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
Date of Report (Date of earliest event reported):September 16, 1997
BEDFORD PROPERTY INVESTORS, INC.
(Exact name of Registrant as specified in its charter)
Maryland 1-12222 68-0306514
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
270 Lafayette Circle, Lafayette, California 94549
(Address of principal executive offices)
Registrant telephone number, including area code: (510) 283-8910
Item 5. Other Events
On September 16, 1997, Bedford Property Investors, Inc. (The
Company) acquired the Mondavi Building, a 120,157 square foot
warehouse/office facility located in the Napa Valley Corporate Park in
Napa, California from the Robert Mondavi Corporation for $6,430,000.
On October 9, 1997, the Company acquired 2230 Oak Ridge Way, a 44,063
square foot research and development/manufacturing building located in
Vista, California from Mutsui Fudosan, Inc. for $2,930,000. In
conjunction with the purchase, the Company also acquired an adjacent
1.36-acre parcel of land for $354,000 upon which the Company plans to
construct a 20,000 square foot research and development building. On
October 16, 1997, the Company acquired the Oracle Center, a 90,712
square foot office building located in Denver, Colorado from DTC West
Land Venture for $16,500,000. The purchase included an adjacent 3.1-
acre parcel of land that has entitlements allowing the Company to
building an additional 120,000 square feet of office space. The
acquisitions were financed with borrowing from the Company's credit
facility with Bank of America.
On October 22, 1997, the Company sold the Academy Place Center
in Colorado Springs, Colorado for $7,500,000, resulting in a gain of
$740,000.
On October 14, 1997, 8,333,334 shares of the Series A
convertible preferred stock was converted into 4,166,667 shares of
common stock.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits:
(A) Financial Statements
The Historical Summary of Gross Income and Direct Operating
Expenses of Oracle Center for the four months ended December
31, 1996 (see Attachment A).
(B) Pro forma Financial Information
The pro forma consolidated balance sheet as of June 30, 1997
and pro forma consolidated income statements for the six
months ended June 30, 1997 and the year ended December 31,
1996, showing the effect of the acquisitions of Laguna Hills
Square, Westech Business Center, 100 View Street, Fourier
Avenue, Lenexa land, Lundy Avenue, Phoenix land, Kenyon
Center, 115 Mason Circle, 47600 Westinghouse Drive,
Westinghouse land, Vista Buildings 1 and 2, Napa lots 10A
and 12J and K, Doherty Avenue, O'Toole Business Center,
Panorama Business Center, Signal Systems Building, 6500
Kaiser Drive, Executive Center at South Bank, Bedford
Fremont Business Center, Spinnaker Court, U.S. Bank Centre,
9737 Great Hills Trail Building, Troika Building, 2277 Pine
View Way, Scripps Wateridge Corporate Center, Orillia Office
Park, 2601 West Broadway, Phoenix Airport Center, Mondavi
Building, 2230 Oak Ridge Way and Oracle Center; the sales of
St. Paul East and West, 1000 Town Center, Mariner Court and
Academy Place; and the conversion of the Series A
convertible preferred stock (see Attachment B).
(C) Exhibit
23.1 Consent of KPMG Peat Marwick LLP
SIGNATURE
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, hereunto duly authorized.
BEDFORD PROPERTY INVESTORS, INC.
By: /s/ Scott R. Whitney
Scott R. Whitney
Senior Vice President and
Chief Financial Officer
Date: October 31, 1997
<PAGE>
Attachment A
Oracle Center
HISTORICAL SUMMARY OF GROSS INCOME AND
DIRECT OPERATING EXPENSES
For the Four Months Ended December 31, 1996
CONTENTS
Independent Auditors' Report 1
Historical Summary of Gross
Income and Direct Operating Expenses 2
Notes to Historical Summary of
Gross Income and Direct Operating Expenses 2-3
<PAGE>
Independent Auditors' Report
The Board of Directors
Bedford Property Investors, Inc.:
We have audited the accompanying historical summary of gross income
and direct operating expenses (the Summary) of Oracle Center (the
Property) for the four months ended December 31, 1996. The Summary is
the responsibility of management. Our responsibility is to express an
opinion on the 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 Summary is free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the Summary. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall Summary presentation. We believe that our audit provides a
reasonable basis for our opinion.
