UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarterly Period Ended June 30, 1996
Commission File Number 1-12784
AMLI RESIDENTIAL PROPERTIES TRUST
(Exact name of registrant as specified in its charter)
Maryland 36-3925916
(State of Organization) (I.R.S. Employer Identification No.)
125 South Wacker Drive, Suite 3100, Chicago, Illinois 60606
(Address of principal executive office) (Zip code)
Registrant's telephone number, including area code: (312) 984-5037
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 and (2) has been subject to such filing
requirements for the past 90 days.
Yes ( X ) No ( )
The number of the Registrant's Common Shares of Beneficial Interest
outstanding was 11,795,476 as of June 30, 1996.
INDEX
PART I: FINANCIAL INFORMATION
Item 1: Financial Statements (Unaudited)
Consolidated Balance Sheets as of
June 30, 1996 and December 31, 1995 . . . . . . . 3
Consolidated Statements of Operations for
the three months and the six months ended
June 30, 1996 and 1995. . . . . . . . . . . . . . 4
Consolidated Statements of Cash Flows for
the six months ended June 30, 1996 and 1995 . . . 5
Notes to Consolidated Financial Statements. . . . . 6 - 18
Item 2: Management's Discussion and
Analysis of Financial Condition and
Results of Operations . . . . . . . . . . . . . . 19 - 25
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . 26
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . 27
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1996 AND DECEMBER 31, 1995
(UNAUDITED)
(Dollars in thousands, except per share data)
<CAPTION>
JUNE 30, DECEMBER 31,
1996 1995
-------------- ------------
<S> <C> <C>
ASSETS:
Rental apartments:
Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 58,643 58,643
Depreciable property. . . . . . . . . . . . . . . . . . . . . . . . . . . 361,879 361,011
---------- ----------
420,522 419,654
Less accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . (44,552) (39,157)
---------- ----------
375,970 380,497
Property under development. . . . . . . . . . . . . . . . . . . . . . . . . 50,597 23,211
Investments in partnerships . . . . . . . . . . . . . . . . . . . . . . . . 24,351 12,255
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . 4,459 2,279
Security deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,881 1,880
Deferred expenses, net. . . . . . . . . . . . . . . . . . . . . . . . . . . 2,509 5,415
Other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,573 7,690
---------- ----------
Total Assets $ 470,340 433,227
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
LIABILITIES:
Debt (note 5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 230,888 215,255
Accrued interest payable. . . . . . . . . . . . . . . . . . . . . . . . . . 992 1,230
Accrued real estate taxes payable . . . . . . . . . . . . . . . . . . . . . 5,057 6,471
Security deposits and prepaid rents . . . . . . . . . . . . . . . . . . . . 2,191 2,439
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,522 2,592
---------- ----------
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . 242,650 227,987
---------- ----------
Commitments and contingencies
Minority interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,814 39,077
---------- ----------
SHAREHOLDERS' EQUITY:
Preferred shares of beneficial interest, $.01 par value,
1,400,000 authorized, 1,200,000 issued and
1,100,000 outstanding at June 30, 1996. . . . . . . . . . . . . . . . . . 11 -
Shares of beneficial interest, $.01 par value, 148,600,000
authorized, 11,795,476 and 11,681,659 common shares issued
and outstanding, respectively . . . . . . . . . . . . . . . . . . . . . . 118 117
Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . . . . . 243,854 218,752
Retained earnings (deficit) . . . . . . . . . . . . . . . . . . . . . . . . (15,419) (20,705)
Dividends paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (42,688) (32,001)
---------- ----------
Total shareholders' equity 185,876 166,163
---------- ----------
Total Liabilities and Shareholders' Equity $ 470,340 433,227
========== ==========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
Three and Six Months Ended June 30, 1996 and 1995
(Unaudited)
(Dollars in thousands, except per share data)
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
------------------------ ------------------------
1996 1995 1996 1995
--------- -------- --------- --------
<S> <C> <C> <C> <C>
Revenues:
Property:
Rental. . . . . . . . . . . . . . . . . . . . . $ 17,766 17,440 35,197 34,569
Other . . . . . . . . . . . . . . . . . . . . . 814 677 1,525 1,331
Interest and share of income from
Service Companies. . . . . . . . . . . . . . . . 19 114 77 268
Other interest. . . . . . . . . . . . . . . . . . 140 92 265 162
Other . . . . . . . . . . . . . . . . . . . . . . 508 216 881 422
-------- -------- -------- --------
Total revenues. . . . . . . . . . . . . . 19,247 18,539 37,945 36,752
-------- -------- -------- --------
Expenses:
Personnel . . . . . . . . . . . . . . . . . . . . 1,727 1,601 3,321 3,099
Advertising and promotion . . . . . . . . . . . . 478 441 950 795
Utilities . . . . . . . . . . . . . . . . . . . . 1,001 943 2,067 1,987
Building repairs and maintenance and
maintenance services . . . . . . . . . . . . . . 1,182 1,108 2,297 2,062
Landscaping and grounds maintenance . . . . . . . 524 581 855 968
Real estate taxes . . . . . . . . . . . . . . . . 2,173 1,972 4,293 4,021
Insurance . . . . . . . . . . . . . . . . . . . . 253 236 487 466
Property management fees. . . . . . . . . . . . . 464 453 918 898
Other operating expenses. . . . . . . . . . . . . 296 252 601 512
Interest. . . . . . . . . . . . . . . . . . . . . 2,996 3,325 5,814 6,680
