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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 1934
Date of Report (date of earliest event reported): September 25, 1998
CarrAmerica Realty Corporation
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(Exact name of registrant as specified in its charter)
Maryland 1-11706 52-1796339
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
1850 K Street, N.W., Washington, D.C. 20006
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(Address of principal executive offices)
Registrant's telephone number, including area code: (202) 729-7500
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FORM 8-K
ITEM 1. Changes in Control of Registrant
Not applicable
ITEM 2. Acquisition or Disposition of Assets.
Attached hereto as Exhibit 99.1 are Historical Summaries of Operating
Revenue and Expenses for the year ended December 31, 1997 with accompanying
notes and Independent Auditor's Report for Citymark Tower. In accordance with
Rule 3-14 of Regulation S-X, financial statements with respect to the listed
property are being filed because the Company has either (a) already acquired the
property and the book value of the property is significant, or (b) deemed the
acquisition to be probable and the book value of the property is significant.
ITEM 3. Bankruptcy or Receivership.
Not applicable.
ITEM 4. Changes in Registrant's Certifying Accountant.
Not applicable.
ITEM 5. Other Events.
None.
ITEM 6. Resignations of Registrant's Directors.
Not applicable.
ITEM 7. Financial Statements and Exhibits.
(a) Financial Statements.
Attached hereto as Exhibit 99.1 are the following financial
statements:
(i) Historical Summaries of Operating Revenue and Expenses for
Citymark Tower for the year ended December 31, 1997 with accompanying notes and
Independent Auditors' Report.
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(b) Exhibits
Exhibit
Number
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99.1 Financial Statements
(i) Historical Summaries of Operating Revenue and Expenses
for Citymark Tower for the year ended December 31, 1997 with
accompanying notes and Independent Auditors' Report.
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: September 25, 1998
CARRAMERICA REALTY CORPORATION
By: /s/ Brian K. Fields
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Brian K. Fields
Chief Financial Officer
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EXHIBIT INDEX
Exhibit
Number
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99.1 Financial Statements
(i) Historical Summaries of Operating Revenue and Expenses for Citymark
Tower for the year ended December 31, 1997 with accompanying notes and
Independent Auditors' Report.
Exhibit 99.1
CITYMARK TOWER
Historical Summary
of Operating Revenue and Expenses
Year Ended December 31, 1997
(With Independent Auditors' Report Thereon)
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Independent Auditors' Report
The Partners
Carr Realty L.P.:
We have audited the accompanying historical summary of operating revenue and
expenses, as defined in note 2(a), of Citymark Tower for the year ended December
31, 1997. This historical summary is the responsibility of the management of
Citymark Tower. Our responsibility is to express an opinion on the 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 historical summary is free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the 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 historical summary. We believe
that our audit provides a reasonable basis for our opinion.
The accompanying historical summary was prepared for the purpose of complying
with the rules and regulations of the Securities and Exchange Commission and is
not intended to be a complete presentation of the revenue and expenses of
Citymark Tower.
In our opinion, the historical summary referred to above, presents fairly, in
all material respects, the operating revenue and expenses described in note 2(a)
of Citymark Tower for the year ended December 31, 1997, in conformity with
generally accepted accounting principles.
KPMG PEAT MARWICK LLP
September 24, 1998
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CITYMARK TOWER
Historical Summary of Operating Revenue and Expenses
For the year ended December 31, 1997
Rental and operating expense pass-through revenue $ 2,562,056
Operating expenses:
Repairs and maintenance 142,286
Utilities 501,688
Operating services 323,887
Property management fees 50,995
Real estate taxes 574,920
Administrative 219,283
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Total operating expenses 1,813,059
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Operating revenue in excess of operating expenses $ 748,997
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See accompanying notes to historical summary.
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CITYMARK TOWER
Notes to Historical Summary of Operating Revenue and Expenses
For the year ended December 31, 1997
(1) Description of the property
Citymark Tower (the Building) consists of one building located in Dallas,
Texas. The Building contains approximately 218,000 square feet of leasable
office space. As of December 31, 1997, the building was approximately 77%
leased. The building was acquired by a subsidiary of Carr Realty L.P., a
subsidiary of CarrAmerica Realty Corporation, on January 27, 1998.
(2) Summary of Significant Accounting Policies
(a) Basis of Presentation
The accompanying historical summary of operating revenue and expenses is
not representative of the actual operations for the period presented as
certain revenues and expenses, which may not be comparable to those
expected to be incurred by Carr Realty L.P. in the proposed future
operations of the building have been excluded. Interest income has been
excluded from revenue, and interest, depreciation and amortization, and
other costs not directly related to the future operations of Citymark
Tower have been excluded from expenses. Management is not aware of any
material factors relating to Citymark Tower that would cause the
historical summary of operating revenue and expenses not to be
indicative of future operating results of the building.
(b) Revenue Recognition
Rental revenue from rental operations is recognized straight-line over
the terms of the respective leases.
(3) Rental Revenue
Minimum future rentals (excluding modifications and renewal options) on
noncancelable leases are as follows for the years ending December 31:
1998 $ 1,957,575
1999 860,372
2000 486,070
2001 239,564
2002 50,034
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$ 3,593,615
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(Continued)
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CITYMARK TOWER
Notes to Historical Summary of Operating Revenue and Expenses
For the year ended December 31, 1997
(4) Pro Forma Taxable Operating Results and Cash Available from Operations
(Unaudited)
The unaudited pro forma table reflects the pro forma taxable operating
results and pro forma cash available from operations of Citymark Tower for
the twelve months ended December 31, 1997, as adjusted for certain items
which can be factually supported. For purposes of presenting pro forma net
taxable operating income, revenue is recognized when it is either
collectible under the lease terms or collected. Tax depreciation and
amortization have been calculated based on the new cost basis for the
Building, assuming the purchase by Carr Realty L.P. was made on January 1,
1997. Tax depreciation for the Building is computed on the modified
accelerated cost recovery system method over a 39-year life. This statement
does not purport to forecast actual operating results for any period in the
future.
Proforma net operating income (exclusive of
depreciation and amortization expense) $ 692,039
Less - estimated depreciation and amortization expense 500,874
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Proforma taxable operating income $ 191,165
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Proforma cash available from operations $ 692,039
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