<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
---
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 1996
OR
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE PERIOD FROM TO
COMMISSION FILE NUMBER: 1934 ACT FILE NUMBER: 0-25968
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
(Exact name of registrant as specified in its charter)
DELAWARE 54-1681657
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2345 CRYSTAL DRIVE
CRYSTAL CITY, VA
(Address of principal 22202
executive offices) (Zip Code)
Registrant's telephone number including area code: (703) 920-8500
____________________
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
CLASS A UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class)
____________________
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
As of May 10, 1996, there were 21,935,621 Units of Limited Partnership
Interest of the Registrant issued and outstanding.
1
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
FORM 10-Q
INDEX
<TABLE>
<CAPTION>
Pages
-----
<S> <C>
PART I - FINANCIAL INFORMATION
Item 1: Financial Statements
Charles E. Smith Residential Realty L.P.
Financial Statements as of March 31, 1996, and
December 31, 1995, Filed as a Part of This Report
Consolidated Balance Sheets 3
Consolidated Statements of Operations 4
Consolidated Statements of Partners' Deficit 5
Consolidated Statements of Cash Flows 6
Notes to Consolidated Financial Statements 7
Item 2: Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II - OTHER INFORMATION 17
SIGNATURES 18
</TABLE>
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
March 31, 1996 December 31, 1995
-------------- -----------------
(Unaudited)
<S> <C> <C>
ASSETS
Rental property, at predecessor cost,
net of accumulated depreciation $ 273,243 $ 276,269
Rental property, acquired and developed, net of
accumulated depreciation 155,395 138,221
Cash and cash equivalents 2,005 9,478
Tenants' security deposits 3,618 3,634
Escrow funds 7,035 5,371
Investment in and advances to Property Service Businesses
and other 11,030 8,348
Deferred charges, net of accumulated amortization 18,852 18,782
Other assets 10,317 9,219
------------- --------------
$ 481,495 $ 469,322
============= ==============
LIABILITIES AND EQUITY
Liabilities
Mortgage loans $ 413,799 $ 413,973
Notes payable 87,136 69,204
Accounts payable and accrued expenses 11,711 12,693
Tenants' security deposits 3,618 3,634
Due to related parties 227 1,441
------------- --------------
Total liabilities $ 516,491 $ 500,945
------------- --------------
Commitments and Contingencies
Partners' deficit
21,935,621 and 21,913,562 units issued and outstanding
at March 31, 1996 and December 31, 1995, respectively (34,996) (31,623)
------------- ---------------
$ 481,495 $ 469,322
============= ===============
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
CONSOLIDATED STATEN[ENTS OF OPERATIONS
(DOLLARS IN THOUSANDS, EXCEPT FOR PER UNIT AMOUNTS)
<TABLE>
<CAPTION>
(Unaudited)
For the Three Months
Ended March 31,
---------------------
1996 1995
--------- ---------
(Restated)
<S> <C> <C>
RENTAL PROPERTIES
Revenues $ 39,541 $34,102
Expenses
Operating 16,672 13,544
Real estate taxes 2,442 2,028
Depreciation and amortization 4,392 3,930
--------- ---------
Total expenses 23,506 19,502
--------- ---------
Operating profit - rental properties 16,035 14,600
--------- ---------
PROPERTY SERVICE BUSINESSES
Equity in income of Property Service Businesses 1,548 561
--------- ---------
General & administrative expenses (745) (653)
Interest income 269 308
Interest expense (10,411) (8,663)
--------- ---------
Net income $ 6,696 $ 6,153
========= =========
Net income per unit $ 0.31 $ 0.29
========= =========
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE>
CHARLES E. SMITH RESEDENTIAL REALTY L.P.
