<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
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): December 21, 1999
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
(Exact name of registrant as specified in its charter)
Commission File Number: 1934 Act File Number: 0-25968
Delaware 54-1681657
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2345 Crystal Drive 22202
Crystal City, VA (Zip Code)
(Address of principal
executive offices)
Registrant's telephone number including area code: (703) 920-8500
<PAGE>
Item 7. Financial Statements and Exhibits
- ------- ---------------------------------
The following pro forma financial information is included as a second amendment
to the Form 8-K dated December 21, 1999 and filed on January 5, 2000 for
Charles E. Smith Residential Realty L.P.
(A) Pro forma financial information beginning at page F-2
(B) Historical financial information beginning at page F-7
(C) Exhibits
99.4 Consent of Independent Public Accountants dated March 2, 2000
99.5 Consent of Independent Public Accountants dated March 2, 2000
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, hereunto duly authorized, on this 2nd day of
March 2000.
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
By: Charles E. Smith Residential Realty, Inc.,
its General Partner
By: /s/ W.D. Minami
------------------------------------------
W.D. Minami
Executive Vice President and Chief Financial
Officer of Charles E. Smith Residential
Realty, Inc. (on behalf of the Registrant and
as Principle Financial Officer)
/s/ Steven E. Gulley
------------------------------------------
Steven E. Gulley
Chief Accounting Officer of Charles E. Smith
Residential Realty, Inc.
<PAGE>
INDEX TO FINANCIAL STATEMENTS AND PRO FORMA INFORMATION
Page
----
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
Pro Forma (Unaudited) Consolidated Balance Sheet
as of September 30, 1999 F-3
Pro Forma (Unaudited) Consolidated Statement of
Operations for the nine months ended September 30, 1999 F-4
Pro Forma (Unaudited) Consolidated Statement of
Operations for the year ended December 31, 1998 F-5
Notes and Management's Assumptions to Unaudited Pro Forma
Consolidated Financial Information F-6
ACQUISITION PROPERTIES
Report of Independent Public Accountants - Ocean View
at Aventura Beach F-7
Combined Statements of Revenues and Certain Expenses of
Ocean View at Aventura Beach for the nine months ended
September 30, 1999 (Unaudited) and for the year ended
December 31, 1998. F-8
Notes to Combined Statements of Revenues and Certain Expenses
of Ocean View at Aventura Beach for the nine months ended
September 30, 1999 (Unaudited) and for the year ended
December 31, 1998. F-9
Report of Independent Public Accountants - Ocean View at
Sunset Pointe F-10
Combined Statements of Revenues and Certain Expenses of
Ocean View at Sunset Pointe for the nine months ended
September 30, 1999 (Unaudited) and for the year ended
December 31, 1998. F-11
Notes to Combined Statements of Revenues and Certain Expenses
of Ocean View at Sunset Pointe for the nine months ended
September 30, 1999 (Unaudited) and for the year
ended December 31, 1998. F-12
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The unaudited Pro Forma Consolidated Balance Sheet as of September 30, 1999, and
unaudited Pro Forma Consolidated Statements of Operations for the nine months
ended September 30, 1999, and the year ended December 31, 1998, are based on the
historical financial statements of Charles E. Smith Residential Realty L.P.
("the Operating Partnership").
The unaudited Pro Forma Consolidated Balance Sheet as of September 30, 1999, is
presented as if the Ocean View at Aventura Beach ("Aventura") and Ocean View at
Sunset Pointe ("Hollywood") acquisitions had occurred by September 30, 1999. The
unaudited Pro Forma Consolidated Statements of Operations for the nine months
ended September 30, 1999, and the year ended December 31, 1998, are presented as
if the acquisitions had occurred at the beginning of each of those periods. The
unaudited pro forma information should be read in conjunction with the
historical financial statements and notes related thereto appearing in the
Operating Partnership's Forms 10-Q and 10-K.
Preparation of the unaudited pro forma financial information was based on
assumptions considered appropriate by the Operating Partnership's management.
The pro forma financial information is unaudited and is not necessarily
indicative of the results which would have occurred if the acquisitions had been
consummated at the beginning of the periods presented, nor does it purport to
represent the future financial position and results of operations for future
periods. In management's opinion, all adjustments necessary to reflect the
effects of the transaction have been made.
