SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report (date of earliest event reported): August 28, 1997
CarrAmerica Realty Corporation
(formerly Carr Realty Corporation)
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(Exact name of registrant as specified in its charter)
Maryland 1-11706 52-1796339
- ---------------------------- ---------- -------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
1700 Pennsylvania Avenue, N.W., Washington, DC 20006
- ---------------------------------------------- ---------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (202) 624-7500
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FORM 8-K
ITEM 1. Changes in Control of Registrant.
Not applicable.
ITEM 2. Acquisition or Disposition of Assets.
Not applicable.
ITEM 3. Bankruptcy or Receivership.
Not applicable.
ITEM 4. Changes in Registrant's Certifying Accountant.
Not applicable.
ITEM 5. Other Events.
Not applicable.
ITEM 6. Resignations of Registrant's Directors.
Not applicable.
ITEM 7. Financial Statements and Exhibits.
(a) Financial Statements.
Not applicable.
(b) Pro Forma Financial Information.
Attached hereto as Exhibit 99.1 are a pro forma condensed consolidated
balance sheet (unaudited) at June 30, 1997 and pro forma condensed consolidated
statements of operations (unaudited) for the six months ended June 30, 1997 and
the year ended December 31, 1996, relating to the Company.
(c) Exhibits.
Exhibit
Number
99.1 Pro Forma Financial Information.
Pro forma condensed consolidated balance
sheet (unaudited) at June 30, 1997 and pro
forma condensed consolidated statements of
operations (unaudited) for the six months
ended June 30, 1997 and the year ended
December 31, 1996, relating to the Company.
ITEM 8. Change in Fiscal Year.
Not applicable.
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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 hereto duly authorized.
Date: August 28, 1997
CARRAMERICA REALTY CORPORATION
By: /s/ Brian K. Fields
--------------------
Brian K. Fields
Chief Financial Officer
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EXHIBIT INDEX
Exhibit
Number
- -------
99.1 Pro Forma Financial Information.
Pro forma condensed consolidated balance sheet (unaudited) at
June 30, 1997 and pro forma condensed consolidated statements
of operations (unaudited) for the six months ended June 30,
1997 and the year ended December 31, 1996, relating to the
Company.
CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share data)
<TABLE>
<CAPTION>
For the six months ended June 30, 1997 (Unaudited)
--------------------------------------------------------------------------------------------------------
Pro Forma Adjustments
-----------------------------------------------------------------------------
January April August
Common Common June Preferred
Acquired Probable Stock Stock Debt Stock Pro Forma
Historical(A) Properties(B) Acquisitions(C) Offering(D) Offering(E) Offering(F) Offering(G) Consolidated
------------- ------------- --------------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Real estate operating
revenue:
Rental revenue $143,977 $ 35,065(1) $ - $ - $ - $ - $ - $179,042
Real estate service
income 7,936 9,588(1) - - - - - 17,524
---------- ----------- --------- -------- -------- -------- ---------- ---------
Total revenues 151,913 44,653 - - - - - 196,566
---------- ----------- --------- -------- -------- -------- ---------- ---------
Real estate operating
expenses:
Property operating
expenses 50,388 17,558(4) - - - - - 67,946
Interest expense 22,992 15,375(2) (107) (823) (4,583) 158 (7,094) 25,918
General and
administrative 10,332 9,468(1) - - - - - 19,800
Depreciation and
amortization 34,183 5,923(3) - - - - - 40,106
---------- ----------- --------- -------- -------- --------- ---------- ---------
Total operating
expenses 117,895 48,324 (107) (823) (4,583) 158 (7,094) 153,770
---------- ----------- --------- -------- -------- --------- ---------- ---------
Real estate
operating income 34,018 (3,671) 107 823 4,583 (158) 7,094 42,796
Other operating
income (expense), net 1,509 - - - - - - 1,509
---------- ----------- --------- -------- -------- --------- ---------- ---------
Income before minority
interest 35,527 (3,671) 107 823 4,583 (158) 7,094 44,305
---------- ----------- --------- -------- -------- --------- ---------- ---------
Minority interest (3,737) (130)(5) (1) - - - - (3,868)
---------- ----------- --------- -------- -------- --------- ---------- ---------
Income from continuing
operations $ 31,790 (3,801) $ 106 $ 823 $ 4,583 $(158) $7,094 $ 40,437