CONSOLIDATED STATEMENTS OF PARTNERS' DEFICIT
<TABLE>
<CAPTION>
General Limited
(Dollars in Thousands, Except for Per Unit Amounts) Partner Partners Total
- - -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Balance, June 29, 1994 $ - $ - $ -
Contribution by Predecessors of assets, at historical cost, net of liabilities - (244,208) (244,208)
Contribution by Charles E. Smith Residential Realty, Inc. 2,014 199,360 201,374
Unit grants 23 2,257 2,280
Deferred compensation - unit grants (20) (1,975) (1,995)
Net income 152 15,089 15,241
Distributions ($0.48 per unit) (102) (10,110) (10,212)
--------- ---------- ----------
Balance, December 31, 1994 2,067 (39,587) (37,520)
Units exchanged for acquisitions 155 15,336 15,491
Amortization of deferred compensation - unit grants 6 564 570
Net income 311 30,742 31,053
Distributions ($1.915 per unit) (412) (40,805) (41,217)
--------- ---------- ----------
Balance, December 31, 1995 2,127 (33,750) (31,623)
Units exchanged for acquisitions 5 508 513
Amortization of deferred compensation - unit grants 1 142 143
Net income 67 6,629 6,696
Distributions ($0.49 per unit) (107) (10,618) (10,725)
--------- ---------- ----------
Balance, March 31, 1996 (Unaudited) $ 2,093 $ (37,089) $ (34,996)
========= ========== ==========
Units issued and outstanding at March 31, 1996 211,810 21,723,811 21,935,621
========= ========== ==========
Units issued and outstanding at December 31, 1995 211,810 21,701,752 21,913,562
========= ========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
CONSOLEDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
(Unaudited)
For the Three Months
Ended March 31,
----------------------
1996 1995
----------- ----------
(Restated)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 6,696 $ 6,153
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 5,164 4,698
Increase in other assets (98) (580)
Decrease in accounts payable and accrued expenses (982) (1,149)
----------- ----------
Net cash provided by operating activities 10,780 9,122
----------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions and development of rental property (17,131) (3,981)
Additions to rental property (824) (738)
Decrease in related party payables:
Property Service Businesses (589) (10,150)
Predecessor (625)
Increase in investment in and advances
to Property Service Businesses and other (2,682) (2,171)
Other (3,435)
----------- ----------
Net cash used by investing activities (25,286) (17,040)
----------- ----------
CASH FLOWS FROM FINANCING ACTIVITES:
Repayments of mortgage debt (174) (78)
Lines of credit:
Proceeds from draws 30,000 1,275
Repayments (13,100) -
Proceeds from construction loan 1,032 -
Distributions to unitholders (10,725) (10,106)
----------- ----------
Net cash provided by (used in) financing activities 7,033 (8,909)
----------- ----------
NET DECREASE IN CASH AND CASH EQUIVALENTS (7,473) (16,827)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 9,478 18,350
----------- ----------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 2,005 $ 1,523
=========== ==========
SUPPLEMENT AL INFORMATION:
Cash paid during the period for interest $ 9,784 $ 8,223
Purchase of property in exchange for units 513 6,342
Capitalized interest - 21O
</TABLE>
The accompanying notes are an integral part of these statements.
6
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying interim financial statements include all of the accounts of
Charles E. Smith Residential Realty L.P. (the "Operating Partnership") and its
subsidiary financing partnerships. All significant intercompany balances and
transactions have been eliminated. The financial information furnished is
unaudited and reflects all normal, recurring adjustments which management
believes are necessary for a fair presentation of financial position as of March
31, 1996 and the results of operations for the interim periods ended March 31,
1996 and 1995. Such interim results are not necessarily indicative of the
operating results for a full year. The accompanying financial statements should
be read in conjunction with the audited financial statements and related
footnotes appearing in the Operating Partnership's Annual Report on Form 10-K.
As discussed in the Form 10-K, 1995 results were restated to reflect a change in
accounting for the Property Service Businesses from the cost to the equity
method in compliance with the Emerging Issues Task Force consensus "Accounting
by a Real Estate Investment Trust for an Investment in a Service Corporation".
As a result, the Operating Partnership's net income for the three months ended
March 31, 1995 decreased by $325,000. The change had no effect on Funds from
Operations of the Operating Partnership.