F-2
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
PRO FORMA CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 1999
(UNAUDITED) (IN THOUSANDS)
<TABLE>
<CAPTION>
ASSETS Historical Aventura Hollywood Property Sales
---------- -------- --------- --------------
<S> <C> <C> <C> <C>
Rental property, net $1,217,012 $ 77,665 (A) $ 102,937 (A) $ (11,213)(B)
Rental property under development 148,264
Security deposits 2,169
Escrow funds 9,575 (56,705)(A) (8,127)(A) 64,832 (B)
Investment in and advances to Property Service Businesses 46,903
Investment in joint ventures 19,555
Deferred charges, net 18,333
Other assets 27,372
---------- ---------- ---------- ----------
Total $1,489,183 $ 20,960 $ 94,810 $ 53,619
========== ========== ========== ==========
LIABILITIES AND PARTNERS' EQUITY
Liabilities
Mortgage loans $ 784,081
Lines of credit and note payable 38,488 $ 19,524 (A) $ 92,692 (A)
Construction loans 73,095
Accounts payable and accrued expenses 46,175 540 (A) 1,026 (A) 176 (B)
Security deposits 2,169 896 (A) 1,092 (A)
---------- ---------- ---------- ----------
Total Liabilities 944,008 $ 20,960 $ 94,810 176
Other Limited Partners' Interest
Preferred units - Series H Cumulative Convertible
Redeemable Preferred Units 45,000
Common units at redemption value 471,931
----------
516,931
Partners' Equity:
General Partner's General and Limited Partnership Interest
Preferred Units
Series A Cumulative Convertible Redeemable
Preferred Units 71,500
Series C Cumulative Redeemable Preferred Units 50,000
Series E Cumulative Convertible Redeemable
Preferred Units 25,000
Series H Cumulative Convertible Redeemable
Preferred Units 55,000
Common Units (173,256) $ 53,443 (B)
---------- ---------- ---------- ----------
Total partners' equity 28,244 - - 53,443
---------- ---------- ---------- ----------
Total Liabilities and Partners' equity $1,489,183 $ 20,960 $ 94,810 $ 53,619
========== ========== ========== ==========
Other
ASSETS Adjustments Pro-forma
----------- ---------
Rental property, net $ - $1,386,401
Rental property under development 148,264
Security deposits 2,169
Escrow funds 9,575
Investment in and advances to Property Service Businesses 46,903
Investment in joint ventures 19,555
Deferred charges, net 18,333
Other assets 27,372
---------- ----------
Total $1,658,572
========== ==========
LIABILITIES AND PARTNERS' EQUITY
Liabilities
Mortgage loans $ 784,081
Lines of credit and note payable 150,704
Construction loans 73,095
Accounts payable and accrued expenses 47,917
Security deposits 4,157
---------- ----------
Total Liabilities 1,059,954
Other Limited Partners' Interest
Preferred units - Series H Cumulative Convertible
Redeemable Preferred Units 45,000
Common units at redemption value 471,931
----------
516,931
Partners' Equity:
General Partner's General and Limited Partnership Interest
Preferred Units
Series A Cumulative Convertible Redeemable Preferred Units 71,500
Series C Cumulative Redeemable Preferred Units 50,000
Series E Cumulative Convertible Redeemable Preferred Units 25,000
Series H Cumulative Convertible Redeemable Preferred Units 55,000
Common Units (119,813)
---------- ----------
Total partners' equity 81,687
---------- ----------
Total Liabilities and Partners' Equity $ - $1,658,572
========== ==========
</TABLE>
The accompanying notes are an integral part of this statement.
