, and $22,904 and $887 for Furr's Supermarket.
<PAGE>
7. CHANGES IN OPERATING ACCOUNTS
The effect of changes in the operating accounts on cash flows from operating
activities is as follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1997 1996 1995
--------- -------- ---------
<S> <C> <C> <C>
Decrease (increase) in:
Accrued rent and accounts receivable. . . . $ 70,003 $14,179 $(41,612)
Other assets - primarily lease costs. . . . (13,738) (8,767) (6,808)
Increase (decrease) in:
Accounts payable and accrued expenses . . . (16,662) 24,969 18,818
Other liabilities . . . . . . . . . . . . . (2,517) 6,220 (1,800)
--------- -------- ---------
Net effect of changes in operating accounts $ 37,086 $36,601 $(31,402)
========= ======== =========
</TABLE>
8. SUBSEQUENT EVENT
At the close of business on December 31, 1997, WRI purchased Amresco's
interest in four joint ventures, including Amresco's interest in this Joint
Venture for $4,872,600. Also, WRI funded $400,000 to Amresco as the 1997
estimated quarterly distribution of distributable funds for all four joint
ventures. The purchase agreement allows for final adjustments to the purchase
price based on actual cash proceeds from the liquidation of year-end working
capital items. This transaction is not reflected in the financial statements.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
Venturers
Eastdale Center, Ltd.
We have audited the accompanying balance sheets of Eastdale Center, Ltd. (the
"Joint Venture"), as of December 31, 1997, and the related statements of
income, Venturers' capital, and cash flows for each of the three years in the
period ended December 31, 1997. These financial statements are the
responsibility of the Joint Venture's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Eastdale Center, Ltd., at
December 31, 1997, and the results of its operations and its cash flows for
each of the three years in the period ended December 31, 1997, in conformity
with generally accepted accounting principles.
Ernst & Young LLP
Houston, Texas
February 20, 1998
<PAGE>
<TABLE>
<CAPTION>
Eastdale Center, Ltd.
(A Joint Venture)
Balance Sheets
DECEMBER 31,
1997 1996
---------- ----------
<S> <C> <C>
ASSETS
Property:
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,355,623 $1,355,623
Buildings and improvements . . . . . . . . . . . . . . . . 5,866,644 5,773,812
7,222,267 7,129,435
Less accumulated depreciation. . . . . . . . . . . . . . . 819,479 634,821
---------- ----------
6,402,788 6,494,614
Accrued rent and accounts receivable, net of allowance for
doubtful accounts of $4,994 in 1997. . . . . . . . . . 63,584 61,264
Lease costs, net of accumulated amortization of $31,551 in
1997 and $21,751 in 1996 . . . . . . . . . . . . . . . 34,255 37,396
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . 241,611 257,546
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . 1,865 2,732
---------- ----------
Total assets . . . . . . . . . . . . . . . . . . . . . . . $6,744,103 $6,853,552
========== ==========
LIABILITIES AND VENTURERS' CAPITAL
Accounts payable and accrued expenses:
Affiliates . . . . . . . . . . . . . . . . . . . . . . . . $ 19,490 $ 27,592
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . 20,114 12,591
Rentals collected in advance . . . . . . . . . . . . . . . 37,165 36,842
Tenants' security deposits . . . . . . . . . . . . . . . . 22,936 23,287
Notes payable to affiliates. . . . . . . . . . . . . . . . 124,316 44,555
Total liabilities. . . . . . . . . . . . . . . . . . . . . 224,021 144,867
Venturers' capital . . . . . . . . . . . . . . . . . . . . 6,520,082 6,708,685
---------- ----------
Total liabilities and Venturers' capital . . . . . . . . . $6,744,103 $6,853,552
========== ==========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Eastdale Center, Ltd.
(A Joint Venture)
Statements of Income
YEAR ENDED DECEMBER 31,
1997 1996 1995
-------- -------- --------
<S> <C> <C> <C>
Revenues:
Rents . . . . . . . . . . . . . . . $928,429 $984,006 $921,792
Interest income . . . . . . . . . . 3,363 3,186 3,126
-------- -------- --------
Total revenues. . . . . . . . . . . 931,792 987,192 924,918
Operating expenses:
Ad valorem taxes. . . . . . . . . . 64,887 65,058 63,377
Repairs and maintenance . . . . . . 81,636 67,464 67,460
Management fees - Weingarten Realty
Management Company . . . . . . . 46,590 49,360 46,246
Insurance . . . . . . . . . . . . . 7,816 9,548 10,107
Advertising and promotion . . . . . 12,340 12,000 12,000
General and administrative. . . . . 9,838 11,399 12,053
Interest. . . . . . . . . . . . . . 7,664 2,208 -
-------- -------- --------
Total operating expenses. . . . . . 230,771 217,037 211,243
-------- -------- --------
Income before depreciation and
amortization. . . . . . . . . 701,021 770,155 713,675
Depreciation and amortization . . . 202,179 190,787 167,751
-------- -------- --------
Net income. . . . . . . . . . . . . $498,842 $579,368 $545,924
======== ======== ========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Eastdale Center, Ltd.
(A Joint Venture)
Statements of Venturers' Capital
AMRESCO/
WEINGARTEN
WEINGARTEN RETAIL
TOTAL NOSTAT, INC. PARTNERS, L.P.
----------- -------------- ----------------
<S> <C> <C> <C>
Balance at December 31, 1994 $6,887,640 $ 1,024,368 $ 5,863,272
Distributions to Venturers . (727,807) (151,731) (576,076)
Contributions from Venturers 77,602 11,640 65,962
Net income for 1995. . . . . 545,924 113,140 432,784
----------- -------------- ----------------
Balance at December 31, 1995 6,783,359 997,417 5,785,942
Distributions to Venturers . (763,205) (163,134) (600,071)
Contributions from Venturers 109,163 16,374 92,789
Net income for 1996. . . . . 579,368 123,547 455,821
----------- -------------- ----------------
Balance at December 31, 1996 6,708,685 974,204 5,734,481
Distributions to Venturers . (719,267) (144,722) (574,545)
Contributions from Venturers 31,822 4,773 27,049
Net income for 1997. . . . . 498,842 98,172 400,670
Balance at December 31, 1997 $6,520,082 $ 932,427 $ 5,587,655
=========== ============== ================
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Eastdale Center, Ltd.