The Operating Partnership and its subsidiaries are engaged in the ownership,
operation, management, leasing, acquisition, expansion and development of real
estate properties, primarily residential multifamily properties. As of March
31, 1996, the Operating Partnership owns 40 existing multifamily properties
containing 14,460 apartment units, and owns and operates two free-standing
community retail shopping centers, aggregating 436,000 square feet.
Additionally, the Operating Partnership owns substantially all of the economic
interest in entities which provide multifamily and retail property management,
leasing and development services, interior construction and renovation, building
engineering and technical services, and financial advisory services
(collectively the "Property Service Businesses"). The Operating Partnership
uses the equity method of accounting for its investment in the Property Service
Businesses.
2. ACQUISITIONS
In March, 1996, the Operating Partnership acquired 309 apartment units
through the purchase of two properties in northern Virginia. A 262-unit garden-
style community in Reston, Virginia was acquired for approximately $13.7 million
in cash and 22,059 limited partnership units of the Operating Partnership valued
at $0.5 million. A 47-unit community in Old Town, Alexandria was purchased for
approximately $2.8 million in cash.
7
<PAGE>
3. NEW ACCOUNTING PRONOUNCEMENTS
On January 1, 1996, the Operating Partnership implemented SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed Of" which provides guidance on the carrying value of long-lived
assets. Implementation of the standard had no effect on the consolidated
financial statements.
4. PER UNIT DATA
Earnings per unit of the Operating Partnership for the three months ended
March 31, 1996 and 1995 is computed based on 21,860,226 and 21,360,216 units,
respectively, which represents the weighted average number of units outstanding
during the period.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The following discussion should be read in conjunction with the accompanying
financial statements and notes thereto. The results of operations for the three
months ended March 31, 1996 and 1995 presented in the Consolidated Statements of
Operations and discussed below represent the operations of Charles E. Smith
Residential Realty L.P. (the "Operating Partnership") and its subsidiary
financing partnerships.
RENTAL PROPERTIES
Revenues, expenses and operating income before interest and
general/administrative expenses from the multifamily and retail properties for
the three months ended March 31, 1996 and 1995 were as follows:
9
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended March 31,
------------------------------
1996 1995
-------- --------
<S> <C> <C>
(Dollars in Thousands)
Multifamily Properties - Core
Revenues $ 32,735 $ 31,457
Expenses (15,907) (14,549)
-------- --------
Operating income before
depreciation $ 16,828 $ 16,908
======== ========
Multifamily Properties -
Acquisitions and development
Revenues $ 4,364 $ 248
Expenses (2,259) (187)
-------- --------
Operating income before
depreciation $ 2,105 $ 61
======== ========
Retail Properties
Revenues $ 2,442 $ 2,397
Expenses (948) (836)
-------- --------
Operating income before
depreciation $ 1,494 $ 1,561
======== ========
Total Rental Properties
Revenues $ 39,541 $ 34,102
Expenses (19,114) (15,572)
-------- --------
Operating income before
depreciation $ 20,427 18,530
Depreciation and amortization (4,392) $ (3,930)
-------- --------
Operating income before interest
and general/administrative
expenses $ 16,035 $ 14,600
======== ========
</TABLE>
10
<PAGE>
PROPERTY SERVICE BUSINESSES
The Operating Partnership's 99% interest in the revenues, expenses and
operating income before depreciation and amortization from the various Property
Service Businesses for the three months ended March 31, 1996 and 1995 were as
follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
---------------------------------------
1996 1995
--------------- --------------
<S> <C> <C>
(Dollars in Thousands)
Multifamily and Retail Property
Management and Other
Revenues $ 3,107 $ 2,309
Expenses/1/ (2,192) (1,947)
-------- --------
Operating income before depreciation
and amortization $ 915 $ 362
======== ========
Interior Construction and Renovation
Services
Revenues $ 1,031 $ 1,129
Expenses/1/ (1,167) (1,269)
-------- --------
Operating loss before depreciation
and amortization $ (136) $ (140)
======== ========
Engineering and Technical Services
(including reimbursed costs)
Revenues $ 9,679 $ 10,026
Expenses/1/ (9,026) (9,273)
-------- --------
Operating income before depreciation
and amortization $ 653 $ 753
======== ========
Financing Services
Revenues $ 669 $ 235
Expenses/1/ (287) (324)
-------- --------
Operating income (loss) before depreciation
and amortization $ 382 $ (89)
======== ========
Total Property Services
Revenues $ 14,486 $ 13,699
Expenses/1/ (12,672) (12,813)
-------- --------
Operating income before depreciation
and amortization $ 1,814 $ 886
Depreciation and amortization (266) (325)
-------- --------
Equity in income of Property Service Businesses $ 1,548 $ 561
======== ========
</TABLE>
/1/ Includes general and administrative costs.