F-3
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999
(UNAUDITED) (IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)
<TABLE>
<CAPTION>
Property
Historical Aventura Hollywood Sales (A)
---------- -------- --------- ---------
<S> <C> <C> <C> <C>
Rental Properties:
Revenues $ 218,749 $ 9,321 $ 12,172 $ (8,504)
Expenses
Operating Costs (70,189) (3,819) (4,944) 3,523
Real estate taxes (16,678) (768) (1,357) 358
Depreciation and amortization (24,304) 685
---------- ---------- ---------- ----------
Total expenses (111,171) (4,587) (6,301) 4,566
---------- ---------- ---------- ----------
Equity in income of joint ventures 408
Equity in income of Property Service Businesses 3,255
Corporate general and administrative expenses (6,785)
Interest income 605
Interest expense (42,040) 844
---------- ---------- ---------- ----------
Income before gain on sales
and extraordinary item 63,021 4,734 5,871 (3,094)
Gain on sales 7,065
---------- ---------- ---------- ----------
Income before extraordinary item 70,086 4,734 5,871 (3,094)
Extraordinary item - loss on extinguishment of debt (359)
---------- ---------- ---------- ----------
Net Income 69,727 4,734 5,871 (3,094)
Less: Income attributable to preferred units (8,028)
---------- ---------- ---------- ----------
Net Income attributable to common units $ 61,699 $ 4,734 $ 5,871 $ (3,094)
========== ========== ========== ==========
Net income per common unit - basic $ 1.89
==========
Net income per common unit - diluted $ 1.85
==========
Weighted average units outstanding - basic 32,569
==========
Weighted average units outstanding - diluted 35,755
==========
Other
Adjustments Pro-Forma
----------- ---------
Rental Properties:
Revenues $ - $ 231,738
Expenses
Operating Costs 586 (B) (74,843)
Real estate taxes (18,445)
Depreciation and amortization (2,878)(C) (26,497)
---------- ----------
Total expenses (2,292) (119,785)
---------- ----------
Equity in income of joint ventures 408
Equity in income of Property Service Businesses 3,255
Corporate general and administrative expenses (6,785)
Interest income 605
Interest expense (5,454)(D) (46,650)
---------- ----------
Income before gain on sales
and extraordinary item (7,746) 62,786
Gain on sales 7,065
---------- ----------
Income before extraordinary item (7,746) 69,851
Extraordinary item - loss on extinguishment of debt (359)
---------- ----------
Net Income (7,746) 69,492
Less: Income attributable to preferred units (8,028)
---------- ----------
Net Income attributable to common units $ (7,746) $ 61,464
========== ==========
Net income per common unit - basic $1.89
==========
Net income per common unit - diluted $ 1.85
==========
Weighted average units outstanding - basic 32,569
==========
Weighted average units outstanding - diluted 35,755
==========
</TABLE>
The accompanying notes are an integral part of this statement.
F-4
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
(UNAUDITED) (IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)
<TABLE>
<CAPTION>
Property
Historical Aventura Hollywood Sales (A)
---------- -------- --------- ---------
<S> <C> <C> <C> <C>
Rental Properties:
Revenues $ 250,211 $ 9,827 $ 14,530 $ (10,964)
Expenses
Operating costs (84,381) (4,621) (6,782) 4,484
Real estate taxes (17,254) (1,276) (1,759) 461
Depreciation and amortization (28,958) 916
---------- ---------- ---------- ----------
Total expenses (130,593) (5,897) (8,541) 5,861
---------- ---------- ---------- ----------
Equity in income of Property Service Businesses 8,433
Corporate general and administrative expenses (8,947)
Interest income 1,257
Interest expense (47,334) 950
---------- ---------- ---------- ----------
Income before gain on sale, loss on unused treasury
lock, and extraordinary item 73,027 3,930 5,989 (4,153)
Gain on sale of property 18,150
Loss on unused treasury lock (4,923)
---------- ---------- ---------- ----------
Income before extraordinary item 86,254 3,930 5,989 (4,153)
Extraordinary item - loss on extinguishment of debt (16,384)
---------- ---------- ---------- ----------
Net Income 69,870 3,930 5,989 (4,153)
Less: Income attributable to preferred units (10,722)
---------- ---------- ---------- ----------
Net Income attributable to common units $ 59,148 $ 3,930 $ 5,989 $ (4,153)
========== ========== ========== ==========
Net income per common unit - basic $ 1.96
==========
Net income per common unit - diluted $ 1.95
==========
Weighted average units outstanding - basic 30,184
==========
Weighted average units outstanding - diluted 30,349
==========
Other
Adjustments Pro-Forma
----------- ---------
Rental Properties:
Revenues $ - $ 263,604
Expenses
Operating costs 668 (B) (90,632)
Real estate taxes (19,828)
Depreciation and amortization (3,838)(C) (31,880)
---------- ----------
Total expenses (3,170) (142,340)
---------- ----------
Equity in income of Property Service Businesses 8,433
Corporate general and administrative expenses (8,947)
Interest income 1,257
Interest expense (7,272)(D) (53,656)
---------- ----------
Income before gain on sale, loss on unused treasury
lock, and extraordinary item (10,442) 68,351
Gain on sale of property 18,150
Loss on unused treasury lock (4,923)
---------- ----------
Income before extraordinary item (10,442) 81,578
Extraordinary item - loss on extinguishment of debt (16,384)
---------- ----------
Net Income (10,442) 65,194
Less: Income attributable to preferred units (10,722)
---------- ----------
Net Income attributable to common units $ (10,442) $ 54,472
========== ==========
Net income per common unit - basic $ 1.80
==========
Net income per common unit - diluted (F)$ 1.79
==========
Weighted average units outstanding - basic 30,184
==========
Weighted average units outstanding - diluted 30,349
==========
</TABLE>
The accompanying notes are an integral part of this statement.