The accompanying Summary was prepared to comply with the rules and
regulations of the Securities and Exchange Commission and excludes
certain expenses, described in note A, that would not be comparable to
those resulting from the proposed future operations of the Property.
In our opinion, the Summary referred to above presents fairly, in all
material respects, the gross income and direct operating expenses,
exclusive of expenses described in note A, of the Property for the
four months ended December 31, 1996, in conformity with generally
accepted accounting principles.
KPMG Peat Marwick LLP
San Francisco, California
September 26, 1997
<PAGE>
Oracle Center
Historical Summary of Gross Income
and Direct Operating Expenses
For the four months ended December 31, 1996
Gross income:
Rental income $ 611,501
Direct operating expenses:
Real property taxes 90,589
Utilities, repairs and maintenance 107,562
Insurance 2,200
Administrative 53,666
254,017
Operating income $ 357,484
Notes to Historical Summary of Gross Income and Direct Operating
Expenses
A. Property and Basis of Accounting
The historical summary of gross income and direct operating
expenses has been prepared in accordance with Rule 3-14 of
Regulation S-X of the Securities and Exchange Commission and
relates to the operations of Oracle Center (the Property). Rental
operations of the Property commenced in September 1996.
In accordance with Rule 3-14, direct operating expenses are
presented exclusive of depreciation, interest, management fees and
income taxes as these expenses would not be comparable to the
proposed future operations of the property.
Rental income of the Property is recognized on a straight-line
basis over the term of the related leases. For the four months
ended December 31, 1996, rental income on a straight-line basis
exceeded contractual income by $10,375.
<PAGE>
B. Leases
Minimum future rents of the Property as of December 31, 1996 are
as follows (in thousands):
1997 $ 2,120
1998 2,120
1999 2,120
2000 2,120
2001 2,120
Thereafter 5,024
$15,624
C. Estimated Taxable Operating Results and Cash to be Made Available
by Operations (unaudited)
Pro forma cash available from operations and pro forma taxable
income for 1996 are shown below. Pro forma taxable income is
calculated by subtracting depreciation expense, calculated using
a 39 year life, from pro forma cash available from operations.
Bedford Property Investors, Inc. expects to continue to qualify as
a Real Estate Investment Trust (REIT), to pay dividends in amounts
that exceed taxable income and therefore to pay no federal income
taxes. Dividends paid to the REIT shareholders are classified as
return of capital, dividend income or capital gains.
Revenues (1) $601,126
Operating expenses 254,017
Pro forma cash available from
operations 347,109
Depreciation expense 100,742
Pro forma taxable income $ 246,367
(1) Excludes $10,375 which represents the excess of
aggregate straight-line rents over rental income on a
contractual basis.
<PAGE>
Attachment B
The pro forma financial information is presented for illustrative
purposes only and is not necessarily indicative of operating results
or financial position that would have been achieved if the
transactions described in the footnotes had been consummated as of the
beginning of the periods presented, nor are they necessarily
indicative of the future operating results or financial position of
the Company. These statements should be read in conjunction with the
financial statements and accompanying notes included in the Company's
Forms 10-K and 10-Q.
<PAGE>
<TABLE>
BEDFORD PROPERTY INVESTORS, INC.