(A Joint Venture)
Statements of Cash Flows
YEAR ENDED DECEMBER 31,
1997 1996 1995
---------- ---------- ----------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income. . . . . . . . . . . . . . . . . . . $ 498,842 $ 579,368 $ 545,924
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization . . . . . . . . . 202,179 190,787 167,751
Net effect of changes in operating accounts . . (16,440) 35,745 (67,392)
---------- ---------- ----------
Net cash provided by operating activities . . . 684,581 805,900 646,283
INVESTING ACTIVITIES
Property additions. . . . . . . . . . . . . . . (92,832) (39,446) (137,547)
---------- ---------- ----------
Net cash used in investing activities . . . . . (92,832) (39,446) (137,547)
FINANCING ACTIVITIES
Distributions to Venturers. . . . . . . . . . . (719,267) (763,205) (727,807)
Capital contribution from Venturers . . . . . . 31,822 109,163 77,602
Proceeds from debt - affiliate. . . . . . . . . 79,761 36,090 8,465
---------- ---------- ----------
Net cash used in financing activities . . . . . (607,684) (617,952) (641,740)
---------- ---------- ----------
Net increase (decrease) in cash . . . . . . . . (15,935) 148,502 (133,004)
Cash at beginning of year . . . . . . . . . . . 257,546 109,044 242,048
---------- ---------- ----------
Cash at end of year . . . . . . . . . . . . . . $ 241,611 $ 257,546 $ 109,044
========== ========== ==========
</TABLE>
See accompanying notes.
<PAGE>
Eastdale Center, Ltd.
(A Joint Venture)
Notes to Financial Statements
December 31, 1997
1. NATURE OF JOINT VENTURE AND TERMS OF JOINT VENTURE AGREEMENT
Eastdale Center, Ltd. (the "Joint Venture"), was organized December 28, 1992
by predecessor partners to Amresco/Weingarten Retail Partners, L.P.
("Amresco"), a Delaware limited partnership, as limited partner, and
Weingarten Nostat, Inc. ("Nostat"), a Texas corporation, as general partner.
Amresco and Nostat are, collectively, the "Venturers." The business purposes
of the Joint Venture include, but are not limited to, owning, refurbishing,
operating, managing, and leasing a shopping center (the "Center") located in
Albuquerque, New Mexico. The ownership interests of Amresco and Nostat in the
Joint Venture are 85% and 15%, respectively.
For financial reporting and federal income tax purposes, net income is
generally allocated to the Venturers in amounts equal to distributable funds
(as defined in the Joint Venture Agreement) received by each of the Venturers
during the period. Net losses shall be allocated 60% to Amresco and 40% to
Nostat.
Distributable funds are determined quarterly and distributed in the following
priority:
(a) The repayment of any accrued interest on loans.
(b) A cumulative return of 8% annual simple interest on Amresco's
capital contributions.
(c) A cumulative return of 8% annual simple interest on Nostat's
capital contributions.
(d) Remaining distributable funds shall be distributed 60% to
Amresco and 40% to Nostat.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
balance sheet dates.
PROPERTY
Property is carried at cost. Depreciation is computed using the straight-line
method based on estimated useful lives of 5 to 40 years. Repairs and
maintenance are charged to expense.
LEASE COSTS
Lease costs are amortized primarily on a straight-line basis over the lives of
the leases.
<PAGE>
RENTAL REVENUE
Rental revenue is generally recognized on a straight-line basis over the lives
of the leases. Contingent rentals (payments for taxes, insurance, and
maintenance by the lessees and for an amount based on a percentage of the
tenants' sales) are estimated and accrued over the lease year.
INCOME TAXES
Income taxes are not provided because each of the Venturers reports its share
of taxable income or loss in its tax return.
3. RENTALS UNDER OPERATING LEASES
The Center's lease terms range from 3 years for smaller tenant spaces to 25
years for larger tenant spaces. In addition to minimum lease payments, most of
the leases provide for contingent rentals.
Minimum future rental income on noncancelable operating leases as of December
31, 1997 is: $749,763 in 1998; $724,780 in 1999; $701,353 in 2000; $606,899 in
2001; $432,451 in 2002; and $2,355,504 thereafter. The future minimum lease
payments do not include estimates for contingent rentals. Such contingent
rentals aggregated $146,603, $151,734, and $147,948 in 1997, 1996 and 1995,
respectively.
4. DISTRIBUTIONS TO VENTURERS
As described in Note 1, the Joint Venture Agreement (the "Agreement") provides
for preferential distribution, as defined, to Amresco, which is cumulative
from year to year. Required distributions to Nostat, after satisfaction of
Amresco's preference, are also cumulative. In accordance with the Agreement,
Amresco and Nostat received a distribution of $137,421 and $31,802,
respectively, in 1997 based on distributable funds of the Joint Venture at
December 31, 1996. See Note 9 for additional information.
5. NOTES PAYABLE TO AFFILIATES
At December 31, 1997, notes payable to affiliates were as follows:
<TABLE>
<CAPTION>
AMRESCO/
WEINGARTEN
WEINGARTEN RETAIL
TOTAL NOSTAT, INC. PARTNERS, L.P.
-------- ------------- ---------------
<S> <C> <C> <C>
Mandatory loans, bearing interest at 8 % $124,316 $ 49,726 $ 74,590
</TABLE>
6. RELATED PARTY TRANSACTIONS
Weingarten Realty Management Company ("WRMC") is the manager of the Center.
WRMC is an affiliate of Nostat because both WRMC and Nostat are wholly owned
subsidiaries of Weingarten Realty Investors
("WRI"). The Joint Venture pays WRMC a monthly management fee equal to 5% of
gross income and a lump-sum leasing fee generally equal to 4% of net minimum
rental, less certain exclusions defined in the Agreement. WRMC also receives
fees for performing certain other operating and administrative functions,
including in-house legal services. In addition, the Joint Venture reimbursed
WRI for performing certain operating and administrative functions, including
development costs. Total payments to WRI and its subsidiary during 1997, 1996,
and 1995 were $78,774, $51,235, and $85,814, respectively.
7. MAJOR TENANT
Skaggs Companies, Inc. ("Skaggs"), the major tenant of the Center, leases a
total of 54,250 square feet, or approximately 49% of the leased premises.
Revenues from Skaggs for the years ended December 31, 1997 and 1996, and 1995
were $462,770, $459,869, and $467,529, respectively, and receivables at
December 31, 1997 and 1996 were $33,560 and $33,822, respectively.
