<PAGE>
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):
May 22, 1998 (January 23, 1998)
Kimco Realty Corporation
(Exact name of registrant as specified in its charter)
Maryland 1-10899 13-2744380
- ----------------- ---------------------- -------------------
(State or other (Commission File Number) (IRS Employer
jurisdiction of Identification No.)
incorporation)
3333 New Hyde Park Road
New Hyde Park, New York 11042/0-0020
- ------------------------------- ------------------
(Address of principal executive (zip code)
offices)
516/869-9000
-----------------------------------
Registrant's telelphone,
including area code
Not Applicable
- ------------------------------------------------------------------------------
(former name or former address, if changed since last report.)
Page 1 of 18
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CURRENT REPORT
ON
FORM 8-K
Item 5. Other Events
Shopping Center Acquisitions -
Certain subsidiaries of Kimco Realty Corporation (the "Company")
acquired 15 neighborhood and community shopping center properties (the
"Shopping Center Acquisitions") comprising approximately 1.7 million square
feet of gross leasable area ("GLA") in 8 states. These shopping center
properties, acquired in separate transactions for an aggregate purchase price
of approximately $136.3 million, including the assumption of approximately
$20.8 million of mortgage debt, include:
o Village on the Park I and II, Aurora, Colorado
o Phar-Mor Plaza, Englewood, Colorado
o Heritage West Shopping Center, Lakewood, Colorado
o Quincy Place Shopping Center, Aurora, Colorado
o Spring Creek Shopping Center, Colorado Springs, Colorado
o East Bank Shopping Center, Aurora, Colorado
o West 38th Street Shopping Center, Denver, Colorado
o The Shoppes at West Melbourne, West Melbourne, Florida
o Marshalls Plaza, Cranston, Rhode Island
o South Plains Plaza, Lubbock, Texas
o Poca Fiesta Shopping Center, Mesa, Arizona
o Wellington Park Shopping Center, Cary, North Carolina
o Phar-Mor building, Greenville, South Carolina
o Bayshore Gardens Shopping Center, Bradenton, Florida
o Lafayette Marketplace, Lafayette, Indiana
Although none of the above Shopping Center Acquisitions, individually
represent a "significant acquisition" pursuant to the rules governing the
reporting of transactions under this Current Report on Form 8-K, the Company
considers these acquisitions in the aggregate to be material in relation to
its overall financial position and results of operations. Consequently, this
report has been filed for the purpose of providing certain historical
financial information for certain acquired properties and pro forma financial
information for the Shopping Center Acquisitions.
More specific information with respect to each of these acquired properties is
as follows:
In January 1998, the Company acquired seven properties, in separate
transactions, consisting of: (i) Village on the Park I and II, adjoining
shopping centers located on South Parker Road in Aurora, Colorado, which are
anchored by TJ Maxx and contain
2
<PAGE>
approximately 146,000 square feet of GLA; (ii) Phar-Mor Plaza, located on West
Gerard Avenue in Englewood, Colorado, which is anchored by Phar-Mor and
contains approximately 80,000 square feet of GLA; (iii) Heritage West Shopping
Center, located on West Jewel Avenue in Lakewood, Colorado, which is anchored
by Safeway and contains approximately 83,000 square feet of GLA; (iv) Quincy
Place Shopping Center, located on East Quincy Avenue in Aurora, Colorado,
which is anchored by Blockbuster and contains approximately 44,000 square feet
of GLA; (v) Spring Creek Shopping Center, located on Spring Circle Drive in
Colorado Springs, Colorado, which is anchored by Cub Foods and contains
approximately 108,000 square feet of GLA; (vi) East Bank Shopping Center,
located on South Parker Road in Aurora, Colorado, which is anchored by
Albertson's and Coomers and contains approximately 152,000 square feet of GLA;
and (vii) West 38th Street Shopping Center, a single tenant property, located
on West 38th Avenue in Denver, Colorado, occupied by Payless Drugs comprising
approximately 18,000 square feet of GLA. These properties were acquired for an
aggregate purchase price of approximately $43.9 million, including the
assumption of approximately $1.4 million and $2.8 million of mortgage debt
encumbering Phar-Mor Plaza and Quincy Place Shopping Center, respectively.