PRO FORMA CONSOLIDATED BALANCE SHEET
AS OF JUNE 30, 1997 (Unaudited)
(in thousands, except share and per share amounts)
<S> <C> <C> <C> <C> <C> <C> <C>
Properties Properties
Acquired Sold
Consolidated Previously Properties Previously Properties Pro Forma Consolidated
Historical (1) Acquired (2) (3) Sold (4) Adjustments Pro Forma
ASSETS:
Real estate investments:
Industrial buildings $201,326 $ 3,475 $ 9,864 $ - $ - $ - $214,665
Office buildings 96,164 52,394 16,755 - - - 165,313
Operating properties held
for sale 20,767 - - (14,486) (6,281) - -
Industrial properties
under development 10,304 - - - - - 10,304
328,561 55,869 26,619 (14,486) (6,281) - 390,282
Less accumulated depreciation 7,126 - - (1,199) (110) - 5,817
321,435 55,869 26,619 (13,287) (6,171) - 384,465
Cash 1,075 - - - - - 1,075
Other assets 10,180 - - (888) (27) - 9,265
Total Assets $332,690 $ 55,869 $ 26,619 $(14,175) $ (6,198) $ - $394,805
LIABILITIES AND STOCKHOLDERS' EQUITY:
Bank loan payable $ 58,350 $ 54,937 $ 26,090 $(25,144) $ (6,946) $ - $107,287
Mortgage loans payable 60,584 - - - - - 60,584
Accounts payable and
accrued expenses 4,531 922 493 386 - - 6,332
Dividend and distributions
payable 4,163 - - - - - 4,163
Other liabilities 3,525 10 36 (205) (25) - 3,341
Total liabilities 131,153 55,869 26,619 (24,963) (6,971) - 181,707
Redeemable preferred stock:
Series A convertible
preferred stock 50,000 - - - - (50,000) (5) -
Minority interest in
consolidated partnership 1,497 - - - - - 1,497
Common stock and other
stockholders' equity:
Common stock 223 - - - - 83 (5) 306
Additional paid-in capital 223,454 - - - - 49,917 (5) 273,371
Accumulated losses and
distributions in excess of
net income (73,637) - - 10,788 773 - (62,076)
Total common stock
and other stockholders' equity 150,040 - - 10,788 773 - 211,601
Total liabilities and
stockholders' equity $332,690 $ 55,869 $26,619 $(14,175) $(6,198) $ - $394,805
</TABLE>
See accompanying notes to pro forma financial statements.
<TABLE>
BEDFORD PROPERTY INVESTORS, INC.
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE SIX MONTHS ENDED JUNE 30, 1997
(Unaudited)
(in thousands, except share and per share amounts)
<S> <C> <C> <C> <C> <C> <C> <C>
Properties Properties
Acquired Sold
Consolidated Previously Properties Previously Properties Pro Forma Pro Forma
Historical (6) Acquired (7) (8) Sold (9) Adjustments Consolidated
Property operations:
Rental income $19,683 $5,476 $1,575 $(1,960) $ (514) $ - $24,260
Rental expenses:
Operating expenses 3,023 789 277 (582) (56) - 3,451
Real estate taxes 1,715 444 217 (131) (23) - 2,222
Depreciation and amortization 2,374 895 233 (227) (32) - 3,243
Income from property operations 12,571 3,348 848 (1,020) (403) - 15,344
General and administrative
expenses (1,117) - - - - - (1,117)
Interest income 144 - - - - - 144
Interest expense (3,032) - - - - (3,566)(10) (6,598)
Income before minority interest
and gain on sale 8,566 3,348 848 (1,020) (403) (3,566) 7,773
Gain on sale of real estate
investments - - - 10,595 746 - 11,341
Minority interest (51) - - - - - (51)
Net income $ 8,515 $ 3,348 $ 848 $ 9,575 $ 343 $(3,566) $19,063
Net income applicable to common
stockholders* $ 6,265 $ 3,348 $ 848 $ 9,575 $ 343 $(1,316)(11) $19,063
Primary earnings per common and
common equivalent share $ 0.61 $ 1.23
Primary weighted average number
of common and common
equivalent shares 10,243,123 15,497,251 (11)(12)
Earnings per common share -
assuming full dilution $ 0.59 $ 1.22
Weighted average number of
common shares - assuming
full dilution 14,546,136 15,633,597 (12)
</TABLE>
* Reflects reduction for quarterly dividends on the $50,000 Series A
convertible preferred stock.
See accompanying notes to pro forma financial statements.
<TABLE>
BEDFORD PROPERTY INVESTORS, INC.