Amortization of deferred costs. . . . . . . . . . 400 431 851 892
Depreciation . . . . . . . . . . . . . . . . . . 2,726 2,741 5,395 5,469
General and administrative. . . . . . . . . . . . 532 492 1,128 1,000
Expenses associated with the AMLI brand name. . . - 497 - 622
-------- -------- -------- --------
Total expenses. . . . . . . . . . . . . . 14,752 15,073 28,977 29,471
-------- -------- -------- --------
Income before non-recurring gain, minority
interest and extraordinary item . . . . . . . . . 4,495 3,466 8,968 7,281
Non-recurring gain. . . . . . . . . . . . . . . . . 584 - 584 -
-------- -------- -------- --------
Income before minority interest and
extraordinary item . . . . . . . . . . . . . . . 5,079 3,466 9,552 7,281
Minority interest . . . . . . . . . . . . . . . . . 920 669 1,727 1,430
-------- -------- -------- --------
Income before extraordinary item. . . . . 4,159 2,797 7,825 5,851
Extraordinary item -
loss on early extinguishment of debt (net of
minority interest). . . . . . . . . . . . . . . . 1,118 - 1,118 -
-------- -------- -------- --------
Net income . . . . . . . . . . . . . . . 3,041 2,797 6,707 5,851
Less income attributable to Series A
preferred shares. . . . . . . . . . . . . . . . . 473 - 800 -
-------- -------- -------- --------
Net income attributable to common shares. $ 2,568 2,797 5,907 5,851
======== ======== ======== ========
Income per common share:
Before extraordinary item . . . . . . . . . . . . $ .31 .24 .60 .50
Extraordinary item. . . . . . . . . . . . . . . . $ (.09) - (.09) -
Net income per common share . . . . . . . . . . . $ .22 .24 .51 .50
Dividends declared and paid per common share. . . . $ .43 .43 .86 .85
========= ======== ======== ========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(UNAUDITED)
(Dollars in thousands)
<CAPTION>
1996 1995
--------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,707 5,851
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,395 5,469
Amortization of deferred costs. . . . . . . . . . . . . . . . . . . . . . . 851 892
Income from partnerships. . . . . . . . . . . . . . . . . . . . . . . . . . (209) 23
Non-recurring gain. . . . . . . . . . . . . . . . . . . . . . . . . . . . . (584) -
Loss on early extinguishment of debt. . . . . . . . . . . . . . . . . . . . 1,365 -
Minority interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,480 1,430
Changes in assets and liabilities:
Increase in deferred costs. . . . . . . . . . . . . . . . . . . . . . . . . - (307)
Decrease in security deposits . . . . . . . . . . . . . . . . . . . . . . . (1) (5)
(Increase) decrease in other assets . . . . . . . . . . . . . . . . . . . . (655) 547
(Decrease) increase in accrued interest payable . . . . . . . . . . . . . . (238) 431
Decrease in accrued real estate taxes . . . . . . . . . . . . . . . . . . . (1,394) (1,518)
Decrease in tenant security deposits and prepaid rents. . . . . . . . . . . (248) (20)
Increase (decrease) in other liabilities. . . . . . . . . . . . . . . . . . 930 (849)
-------- -------
Net cash provided by operating activities . . . . . . . . . . . . . . 13,399 11,944
-------- -------
Cash flows for investing activities:
Investments in partnerships . . . . . . . . . . . . . . . . . . . . . . . . . (11,347) (2,992)
Cash distributions from partnerships. . . . . . . . . . . . . . . . . . . . . 528 156
Advances to affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,675) (2,601)
Earnest money deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . 450 (150)
Capital expenditures - existing properties. . . . . . . . . . . . . . . . . . (727) (739)
Acquisition properties. . . . . . . . . . . . . . . . . . . . . . . . . . . . - (738)
Properties under development, net of reimbursable
co-investors' costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . (21,653) (8,786)
-------- -------
Net cash used in investing activities . . . . . . . . . . . . . . . . (35,424) (15,850)
-------- -------
Cash flows from financing activities:
Debt proceeds, net of financing costs . . . . . . . . . . . . . . . . . . . . 127,045 30,004
Debt repayments, including prepayment penalties . . . . . . . . . . . . . . . (116,439) (14,454)
Proceeds from preferred shares offering, net of issuance costs. . . . . . . . 23,918 -
Net proceeds from treasury lock contracts . . . . . . . . . . . . . . . . . . 1,424 -
Net proceeds from sale of interest rate cap contracts . . . . . . . . . . . . 1,310 -
Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,366) (2,410)
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10,687) (9,853)
-------- -------
Net cash provided by financing activities . . . . . . . . . . . . . . 24,205 3,287
-------- -------
Net increase (decrease) in cash and cash equivalents. . . . . . . . . . . . . . 2,180 (619)
Cash and cash equivalents at beginning of period. . . . . . . . . . . . . . . . 2,279 4,010
-------- -------
Cash and cash equivalents at end of period. . . . . . . . . . . . . . . . . . . $ 4,459 3,391
======== =======
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest, net of amounts capitalized . . . . $ 6,052 6,249
======== ========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1996 and 1995
(Unaudited)
(Dollars in thousands, except per share data)
1. ORGANIZATION AND BASIS OF PRESENTATION
Organization
Amli Residential Properties Trust (the "Company") commenced
operations upon the completion of its initial public offering on February
15, 1994. In the opinion of management, all adjustments, which include
only normal recurring adjustments necessary to present fairly the financial
position at June 30, 1996 and December 31, 1995 and the results of
operations and cash flows for the periods presented, have been made.