In February 1998, the Company acquired The Shoppes at West Melbourne,
located on West New Haven Avenue in West Melbourne, Florida, for a purchase
price of approximately $11.0 million. The shopping center contains
approximately 148,000 square feet of GLA and is anchored by Service
Merchandise and Marshalls.
In March 1998, the Company acquired three properties, in separate
transactions, consisting of (i) Marshalls Plaza, (ii) South Plains Plaza and
(iii) Poca Fiesta Shopping Center. Marshalls Plaza, located at the
intersection of Oaklawn Avenue and Bald Hill Road in Cranston, Rhode Island,
is anchored by Marshalls and Bob's Stores and contains approximately 118,000
square feet of GLA. South Plains Plaza, located on Slide Road in Lubbock,
Texas, is anchored by PetsMart and Office Max and contains approximately
108,000 square feet of GLA. Poca Fiesta Shopping Center, located on Southern
Avenue in Mesa, Arizona, is anchored by Ross Stores, and contains
approximately 147,000 square feet of GLA. These properties were acquired for
an aggregate purchase price of approximately $33.5 million, including the
assumption of approximately $6.6 million and $10.0 million of mortgage debt
encumbering South Plains Plaza and Poca Fiesta Shopping Center, respectively.
In April 1998, the Company acquired Wellington Park Shopping Center and
the Phar-Mor building, in separate transactions, for an aggregate
purchase price of approximately $14.6 million. Wellington Park Shopping
Center, located on Tryon Road in Cary, North Carolina, is anchored by
Lowe's Grocery and contains approximately 103,000 square feet of GLA.
The Phar-Mor building, located on Haywood Road in Greenville, South
Carolina, is a 60,000 square foot building adjacent to a property
previously acquired by the Company in December 1997 and is occupied by
Phar-Mor.
3
<PAGE>
In May 1998, the Company acquired two properties, Bayshore Gardens Shopping
Center and Lafayette Marketplace, in separate transactions, for an aggregate
purchase price of approximately $33.3 million, which included the issuance of
partnership units valued at approximately $5.0 million in connection with the
Bayshore Gardens acquisition. Bayshore Gardens Shopping Center, located on
Flamingo Boulevard in Bradenton, Florida, is anchored by Publix and TJ Maxx, and
contains approximately 163,000 square feet of GLA. The Lafayette Marketplace,
located on State Road 38 East in Lafayette, Indiana, is anchored by Michael's
and contains approximately 214,000 square feet of GLA.
Management believes that the current annualized net cash flow
generated by these recently acquired properties provides a weighted average
annualized yield of approximately 9.8% on the Company's investment in such
properties.
Retail Properties Acquisition -
As reported in the Company's Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 1998, the Company, through an affiliated
entity, acquired fee interests in three properties from a retailer in the
Chicago, Illinois market comprising approximately 516,000 square feet of GLA
for an aggregate purchase price of approximately $23.7 million. These properties
include approximately 70,000 square feet of showroom space and adjoining
warehouses of approximately 100,000 square feet at each location. Simultaneous
with this transaction, the Company leased, to a national furniture retailer, the
showroom portion of each property under individual long-term leases. The Company
is currently planning the redevelopment of the warehouse portion of each
property.
Financial statement information required under Item 7 of Form 8-K is
not required in connection with the retail properties acquisition since these
properties acquired were non-operating rental real estate assets owned by a
retailer and not a business with financial statements and information of the
type required by Item 7.
4
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) (b) Financial Statements and Pro Forma Financial Information
The financial statements and pro forma financial information filed
herewith is as follows:
Page
Report of Independent Accountants..................................7
Combined Historical Summary of Revenue and Certain
Operating Expenses of Certain Acquired Properties
for the Year Ended December 31, 1997 (Audited) and the Three Months
Ended March 31, 1998 (Unaudited)...................................8
Notes to Combined Historical Summary of Revenue and Certain
Operating Expenses of Certain Acquired Properties..................9
Estimates of Net Income and Funds from Operations of Certain
Acquired Properties...............................................10
Notes to Estimates of Net Income and Funds from Operations of
Certain Acquired Properties.......................................11
Pro Forma Condensed Consolidated Balance Sheet
as of March 31, 1998..............................................13
Pro Forma Condensed Consolidated Statements of
Income for the Year Ended December 31, 1997 and
the Three Months Ended March 31, 1998.............................14
Notes to Pro Forma Condensed Consolidated
Financial Statements..............................................16
(c) Exhibits:
* 23.1 Consent of Coopers & Lybrand L.L.P.