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1996
(Unaudited)
(in thousands, except share and per share amounts)
<S> <C> <C> <C> <C> <C> <C> <C>
Properties Properties
Acquired Sold
Consolidated Previously Properties Previously Properties Pro Forma Pro Forma
Historical (13) Acquired (14) (15) Sold (16) Adjustments Consolidated
Property operations:
Rental income $27,541 $22,610 $3,150 $(5,354) $(1,010) $ - $46,937
Rental expenses:
Operating expenses 5,352 3,067 554 (1,603) (145) - 7,225
Real estate taxes 2,595 2,096 434 (605) (32) - 4,488
Depreciation and amortization 3,030 3,342 466 (611) (76) - 6,151
Income from property operations 16,564 14,105 1,696 (2,535) (757) - 29,073
General and administrative expenses (1,752) - - - - - (1,752)
Interest income 150 - - - - - 150
Interest expense (4,347) - - - - (9,837) (17) (14,184)
Income before minority interest and
gain on sale 10,615 14,105 1,696 (2,535) (757) (9,837) 13,287
Gain on sale of real estate
investments 406 - - 10,255 712 - 11,373
Minority interest - - - - - (106) (18) (106)
Net income $11,021 $14,105 $1,696 $ 7,720 $ (45) $ (9,943) $24,554
Net income applicable to common
stockholders $ 6,516 * $14,105 $1,696 $ 7,720 $ (45) $ (5,443) (19) $24,549
Primary earnings per common
and common equivalent share $ 1.18 ** $ 1.60
Primary weighted average number of
common and common equivalent
shares 5,531,438 ** 15,341,790 (19)(20)
Earnings per common share -
assuming full dilution $ 1.13 ** $ 1.59
Weighted average number of common
shares - assuming full
dilution 9,765,303 ** 15,513,100 (20)
</TABLE>
* Reflects dividends and distributions.
** Reflects the one-for-two reverse stock split effective March 29,
1996.
See accompanying notes to pro forma financial statements.
BEDFORD PROPERTY INVESTORS, INC.
NOTES TO PRO FORMA FINANCIAL STATEMENTS
PRO FORMA CONSOLIDATED BALANCE SHEET AS OF JUNE 30, 1997
(1) The unaudited pro forma consolidated balance sheet reflects the
acquisition of (i) Orillia Office Park located in Renton,
Washington, (ii) 2601 West Broadway located in Tempe, Arizona, and
(iii) Phoenix Airport Center located in Phoenix, Arizona as if
such acquisitions had occurred on June 30, 1997. The Company
acquired Orillia Office Park on July 10, 1997, 2601 West Broadway
on July 15, 1997, and Phoenix Airport Center on July 22, 1997.
These acquisitions were previously reported in the Company's Form
8-K/A which was filed on September 19, 1997.
Consolidated pro forma real estate investments as of June 30, 1997
include capitalized fees of $825,300 paid by the Company to
Bedford Acquisitions, Inc. (BAI), a corporation wholly owned by
Peter B. Bedford, in connection with the Company's acquisition of
Orillia Office Park, 2601 West Broadway and Phoenix Airport Center.
(2) The unaudited pro forma consolidated balance sheet reflects the
acquisition of (i) The Mondavi Building located in Napa,
California, (ii) 2230 Oak Ridge Way located in Vista, California,
and (iii) Oracle Center located in Denver, Colorado as if such
acquisitions had occurred on June 30, 1997. The Company acquired
The Mondavi Building on September 16, 1997, 2230 Oak Ridge Way on
October 9, 1997, and Oracle Center on October 16, 1997.
The combining balance sheet for these acquisitions as of June 30,
1997 is as follows (in thousands):
Mondavi 2230 Oak Oracle
Building Ridge Way Center Total
Assets:
Real estate investment:
Industrial buildings $6,529 $3,335 $ - $ 9,864
Office buildings - - 16,755 16,755
$ 6,529 $3,335 $16,755 $ 26,619
Liabilities and
stockholders' equity:
Bank loan payable $ 6,433 $3,163 $16,494 $26,090
Accounts payable and
accrued expenses 96 149 248 493
Other liabilities - 23 13 36
Total liabilities $ 6,529 $3,335 $16,755 $26,619
Consolidated pro forma real estate investments as of June 30, 1997
include capitalized fees of $392,500 paid by the Company to
BAI, a corporation wholly owned by Mr. Bedford, in connection with
the Company's acquisition of The Mondavi Building, 2230 Oak Ridge Way,
and Oracle Center.