Certain information and note disclosures normally included in the
Company's annual financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. These
consolidated financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's December
31, 1995 Annual Report on Form 10-K filed with the Securities and Exchange
Commission. The results for the six months ended June 30, 1996 are not
necessarily indicative of expected results for the entire year.
The consolidated financial statements include the accounts of the
Company and Amli Residential Properties, L. P. (the "Operating Partnership"
which holds the operating assets of the Company). The Company is the sole
general partner and owns an 81.6% majority interest in the Operating
Partnership. The limited partners hold Operating Partnership units ("OP
Units") which are convertible into shares of the Company on a one-for-one
basis, subject to certain limitations.
On January 30, 1996, the Company completed the sale of 1,200,000
newly issued Series A convertible preferred shares, $.01 par value, for
$24,000 in a registered offering. The price per share of $20 was the price
of the Company's common shares on January 15, 1996. The Company sold the
preferred shares directly to four institutional investors and Amli Realty
Co. ("Amli") without the use of a placement agent or underwriter. The
proceeds from the sale of these preferred shares, less $82 of transaction
costs, were used to reduce the Company's debt, fund development costs and
for general corporate purposes.
The preferred shares pay a dividend equal to $1.72 per share on an
annual basis or the dividend amount paid on common shares, whichever is
higher. The Company's Board of Trustees has authorized the payment of
dividends at this annual rate for the period from January 30, 1996 to
February 20, 1996, the dividend payment date. The preferred shares are
perpetual and generally have no voting rights except in certain limited
circumstances. The preferred shares may be converted on a share-for-share
basis into common shares at any time at a conversion price that shall be
adjusted from time to time. After January 30, 2001, the Company may redeem
the preferred shares at its option for cash or common shares. The Company
may redeem the preferred shares for common shares only when the price of
the common shares equals or exceeds the conversion price for 20 of the 30
days preceding the date of redemption notice. The preferred shares and the
common shares into which the preferred shares may be converted have been
registered under the Company's existing shelf registration.
On March 6, 1996 Amli converted its 100,000 Series A convertible
preferred shares into common shares.
On February 26, 1996, the Operating Partnership issued 26,182 OP
Units in addition to $3,500 in cash for the acquisition of a land parcel in
Aurora, Illinois. Construction of a 272-unit apartment community on this
site is currently underway.
On May 6, 1996, the Operating Partnership issued 143,500 OP Units in
exchange for the contribution of 24 acres of land by an unrelated party.
The Company plans to start construction on a 312-unit apartment community
on this site later in 1996. The Company filed a registration statement to
provide its new investor with the opportunity to acquire registered shares.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Real Estate Assets and Depreciation
Real estate assets are stated at cost less accumulated depreciation.
Ordinary repairs and maintenance are expensed as incurred; replacements
having an estimated useful life of at least one year and betterments are
capitalized and depreciated over their estimated useful lives.
Depreciation is computed on a straight-line basis over useful lives of the
properties (buildings and related land improvements -- 40 years; furniture,
fixtures and equipment -- 5 - 15 years). Substantially all real estate
assets are pledged to secure debt (see note 5).
In conjunction with acquisitions of existing properties, it is the
Company's policy to provide in its acquisition budgets adequate funds to
complete any deferred maintenance items and to otherwise make the
properties acquired competitive with comparable newly-constructed
properties. In some cases the Company will provide in its acquisition
budget additional funds to upgrade or otherwise improve new acquisitions.
Losses in carrying values of investment assets are provided by
management when the losses become apparent and the investment asset is
considered impaired. Management evaluates its investment properties at
least quarterly to assess whether any impairment indications are present,
comparing undiscounted future cash flows with the carrying amount of the
asset. If any investment asset is considered impaired, a loss is provided
to reduce the carrying value of the property to its estimated value.
Management believes that no assets are impaired; therefore, no such losses
have been required to be recognized or provided in the accompanying
financial statements.