-----------------
*Filed herewith.
5
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CERTAIN ACQUIRED PROPERTIES
COMBINED HISTORICAL SUMMARY OF REVENUE AND
CERTAIN OPERATING EXPENSES
FOR THE
YEAR ENDED DECEMBER 31, 1997
6
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders
of Kimco Realty Corporation:
We have audited the accompanying Combined Historical Summary of Revenue and
Certain Operating Expenses of Certain Acquired Properties, as defined in the
accompanying Note 1, for the year ended December 31, 1997. This combined
historical summary is the responsibility of the management of Kimco Realty
Corporation. Our responsibility is to express an opinion on the combined
historical summary based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the combined historical summary is
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the combined historical
summary. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
presentation of the combined historical summary. We believe that our audit
provides a reasonable basis for our opinion.
The accompanying Combined Historical Summary of Revenue and Certain Operating
Expenses of Certain Acquired Properties has been prepared for the purpose of
complying with the rules and regulations of the Securities and Exchange
Commission as described in Note 2, and is not intended to be a complete
presentation of the revenue and expenses of the Certain Acquired Properties.
In our opinion, the combined historical summary referred to above presents
fairly, in all material respects, the revenue and certain operating expenses
of the Certain Acquired Properties described in Note 1 for the year ended
December 31, 1997, in conformity with generally accepted accounting
principles.
COOPERS & LYBRAND L.L.P.
New York, New York
May 20, 1998
7
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CERTAIN ACQUIRED PROPERTIES
COMBINED HISTORICAL SUMMARY OF REVENUE
AND CERTAIN OPERATING EXPENSES
<TABLE>
<CAPTION>
Year Ended Three Months Ended
December 31, 1997 March 31, 1998
------------------- ------------------
(Unaudited)
<S> <C> <C>
Revenue:
Base rentals $ 7,920,890 $ 2,032,285
Operating reimbursements and other income 2,191,061 613,760
----------------- ----------------
10,111,951 2,646,045
----------------- ----------------
Certain operating expenses:
Real estate taxes 1,435,817 288,374
Repairs and maintenance 1,009,477 300,623
Other operating expenses 413,700 96,773
----------------- ----------------
2,858,994 685,770
----------------- ----------------
Excess of revenue over certain
operating expenses $ 7,252,957 $ 1,960,275
================= ================
</TABLE>
The accompanying notes are an integral part of this combined financial
statement.
8
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
CERTAIN ACQUIRED PROPERTIES
NOTES TO COMBINED HISTORICAL SUMMARY OF REVENUE
AND CERTAIN OPERATING EXPENSES
1. Certain Acquired Properties
The Combined Historical Summary of Revenue and Certain Operating Expenses for
the year ended December 31, 1997 relates to the operations of the following
certain acquired properties (the "Certain Acquired Properties"), while under
ownership previous to Kimco Realty Corporation and Subsidiaries.
Property Name Location
- ------------- --------
Village on the Park I and II Aurora, Colorado
Phar-Mor Plaza Englewood, Colorado
Heritage West Shopping Center Lakewood, Colorado
Quincy Place Shopping Center Aurora, Colorado
Spring Creek Shopping Center Colorado Springs, Colorado
East Bank Shopping Center Aurora, Colorado
West 38th Street Shopping Center Denver, Colorado
Marshalls Plaza Cranston, Rhode Island
South Plains Plaza Lubbock, Texas
Poca Fiesta Shopping Center Mesa, Arizona
2. Basis of Presentation
The Combined Historical Summary has been prepared on the accrual method of
accounting. Certain operating expenses include operating and maintenance costs,
real estate taxes, and insurance expense relating to the operation of the
Certain Acquired Properties. In accordance with the regulations of the
Securities and Exchange Commission, mortgage interest, depreciation and general
and administrative expenses have been excluded, as such costs are dependent
upon a particular owner, purchase price or other financial agreements.
3. Revenue Recognition
Minimum revenues from rental property are recognized on a straight-line basis
over the terms of the related leases.