8. CHANGES IN OPERATING ACCOUNTS
The effect of changes in the operating accounts on cash flows from operating
activities is as follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1997 1996 1995
--------- --------- ---------
<S> <C> <C> <C>
Decrease (increase) in:
Accrued rent and accounts receivable $ (2,320) $ (4,408) $ 3,138
Other assets - primary lease costs (13,513) (20,038) (30,107)
Increase (decrease) in:
Accounts payable and accrued expenses (579) 21,024 (9,466)
Other liabilities (28) 39,167 (30,957)
--------- ---------
Net effect of changes in operating accounts $(16,440) $ 35,745 $(67,392)
========= ========= =========
</TABLE>
9. SUBSEQUENT EVENT
At the close of business on December 31, 1997, WRI purchased Amresco's
interest in four joint ventures, including Amresco's interest in this Joint
Venture for $6,117,400. Also, WRI funded $400,000 to Amresco as the 1997
estimated quarterly distribution of distributable funds for all four joint
ventures. The purchase agreement allows for final adjustments to the purchase
price based on actual cash proceeds from the liquidation of year-end working
capital items. This transaction is not reflected in the financial statements.
<PAGE>
Report of Independent Auditors
Venturers
Mesquite Center, Ltd.
We have audited the accompanying balance sheets of Mesquite Center, Ltd (the
"Joint Venture"), as of December 31, 1997, and the related statements of
income, Venturers' capital, and cash flows for each of the three years in the
period ended December 31, 1997. These financial statements are the
responsibility of the Joint Venture's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Mesquite Center, Ltd, at
December 31, 1997, and the results of its operations and its cash flows for
each of the three years in the period ended December 31, 1997, in conformity
with generally accepted accounting principles.
Ernst & Young LLP
Houston, Texas
February 20, 1998
<PAGE>
<TABLE>
<CAPTION>
Mesquite Center, Ltd.
(A Joint Venture)
Balance Sheets
DECEMBER 31,
1997 1996
----------- -----------
<S> <C> <C>
ASSETS
Property:
Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,715,197 $ 1,715,197
Buildings and improvements. . . . . . . . . . . . . . . . . . 8,479,368 8,456,879
Construction-in-progress. . . . . . . . . . . . . . . . . . . 800 750
----------- -----------
10,195,365 10,172,826
Less accumulated depreciation . . . . . . . . . . . . . . . . 1,346,489 1,048,054
----------- -----------
8,848,876 9,124,772
Accrued rent and accounts receivable, net of allowance for
doubtful accounts of $143,615 in 1997 and $106,000 in 1996 28,404 159,683
Lease costs, net of accumulated amortization of $143,185 in
1997 and $109,220 in 1996. . . . . . . . . . . . . . . . . 175,570 199,261
Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 749,514 642,068
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,285 4,595
----------- -----------
Total assets. . . . . . . . . . . . . . . . . . . . . . . . . $ 9,806,649 $10,130,379
=========== ===========
LIABILITIES AND VENTURERS' CAPITAL
Accounts payable and accrued expenses:
Affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . $ 39,067 $ 40,243
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . 380,540 341,479
Rentals collected in advance. . . . . . . . . . . . . . . . . 44,058 53,951
Tenants' security deposits. . . . . . . . . . . . . . . . . . 25,556 31,815
Notes payable to affiliates . . . . . . . . . . . . . . . . . 154,967 102,347
Total liabilities . . . . . . . . . . . . . . . . . . . . . . 644,188 569,835
Venturers' capital. . . . . . . . . . . . . . . . . . . . . . 9,162,461 9,560,544
----------- -----------
Total liabilities and Venturers' capital. . . . . . . . . . . $ 9,806,649 $10,130,379
=========== ===========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Mesquite Center, Ltd.
(A Joint Venture)
Statements of Income
YEAR ENDED DECEMBER 31,
1997 1996 1995
---------- ---------- ----------
<S> <C> <C> <C>
Revenues:
Rents . . . . . . . . . . . . . . . $1,659,727 $1,767,347 $1,711,678
Interest income . . . . . . . . . . 7,807 8,413 8,466
Total revenues. . . . . . . . . . . 1,667,534 1,775,760 1,720,144
Operating expenses:
Ad valorem taxes. . . . . . . . . . 317,169 303,939 273,608
Repairs and maintenance . . . . . . 138,502 123,785 106,306
Management fees - Weingarten Realty
Management Company. . . . . . . . 83,377 88,788 86,007
Insurance . . . . . . . . . . . . . 12,555 13,680 12,609
General and administrative. . . . . 9,634 10,690 9,227
Interest. . . . . . . . . . . . . . 12,561 8,465 7,573
Total operating expenses. . . . . . 573,798 549,347 495,330
---------- ---------- ----------
Income before depreciation and
amortization. . . . . . . . . . . 1,093,736 1,226,413 1,224,814
Depreciation and amortization . . . 342,100 344,954 319,245
---------- ---------- ----------
Net income. . . . . . . . . . . . . $ 751,636 $ 881,459 $ 905,569
========== ========== ==========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Mesquite Center, Ltd.
(A Joint Venture)
Statements of Venturers' Capital
AMRESCO/
WEINGARTEN
WEINGARTEN/ RETAIL
TOTAL NOSTAT, INC. PARTNERS, L.P.
------------ -------------- ----------------
<S> <C> <C> <C>
Balance at December 31, 1994 $10,187,445 $ 1,520,663 $ 8,666,782
Distributions to Venturers . (1,223,183) (284,250) (938,933)
Contributions from Venturers 13,384 2,018 11,366
Net income for 1995. . . . . 905,569 211,407 694,162
------------ -------------- ----------------
Balance at December 31, 1995 9,883,215 1,449,838 8,433,377
Distributions to Venturers . (1,243,075) (290,372) (952,703)
Contributions from Venturers 38,945 5,842 33,103
Net income for 1996. . . . . 881,459 205,603 675,856
------------ -------------- ----------------
Balance at December 31, 1996 9,560,544 1,370,911 8,189,633
Distributions to Venturers . (1,171,876) (261,664) (910,212)
Contributions from Venturers 22,157 3,323 18,834
Net income for 1997. . . . . 751,636 174,605 577,031
Balance at December 31, 1997 $ 9,162,461 $ 1,287,175 $ 7,875,286
============ ============== ================
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Mesquite Center, Ltd.
(A Joint Venture)
Statements of Cash Flows
YEAR ENDED DECEMBER 31,
1997 1996 1995
------------ ------------ ------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income. . . . . . . . . . . . . . . . . . . $ 751,636 $ 881,459 $ 905,569
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization . . . . . . . . . 342,100 344,954 319,245
Net effect of changes in operating accounts . . 133,348 49,901 (60,319)
------------ ------------ ------------
Net cash provided by operating activities . . . 1,227,084 1,276,314 1,164,495
INVESTING ACTIVITIES
Property additions. . . . . . . . . . . . . . . (22,539) (51,721) (81,623)
------------ ------------ ------------
Net cash used in investing activities . . . . . (22,539) (51,721) (81,623)
FINANCING ACTIVITIES
Distributions to Venturers. . . . . . . . . . . (1,171,876) (1,243,075) (1,223,183)
Capital contribution from Venturers . . . . . . 22,157 38,945 13,384
Proceeds from debt - affiliate. . . . . . . . . 52,620 16,836 85,511
Net cash used in financing activities . . . . . (1,097,099) (1,187,294) (1,124,288)
------------ ------------ ------------
Net increase (decrease) in cash . . . . . . . . 107,446 37,299 (41,416)
Cash at beginning of year . . . . . . . . . . . 642,068 604,769 646,185
------------ ------------ ------------
Cash at end of year . . . . . . . . . . . . . . $ 749,514 $ 642,068 $ 604,769
============ ============ ============
</TABLE>
See accompanying notes.