========== =========== ========= ======== ======== ========= ========== =========
Earnings from continuing
operations per common
share $ 0.58 $ 0.53(H)
========== ========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
For the six months ended June 30, 1997 (Unaudited)
--------------------------------------------------------------------------------------------------------
Pro Forma Adjustments
-----------------------------------------------------------------------------
January April August
Common Common June Preferred
Acquired Probable Stock Stock Debt Stock Pro Forma
Historical(A) Properties(B) Acquisitions(C) Offering(D) Offering(E) Offering(F) Offering(G) Consolidated
------------- ------------- --------------- ----------- ----------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Real estate operating
revenue:
Rental revenue $154,165 $167,384(1) $ - $ - $ - $ - $ - $321,549
Real estate service
income 12,512 18,154(1) - - - - - 30,666
---------- ----------- --------- -------- -------- --------- ---------- ---------
Total revenues 166,677 185,538 - - - - - 352,215
---------- ----------- --------- -------- -------- --------- ---------- ---------
Real estate operating
expenses:
Property operating
expenses 51,927 68,445(4) - - - - - 120,372
Interest expense 31,630 62,352(2) (219) (10,200) (15,609) (6) (14,498) 53,450
General and
administrative 15,228 17,264(1) - - - - - 32,492
Depreciation and
amortization 38,264 34,950(3) - - - - - 73,214
---------- ----------- --------- -------- -------- --------- ---------- ---------
Total operating
expenses 137,049 183,011 (219) (10,200) (15,609) (6) (14,498) 279,528
---------- ----------- --------- -------- -------- --------- ---------- ---------
Real estate
operating income 29,628 2,527 219 10,200 15,609 6 14,498 72,687
Other operating income
(expense), net (94) 8(1) - - - - - (86)
---------- ----------- --------- -------- -------- --------- ---------- ---------
Income before minority
interest 29,534 2,535 219 10,200 15,609 6 14,498 72,601
---------- ----------- --------- -------- -------- --------- ---------- ---------
Minority interest (4,732) (887)(5) 3 - - - - (5,616)
---------- ----------- --------- -------- -------- --------- ---------- ---------
Income from continuing
operations $ 24,802 $1,648 $ 222 $10,200 $15,609 $ 6 $14,498 $ 66,985
========== =========== ========= ======== ======== ========= ========== =========
Earnings from continuing
operations per common
share $ 0.90 $0.82(H)
========= ========
</TABLE>
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CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED
BALANCE SHEET
June 30, 1997
(Unaudited)
Adjustments (dollars in thousands):
(A) Reflects the Company's historical condensed consolidated balance sheet as of
June 30, 1997.
(B) Reflects the following pro forma adjustments related to the acquired
properties:
(1) total acquisition costs of $195,219 ($16,200 related to Von Karman,
$25,258 related to San Mateo, $5,200 related to Two Mission Park,
$15,138 related to 3571 North First Street, $7,804 related to the
Lightspan Building, $2,019 related to Preston Ridge land, $39,000
related to CM Capital, $34,100 related to Panattoni, and $50,500
related to OmniOffices; and
(2) the assumption of existing debt of $500 related to OmniOffices, the
assumption of other liabilities totaling $655, use of the Company's
purchase deposits of $2,450 (net of other assets acquired of $39,394
related to OmniOffices), and draws on the Company's line of credit of
$191,613.
(C) Reflects the following pro forma adjustments related to the anticipated
effects of probable acquisitions:
(3) total acquisition costs of $62,075 ($8,117 related to Reston Crossing
land, $22,284 related to Valley Technology Centre land, $9,800
related to Rosewood, $17,400 related to Watkins-Johnson, and $2,366
related to Draper Park North land, and $2,108 related to Sorenson
land); and
(4) the use of the Company's purchase deposits of $2,920 and draws on the
Company's line of credit of $59,155.
(D) Reflects the issuance of $275,000 of senior unsecured notes. The Company
used all of the proceeds (net of deferred financing costs incurred of
$2,250 and the discount on issuance of $807) to pay down amounts
outstanding under its line of credit.
(E) Reflects the sale of 8,000,000 shares of Series B Cumulative Redeemable
Preferred Stock at a net price of $193,300, after deduction of
transaction costs $400. The Company used all of the proceeds to pay down
amounts outstanding under its line of credit.