The future minimum revenues from rental property under the terms of all
noncancellable tenant leases are approximately as follows:
1998 $8,010,000
1999 $7,221,000
2000 $6,427,000
2001 $5,607,000
2002 $4,121,000
Thereafter $11,040,000
9
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
ESTIMATES OF NET INCOME AND
FUNDS FROM OPERATIONS
OF
CERTAIN ACQUIRED PROPERTIES
(Unaudited)
The following represents an estimate of the net income and funds from
operations expected to be generated from the operation of the Certain Acquired
Properties based upon the Combined Historical Summary of Revenue and Certain
Operating Expenses of Certain Acquired Properties for the year ended December
31, 1997. These estimated results do not purport to represent results of
operations for these properties in the future and were prepared on the basis
described in the accompanying notes which should be read in conjunction
herewith.
Estimated Net Income
Excess of revenue over certain operating expenses $ 7,252,957
Less: Estimated depreciation (Note 1) (1,586,828)
===========
Estimated net income $ 5,666,129
===========
Estimated Funds from Operations
Estimated net income $ 5,666,129
Add: Estimated depreciation (Note 1) 1,586,828
-----------
Estimated funds from operations $ 7,252,957
===========
10
<PAGE>
KIMCO REALTY COPRORATION AND SUBSIDIARIES
NOTES TO ESTIMATES OF NET INCOME AND
FUNDS FROM OPERATIONS
OF
CERTAIN ACQUIRED PROPERTIES
1. Basis of Presentation
Depreciation has been estimated based upon an allocation of the purchase
prices of the Certain Acquired Properties to land (20%) and building (80%) and
assuming a 39 year useful life applied on a straight-line method.
No income taxes have been provided because the Company is organized and
operates in such a manner so as to qualify as a Real Estate Investment Trust
("REIT") under the provisions of the Internal Revenue Code (the "Code").
Accordingly, the Company generally will not pay Federal income taxes provided
that distributions to its stockholders equal at least the amount of its REIT
taxable income as defined under the Code.
2. Acquisition Considerations
In assessing the properties acquired, the Company's management considered the
existing tenancies, which are the primary revenue source, the occupancy rates,
which averaged 97.3% on the dates of acquisition, the competitive nature of
the markets and comparative rental rates. Furthermore, current and anticipated
maintenance and repair costs, real estate taxes and capital improvement
requirements were evaluated. Management is not aware of any material factors
that would cause the reported financial information in the accompanying
Combined Historical Summary of Revenue and Certain Operating Expenses and
Estimates of Net Income and Funds from Operations of Certain Acquired
Properties to be misleading.
11
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AND
STATEMENTS OF INCOME
The accompanying Pro Forma Condensed Consolidated Balance Sheet as of March 31,
1998 gives effect to (i) the purchase of four shopping center properties
acquired by the Company during April and May 1998, (ii) the issuance of an
aggregate 2,259,020 shares of the Company's common stock during April 1998, in
four separate transactions, consisting of a primary public offering priced at
$36.0625 per share and three private placements priced at $36.0625, $36.625 and
$36.25 per share and (iii) the issuance of partnership units valued at
approximately $5.0 million in connection with the Bayshore Gardens acquisition,
as if these properties had been acquired and the common shares and partnership
units were issued as of March 31, 1998.
The accompanying Pro Forma Condensed Consolidated Statements of Income for the
year ended December 31, 1997 and the three months ended March 31, 1998 assume
the Shopping Center Acquisitions had occurred as of January 1, 1997. The pro
forma information is based on the historical statements of the Company after
giving effect to the acquisition of these properties.
The Pro Forma Condensed Consolidated Balance Sheet and the Statements of
Income have been prepared by the management of the Company. These pro forma
statements may not be indicative of the results that would have actually
occurred if the Shopping Center Acquisitions had been in effect on the date
indicated. Also, they may not be indicative of the results that may be
achieved in the future. The Pro Forma Condensed Consolidated Balance Sheet and
Statements of Income should be read in conjunction with Kimco Realty
Corporation's audited financial statements as of December 31, 1997 and for the
year then ended (which are included in the Company's Annual Report on Form
10-K for the year ended December 31, 1997), and the unaudited condensed
consolidated financial statements as of March 31, 1998 and for the three
months then ended (which are included in the Company's Quarterly Report on
Form 10-Q for the period ended March 31, 1998) and the accompanying notes
thereto.