<PAGE>
Mesquite Center, Ltd.
(A Joint Venture)
Notes to Financial Statements
December 31, 1997
1. NATURE OF JOINT VENTURE AND TERMS OF JOINT VENTURE AGREEMENT
Mesquite Center, Ltd. (the "Joint Venture"), was organized on October 27, 1992
by predecessor partners to Amresco/Weingarten Retail Partners, L.P.
("Amresco"), a Delaware limited partnership, as limited partner, and
Weingarten/Nostat, Inc. ("Nostat"), a Texas corporation, as general partner.
Amresco and Nostat are, collectively, the "Venturers." The business purposes
of the Joint Venture include, but are not limited to, owning, refurbishing,
operating, managing, and leasing a shopping center located in Mesquite, Texas
(the "Center"). The ownership interests of Amresco and Nostat in the Joint
Venture are 85% and 15%, respectively.
For financial reporting and federal income tax purposes, net income is
generally allocated to the Venturers in amounts equal to distributable funds
(as defined in the Joint Venture Agreement (the "Agreement")) received by each
of the Venturers during the period. Net losses shall be allocated 60% to
Amresco and 40% to Nostat.
Distributable funds are determined quarterly and distributed in the following
priority:
(a) The repayment of any accrued interest on loans.
(b) A cumulative return of 8% annual simple interest on Amresco's
capital contributions.
(c) A cumulative return of 8% annual simple interest on Nostat's
capital contributions.
(d) Remaining distributable funds shall be distributed 60% to Amresco
and 40% to Nostat.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
balance sheet dates.
PROPERTY
Property is carried at cost. Depreciation is computed using the straight-line
method based on estimated useful lives of 5 to 40 years. Repairs and
maintenance are charged to expense.
LEASE COSTS
Lease costs are amortized primarily on a straight-line basis over the lives of
leases
<PAGE>
RENTAL REVENUE
Rental revenue is generally recognized on a straight-line basis over the life
of the lease. Contingent rentals (payments for taxes, insurance, and
maintenance by the lessees and for an amount based on a percentage of the
tenants' sales) are estimated and accrued over the lease year.
INCOME TAXES
Income taxes are not provided because each of the Venturers reports its share
of taxable income or loss in its tax return.
3. RENTALS UNDER OPERATING LEASES
The Center's lease terms range from 3 years for smaller tenant spaces to 20
years for larger tenant spaces. In addition to minimum lease payments, most of
the leases provide for contingent rentals.
Minimum future rental income on noncancelable operating leases as of December
31, 1997 is: $1,232,381 in 1998, $1,187,606 in 1999, $1,165,220 in 2000,
$1,028,414 in 2001, $947,415 in 2002, and $2,455,378 thereafter. The future
minimum lease payments do not include estimates for contingent rentals. Such
contingent rentals aggregated $415,289, $425,079, and $379,175 in 1997, 1996,
and 1995, respectively.
4. DISTRIBUTIONS TO VENTURERS
As described in Note 1, the Agreement provides for preferential distribution
of distributable funds to Amresco, which is cumulative from year to year.
Required distributions to Nostat, after satisfaction of Amresco's preference,
are also cumulative. In accordance with the Agreement, Amresco and Nostat
received distributions of $214,680 and $56,436, respectively, in 1997 based on
distributable funds of the Joint Venture at December 31, 1996. See Note 9 for
additional information.
5. NOTES PAYABLE TO AFFILIATES
At December 31, 1997, notes payable to affiliates were as follows:
<TABLE>
<CAPTION>
AMRESCO/
WEINGARTEN
WEINGARTEN/ RETAIL
TOTAL NOSTAT, INC. PARTNERS, L.P.
<S> <C> <C> <C>
Mandatory loans, bearing interest at 8 % $154,967 $ 61,987 $ 92,980
</TABLE>
6. RELATED PARTY TRANSACTIONS
Weingarten Realty Management Company ("WRMC") is the manager of the Center.
WRMC is an affiliate of Nostat because both WRMC and Nostat are wholly owned
subsidiaries of Weingarten Realty Investors ("WRI"). The Joint Venture pays
WRMC a monthly management fee equal to 5% of gross income and a lump-sum
leasing fee generally equal to 4% of net minimum rental, less certain
exclusions defined in the Agreement. WRMC also receives fees for performing
certain other operating and administrative functions including in-house legal
services. In addition, the Joint Venture reimbursed WRI for development and
insurance costs. Total payments to WRMC and WRI during 1997, 1996, and 1995
were $105,261, $88,790, and $107,768, respectively.
<PAGE>
7. MAJOR TENANT
Minyards Food Stores, Inc. ("Minyards"), and Baby Superstore, major tenants of
the Center, lease a total of 102,963 square feet, or approximately 57% of the
leased premises. Revenues for the years ended December 31, 1997, 1996 and 1995
were $519,803, $507,301, and $495,479, respectively, for Minyards and
$332,880, $327,219, and $316,912, respectively, for Baby Superstore.
Receivables at December 31, 1997 and 1996 were $2,929 and $114,931,
respectively, for Minyards and $1,401 for Baby Superstore at December 31,
1997.
8. CHANGES IN OPERATING ACCOUNTS
The effect of changes in the operating accounts on cash flows from operating
activities is as follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1997 1996 1995
--------- --------- ---------
<S> <C> <C> <C>
(Increase) decrease in:
Accrued rent and accounts receivable $131,279 $(18,141) $ 8,471
Other assets - primarily lease costs (19,664) (37,079) (38,335)
Increase (decrease) in:
Accounts payable and accrued expenses 37,885 54,261 6,544
Other liabilities (16,152) 50,860 (36,999)
--------- --------- ---------
Net effect of changes in operating accounts $133,348 $ 49,901 $(60,319)
========= ========= =========
</TABLE>
9. SUBSEQUENT EVENT
At the close of business on December 31, 1997, WRI purchased Amresco's
interest in four joint ventures, including Amresco's interest in this Joint
Venture for $8,814,500. Also, WRI funded $400,000 to Amresco as the 1997
estimated quarterly distribution of distributable funds for all four joint
ventures. The purchase agreement allows for final adjustments to the purchase
price based on actual cash proceeds from the liquidation of year-end working
capital items. This transaction is not reflected in the financial statements.