Properties Under Development
At June 30, 1996 the Company's properties under development include
parcels of land in the development planning stage on which physical
construction will commence during 1996. Properties currently under
development are as follows:
<TABLE>
<CAPTION>
NUMBER NUMBER TOTAL
OF OF INCURRED
PROPERTY LOCATION ACRES UNITS THRU 6/30/96
-------- -------- ------- ------- ------------
<S> <C> <C> <C> <C>
Wholly Owned:
AMLI at Autumn Chase II Carrollton, TX 21 224 $11,008
AMLI at Autumn Chase III Carrollton, TX 24 240 1,587
AMLI at Gleneagles II Dallas, TX 12 264 9,042
AMLI on Rosemeade II Dallas, TX 10 200 1,314
AMLI at Fossil Creek (1) Ft. Worth, TX 19 384 1,765
AMLI at Wells Branch (1) Austin, TX 29 576 3,465
AMLI at Crown Colony II Topeka, KS 4 64 423
AMLI at Regents Center III Overland Park, KS 16 124 3,192
Vinings Square (2) Overland Park, KS 14 156 3,326
AMLI at Aurora Crossing (1) Aurora, IL 18 272 4,846
AMLI at Northwinds Atlanta, GA 78 800 7,533
AMLI at Peachtree City (1) Fayette County, GA 24 312 3,096
--- ----- ------
Total Wholly Owned 269 3,616 50,597
=== ===== ======
Co-Investments (Company Ownership Percentage):
AMLI at Barrett Lakes (35%) Cobb County, GA 54 446 6,656
AMLI at Pleasant Hill (40%) Gwinnett County, GA 45 502 25,147
AMLI at River Park (40%) (3) Fulton County, GA 23 222 4,565
--- ----- ------
Total Co-investments 122 1,170 36,368
=== ===== ======
<FN>
(1) It is the Company's intention to develop these land parcels in partnership with one or more
institutional investors.
(2) The construction and development of this property is financed entirely by the Company and is accounted
for as an acquisition, development and construction loan and all costs are included in the Company's financial
statements.
(3) AMLI at River Park was conveyed at cost to a 40%-owned co-investment venture in June 1996.
</TABLE>
Interest and Real Estate Tax Capitalization
Interest and real estate taxes incurred during the construction period
are capitalized and depreciated over the lives of the constructed assets.
During the six months ended June 30, 1996 and 1995 total interest
capitalized was $1,359 and $744, respectively. Net of amounts capitalized,
total interest incurred during the six months ended June 30, 1996 and 1995
aggregated $5,814 and $6,680, respectively.
Deferred Expenses
Deferred costs consist primarily of financing costs which are amortized
using the straight-line method over the terms of the related debt.
Amortization of deferred costs relating to properties under development are
capitalized during the construction period, and depreciated over the lives
of the constructed assets. Deferred expenses at June 30, 1996 include $257
in unamortized cost of interest rate cap contracts which limit the
Company's exposure to increasing rates through various dates in 1997 and
1998. Amounts paid for purchased interest rate cap agreements are
amortized over the terms of the related cap contracts.
In December 1995 the Company initiated a program of buying and rolling
Treasury Locks as a means of limiting its exposure to rising interest rates
in anticipation of funding a new $43,907 loan through FNMA. Through May 6,
1996 (the date on which the FNMA certificates were sold), the Company
received net cash of $1,525 from the above described activities. These net
proceeds are included as a reduction of deferred costs and are being
amortized over the ten-year term of the FNMA loan. The FNMA certificates
were sold at a discount of $673; this discount was netted against the
liability and is being amortized over the ten-year loan term.
On June 11, 1996 the Company replaced the Lehman Whole loan with new
fixed rate loans. Concurrently, the Company sold the $54,835 interest rate
cap contract which pertained to the Lehman Whole loan. The sale was
completed on June 13, 1996 and the Company received net proceeds of $1,310.
The unamortized deferred costs related to the LIBOR cap were written off
and a non-recurring net gain of $584 was recognized.
Interest Rate Limitation Contracts
The Company uses interest rate caps and swaps to limit its exposure to
increases in interest rates on its floating rate debt. The Company does
not use them for trading purposes.
At June 30, 1996, the Company was a party to various interest rate cap
agreements which entitle the Company to receive from counterparties on a
monthly basis the amounts, if any, by which the Company's interest payments
on certain floating rate debt exceed capped amounts.
The following summarizes payments received pursuant to interest rate
limitation and swap contracts and the estimated remaining value of such
contracts at June 30, 1996.
<TABLE>
<CAPTION>
CUMULATIVE
REMAINING CASH
NOTIONAL MAXIMUM TYPE OF CONTRACT ORIGINAL UNAMORTIZED PAYMENTS APPROXIMATE
AMOUNT RATE CONTRACT MATURITY COST COSTS RECEIVED VALUE
- -------- ------- -------- ---------- --------- ------------ ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
$54,835 3.875% LIBOR Cap (1) $2,949 - 4,216 -
15,000 3.875% LIBOR Cap (2) 806 - 1,473 -
15,000 7.5% LIBOR (3) Cap 4/1/97 160 - - -
5,845 3.875% LIBOR Cap 2/15/98 314 128 209 198
31,250 3.0% Tax-Exempt Cap 2/15/97 621 129 399 281
12,400 6.47% (all-in) Swap 2/15/97 - - 172 54
14,000 6.65% Swap 2/24/97 - - 12 58
------ ----- ----- -----
$4,850 257 6,481 591
====== ===== ===== =====
<FN>
(1) Sold in June 1996 for net proceeds of $1,310.