<PAGE>
CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)
<TABLE>
<CAPTION>
At June 30, 1997 (Unaudited)
--------------------------------------------------------------------------------------------
Pro Forma Adjustments
------------------------------------------------------------
August
Preferred
Acquired Probable June Debt Stock Pro Forma
Historical(A) Properties(B) Acquisitions(C) Offering(D) Offering(E) Consolidated
--------------- ---------------- ----------------- ------------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Rental property, net $ 1,757,977 $ 153,806(1) $ - $ - $ - $ 1,911,783
Development property 199,080 2,018(1) 62,075 (3) - - 263,173
Restricted and unrestricted
cash 20,332 - - - - 20,332
Other assets 107,910 36,944(1)(2) (2,920)(4) 3,057 - 144,991
-------------- -------------- -------------- ---------- ------------ -----------
Total assets $ 2,085,299 $ 192,768 $ 59,155 $ 3,057 $ - $2,340,279
============== ============== ============== ========== ============ ===========
LIABILITIES
Mortgages and notes payable $ 840,36 $ 192,113(2) $ 59,155 (4) $ (271,943) $(193,300) 626,391
Senior unsecured notes - - 275,000 - 275,000
Other liabilities 59,966 655(2) - - - 60,621
-------------- -------------- -------------- ---------- ------------ ----------
Total liabilities 900,332 192,768 59,155 3,057 (193,300) 962,012
Minority interest 66,789 - - - - 66,789
STOCKHOLDERS' EQUITY
Preferred stock 17 - - - 80 97
Common stock 571 - - - - 571
Additional paid-in capital 1,183,933 - - - 193,220 1,377,153
Dividends paid in excess of
earnings (66,343) - - - - (66,343)
-------------- -------------- -------------- ---------- ------------- -----------
Total stockholders' equity 1,118,178 - - - 193,300 1,311,478
-------------- -------------- -------------- ----------- ------------- -----------
Total liabilities and
stockholders' equity $ 2,085,299 $ 192,768 $ 59,155 $ 3,057 $ - $ 2,340,279
============== ============== ============== =========== ============= ==========
</TABLE>
<PAGE>
CARRAMERICA REALTY CORPORATION AND SUBSIDIARIES
NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Six Months Ended June 30, 1997 and the Year Ended December 31, 1996
(Unaudited)
Adjustments (dollars in thousands):
(A) Reflects the Company's historical condensed consolidated statements of
operations for the six months ended June 30, 1997 and the year ended
December 31, 1996.
(B) Pro forma adjustments for the purchases of the acquired properties
reflect:
(1) the historical operating activity of the properties acquired and
OmniOffices;
(2) the additional interest expense on the line of credit ($15,925 of
interest costs net of $2,047 capitalized for the six months ended
June 30, 1997 and $57,577 of interest costs net of $8,584 capitalized
in 1996) and interest expense on debt assumed in certain acquisitions
($1,497 for the six months ended June 30, 1997 and $13,359 in 1996);
(3) the depreciation and amortization expense for the acquisitions based
on the new accounting basis for the rental property and OmniOffices;
(4) the historical operating activity of the properties and OmniOffices
reduced by the elimination of management fee expenses that are no
longer incurred by the Company upon purchase of the properties; and
(5) the minority interest share of earnings.
(C) Pro forma adjustments for the probable acquisitions reflect the net
interest capitalized on the development properties ($2,171 of interest
costs net of $2,278 capitalized for the six months ended June 30, 1997
and $4,437 of interest costs net of $4,656 capitalized in 1996) and the
change in minority interest share of earnings.
(D) Pro forma adjustment reflects the reduction in interest expense
associated with the pay down of amounts outstanding under the line of
credit with the proceeds from the January Offering of common stock.
(E) Pro forma adjustment reflects the reduction in interest expense
associated with the pay down of amounts outstanding under the line of
credit with the proceeds from the April Offering of common stock.
(F) Pro forma adjustment reflects the increase in interest expense of $158
for the six months ended June 30, 1997 and the decrease in interest
expense of $6 for 1996, which includes the amortization of deferred
financing costs of $188 for the six months ended June 30, 1997 and $373
for 1996, associated with the pay down of amounts outstanding under the
line of credit with the proceeds from the issuance of $275 million of
senior unsecured notes.
<PAGE>
(G) Pro forma adjustment reflects the reduction in interest expense
associated with the pay down of amounts outstanding under the line of
credit with the proceeds from the August Offering of preferred stock.
(H) Based upon 57,411,043 and 56,931,340 pro forma shares of common stock
outstanding and common stock equivalents on a weighted average basis
during the six months ended June 30, 1997 and the year ended December 31,
1996, respectively.