<PAGE>
44
REPORT OF INDEPENDENT AUDITORS
Venturers
Tempe Valley Plaza, Ltd.
We have audited the accompanying balance sheets of Tempe Valley Plaza, Ltd.
(the "Joint Venture"), as of December 31, 1997, and the related statements of
income, Venturers' capital, and cash flows for each of the three years in the
period ended December 31, 1997. These financial statements are the
responsibility of the Joint Venture's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Tempe Valley Plaza, Ltd., at
December 31, 1997, and the results of its operations and its cash flows for
each of the three years in the period ended December 31, 1997, in conformity
with generally accepted accounting principles.
Ernst & Young LLP
Houston, Texas
February 20, 1998
<PAGE>
<TABLE>
<CAPTION>
Tempe Valley Plaza, Ltd.
(A Joint Venture)
Balance Sheets
DECEMBER 31,
1997 1996
---------- ----------
<S> <C> <C>
ASSETS
Property:
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,233,837 $1,233,837
Building and improvements. . . . . . . . . . . . . . . . . 5,980,146 5,405,499
Construction-in-progress . . . . . . . . . . . . . . . . . - 249,472
---------- ----------
7,213,983 6,888,808
Less accumulated depreciation. . . . . . . . . . . . . . . 739,205 518,103
---------- ----------
6,474,778 6,370,705
Accrued rent and accounts receivable, net of allowance for
doubtful accounts of $4,300 in 1997 and $67 in 1996 . . 95,610 129,080
Lease costs, net of accumulated amortization of $72,908 in
1997 and $43,151 in 1996. . . . . . . . . . . . . . . . 165,344 79,135
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . 300,626 259,009
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . 4,851 5,967
----------
Total assets . . . . . . . . . . . . . . . . . . . . . . . $7,041,209 $6,843,896
========== ==========
LIABILITIES AND VENTURERS' CAPITAL
Accounts payable and accrued expenses:
Affiliates . . . . . . . . . . . . . . . . . . . . . . . . $ 23,341 $ 35,132
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . 120,934 173,097
Rentals collected in advance . . . . . . . . . . . . . . . 21,462 8,762
Tenants' security deposits . . . . . . . . . . . . . . . . 27,961 23,511
Notes payable to affiliates. . . . . . . . . . . . . . . . 160,868 -
Total liabilities. . . . . . . . . . . . . . . . . . . . . 354,566 240,502
Venturers' capital . . . . . . . . . . . . . . . . . . . . 6,686,643 6,603,394
Total liabilities and Venturers' capital . . . . . . . . . $7,041,209 $6,843,896
========== ==========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Tempe Valley Plaza, Ltd.
(A Joint Venture)
Statements of Income
YEAR ENDED DECEMBER 31,
1997 1996 1995
---------- -------- ----------
<S> <C> <C> <C>
Revenues:
Rents . . . . . . . . . . . . . . . $1,096,535 $994,836 $1,035,027
Interest income . . . . . . . . . . 4,488 4,566 4,380
---------- --------
Total revenues. . . . . . . . . . . 1,101,023 999,402 1,039,407
Operating expenses:
Ad valorem taxes. . . . . . . . . . 189,424 192,438 193,803
Repairs and maintenance . . . . . . 112,061 101,032 82,185
Management fees - Weingarten Realty
Management Company. . . . . . . . 55,051 49,970 51,803
Insurance . . . . . . . . . . . . . 9,592 11,240 11,626
General and administrative. . . . . 10,456 11,649 11,875
Interest. . . . . . . . . . . . . . 5,546 - -
---------- -------- ----------
Total operating expenses. . . . . . 382,130 366,329 351,292
---------- -------- ----------
Income before depreciation and
amortization. . . . . . . . . . . 718,893 633,073 688,115
Depreciation and amortization . . . 254,339 204,385 192,118
Net income. . . . . . . . . . . . . $ 464,554 $428,688 $ 495,997
========== ======== ==========
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Tempe Valley Plaza, Ltd.
(A Joint Venture)
Statements of Venturers' Capital
AMRESCO/
WEINGARTEN
WEINGARTEN/ RETAIL
TOTAL NOSTAT, INC. PARTNERS, L.P.
<S> <C> <C> <C>
Balance at December 31, 1994 $6,587,656 $ 979,108 $ 5,608,548
Distributions to Venturers . (609,851) (145,264) (464,587)
Contributions from Venturers 81,870 12,280 69,590
Net income for 1995. . . . . 495,997 133,227 362,770
----------- -------------- ---------------
Balance at December 31, 1995 6,555,672 979,351 5,576,321
Distributions to Venturers . (663,831) (132,316) (531,515)
Contributions from Venturers 282,865 42,429 240,436
Net income for 1996. . . . . 428,688 79,571 349,117
----------- -------------- ---------------
Balance at December 31, 1996 6,603,394 969,035 5,634,359
Distributions to Venturers . (680,786) (132,045) (548,741)
Contributions from Venturers 299,481 44,922 254,559
Net income for 1997. . . . . 464,554 106,244 358,310
----------- -------------- ---------------
Balance at December 31, 1997 $6,686,643 $ 988,156 $ 5,698,487
=========== ============== ===============
</TABLE>
See accompanying notes.
<PAGE>
<TABLE>
<CAPTION>
Tempe Valley Plaza, Ltd.
(A Joint Venture)
Statements of Cash Flows
YEAR ENDED DECEMBER 31,
1997 1996 1995
---------- ---------- ----------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income. . . . . . . . . . . . . . . . . . . $ 464,554 $ 428,688 $ 495,997
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization . . . . . . . . . 254,339 204,385 192,118
Net effect of changes in operating accounts
(74,140) (15,646) 51,629
---------- ---------- ----------
Net cash provided by operating activities . . . 644,753 617,427 739,744
INVESTING ACTIVITIES
Property additions. . . . . . . . . . . . . . . (382,699) (301,997) (60,051)
---------- ---------- ----------
Net cash used in investing activities . . . . . (382,699) (301,997) (60,051)
FINANCING ACTIVITIES
Distributions to Venturers. . . . . . . . . . . (680,786) (663,831) (609,851)
Capital contribution from Venturers . . . . . . 299,481 282,865 81,870
Proceeds from debt - affiliate. . . . . . . . . 160,868 - -
---------- ---------- ----------
Net cash used in financing activities . . . . . (220,437) (380,966) (527,981)
---------- ---------- ----------
Net increase (decrease) in cash . . . . . . . . 41,617 (65,536) 151,712
Cash at beginning of year . . . . . . . . . . . 259,009 324,545 172,833
Cash at end of year . . . . . . . . . . . . . . $ 300,626 $ 259,009 $ 324,545
========== ========== ==========
</TABLE>
See accompanying notes.