(3) The unaudited pro forma consolidated balance sheet reflects the
sale of 1000 Town Center and Mariner Court as if such transaction
had occurred on June 30, 1997. The Company sold these properties
on July 31, 1997. The proceeds of the sale, net of a sale
commission of $386,500 payable to BAI, were used to pay down the
credit facility. The sale of these properties was previously
reported on the Company's Form 8-K/A which was filed on September
19, 1997.
(4) The unaudited pro forma consolidated balance sheet reflects the
sale of Academy Place as if such transaction had occurred on June
30, 1997. The Company sold this property on October 22, 1997.
The proceeds of the sale, net of a sale commission of $112,500
payable to BAI, were used to pay down the credit facility.
(5) The unaudited pro forma consolidated balance sheet reflects the
conversion of 8,333,334 shares of the Series A convertible
preferred stock to 4,166,667 shares of common stock as if such
transaction had occurred on June 30, 1997. The Series A
convertible preferred stock was converted on October 14, 1997.
PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE SIX MONTHS ENDED
JUNE 30, 1997
(6) The unaudited pro forma consolidated statement of income reflects
the property acquisitions through July 31, 1997 as if they had
occurred on January 1, 1997. The Company acquired (i) 6500 Kaiser
Drive on January 15, 1997, (ii) Executive Center at South Bank on
March 12, 1997, (iii) Bedford Fremont Business Center on March 14,
1997, (iv) Spinnaker Court on May 8, 1997, (v) U.S. Bank Centre on
May 9, 1997, (vi) Great Hills Trail Building on May 29, 1997,
(vii) Troika Building on June 4, 1997, (viii) 2277 Pine View Way
on June 19, 1997, (ix) Scripps Wateridge Corporate Center on June
27, 1997, (x) Orillia Office Park on July 10, 1997, (xi) 2601 West
Broadway on July 15, 1997, and (xii) Phoenix Airport Center on
July 22, 1997. The combining historical statement of income for
the period from January 1, 1997 through the date of acquisition
for these properties was previously reported in the Company's Form
8-K/A which was filed on September 19, 1997.
(7) The unaudited pro forma consolidated statement of income reflects
the property acquisitions from August 1, 1997 through October 22,
1997 as if they had occurred on January 1, 1997. The Company
acquired (i) The Mondavi Building on September 16, 1997, (ii) 2230
Oak Ridge Way on October 9, 1997, and (iii) Oracle Center on
October 16, 1997.
The combining historical statement of income for the first six
months of 1997 for these properties is as follows (in thousands):
Total
Mondavi 2230 Oak Oracle properties
Building Ridge Way Center acquired
Rental income $ 363 $ 160 $1,052 $1,575
Rental expenses:
Operating expenses 12 4 261 277
Real estate taxes 62 19 136 217
Depreciation and
amortization 58 25 150 233
Income from
property operations $ 231 $ 112 $ 505 $ 848
The pro forma amounts are generally based on historical data.
Depreciation and amortization expense is calculated on a pro forma basis,
based on acquisition costs. Incremental costs of managing the acquired
properties are reflected in the property operating expenses.
(8) The unaudited pro forma consolidated statement of income reflects
the elimination of the actual results of the operations of 1000
Town Center and Mariner Court from January 1 through June 30,
1997. The statement also reflects the gain on the sale as if the
sale had occurred on January 1, 1997. The Company sold 1000 Town
Center and Mariner Court on July 31, 1997. The sale of these
properties was previously reported on the Company's Form 8-K/A
which was filed on September 19, 1997.
(9) The unaudited pro forma consolidated statement of income reflects
the elimination of the actual results of the operations of
Academy Place from January 1 through June 30, 1997. The
statement also reflects the gain on the sale as if the sale had
occurred on January 1, 1997. The Company sold Academy Place on
October 22, 1997.
(10) The unaudited pro forma consolidated statement of income reflects
the effects of the sale of 4,600,000 shares of common stock
at $17.375 per share and the assumption of the mortgage loan of
$8,914,000 as if they had occurred on January 1, 1997. Net
proceeds from the sale of common stock; proceeds from the sale of
1000 Town Center, Mariner Court and Academy Place; borrowings
of $61,000,000 on the credit facility; and the assumption of the
$8,914,000 mortgage were utilized to finance the Company's
acquisition of real estate investments during the first six months
of 1997. The sale of 4,600,000 shares of common stock was
completed on February 18, 1997. The acquisition of U.S. Bank Centre
was financed with borrowings from the credit facility and
the assumption of an $8,914,000 mortgage on May 9, 1997.