11
<PAGE>
RESULTS OF OPERATIONS
COMPARISON OF THREE MONTHS ENDED MARCH 31, 1996 TO THREE MONTHS ENDED MARCH 31,
1995.
SUMMARY. Net income of the Operating Partnership increased $0.5 million, or
8.8%, from $6.2 million for the three months ended March 31, 1995 to $6.7
million for the three months ended March 31, 1996. Funds from Operations ("FFO")
of the Operating Partnership increased $1.0 million, or 10%, from $10.1 million
to $11.1 million, during the same period. The increase in both net income and
FFO is attributable to increases in operating income from the residential
properties, primarily the acquisition and development properties, and from the
Property Service Businesses. These increases were partially offset by increases
in interest expense and general and administrative expenses.
Results for the quarter reflect the effect of several non-recurring events -
higher operating expenses due to an abnormally severe winter, a contract
termination fee related to the sale of a hotel managed by one of the Property
Service Businesses, and a fee for reimbursement of previously expended repair
and maintenance costs. Together, these events reduced FFO of the Operating
Partnership by approximately $0.3 million, or 2.9%, for the three months ended
March 31, 1996.
The Washington, D.C. region experienced a combination of record cold
temperatures and snowfall during the first quarter of 1996 which unfavorably
impacted earnings by an estimated $1.1 million. This was primarily due to
higher operating expenses for snow removal and utilities, particularly fuel
consumption, at the residential properties. Partially offsetting the effects of
the weather, however, was a contract termination fee of $0.6 million, net of
tax, earned in connection with a related party's sale of a hotel managed by one
of the Property Service Businesses. Also, the Operating Partnership recognized
a $0.2 million fee for reimbursement of costs associated with ongoing rental
property operations.
RENTAL PROPERTIES. Revenue from rental properties increased $5.4 million, or
15.9%, from $34.1 million for the three months ended March 31, 1995 to $39.5
million for the three months ended March 31, 1996. The acquisition and
development properties (defined as properties with less than one full calendar
year of operation after stabilization and consisting of 1,998 apartment units,
309 of which were added during the first quarter) contributed $4.1 million to
the rental revenue increase reflecting the acquisition/development of seven
properties subsequent to the first quarter of 1995. Two properties purchased in
1994 totaling 627 apartment units were transferred into the core portfolio on
January 1, 1996. Revenue from the core portfolio increased $1.3 million, or 4.1%
for the three months ended March 31, 1996 compared to the three months ended
March 31, 1995 with average monthly revenue per apartment unit increasing to
$876 from $841. Average occupancy for the core portfolio, typically lowest
during the first quarter, was 97.1% for the three months ended March 31, 1996
compared to 96.9% for the comparable prior year quarter. Although the
12
<PAGE>
improvement in occupancy was fairly modest, it is significant in comparison to
the prior year's softening demand experienced late in the first quarter and
throughout the second quarter of 1995.
PROPERTY SERVICE BUSINESSES. The Operating Partnership's 99% equity in the
earnings of the Property Service Businesses increased from $0.6 million during
the first quarter of 1995 to $1.5 million for the first quarter of 1996 as
operating income before interest and depreciation from the Property Service
Businesses increased $.9 million, or 100%, from $.9 million to $1.8 million. The
Operating Partnership uses the equity method of accounting for investments in
the Property Service Businesses.