<PAGE>
Tempe Valley Plaza, Ltd.
(A Joint Venture)
Notes to Financial Statements
December 31, 1997
1. NATURE OF JOINT VENTURE AND TERMS OF JOINT VENTURE AGREEMENT
Tempe Valley Plaza, Ltd. (the "Joint Venture"), was organized December 13,
1993 by predecessor partners to Amresco/Weingarten Retail Partners, L.P.
("Amresco"), a Delaware limited partnership, as limited partner, and
Weingarten/Nostat, Inc. ("Nostat"), a Texas corporation, as general partner.
Amresco and Nostat are, collectively, the "Venturers." The business purposes
of the Joint Venture include, but are not limited to, owning, refurbishing,
operating, managing, and leasing a shopping center (the "Center") located in
Tempe, Arizona. The ownership interests of Amresco and Nostat in the Joint
Venture are 85% and 15%, respectively.
For financial reporting and federal income tax purposes, net income is
generally allocated to the Venturers in amounts equal to distributable funds
(as defined in the Joint Venture Agreement) received by each of the Venturers
during the period. Net losses shall be allocated 60% to Amresco and 40% to
Nostat.
Distributable funds are determined quarterly and distributed in the following
priority:
(a) The repayment of any accrued interest on loans.
(b) A cumulative return of 8% annual simple interest on Amresco's
capital contributions.
(c) A cumulative return of 8% annual simple interest on Nostat's
capital contributions.
(d) Remaining distributable funds shall be distributed 60% to Amresco
and 40% to Nostat.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USE OF ESTIMATES
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
balance sheet dates.
PROPERTY
Property is carried at cost. Depreciation is computed using the straight-line
method based on estimated useful lives of 5 to 40 years. Repairs and
maintenance are charged to expense.
LEASE COSTS
Lease costs are amortized primarily on a straight-line basis over the lives of
the leases.
<PAGE>
RENTAL REVENUE
Rental revenue is generally recognized on a straight-line basis over the life
of the lease. Contingent rentals (payments for taxes, insurance, and
maintenance by the lessees and for an amount based on a percentage of the
tenants' sales) are estimated and accrued over the lease year.
INCOME TAXES
Income taxes are not provided because each of the Venturers reports its share
of taxable income or loss in its tax return.
3. RENTALS UNDER OPERATING LEASES
The Center's lease terms range from 3 years for smaller tenant spaces to 25
years for larger tenant spaces. In addition to minimum lease payments, most of
the leases provide for contingent rentals.
Minimum future rental income on noncancelable operating leases as of December
31, 1997 is: $929,650 in 1998; $847,573 in 1999; $740,458 in 2000; $710,190 in
2001; $534,358 in 2002; and $6,989,032 thereafter. The future minimum lease
payments do not include estimates for contingent rentals. Such contingent
rentals aggregated $287,285, $276,749, and $298,675 in 1997, 1996, and 1995,
respectively.
4. DISTRIBUTIONS TO VENTURERS
As described in Note 1, the Joint Venture Agreement (the "Agreement") provides
for preferential distribution of distributable funds to Amresco, which is
cumulative from year to year. Required distributions to Nostat, after
satisfaction of Amresco's preference, are also cumulative. In accordance with
the Agreement, Amresco and Nostat received a distribution of $125,378 and
$27,014, respectively, in 1997 based on distributable funds of the Joint
Venture at December 31, 1996. See Note 9 for additional information.
5. NOTES PAYABLE TO AFFILIATES
At December 31, 1997, notes payable to affiliates were as follows:
<TABLE>
<CAPTION>
AMRESCO/
WEINGARTEN
WEINGARTEN RETAIL
TOTAL NOSTAT, INC. PARTNERS, L.P.
-------- ------------- -----------------
<S> <C> <C> <C>
Mandatory loans, bearing interest at 8 % $160,868 $ 64,347 $ 96,521
</TABLE>
6. RELATED PARTY TRANSACTIONS
Weingarten Realty Management Company ("WRMC") is the manager of the Center.
WRMC is an affiliate of Nostat because both WRMC and Nostat are wholly owned
subsidiaries of Weingarten Realty Investors ("WRI"). The Joint Venture pays
WRMC a monthly management fee equal to 5% of gross income and a lump-sum
leasing fee generally equal to 4% of net minimum rental, less certain
exclusions defined in the Agreement. WRMC also receives fees for performing
certain other operating and administrative functions including in-house legal
services. In addition, the Joint Venture reimbursed WRI for development costs.
The total paid to WRI and its subsidiary during 1997, 1996, and 1995 was
$193,512, $72,019, and $53,626, respectively.
7. MAJOR TENANT
Fry's Food Store ("Fry's"), the major tenant of the Center, leases a total of
60,145 square feet, or approximately 44% of the leased premises. Revenues from
Fry's for the years ended December 31, 1997, 1996, and 1995 were $327,424,
$326,642, and $324,118, respectively, and receivables at December 31, 1997 and
1996 were $9,069 and $43,804, respectively.
8. CHANGES IN OPERATING ACCOUNTS
The effect of changes in the operating accounts on cash flows from operating
activities is as follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
1997 1996 1995
---------- --------- --------
<S> <C> <C> <C>
Decrease (increase) in:
Accrued rent and accounts receivable $ 33,470 $ (9,333) $ 4,346
Other assets - primarily lease costs (118,330) (25,010) (8,013)
Increase (decrease) in:
Accounts payable and accrued expenses (6,430) 13,149 59,231
Other liabilities 17,150 5,548 (3,935)
---------- --------- --------
Net effect of changes in operating accounts $ (74,140) $(15,646) $51,629
========== ========= ========
</TABLE>
9. SUBSEQUENT EVENT
At the close of business on December 31, 1997, WRI purchased Amresco's
interest in four joint ventures, including Amresco's interest in the Joint
Venture for $6,195,500. Also, WRI funded $400,000 to Amresco as the 1997
estimated quarterly distribution of distributable funds for all four joint
ventures. The purchase agreement allows for final adjustments to the purchase
price based on actual cash proceeds from the liquidation of year-end working
capital items. This transaction is not reflected in the financial statements.