12
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
MARCH 31, 1998
---------------
(Unaudited)
<TABLE>
<CAPTION>
PRO FORMA
AS REPORTED ADJUSTMENTS PRO FORMA
----------------- ------------- ----------------
<S> <C> <C> <C>
Assets:
Real estate, net of accumulated depreciation $ 1,311,322,749 $ 47,985,000 $ 1,359,307,749
Investment in retail store leases 15,539,477 - 15,539,477
Cash and cash equivalents 34,377,395 34,551,891 68,929,286
Accounts and notes receivable 18,304,186 - 18,304,186
Other assets 91,573,797 - 91,573,797
--------------- ------------- ---------------
$ 1,471,117,604 $ 82,536,891 $ 1,553,654,495
=============== ============= ===============
Liabilities:
Notes payable $ 510,250,000 $ - $ 510,250,000
Mortgages payable 141,192,853 - 141,192,853
Other liabilities, including minority interests
in partnerships 74,341,707 4,973,196 79,314,903
--------------- ------------- ----------------
725,784,560 4,973,196 730,757,756
--------------- ------------- ----------------
Stockholders' Equity:
Preferred stock, $1.00 par value, authorized
5,000,000 shares
Class A Preferred Stock, $1.00 par value,
authorized 345,000 shares
Issued and outstanding 300,000 shares 300,000 - 300,000
Aggregate liquidation preference $75,000,000
Class B Preferred Stock, $1.00 par value,
authorized 230,000 shares
Issued and outstanding 200,000 shares 200,000 - 200,000
Aggregate liquidation preference $50,000,000
Class C Preferred Stock, $1.00 par value,
authorized 460,000 shares
Issued and outstanding 400,000 shares 400,000 - 400,000
Aggregate liquidation preference $100,000,000
Common stock, $.01 par value, authorized
100,000,000 shares
Issued and outstanding 40,419,440 and
42,678,460 shares, respectively 404,194 22,590 426,784
Paid-in capital 858,197,672 77,541,105 935,738,777
Cumulative distributions in excess of net income (114,168,822) - (114,168,822)
--------------- ------------- ---------------
745,333,044 77,563,695 822,896,739
--------------- ------------- ---------------
$ 1,471,117,604 $ 82,536,891 $ 1,553,654,495
=============== ============= ===============
</TABLE>
The accompanying notes are an integral part of these pro forma condensed
consolidated financial statements.
13
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1997
-------------------------------
(Unaudited)
<TABLE>
<CAPTION>
Shopping Center
As Reported Acquisitions Pro Forma
--------------- ----------------- ----------------
<S> <C> <C> <C>
Revenues from rental property $ 198,929,403 $ 17,191,682 $ 216,121,085
--------------- ----------------- ----------------
Rental property expenses:
Rent 4,873,200 - 4,873,200
Real estate taxes 26,345,685 2,069,241 28,414,926
Interest 31,744,762 3,222,408 34,967,170
Operating and maintenance 22,194,628 2,163,488 24,358,116
Depreciation and amortization 30,052,714 2,796,779 32,849,493
--------------- ----------------- ----------------
115,210,989 10,251,916 125,462,905
--------------- ----------------- ----------------
Income from rental property 83,718,414 6,939,766 90,658,180
Income from investment in retail store leases 3,571,946 - 3,571,946
--------------- ----------------- ----------------
87,290,360 6,939,766 94,230,126
Management fee income 3,276,152 - 3,276,152
General and administrative expenses (11,651,341) - (11,651,341)
Other income (expenses), net 6,677,279 (777,856) 5,899,423
--------------- ----------------- ----------------
Income before gain on sale of shopping center 85,592,450 6,161,910 91,754,360
Gain on sale of shopping center property 243,995 - 243,995
--------------- ----------------- ----------------
Net income $85,836,445 $6,161,910 $91,998,355
=============== ================= ================
Net income applicable to common shares $67,398,745 $6,161,910 $73,560,655
=============== ================= ================
Net income per common share
Basic $1.80 $1.97
===== =====
Diluted $1.78 $1.94
===== =====
</TABLE>
The accompanying notes are an integral part of these pro forma condensed
consolidated financial statements.