(2) Sold in August 1995 for net proceeds of $1,450.
(3) The loan to which this cap was related was repaid in April 1996, thus its carrying cost has been written
down to its estimated market value.
</TABLE>
Other Assets
At June 30, 1996 other assets consist primarily of $3,500 in 13%
interest-only notes receivable from the Service Companies due in 2004,
$4,391 in other current receivables from the Service Companies and $550 in
restricted cash.
Per Share Data
Earnings per common share are computed based on 11,772,837 and
11,596,750 weighted average number of common shares outstanding during the
six months ended June 30, 1996 and 1995 and 11,793,138 and 11,644,850
weighted average number of common shares outstanding during the three
months ended June 30, 1996 and 1995 and after giving effect to earnings
allocated to the Company's preferred shares. The assumed exercise of
outstanding share options is not considered in the computation as it did
not have a materially dilutive effect. The conversion of the convertible
preferred shares is not considered in the computation as it is
antidilutive.
Reclassifications
Certain amounts in the consolidated 1995 financial statements of the
Company have been reclassified to conform with the current presentation.
3. INVESTMENTS IN PARTNERSHIPS AND SERVICE COMPANIES
Investments in Partnerships
At June 30, 1996 the Company, as general partner, owns co-investment
partnership interests in Amli Foundation Co-Investors, L.P. ("Foundation");
Amli Foundation Co-Investors-II, L.P. ("Foundation II"); Amli at Champions,
L.P. ("Champions"); Amli at Windbrooke, L.P. ("Windbrooke"); Amli at Willeo
Creek, L.P. ("Willeo Creek"); Amli at Chevy Chase L.P. ("Chevy Chase");
Amli at Willowbrook, L.P. ("Willowbrook"); Pleasant Hill Joint Venture
("Pleasant Hill"); Barrett Lakes Limited Liability Company ("Barrett"); and
Amli at River Exchange Limited Liability Company ("River Exchange"); and a
nominal interest in the GP Properties. These co-investment partnerships
are accounted for using the equity method.
<TABLE>
Investments in partnerships at June 30, 1996 and the Company's share of income or loss for the six months
ended June 30, 1996 from each (excluding the GP Properties) are summarized as follows:
<CAPTION>
EQUITY (DEFICIT) TOTAL COMPANY'S
------------------ NET SHARE OF
PROPERTY (COMPANY'S TOTAL COMPANY'S COMPANY'S INCOME NET INCOME
PARTNERSHIP OWNERSHIP PERCENTAGE) ASSETS TOTAL SHARE INVESTMENT (LOSS) (LOSS)
- ----------- --------------------- ------- ------- --------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Foundation AMLI at Park Place (25%) $20,310 7,147 1,787 1,750 270 68
Foundation II AMLI at Greenwood Forest (15%) 17,660 5,647 847 827 (27) (27)
Champions AMLI at Champions Park (15%) 12,625 3,209 482 482 (146) (21)
Champions AMLI at Champions Centre (15%) 9,909 2,923 438 438 (85) (5)
Windbrooke AMLI at Windbrooke (15%) 17,886 5,915 887 887 (25) (4)
Willeo Creek AMLI at Willeo Creek (30%) 15,705 5,496 1,651 1,651 115 35
Chevy Chase AMLI at Chevy Chase (33%) 46,521 15,750 5,198 5,198 8 3
Pleasant Hill AMLI at Pleasant Hill (40%) 25,824 12,014 5,102 4,864 276 104
Barrett AMLI at Barrett Lakes (35%) 6,732 5,300 1,855 1,927 - -
Willowbrook AMLI at Willowbrook (40%) 37,411 11,767 4,707 4,707 140 56
River Exchange AMLI at River Park (40%) 4,688 4,050 1,620 1,620 - -
======= ====== ------- ------ ===== -----
$24,574 24,351 209
======= ====== =====
</TABLE>
<TABLE>
The fixed-rate debt financing which has been obtained from various insurance companies on behalf of these co-
investment partnerships is summarized below:
<CAPTION>
TOTAL OUTSTANDING INTEREST
PROPERTY COMMITMENT AT 6/30/96 RATE MATURITY
---------- ---------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
AMLI at Park Place $13,000 12,718 8.21% 10/5/99
AMLI at Greenwood Forest 11,625 11,625 8.95% 5/10/02
AMLI at Champions Park 9,500 9,148 7.26% 12/5/97
AMLI at Champions Centre 6,700 6,700 8.93% 1/1/02
AMLI at Windbrooke 11,500 11,500 9.24% 2/1/02
AMLI at Willeo Creek 10,000 10,000 6.77% 5/1/03
AMLI at Chevy Chase 29,767 29,767 6.67% 4/1/03
AMLI at Pleasant Hill 15,500 11,722 9.15% 3/1/07
AMLI at Barrett Lakes 16,680 1 8.50% 12/1/09
AMLI at Willowbrook 24,500 24,500 7.785% 5/1/03
AMLI at River Park 9,100 - 7.75% 6/27/08
<FN>
In general, these loans provide for monthly payments of principal and interest based on a 25 or 27 year
amortization schedule and a balloon payment at maturity. Loans against newly-completed properties provide for
payments of interest only for an initial period, with principal amortization commencing generally within two years
of completion of construction and initial lease-up.
