SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1943
Date of Report (date of earliest event reported) APRIL 21, 1999
FRANKLIN SELECT REALTY TRUST
(Exact Name of Registrant as Specified in its Charter)
CALIFORNIA 1-12709 94-3095938
State or other Commission File Number IRS Employer
jurisdiction of Identification Number
incorporation
2000 ALAMEDA DE LAS PULGAS, SAN MATEO, CA 94404
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 650/312 3000
ITEM 5. OTHER EVENTS.
On April 21, 1999, Tanon Manufacturing, Inc. ("TMI"), the sole tenant of
a building (the "Property") located in Fremont, California owned by F.S.R.T.,
L.P. ("FSRT"), a limited partnership in which Franklin Select Realty Trust
(the "Company") is the general partner and owner of a majority interest,
notified the Company that TMI was rejecting its lease under Chapter 11 of the
United States Bankruptcy Code. TMI filed a bankruptcy petition on December
3, 1998. The Company's rental income from TMI pursuant to the lease was
approximately $98,000 per month, including operating expense reimbursements.
Based on the Company's financial statements for the year ended December 31,
1998, rental income from TMI represented approximately seven percent (7%) of
the Company's gross revenues, approximately sixteen percent (16%) of funds
from operations and approximately twenty-four percent (24%) of net income
during 1998.
The base rental rate that was paid by TMI pursuant to the lease was
approximately $8.16 per square foot per year on a net lease basis. As of
this date, the Company believes that the market base rental rate for the
Property may be between $12 and $14.40 per square foot per year on a net
lease basis. Based on the most recently available reports from Colliers
Parrish International, the vacancy rate in the Fremont R&D market is
currently 13% and rental rates have leveled off after increasing for several
years in a row. Upon re-leasing the property, the Company is likely to incur
costs for tenant improvements and leasing commissions but the amounts are
unknown at this time.
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 heretofore duly authorized.
Dated: April 23, 1999 FRANKLIN SELECT REALTY TRUST
By: /S/ DAVID P. GOSS
David P. Goss
President