<PAGE>
WEINGARTEN REALTY INVESTORS
PRO FORMA CONDENSED STATEMENT OF CONSOLIDATED INCOME
YEAR ENDED DECEMBER 31, 1997
(Unaudited)
(in thousands, except per share amounts)
This unaudited Pro Forma Condensed Statement of Consolidated Income is
presented as if (A) the acquisitions of Rainbow Plaza Shopping Center and the
AMRESCO/Weingarten Joint Venture Interests, and (B) the acquisition of other
properties as set forth in the Notes and Significant Assumptions, has occurred
as of January 1, 1997. In management's opinion, all adjustments necessary to
reflect the effects of these transactions have been made. This unaudited Pro
Forma Condensed Statement of Consolidated Income is not necessarily indicative
of what actual results of operations would have been had these transactions
occurred on January 1, 1997, nor does it purport to represent the results of
operations for future periods.
<TABLE>
<CAPTION>
Adjustments
for Acquisition Adjustment
of Acquired for Other Pro
Historical Properties(A) Acquisitions(B) Forma
----------- ----------------- ---------------- --------
<S> <C> <C> <C> <C>
Revenue:
Rentals $ 169,041 $ 7,028 $ 2,926 $178,995
Interest 2,487 22 0 2,509
Other 2,984 (613) 13 2,384
Total Revenue 174,512 6,437 2,939 183,888
----------- ----------------- ---------------- --------
Expenses:
Operating 27,131 829 487 28,447
Ad Valorem Taxes 22,110 807 381 23,298
Depreciation & Amortization 37,976 1,796 434 40,206
Interest 30,009 3,575 1,367 34,951
General & Administrative 5,647 5,647
Total Expenses 122,873 7,007 2,669 132,549
----------- ----------------- ---------------- --------
Income (Loss) From Operations 51,639 (570) 270 51,339
Gain on Sales of Property and Securities 3,327 3,327
Net Income $ 54,966 $ (570) $ 270 $ 54,666
=========== ================= ================ ========
Net Income per Common Share $ 2.06 $ 2.05
=========== ========
Net Income per Common Share
Assuming Dilution $ 2.06 $ 2.05
=========== ========
Weighted Average Number of
Common Shares Outstanding 26,638 26,638
=========== ========
Weighted Average Number of
Common Shares Outstanding
Assuming Dilution 26,671 26,671
=========== ========
</TABLE>
<PAGE>
WEINGARTEN REALTY INVESTORS
NOTES AND SIGNIFICANT ASSUMPTIONS
YEAR ENDED DECEMBER 31,1997
(Unaudited)
(A) ACQUISITION OF RAINBOW PLAZA SHOPPING CENTER AND AMRESCO/WEINGARTEN
JOINT VENTURE INTEREST
On October 22, 1997, the Company acquired Phases II and III of Rainbow Plaza,
a 280,000 square foot shopping center located in Las Vegas, Nevada for $30.3
million. The purchase price was funded with $12.9 million borrowed under the
Company's revolving credit facility (average rate of 6.3%) and the assumption
of $17.4 million of debt (rate of 8.75%). Rainbow Plaza is located at Rainbow
and Charleston Boulevards and is situated on 24.3 acres. Developed between
1992 and 1995, Rainbow is anchored by Home Depot, JCPenney Home Store,
Ultimate Electronics and the Q-Club and is currently 100% leased. The
purchase price was allocated between land and buildings, with the buildings
depreciated over a period of forty years. Pro forma revenue and expenses,
other than interest and depreciation, represent the historical amounts of
Rainbow Plaza.
On December 31, 1997, the Company completed the purchase of its joint venture
partner's interest in four shopping centers located in Texas, New Mexico and
Arizona. The partner's previous interest was 85% of each property. The
seller was AMRESCO/Weingarten Retail Partnership L.P. and the sales price was
$26.4 million, which was borrowed under the Company's revolving credit
facilities (average rate of 6.3%). AMRESCO is an advisor to pension funds who
sold the properties on behalf of several clients.
The properties included in the purchase are as follows:
1) Independence Plaza located at Independence and Town East Boulevard in
Mesquite, Texas, a suburb of Dallas. Independence contains 179,100
square feet and is anchored by Baby Superstore and Sak 'N Sav Grocery.
2) Eastdale Shopping Center located at Candelaria Road and Eubanks Boulevard
in Albuquerque, New Mexico. Eastdale contains 111,000 square feet and
is anchored by Skaggs Supermarket.
3) Coronado Hills Shopping Center located at Mesa Street and Balboa Drive in
El Paso, Texas. Coronado contains 127,100 square feet and is anchored by
Anthony's, Cloth World, Furr's Supermarket and AutoZone.
4) Frys Valley Shopping Center located at Southern and McClintock Streets in
Tempe, Arizona. Frys Valley contains 145,100 square feet and is anchored
by Fry's Foods, Hancock Fabrics and Paddock Pools.
Collectively, the four properties add an additional 478,000 square feet to the
portfolio and have an average occupancy of 91.5%. The purchase price was
allocated between land and buildings, with the buildings depreciated over a
period of forty years. Pro forma revenue and expenses, other than interest
and depreciation, represent the historical amounts of the AMRESCO/Weingarten
Joint Venture properties on a fully consolidated basis, adjusted for the
elimination of the equity in the income of the joint venture which was
previously accounted for under the equity method.
<PAGE>
B) OTHER ACQUISITIONS
All of the acquisitions described below (the "Other Acquisitions") were
purchased with borrowings under the Company's revolving credit facilities
(average rate of 6.3%) and the aggregate purchase price of $54.3 million was
allocated between land and buildings, with buildings depreciated over a period
of forty years. Pro forma revenues and expenses other than interest and
depreciation for the Other Acquisitions through the date of acquisition
are based on unaudited information provided by the sellers of the properties.
Unaudited financial information has been prepared on a basis consistent with
the historical information.
On March 19, 1997, the Company purchased Southcliff Shopping Center located in
Fort Worth, Texas. Developed in 1968, the center is located on 13.0 acres and
was 95% leased at the date of purchase. Located at the intersection of
Interstate 20 and Granbury Road, this 116,000 square foot shopping center is
anchored by Pancho's Mexican Restaurant, Cloth World and Armbrister's
Hardware.
On April 28, 1997, the Company purchased Rancho Encanto Plaza located in
Phoenix, Arizona. Developed in 1988, the center contains 71,000 square feet
and is situated on 5.95 acres. The center was 94.7% leased at the date of
purchase and is anchored by ABCO Supermarket and Berean Book Store.
On May 12, 1997, the Company purchased West State Plaza located in Kansas
City, Kansas. Located at the intersection of 75th Street and State Avenue,
West State contains 94,000 square feet and was 69% leased when purchased.