14
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
FOR THE THREE MONTHS ENDED March 31, 1998
------------------------------------------
(Unaudited)
<TABLE>
<CAPTION>
Shopping Center
As Reported Acquisitions Pro Forma
-------------- ---------------- ------------
<S> <C> <C> <C>
Revenues from rental property $ 63,111,632 $ 3,186,827 $ 66,298,459
-------------- ---------------- ------------
Rental property expenses:
Rent 2,752,135 - 2,752,135
Real estate taxes 8,876,999 265,551 9,142,550
Interest 11,039,207 367,816 11,407,023
Operating and maintenance 6,936,109 529,202 7,465,311
Depreciation and amortization 8,899,764 514,380 9,414,144
-------------- ---------------- ------------
38,504,214 1,676,949 40,181,163
-------------- ---------------- ------------
Income from rental property 24,607,418 1,509,878 26,117,296
Income from investment in retail store leases 916,171 - 916,171
-------------- ---------------- ------------
25,523,589 1,509,878 27,033,467
Management fee income 801,708 - 801,708
General and administrative expenses (3,180,653) - (3,180,653)
Other income (expenses), net 1,437,863 (228,464) 1,209,399
-------------- ---------------- ------------
Income before gain on sale of shopping center 24,582,507 1,281,414 25,863,921
Gain on sale of shopping center property 901,249 - 901,249
-------------- ---------------- ------------
Net income $25,483,756 $1,281,414 $26,765,170
============== ================ ============
Net income applicable to common shares $20,874,331 $1,281,414 $22,155,745
============== ================ ============
Net income per common share
Basic $0.52 $0.55
===== =====
Diluted $0.51 $0.54
===== =====
</TABLE>
The accompanying notes are an integral part of these pro forma condensed
consolidated financial statements.
15
<PAGE>
KIMCO REALTY CORPORATION AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
1. Basis of Presentation
The Pro Forma Condensed Consolidated Balance sheet as of March 31, 1998 gives
effect to (i) the purchase of four shopping center properties acquired by the
Company during April and May 1998, (ii) the issuance of an aggregate 2,259,020
shares of the Company's common stock during April 1998, in four separate
transactions, consisting of a primary public offering priced at $36.0625 per
share and three private placements priced at $36.0625, $36.625 and $36.25 per
share and (iii) the issuance of partnership units valued at approximately $5.0
million in connection with the Bayshore Gardens acquisition, as if these
properties had been acquired and the common shares and partnership units were
issued as of March 31, 1998.
As reported amounts have been adjusted based upon the historical results of the
Shopping Center Acquisitions for the year ended December 31, 1997. These
adjustments to the Pro Forma Condensed Consolidated Statements of Income have
the effect of presenting the results for the year ended December 31, 1997 and
the three months ended March 31, 1998 as if the Shopping Center Acquisitions
had been completed as of January 1, 1997.
2. Pro Forma Adjustments
The adjustment to interest expense relates to (i) the assumption of mortgage
debt encumbering four of the properties acquired and additional borrowings
related to the other Shopping Center Acquisitions.
The adjustments to other income (expenses), net relate to (i) the elimination of
interest earned on funds assumed to have been expended as of January 1, 1997
for the Shopping Center Acquisitions and (ii) the preferred return
applicable to the partnership unitholders in connection with the Bayshore
Gardens acquisition.
The adjustment for depreciation was based upon an estimated useful life of 39
years using the straight-line method and purchase price allocations to land
and building of 20% and 80%, respectively.
16
<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 hereunto duly authorized.
Kimco Realty Corporation
------------------------
Registrant
Date: May 22, 1998
By: /s/ Michael V. Pappagallo
---------------------------
Michael V. Pappagallo
Chief Financial Officer
17
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
Kimco Realty Corporation on Form S-3 (File No. 333-37285), of our report dated
May 20, 1998 on our audit of the Combined Historical Summary of Revenue and
Certain Operating Expenses of Certain Acquired Properties as of December 31,
1997, which report is included in this Current Report on Form 8-K.
COOPERS & LYBRAND L.L.P.
New York, New York
May 22, 1998
18