The pro forma consolidated interest expense consists of the
amortization of loan fees (including fees incurred for the
amendment and expansion of the credit facility to $150,000,000)
and interest expense incurred on borrowings on the credit
facility and the mortgage loans.
(11) The unaudited pro forma consolidated statement of income reflects
the conversion of 8,333,334 shares of the Series A convertible
preferred stock to 4,166,667 shares of common stock as if such
transaction had occurred on January 1, 1997. The Series A convertible
preferred stock was converted on October 14, 1997.
(12) The weighted average number of shares outstanding shown on the
pro forma consolidated statement of income reflects the sale of
4,600,000 shares of common stock as if it had occurred on
January 1, 1997.
PRO FORMA CONSOLIDATED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER
31, 1996
(13) The unaudited pro forma consolidated statement of income reflects
the property acquisitions in 1996 as if they had occurred
on January 1, 1996. The Company acquired (i) Laguna Hills Square
on March 27, 1996, (ii) Westech Business Center on April 15,
1996, (iii) 100 View Street on May 3, 1996, (iv) Fourier Avenue
on May 30, 1996, (v) Lenexa land on June 5, 1996 (vi) Lundy
Avenue on July 9, 1996, (vii) Phoenix land on July 31, 1996,
(viii) Kenyon Center, 115 Mason Circle and 47600 Westinghouse Drive
on September 5, 1996, (ix) Napa Valley Corporate Way on
September 19, 1996, (x) Carroll Tech Center on October 7, 1996, (xi)
47633 Westinghouse Drive and Westinghouse land on October 15, 1996,
(xii) Vista Buildings 1 and 2 on October 17, 1996, (xiii) Napa lots
10A and 12J and K on December 10, 1996, (xiv) Doherty Avenue on
December 17, 1996, (xv) O'Toole Business Center and Panorama Business
Center on December 18, 1996, and (xvi) Signal Systems Building on
December 31, 1996.
The unaudited pro forma consolidated statement of income reflects
the property acquisitions from January 1 through July 31, 1997 as
if they had occurred on January 1, 1996. The Company acquired
(i) 6500 Kaiser Drive on January 15, 1997, (ii) Executive Center
at South Bank on March 12, 1997, (iii) Bedford Fremont Business
Center on March 14, 1997, (iv) Spinnaker Court on May 8, 1997,
(v) U.S. Bank Centre on May 9, 1997, (vi) Great Hills Trail
Building on May 29, 1997, (vii) Troika Building on June 4, 1997,
(viii) 2277 Pine View Way on June 19, 1997, (ix) Scripps
Wateridge Corporate Center on June 27, 1997, (x) Orillia Office
Park on July 10, 1997, (xi) 2601 West Broadway on July 15, 1997,
and (xii) Phoenix Airport Corporate Center on July 22, 1997.
The combining historical statement of income for the period from
January 1, 1996 through the date of acquisition of the properties
acquired in 1996 and the combining historical statement of income
for the twelve months of 1996 for properties acquired from
January 1 through July 31, 1997 were previously reported on the
Company's Form 8-K/A filed on September 19, 1997.
(14) The unaudited pro forma consolidated statement of income reflects
the property acquisitions from August 1 through October 22, 1997 as
if they had occurred on January 1, 1996. The Company acquired (i) The
Mondavi Building on September 16, 1997, (ii) 2230 Oak Ridge Way on
October 9, 1997, and (iii) Oracle Center on October 16, 1997.
The combining statement of income for the twelve months of 1996
for these properties is as follows (in thousands):
Mondavi 2230 Oak Oracle Total properties
Buillding Ridge Way Center acquired
Rental income $ 726 $ 320 $2,104 $3,150
Rental expenses:
Operating expenses 24 8 522 554
Real estate taxes 124 38 272 434
Depreciation and
amortization 116 50 300 466
Income from property
operations $ 462 $ 224 $1,010 $1,696
The pro forma amounts are generally based on historical data.