The increase in revenue and operating income before depreciation and
amortization for Multifamily and Retail Property Management results primarily
from the impact of the non-recurring fee related to the termination of a
management agreement with a hotel owned by a related party. The hotel was sold
during the first quarter of 1996.
Operating income from Engineering and Technical Services decreased $.1
million, or 13.3%, due to a decrease in revenue of $.3 million, or 3.5%. The
decrease was primarily attributable to the adverse weather experienced during
the first quarter as well as a decrease in HVAC projects as compared to the
prior year quarter.
Revenue from Financing Services increased $.4 million due to the acceleration
of a refinancing which was expected to occur in the second quarter of 1996, and
a refinancing fee earned in connection with the termination of a management
agreement with a hotel owned by a related party which was sold during the first
quarter. Approximately $51 million of refinancings were closed in the first
quarter of 1996 compared to $20 million during the comparable quarter in the
prior year.
The operating loss from Interior Construction and Renovation, which typically
incurs losses in the first quarter, improved slightly during the three months
ended March 31, 1996 compared to the three months ended March 31, 1995 despite a
$0.1 million decrease in operating revenues. Although revenues decreased due
primarily to the delay of several projects with affiliated partnerships, the
decreases were offset by decreased operating expenses.
OTHER. General and administrative expenses increased $.09 million, or 14.1%,
due primarily to legal and other costs incurred in connection with the Operating
Partnership's ongoing acquisition and development efforts. Interest expense
increased $1.7 million, or 20%, due to additional borrowings under the line of
credit for completed acquisitions and development.
13
<PAGE>
FUNDS FROM OPERATIONS. Industry analysts generally consider Funds from
Operations ("FFO") an appropriate measure of performance of an equity REIT. In
prior years, the Operating Partnership computed FFO as net income (in accordance
with generally accepted accounting principles) excluding gains (or losses) from
debt restructuring, plus depreciation and amortization of assets, including
depreciation of non-real estate assets and amortization of deferred financing
costs. In 1996, the Operating Partnership has revised its definition of FFO to
exclude depreciation of non-real estate assets and amortization of deferred
financing costs in accordance with the revised definition adopted by the
National Association of Real Estate Investment Trusts. Prior year FFO has been
restated to conform to the revised definition. The Operating Partnership
believes that to facilitate a clear understanding of its operating results, FFO
should be examined in conjunction with net income as presented in the financial
statements and notes thereto included elsewhere in this report. FFO does not
represent cash flow from operations as defined by generally accepted accounting
principles and should not be considered as an alternative to net income as an
indicator of the Operating Partnership's operating performance, or as an
alternative to cash flow from operations as a measure of liquidity or ability to
pay dividends.
Funds from Operations for the three months ended March 31, 1996 and 1995 are
computed as follows:
Three Months Ended
March 31,
----------------------
1996 1995
--------- ---------
<TABLE>
<CAPTION>
(Dollars in Thousands)
- - -------------------------------
<S> <C> <C>
Net Income 6,696 $ 6,153
Depreciation of Real Property 4,392 3,930
------- -------
Funds from Operations $11,088 $10,083
======= =======
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES
SUMMARY. The Operating Partnership's primary sources of liquidity are cash
flows from operating activities and proceeds from lines of credit and
construction loans. Secondary sources of liquidity include proceeds from
mortgage debt. A summary of the sources of liquidity follows:
14
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------
(Dollars in Thousands) 1996 1995
- - --------------------------------------- ------- ------
<S> <C> <C>
Cash from operating activities $10,780 $9,122
Proceeds from lines of credit and
construction loans, net 17,932 1,275
</TABLE>
The primary uses of liquidity are (i) property operating expenses, general and
administrative expenses and interest expense, (ii) acquisition and development
of rental property, (iii) distributions, (iv) capital improvements, and (v)
payment on mortgage debt. A summary of the uses of liquidity are as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31
--------------------
(Dollars in Thousands) 1995 1996
- - --------------------------------------- -------- ---------
<S> <C> <C>
Acquisition and development of
rental properties $17,131 $3,981
Distributions 10,725 10,106
Capital improvements 824 738
Principal payments on mortgage debt 174 78
</TABLE>
In March 1996, the Operating Partnership acquired two apartment properties in
northern Virginia totaling 309 units, including a 262-unit garden apartment
complex in Reston and a 47-unit community in Old Town Alexandria. These
properties bring the Operating Partnership's total acquisitions to nine
properties with over 2,300 units acquired since its initial public offering in
mid-1994. The Reston property was acquired for approximately $13.7 million cash,
and an exchange of 22,059 Operating Partnership Units valued at $0.5 million.