F-5
<PAGE>
CHARLES E. SMITH RESIDENTIAL REALTY L.P.
NOTES AND MANAGEMENT'S ASSUMPTIONS TO UNAUDITED PRO FORMA
CONSOLIDATED FINANCIAL INFORMATION
(DOLLAR AMOUNTS IN THOUSANDS)
1. Basis of Presentation
On December 22, 1999, Charles E. Smith Residential Realty L.P. ("the
Operating Partnership") announced plans to acquire an eight-building, 2,669
high-rise apartment portfolio located in Southeast Florida. Intracoastal A
Limited Partnership,Intracoastal B Limited Partnership and Intracoastal C
Limited Partnership (collectively "Ocean View at Aventura Beach" or
"Aventura"), is a three building, 1,199-unit property. Galahad Court Limited
Partnership, Galahad 3 Limited Partnership, Galahad North Limited
Partnership, Galahad South Limited Partnership and Galahad West Limited
Partnership (collectively "Ocean View at Sunset Pointe" or "Hollywood"), is
a five-building, 1,470-unit property. Closing on Aventura occurred on
December 21, 1999, with the closing of Hollywood on January 13, 2000. The
total cash investment was $177 million, funded with $65 million of proceeds
from the sale of four multifamily assets and $112 million of proceeds from
the Operating Partnership's line of credit. The Operating Partnership plans
to reposition the properties by making substantial renovations of
approximately $33 million over the next two years.
2. Adjustments to Pro Forma Consolidated Balance Sheet
(A) Acquisition of Properties
Aventura Hollywood
------------- --------------
Purchase price of rental property $ 76,000,000 $102,000,000
Acquisition costs and working
capital adjustments 1,664,626 936,696
------------ ------------
Cost basis of rental property 77,664,626 102,936,696
Proceeds from sale of four multi-
family assets (56,705,435) (8,126,974)
------------ ------------
20,959,191 94,809,722
============ ============
Accounts payable and accrued expenses 539,350 1,026,484
Security deposit liability 895,758 1,092,219
Proceeds from line of credit 19,524,083 92,691,019
------------ ------------
$ 20,959,191 $ 94,809,722
============ ============
(B) Sale of Suburban Towers, Columbian Stratford, Windsor Towers, and Fort
Chaplin
Net book value of four multifamily assets sold $(11,213,622)
Cash proceeds in escrow as a result of sale 64,832,409
------------
$ 53,618,787
Accrued Closing Costs (175,969)
------------
Net gain on sale $ 53,442,818
============
(C) To adjust Minority Interest for the Aventura and Hollywood acquisitions
and sale of Suburban Towers, Columbian Stratford, Windsor Towers, and
Fort Chaplin.
3. Adjustments to Pro Forma Consolidated Statements of Operations
(A) To eliminate the operations of Suburban Towers, Columbian Stratford,
Windsor Towers, and Fort Chaplin.
(B) Operating expenses have been adjusted to eliminate management fees since
the Operating Partnership's affiliate manages owned properties.
(C) Depreciation and amortization has been adjusted based on the allocated
purchase price of the assets acquired and an estimated useful life of 40
years, as if the purchase occurred on January 1, 1999 for the nine
months ended September 30, 1999 and January 1, 1998 for the year ended
December 31, 1998.
(D) Represents interest expense for draws on the line of credit (assuming a
weighted average interest rate of 6.48% for both the nine months ended
September 30, 1999 and the year ended December 31, 1998, respectively).
F-6
<PAGE>
[ARTHUR ANDERSEN, LLP LETTERHEAD APPEARS HERE]
Report of Independent Public Accountants
To Charles E. Smith Residential Realty L.P.
We have audited the accompanying combined statement of revenues and certain
expenses of Intracoastal A Limited Partnership, Intracoastal B Limited
Partnership and Intracoastal C Limited Partnership (collectively "Ocean View at
Aventura Beach" or the "Properties") for the year ended December 31, 1998.