</TABLE>
<TABLE>
Investments in partnerships at December 31, 1995 and the Company's 1995 share of income or loss from each
(excluding the GP Properties from which the Company received distributions and recorded income of $2) are
summarized as follows:
<CAPTION>
EQUITY (DEFICIT) TOTAL COMPANY'S
------------------ NET SHARE OF
PROPERTY (COMPANY'S TOTAL COMPANY'S COMPANY'S INCOME NET INCOME
PARTNERSHIP OWNERSHIP PERCENTAGE) ASSETS TOTAL SHARE INVESTMENT (LOSS) (LOSS)
- ----------- --------------------- ------- ------- --------- ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Foundation AMLI at Park Place (25%) $20,658 7,116 1,780 1,742 354 90
Foundation II AMLI at Greenwood Forest (15%) 18,086 5,946 892 872 (226) (33)
Champions AMLI at Champions Park (15%) 13,032 3,355 503 503 (273) (41)
Champions AMLI at Champions Centre (15%) 10,158 3,009 451 443 (398) (60)
Windbrooke AMLI at Windbrooke (15%) 18,174 6,190 928 928 (38) (6)
Willeo Creek AMLI at Willeo Creek (30%) 15,829 5,630 1,689 1,692 (7) -
Pleasant Hill AMLI at Pleasant Hill (40%) 21,215 12,012 5,122 4,869 207 82
Barrett AMLI at Barrett Lakes (35%) 4,013 3,406 1,192 1,206 - -
======= ====== ------- ------ ==== ----
$12,557 12,255 32
======= ====== ====
</TABLE>
Investments in Service Companies
In connection with its initial public offering (June 1994 in the case
of Amrescon), the Company obtained 5% of the voting common stock and 100%
of the nonvoting preferred stock in the Service Companies, which provide
property management, construction, landscaping, investment advisory and
asset management services to the Company and to certain other parties. The
nonvoting preferred stock entitles the Company to approximately 95% of all
cash distributions from the Service Companies. The Company accounts for
its investments in the Service Companies using the equity method of
accounting.
Summarized combined financial information of the various Service
Companies at and for the six months ended June 30, 1996 and 1995 follows:
1996 1995
------- -------
Income (1) $ 2,576 1,767
General and adminis-
trative expenses (2,281) (1,534)
------- -------
295 233
Interest (367) (236)
Depreciation (85) (19)
Income taxes 30 (13)
------- -------
Loss $ (127) (35)
======= =======
Total assets $10,399 4,743
======= =======
(1) Net of construction and landscaping costs.
Interest expense of the Service Companies relates primarily to the 13%
notes payable by Amli Management Company and Amli Institutional Advisors,
Inc. to the Company and to working capital advances made to Amrescon, Inc.
4. RELATED PARTY TRANSACTIONS
General and administrative expenses as included in the accompanying
consolidated statements of operations include allocations of costs to the
Company from Amli and its affiliates. Such allocations are not in excess
of Amli's cost of providing services to the Company, including personnel,
occupancy and other corporate overhead. The Company and the Service
Companies have agreed to pay for a share of Amli's total occupancy cost.
During the six months ended June 30, 1996 and 1995 the Company accrued
or paid to the Service Companies fees and other costs and expenses as
follows:
1996
1995
---- ----
Management fees $918 898
General contractor fees 280 91
Interest expense 15 15
Landscaping and ground maintenance 308 305
==== ====
During the six months ended June 30, 1996 and 1995 the Company earned
or received from the Service Companies other income as follows:
1996 1995
---- ----
Interest on notes receivable $228 228
Interest on advances 140 11
==== ===
During the six months ended June 30, 1996 and 1995 the Company earned or
received from co-investment partnerships other income as follows:
1996 1995
---- ----
Development fees $131 101
Acquisition fees 184 154
Disposition fees 66 -
Asset management fees 220 110
Accounting and administrative fees 4 15
Interest on advances 19 18
==== ===
The development and acquisition fees earned from co-investment
partnerships as shown above include only the venture partners' shares of
such fees, as the Company's share of the partnership's cost is eliminated.
5. DEBT
Bond financing
AMLI at Spring Creek, an 1,180-unit apartment community in Atlanta,
Georgia secures a total of $40,750 of tax-exempt bonds. The terms of the
bonds require that a portion of the apartment units be leased to
individuals who qualify based on income levels specified by the U.S.