The Old Town property was acquired for approximately $2.8 million cash. The
acquisitions were funded through borrowings of $16.9 million against the
Operating Partnership's lines of credit.
DEBT
As of March 31, 1996, the Operating Partnership had mortgage indebtedness and
borrowings under the lines of credit and construction loan as follows:
15
<PAGE>
<TABLE>
<CAPTION>
Dollars in % of
Thousands Total
---------- ------
<S> <C> <C>
Long-term mortgage debt
(maturities greater than 1 year)
Fixed rate $365,367 72.9%
Variable rate 17,377 3.5%
Short-term mortgage debt
(maturities less than 1 year)
Fixed rate 31,055 6.2%
Variable rate - -
$100M Acquisition Line of Credit 39,450 7.9%
$83M Acquisition Line of Credit 30,000 6.0%
Construction loan 17,686 3.5%
------- -----
Total Debt $500,935 100%
======== =====
</TABLE>
As of March 31, 1996, the Operating Partnership's Debt to Total Market
Capitalization Ratio was 49%, based on 21,935,621 units outstanding at a price
of $23.75. The Operating Partnership's Debt Coverage Ratio for the three months
ended March 31, 1996 was 2.24:1.
DISTRIBUTIONS
During the three months ended March 31, 1996, the Operating Partnership paid
distributions of $10.7 million, or $.49 per unit representing an annual rate of
$1.96 per unit.
OTHER
For the three months ended March 31, 1996, total capital improvements were
$0.8 million, of which $0.7 million, or $56 per apartment unit, was for the core
portfolio.
16
<PAGE>
PART II
ITEM 1. LEGAL PROCEEDINGS.
Regarding the suit filed against Smith Realty Company on November 8, 1995,
alleging sexual harassment and employment discrimination based on sexual
preference pursuant to Title VII of the Civil Rights Act of 1964, the
company's motion for partial summary judgement was granted, resulting in a
dismissal of the claim alleging the intentional infliction of emotional
distress. Discovery has been completed on the remaining alegations, but no
trial date has been set. The Company reaffirms its belief that an adverse
outcome in the remaining litigation would not have a material adverse
impact on the Company's financial condition or results of operations.
ITEM 2. CHANGES IN SECURITIES.
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS.
None
ITEM 5. OTHER INFORMATION.
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits:
None
(b) Reports on Form 8-K
None
17
<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.
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
By: Charles E. Smith Residential Realty
Inc., its General Partner
Date: May 10, 1996 By: /s/ Anthony J. LoPinto
-----------------------
Anthony J. LoPinto
Executive Vice President, Chief
Financial Officer and Treasurer of
Charles E. Smith Residential Realty,
Inc. (on behalf of the Registrant and
as Principal Financial Officer)
18
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 2,005
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 10,653
<PP&E> 605,582
<DEPRECIATION> (176,544)
<TOTAL-ASSETS> 481,495
<CURRENT-LIABILITIES> 15,556
<BONDS> 500,935
0
0
<COMMON> 0
<OTHER-SE> (34,996)
<TOTAL-LIABILITY-AND-EQUITY> 481,495
<SALES> 0
<TOTAL-REVENUES> 39,541
<CGS> 0
<TOTAL-COSTS> 23,506
<OTHER-EXPENSES> 745
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,142
<INCOME-PRETAX> 6,696
<INCOME-TAX> 0
<INCOME-CONTINUING> 6,696
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,696
<EPS-PRIMARY> 0.31
<EPS-DILUTED> 0.31
</TABLE>