This statement is the responsibility of the Properties' management. Our
responsibility is to express an opinion on this statement based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform an audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
The accompanying combined statement of revenues and certain expenses was
prepared for the purpose of complying with the rules and regulations of the
Securities and Exchange Commission for inclusion in the Form 8-K of Charles E.
Smith Residential Realty L.P. Material amounts, described in Note 1 to the
combined statement of revenues and certain expenses, that would not be
comparable to those resulting from the proposed future operations of the
Properties are excluded and the combined statement is not intended to be a
complete presentation of the revenues and expenses of the properties.
In our opinion, the statement referred to above presents fairly, in all material
respects, the revenues and certain expenses of the properties for the year ended
December 31, 1998 in conformity with accounting principles generally accepted in
the United States.
Vienna, VA
February 11, 2000
F-7
<PAGE>
Ocean View at Aventura Beach
Combined Statements Of Revenues And Certain Expenses
For The Nine Months Ended September 30, 1999 (Unaudited)
And The Year Ended December 31, 1998
<TABLE>
<CAPTION>
Nine Months Ended
September 30,1999 Year Ended
(Unaudited) December 31, 1998
------------------ -----------------
<S> <C> <C>
Revenues:
Rental Revenue $8,519,559 $9,221,493
Other Revenue 802,010 605,132
---------- ----------
Total Revenues 9,321,569 9,826,625
Certain Expenses:
Payroll and related costs 713,224 752,574
Utilities 965,389 1,209,954
Repairs and maintenance 1,075,428 1,466,247
Security 143,247 209,727
Administrative and other 551,875 515,848
Real estate taxes 767,841 1,276,339
Insurance 118,476 194,302
Management fees 252,373 272,080
---------- ----------
Total Certain Expenses 4,587,853 5,897,071
---------- ----------
Revenues in Excess of Certain Expenses $4,733,716 $3,929,554
========== ==========
</TABLE>
The accompanying notes are an integral part of these statements.
F-8
<PAGE>
Ocean View At Aventura Beach
Notes to Combined Statements of Revenues and Certain Expenses
For The Nine Months Ended September 30, 1999 (Unaudited) And For
The Year Ended December 31, 1998
1. Basis of Presentation
---------------------
The accompanying combined statements of revenues and certain expenses
relates to the operations of Intracoastal A Limited Partnership,
Intracoastal B Limited Partnership and Intracoastal C Limited Partnership
(collectively "Ocean view at Aventura Beach" or the "Properties") which is a
1,199 unit, 3-building high-rise apartment complex located in the Aventura
Beach area of Southeast Florida. The Properties were acquired by Charles E.
Smith Residential Realty L.P. on December 21, 1999.
The accompanying statements has been prepared for the purpose of complying
with Rule 3-14 of Regulation S-X of the Securities and Exchange Commission
and thus excludes certain expenses, such as interest expense, depreciation
and amortization, certain professional fees, and other costs not related to
the future operations of the Properties. Management is not aware of any
material factors relating to the Properties which would cause the reported
financial information not to be indicative of future operating results.
2. Significant Accounting Policies
-------------------------------
The accompanying combined statements was prepared on the accrual basis of
accounting. Rental income attributable to residential leases is recognized
when due from tenants.
3. Interim Financial Information
-----------------------------
The interim combined statements of revenues and certain expense is unaudited
but reflects all adjustments which are, in the opinion of management,
necessary to a fair presentation of the interim periods presented. The
adjustments consist of normal recurring accruals.
The combined statements of revenues and certain expenses for interim periods
will not necessarily be indicative of the operating results of the fiscal
year.
F-9
<PAGE>
[ARTHUR ANDERSEN, LLP LETTERHEAD APPEARS HERE]
Report of Independent Public Accountants
To Charles E. Smith Residential Realty L.P.
We have audited the accompanying combined statement of revenues and certain
expenses of Galahad Court Limited Partnership, Galahad 3 Limited Partnership,
Galahad North Limited Partnership, Galahad South Limited Partnership, and
Galahad West Limited Partnership (collectively, "Ocean View at Sunset Pointe" or
the "Properties") for the year ended December 31, 1998. This statement is the
responsibility of the Properties' management. Our responsibility is to express
an opinion on this statement based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform an audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
The accompanying combined statement of revenues and certain expenses was
prepared for the purpose of complying with the rules and regulations of the
Securities and Exchange Commission for inclusion in the Form 8-K of Charles E.