Developed in 1985, the center is situated on 9.3 acres and is anchored by Big
Lots, a popular discount store, and Westlake Hardware.
On May 14, 1997, the Company acquired Desert Square Shopping Center in Tucson,
the Company's seventh property in Arizona. Located on the northeast corner
of Golf Links and Kolb Road, the center contains 98,000 square feet and is
situated on 10.5 acres. Anchored by Safeway, Wells Fargo, Auto Zone and
Salvation Army, Desert Square was 97% leased.
On May 23, 1997, the Company acquired the Corporate I and II office/service
center in Austin, Texas. Located on Research Boulevard (Highway 183) at
Putnam Drive, the project contains 117,000 square feet and is situated on 7.5
acres. Corporate I was developed in 1979 while Corporate II was built in
1983. The total project contains five separate one-story buildings and was
94.3% leased when acquired. Major tenants include Windsport, Pitney Bowes,
Inc. and a division of the State Highway and Public Transportation Department.
On June 3, 1997, the Company purchased Stonecrest Business Center located in
Houston, Texas. This office/service center contains five separate one-story
buildings totaling 111,000 square feet and was 77% leased when purchased.
Stonecrest was developed in 1979 and is situated on 7.1 acres. Major tenants
include Carrousel Production, Flintlock, Ltd. and RLPH Development.
On June 20, 1997, the Company purchased the Grand Plaza Shopping Center in
Amarillo, Texas. Located on the southwest corner of Interstate 40 and Grand
Street, the center contains 75,000 square feet and is situated on 7.08 acres.
Developed in 1985, Grand Plaza is anchored by United Supermarket and Dollar
General. The center was 82% leased when purchased. On November 7, 1997, the
Company purchase the second phase of this shopping center. This 82,000 square
foot building is located on 7.5 acres and was 80% leased when purchased.
Major tenants are Country General and Beall's.
On July 9, 1997, the Company acquired Phase II of League City Plaza, located
adjacent to Phase I which the Company acquired in 1993. Located in League
City, just south of Houston, Phase II contains 20,000 square feet and is
situated on 2.44 acres of which 1.44 acres are undeveloped. Phase II is 100%
leased and anchored by Pancho's Mexican Restaurant.
On August 20, 1997, the Company purchased West Ten Business Center II. The
83,000 square foot warehouse is located on Interstate 10 in Houston and is
situated on 3.4 acres adjacent to the Company's West Ten Business Center.
This project was vacant when purchased.
<PAGE>
On August 22, 1997, the Company purchased a Kmart center in Houston, Texas.
The Company will redevelop the site by expanding the Kmart store and building
a new supermarket along with some additional retail space. The center will
contain about 200,000 square feet when complete and is expected to be open in
the fall of 1998. On December 10, 1997, the Company purchased a 5,460 square
foot building located on a pad site adjacent to this center. The building is
leased to Monterey House restaurant.
On October 22, 1997, the Company acquired Academy Place, a 84,000 square foot
shopping center in Colorado Springs, Colorado. Located at the intersection of
Academy and Union Boulevards, the center is situated on 9.34 acres and is
anchored by Ross Dress for Less and Famous Footwear. It is also strategically
placed between a Safeway supermarket and a Target store, both of which are
owned by others. Developed in 1982, Academy Place was 97.4% leased when
purchased.
<PAGE>
<TABLE>
<CAPTION>
WEINGARTEN REALTY INVESTORS
STATEMENT OF ESTIMATED TAXABLE OPERATING RESULTS
AND CASH TO BE MADE AVAILABLE BY OPERATIONS
FOR A TWELVE MONTH PERIOD ENDING DECEMBER 31, 1997
(Unaudited)
<S> <C>
Revenue:. . . . . . . . . . . . . . . . . . . . . . $9,954
Expenses:
Operating . . . . . . . . . . . . . . . . . . . . . 1,316
Ad Valorem Taxes. . . . . . . . . . . . . . . . . . 1,188
Depreciation & Amortization . . . . . . . . . . . . 2,230
Interest. . . . . . . . . . . . . . . . . . . . . . 4,942
Total Expenses. . . . . . . . . . . . . . . . . . . 9,676
-------
Estimated Taxable Operating Loss. . . . . . . . . . (278)
Add back depreciation and amortization. . . . . . . 2,230
Estimated Cash to be Made Available from Operations $1,952
=======
<FN>
Note: This statement of estimated taxable operating results and estimated
cash to be made available from operations is an estimate of
operating results for all properties acquired by the Company
during the year ended December 31, 1997 and does not purport to
reflect actual results for any period.
</TABLE>
(c) Exhibits
Exhibit Number Description
--------------- -----------
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Ernst & Young LLP
<PAGE>
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.
WEINGARTEN REALTY INVESTORS
-----------------------------
(Registrant)
BY: /s/ Stephen C. Richter
--------------------------------
Stephen C. Richter
Senior Vice President/Financial
Administration and Treasurer
(Principal Accounting Officer)
DATE: April 24, 1998
----------------
Exhibit 23.1
Independent Auditors' Consent
We consent to the incorporation by reference in Registration Statements No.
33-20964, No. 33-24364, No. 33-41604, No. 33-52473, No. 33-54402 and No.
33-54404 on Form S-8, in Post-Effective Amendment No. 1 to Registration
Statement No. 33-25581 on Form S-8 and in Registration Statements No.
33-57659, No. 33-54529 and No. 333-12179 on Form S-3 of Weingarten Realty
Investors of our report dated April 2, 1998, relating to the statement of
revenues and certain expenses of Rainbow Plaza Shopping Center, appearing in
this Current Report on Form 8-K (Date of Event: December 31, 1997) of
Weingarten Realty Investors.
Deloitte & Touche LLP
Houston, Texas
April 23, 1998
Exhibit 23.2
Independent Auditors' Consent
We consent to the incorporation by reference in Registration Statements No.
33-20964, No. 33-24364, No. 33-41604, No. 33-52473, No. 33-54402 and No.
33-54404 on Form S-8, in Post-Effective Amendment No. 1 to Registration
Statement No. 33-25581 on Form S-8 and in Registration Statements No.
33-57659, No. 33-54529 and No. 333-12179 on Form S-3 Weingarten Realty
Investors of our reports dated February 20, 1998, relating to the balance
sheets of Coronado Center, Ltd., Eastdale Center, Ltd., Mesquite Center, Ltd.
and Tempe Valley Plaza, Ltd., and the related statements of income, Venturers'
capital, and cash flows, appearing in this Current Report on Form 8-K (Date of
Event: December 31, 1997) of Weingarten Realty Investors.
Ernst & Young LLP
Houston, Texas
April 23, 1998