Government. The bonds bear interest at a variable rate; however, $31,250
of the total $40,750 has an interest rate cap contract in place against
increases in a tax-exempt index rate above 3%. The variable rate is
adjusted weekly based upon the remarketing rate for these bonds (3.6% at
July 31, 1996; 3.52% average for the six months ended June 30, 1996). The
credit enhancement for the bonds was provided by a $41,297 five-year letter
of credit from Wachovia Bank which expires on October 15, 1999.
Mortgage notes payable
At June 30, 1996, the Company owes a total of $152,501 pursuant to
fourteen fixed rate mortgage notes payable to nine financial institutions.
Each loan is secured by a first mortgage on the respective residential
apartment community and is non-recourse to the partners, except for a
$1,500 portion of one of the mortgage notes payable and $13,726 of another
mortgage note payable. The loans bear interest at fixed rates between 7.0%
and 9.9%, with maturities extending through May 1, 2006.
On April 29, 1996, the Company closed on a $43,907 ten-year, 7.79% loan
provided by FNMA. The loan is secured by mortgages on three properties in
Dallas, Texas. On June 11, 1996, two seven-year loans provided by CIGNA in
the aggregate amount of $42,000 at an average interest rate of 7.31% were
funded. The net proceeds of these loans were used primarily to repay the
Lehman Whole loan and the Lehman Line of Credit. The Company incurred an
extraordinary charge of $1,365 which consists of the related unamortized
deferred costs on these repaid loans plus prepayment penalties.
Other notes payable
Other notes payable are comprised of four floating rate loans due to
financial institutions aggregating $36,887 and $750 in another note
payable. These loans bear interest at rates of 135 to 200 basis points
over LIBOR (6.9% - 7.5% at June 30, 1996). Of the total, $12,400 is the
subject of an interest rate swap fixing the interest rate at 6.47% through
February 15, 1997 and $14,000 is subject to an interest rate swap fixing
the rate at 6.65% through February 24, 1997. In addition, $5,845 is
covered by interest rate cap for protection against increase in LIBOR above
3.875% through February 15, 1998.
On June 16, 1996, the Wachovia line of credit was modified to increase
the commitment amount to $60,000 and to lower the interest rate to LIBOR
plus 1.35% (LIBOR plus 1.65% on construction loans until stabilized
operations are achieved).
In April 1996, First Chicago/NBD purchased the $27,000 revolving credit
and loan facility with Citicorp Real Estate Inc. The loan was modified to
increase the commitment amount to $29,500 and to reduce the interest rate
to LIBOR plus 1.65%.
Of the aggregate $104,480 of other notes payable, $32,535 is outstanding
on the $60,000 Wachovia line of credit; $2,500 is outstanding on the
$29,500 First Chicago/NBD facility; and $1,852 is outstanding on the $6,230
construction loan for AMLI at Regents Center Phase III. Following the
closing of the new loan from FNMA, and repayment of the Lehman Line of
Credit, $3,118 in letters of credit are outstanding on an $8,000 line of
credit from Harris. The total $63,725 (net of $3,118 letters of credit) of
unused credit is available to fund future development, acquisition and
working capital needs. The line of credit agreements provide for customary
borrower covenants, including among other things, minimum debt service
coverage ratios and maximum loan to value ratios.
<TABLE>
The table below sets forth certain information relating to the indebtedness of the Company.
<CAPTION>
ORIGINAL BALANCE INTEREST MATURITY BALANCE
ENCUMBERED PROPERTIES AMOUNT AT 6/30/96 RATE DATE AT 12/31/95
- --------------------- ---------- ---------- ---------- --------- -----------
<S> <C> <C> <C> <C> <C>
BOND FINANCING:
AMLI at Spring Creek $ 40,750 40,750 Tax-exempt 10/1/24 40,750
-------- --------- rate + 1.23%
MORTGAGE NOTES PAYABLE:
AMLI at Alvamar 5,000 4,795 9.38% 3/1/97 4,819
AMLI at the Arboretum 4,800 4,466 9.90% 9/28/97 4,504
AMLI at Gleneagles 8,500 8,201 7.70% 10/31/97 8,248
AMLI at Martha's Vineyard 7,060 6,724 7.42% 11/1/97 6,776
AMLI at Reflections 4,800 4,573 7.50% 6/30/98 4,615
AMLI on Rosemeade 7,050 6,746 7.02% 10/5/98 6,807
AMLI at Sherwood 7,320 7,075 7.75% 7/1/03 7,155
AMLI at Riverbend 31,000 31,000 7.30% 7/1/03 -
AMLI in Great Hills 11,000 11,000 7.34% 7/1/03 -
AMLI at Valley Ranch 11,500 10,998 7.625% 7/10/03 11,092
AMLI at Regents Center 20,100 13,726 (1) 9/1/05 13,776
AMLI at Beekman Place
AMLI on the Green
AMLI of North Dallas (3) 43,234 43,197 7.789% 5/1/06 -
-------- ------- -------
Total Mortgage Notes Payable 161,364 152,501 67,792
-------- ------- -------
OTHER NOTES PAYABLE:
AMLI at Vinings
AMLI at Sope Creek 60,000 32,535 L+1.35%(2) 5/31/98 32,535
-------- ------- ---------- ------- -------
AMLI at Autumn Chase I & II
AMLI at Chase Oaks
AMLI at Gleneagles Phase II 29,500 2,500 L+1.65% 2/28/98 2,343
-------- ------- ---------- ------- -------
AMLI in Great Hills (5)
AMLI at Bear Creek (4)
AMLI at Nantucket (4)
AMLI at Riverbend (5)
AMLI at West Paces (4) - - 5.76% 8/9/01 54,835
-------- ------- ---------- ------- -------
AMLI of North Dallas (5)
AMLI at Beekman Place (5)
AMLI on Timberglen (4)
AMLI on the Green (5) - - L+1.85% 2/9/99 16,000
-------- ------- ---------- ------- -------
AMLI at Park Sheridan 8,000 - L+1.65% 8/30/98 250
AMLI at Park Sheridan 6,230 1,852 L+2.00% 10/9/96 -
Unsecured 750 750 4.00% Demand 750
-------- ------- -------
Total Other Notes Payable 104,480 37,637 106,713
-------- ------- -------
Total $306,594 230,888 215,255
======== ======= =======
<FN>
(1) $13,800 at 8.73%; $6,300 at 9.23% is expected to fund later in 1996.