Smith Residential Realty L.P. Material amounts, described in Note 1 to the
combined statement of revenues and certain expenses, that would not be
comparable to those resulting from the proposed future operations of the
Properties are excluded and the combined statement is not intended to be a
complete presentation of the revenues and expenses of the Properties.
In our opinion, the statement referred to above presents fairly, in all material
respects, the revenues and certain expenses of the properties for the year ended
December 31, 1998 in conformity with accounting principles generally accepted in
the United States.
Vienna, VA
February 11, 2000
F-10
<PAGE>
Ocean View At Sunset Pointe
Combined Statements Of Revenues And Certain Expenses
For The Nine Months Ended September 30, 1999 (Unaudited)
And The Year Ended December 31, 1998
<TABLE>
<CAPTION>
Nine Months Ended
September 30,1999 Year Ended
(Unaudited) December 31, 1998
------------------ -----------------
<S> <C> <C>
Revenues:
Rental Revenue $11,076,648 $13,388,211
Other Revenue 1,095,279 1,142,138
----------- -----------
Total Revenues 12,171,927 14,530,349
Certain Expenses:
Payroll and related costs 1,024,420 1,174,968
Utilities 1,251,651 1,754,060
Repairs and maintenance 1,636,113 2,341,497
Security 18,558 46,045
Administrative and other 511,003 798,209
Real estate taxes 1,356,963 1,758,616
Insurance 169,107 272,388
Management fees 333,517 395,840
----------- -----------
Total Certain Expenses 6,301,332 8,541,623
----------- -----------
Revenues in Excess of Certain Expenses $ 5,870,595 $ 5,988,726
=========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
F-11
<PAGE>
OCEAN VIEW AT SUNSET POINTE
NOTES TO COMBINED STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 (UNAUDITED) AND FOR THE YEAR ENDED
DECEMBER 31, 1998
1. Basis of Presentation
---------------------
The accompanying combined statements of revenues and certain expenses
relates to the operations of Galahad Court Limited Partnership, Galahad 3
Limited Partnership, Galahad North Limited Partnership, Galahad South
Limited Partnership, and Galahad West Limited Partnership (collectively
"Ocean View at Sunset Pointe" or the "Properties") which is a 1,470-unit,
5-building high-rise apartment complex that is located in the Hollywood
Beach area of Southeast Florida. The Property was acquired by Charles E.
Smith Residential Realty L.P. on January 13, 2000.
The accompanying statements has been prepared for the purpose of complying
with Rule 3-14 of Regulation S-X of the Securities and Exchange Commission
and thus excludes certain expenses, such as interest expense, depreciation
and amortization, certain professional fees, and other costs not related to
the future operations of the Properties. Management is not aware of any
material factors relating to the Properties which would cause the reported
financial information not to be indicative of future operating results.
2. Significant Accounting Policies
-------------------------------
The accompanying statements was prepared on the accrual basis of accounting.
Rental income attributable to residential leases is recognized when due from
tenants.
3. Interim Financial Information
-----------------------------
The interim combined statements of revenues and certain expenses is
unaudited but reflects all adjustments which are, in the opinion of
management, necessary to a fair presentation of the interim periods
presented. The adjustments consist of normal recurring accruals.
The combined statements of revenues and certain expenses for interim periods
will not necessarily be indicative of the operating results of the fiscal
year.
F-12
<PAGE>
EXHIBIT 99.4
[LETTERHEAD OF ARTHUR ANDERSEN LLP APPEARS HERE]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We hereby consent to the incorporation of our report dated February 11, 2000, on
our audit of the combined statement of revenue and certain expenses of Ocean
View at Aventura Beach for the year ended December 31, 1998 which report appears
in the Form 8-K/A for Charles E. Smith Residential Realty L.P. dated March 2,
2000 filed with the Securities and Exchange Commission.
/s/ ARTHUR ANDERSEN LLP
Vienna, Virginia
March 2, 2000
<PAGE>
EXHIBIT 99.5
[LETTERHEAD OF ARTHUR ANDERSEN LLP APPEARS HERE]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We hereby consent to the incorporation of our report dated February 11, 2000, on
our audit of the combined statement of revenue and certain expenses of Ocean
View at Sunset Pointe for the year ended December 31, 1998 which report appears
in the Form 8-K/A for Charles E. Smith Residential Realty L.P. dated
March 2, 2000 filed with the Securities and Exchange Commission.
/s/ ARTHUR ANDERSEN LLP
Vienna, Virginia
March 2, 2000