Depreciation and amortization expense is calculated on a pro
forma basis, based on acquisition costs. Incremental costs of
managing the acquired properties are reflected in the property
operating expenses.
(15) The unaudited pro forma consolidated statement of income
reflects the elimination of the actual results of operations of
St. Paul East and West from January 1, 1996 through the date
of sale. The statement reflects the elimination of the actual
results of operations of 1000 Town Center and Mariner Court
from January 1, 1996 to December 31, 1996. The statement also
reflects the loss on the sale of St. Paul East and West and the
gain on the sale of 1000 Town Center and Mariner Court as if
the sales had occurred on January 1, 1996. The Company sold St.
Paul East and West on December 31, 1996 and 1000 Town Center and
Mariner Court on July 31, 1997. The sale of these properties was
previously reported on the Company's Form 8-K/A which was filed
on September 19, 1997.
(16) The unaudited pro forma consolidated statement of income
reflects the elimination of the actual results of operations of
Academy Place from January 1, 1996 to December 31, 1996. The
statement also reflects the gain on the sale of Academy Place as
if the sale had occurred on January 1, 1996. The Company
sold Academy Place on October 22, 1997.
(17) The unaudited pro forma consolidated statement of income
reflects the effects of the sale of 3,350,000 shares of common
stock at $13.00 per share, the mortgage loan financings of
$60,764,000 and the sale of the 4,600,000 shares of common stock
at $17.375 per share as if they had occurred on January 1, 1996.
Net proceeds from the sale of common stock; proceeds from the
sales of St. Paul East and West, 1000 Town Center, Mariner Court
and Academy Place; the mortgage loan financings; and borrowings
of $64,000,000 on the credit facility were utilized to finance
the Company's acquisitions of real estate investments during
1996 and 1997. The sales of the 3,350,000 shares and 4,600,000
shares of common stock were completed on April 24, 1996 and
February 18, 1997, respectively; the mortgage loan financing from
Prudential Insurance Company of America was completed on May 31,
1996; and the mortgage loan financing from Union Bank was
completed on December 31, 1996. The acquisition of Doherty Avenue
was financed with a $1,850,000 mortgage loan and the issuance of
partnership units convertible to 108,495 shares of common stock.
The acquisition of U.S. Bank Centre was financed with borrowings on
the credit facility and the assumption of an $8,914,000 mortgage in
May 1997.
The pro forma consolidated interest expense consists of the
amortization of loan fees (including fees incurred for the amendment
and expansion of the credit facility to $150,000,000) and interest
expense incurred on borrowings on the credit facility and the mortgage
loans.
(18) Minority interest shown on the pro forma consolidated statement
of income reflects the income allocated to the owners of the
partnership units as if the units had been issued on January 1,
1996. The units were issued on December 17, 1996 in connection
with the acquisition of Doherty Avenue.
(19) The unaudited pro forma consolidated statement of income reflects
the conversion of 8,333,334 shares of the Series A convertible
preferred stock to 4,166,667 shares of common stock as if such
transaction had occurred on January 1, 1996. The Series A convertible
preferred stock was converted on October 14, 1997.
(20) The weighted average number of shares outstanding shown on the
pro forma consolidated statement of income reflects the sale of
3,350,000 shares and 4,600,000 shares of common stock as if the
sales had occurred on January 1, 1996.
<PAGE>
Exhibit 23.1
Consent of Independent Certified Public Accountants
The Board of Directors
Bedford Property Investors, Inc.:
We consent to the incorporation by reference in the registration
statements (No. 333-33643 and 333-33795) on Form S-3 and the related
prospectuses of Bedford Property Investors, Inc. of our report dated
September 26, 1997 with respect to the historical summary of gross
income and direct operating expenses of Oracle Center for the four
months ended December 31, 1996, which reports appear in the Form 8-K
of Bedford Property Investors, Inc. filed on October 31, 1997. Our report
on the Summary contains a paragraph that states that the Summary was
prepared for the purpose of complying with the rules and regulations of
the Securities and Exchange Commission, as described in note A to the
Summary. The Summary is not intended to be a complete presentation of
the income and expense of Oracle Center.
KPMG, Peat Marwick LLP
San Francisco, California
October 31, 1997
