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
November 14, 1996
Date of Report
(Date of earliest event reported)
SHURGARD STORAGE CENTERS, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-23466 91-1080141
(State or other (Commission (IRS Employer
jurisdiction of File No.) Identification
incorporation) No.)
1201 Third Avenue, Suite 2200
Seattle, Washington 98101
(Address of principal executive offices, including zip code)
(206) 624-8100
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events
a. Completion of Acquisition of IDS/Shurgard Income Growth Partners
L.P. ("IDS1"), IDS/Shurgard Income Growth Partners L.P. II ("IDS2")
and IDS/Shurgard Income Growth Partners L.P. III ("IDS3" and, together
with IDS1 and IDS2, the "Partnerships")
On November 14, 1996, Shurgard Storage Centers, Inc., a Delaware
corporation (the "Company") completed the acquisition of the
Partnerships through the merger of each of the Partnerships into the
Company pursuant to an Acquisition Agreement between each of the
Partnerships and the Company dated as of July 1, 1996 (the
"Acquisition Agreement"). The mergers were approved by the holders of
units of limited partnership interests ("Units") of each of the
Partnerships at meetings of Unitholders held on November 13, 1996.
Pursuant to the Acquisition Agreement, the Company will issue
approximately 2,520,500 shares of its Class A Common Stock (the
"Common Stock") in the mergers. Based on the value of the Common
Stock as defined in the Acquisition Agreement, $25.90 per share, the
shares issued in the mergers have a value of approximately $65.2
million. The Company will pay cash in lieu of issuing any fractional
shares of Common Stock.
b. Announcement of Third Quarter Results of Operations for the Partnerships
The following are the results of operations of each of the
Partnerships for the quarter ended September 30, 1996.
IDS/Shurgard Income Growth Partners L.P.
Three months ended Nine months ended
September 30, September 30,
------------------------ ------------------------
1996 1995 1996 1995
----------- ----------- ----------- -----------
Revenues $ 1,754,634 $ 1,713,233 $ 5,051,961 $ 4,906,235
=========== =========== =========== ===========
Net operating $ 1,271,278 $ 1,215,539 $ 3,539,974 $ 3,381,453
income (1) =========== =========== =========== ===========
Net Income $ 580,855 $ 717,262 $ 1,448,067 $ 1,859,690
Transaction costs 195,027 620,400
Depreciation/ 229,101 243,720 699,122 758,540
amortization (2)
----------- ----------- ----------- -----------
Funds from $ 1,004,983 $ 960,982 $ 2,767,589 $ 2,618,230
operations (3) =========== =========== =========== ===========
IDS/Shurgard Income Growth Partners L.P. II
Three months ended Nine months ended
September 30, September 30,
----------- ----------- ----------- -----------
1996 1995 1996 1995
----------- ----------- ----------- -----------
Revenues $ 1,249,561 $ 1,135,734 $ 3,514,377 $ 3,204,166
=========== =========== =========== ===========
Net operating $ 900,017 $ 817,848 $ 2,475,778 $ 2,236,263
income (1) =========== =========== =========== ===========
Net Income $ 329,806 $ 412,507 $ 797,269 $ 1,030,374
Transaction costs 184,818 470,000
Depreciation/ 223,571 234,617 682,282 679,964
amortization (2)
----------- ----------- ----------- -----------
Funds from $ 738,195 $ 647,124 $ 1,949,551 $ 1,710,338
operations (3) =========== =========== =========== ===========
IDS/Shurgard Income Growth Partners L.P. III
Three months ended Nine months ended
September 30, September 30,
------------------------ ------------------------
1996 1995 1996 1995
----------- ----------- ----------- -----------
Revenues $ 1,947,250 $ 1,894,821 $ 5,634,726 $ 5,418,329
=========== =========== =========== ===========
Net Operating $ 1,363,427 $ 1,320,028 $ 3,844,152 $ 3,702,785
Income (1) =========== =========== =========== ===========
Net Income $ 427,738 $ 559,691 $ 1,071,346 $ 1,381,314
Transaction costs 274,655 695,600
Depreciation/ 295,076 350,370 937,719 1,122,008
amortization (2)
----------- ----------- ----------- -----------
Funds from $ 997,469 $ 910,061 $ 2,704,665 $ 2,503,322
operations (3) =========== =========== =========== ===========
_____________________________
(1) Includes all direct property expenses. Does not include
property management fees previously charged by Shurgard
Incorporated, who managed the Company's properties prior to
its merger with the Company, nor does it include any
allocation of joint expenses incurred by the Company such as
off-site management personnel.
(2) Excludes amortization of financing costs.
(3) Funds from operations ("FFO"), as promulgated by the
National Association of Real Estate Investment Trusts
("NAREIT") in its March 1995 White Paper on FFO, is defined as
net income (calculated in accordance with GAAP) excluding
gains or losses from debt restructuring and sales of real
estate, plus depreciation of rental real estate and
amortization of intangible assets exclusive of deferred
financing costs. Contributions to FFO from unconsolidated
entities in which the reporting entity holds an active
interest are to be reflected in FFO on the same basis. The
Company believes FFO is meaningful disclosure as a supplement
to net income because net income implicitly assumes that the
value of assets diminish predictably over time while the
Company believes that real estate values have historically
risen or fallen with market conditions. FFO is not a
substitute for net cash provided by operating activities or
net income computed in accordance with GAAP, nor should it be
considered an alternative indication of the Company's
operating performance or liquidity. In addition, FFO is not
comparable to "funds from operations" reported by other REITs
that do not define funds from operations in accordance with
NAREIT's definition.
SIGNATURE
Pursuant to the requirements of the Exchange Act, the registrant
has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SHURGARD STORAGE CENTERS, INC.
Dated: November 14, 1996
By /s/ Kristin H. Stred
Kristin H. Stred, Secretary and
General Counsel