(2) The Company has used interest rate derivative contracts to fix the interest rate at 6.47% through February
15, 1997 on $12,400, to fix the interest rate at 6.65% through February 24, 1997 on $14,000 , and to limit the
interest rate to 5.38% through February 15, 1998 on $5,845. The rate is LIBOR + 1.65% on construction loans until
stabilized occupancy.
(3) Net of discount of $673.
(4) Unencumbered as of June 30, 1996, loans were repaid in full in April and June 1996.
(5) These properties now secure new fixed rate mortgages.
</TABLE>
<TABLE>
As of June 30, 1996, the scheduled maturities of the Company's debt are as follows:
<CAPTION>
FIXED RATE OTHER
BOND MORTGAGE NOTES
FINANCINGS NOTES PAYABLE PAYABLE TOTAL
----------- ------------ ------- -------
<S> <C> <C> <C> <C>
1996. . . . . . . . . . . . . . . . $ - 773 2,602 3,375
1997. . . . . . . . . . . . . . . . - 25,605 - 25,605
1998. . . . . . . . . . . . . . . . - 12,770 35,035 47,805
1999. . . . . . . . . . . . . . . . - 1,933 - 1,933
2000. . . . . . . . . . . . . . . . - 2,092 - 2,092
Thereafter. . . . . . . . . . . . . 40,750 109,328 - 150,078
------- ------- ------- -------
$40,750 152,501 37,637 230,888
======= ======= ======= =======
</TABLE>
6. COMMITMENTS
In conjunction with the February 1996 acquisition of land for the
development of Aurora Crossing, the Company may be obliged, at the option
of the unit holder, to purchase 26,182 Operating Partnership units at the
then current market value of the Company's shares of beneficial interest.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (DOLLARS IN THOUSANDS,
EXCEPT SHARE DATA)
The following discussion is based primarily on the consolidated financial
statements of Amli Residential Properties Trust (the "Company") as of June
30, 1996 and December 31, 1995 and for the six months ended June 30, 1996
and 1995.
This information should be read in conjunction with the accompanying
unaudited consolidated financial statements and notes thereto. These
financial statements include all adjustments which are, in the opinion of
management, necessary to reflect a fair statement of the results for the
interim periods presented, and all such adjustments are of a normal
recurring nature.
As of June 30, 1996, the Company owns an 81.6% general partnership interest
in the Operating Partnership, which holds the operating assets of the
Company. The limited partners hold Operating Partnership units ("OP
Units") which are convertible into shares of the Company on a one-for-one
basis, subject to certain limitations. The Company has qualified, and
anticipates continuing to qualify, as a real estate investment trust
("REIT") for Federal income tax purposes.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1996 the Company has $4,459 in cash and cash equivalents.
At June 30, 1996 the Company has outstanding borrowings of approximately
$32,535 on a $60,000 line of credit from Wachovia Bank secured by mortgages
on two properties in Georgia. Of the total outstanding, the rate on
$12,400 has been fixed at 6.47% until February 15, 1997 and the rate on
$14,000 has been fixed at 6.65% through February 24, 1997 through use of
interest rate swap contracts. In addition, $5,845 has an interest rate cap
contract in place as protection against increases in LIBOR above 3.875%
through February 15, 1998. The remaining credit availability of $27,465 is
anticipated to be used to fund future acquisition or development
activities.
In April 1996, the $27,000 revolving credit and construction loan facility
with Citicorp Real Estate, Inc. was sold to First Chicago/NBD which has
modified the loan to increase the commitment amount to $29,500 and reduce
the interest rate to LIBOR plus 1.65%. Of the total credit facility,
approximately $21,200 will be used to fund development costs (excluding
land costs) of a 224-unit Amli at Autumn Chase Phase II and a 264-unit Amli
at Gleneagles Phase II, both developments located in Dallas, Texas. The
balance of the loan facility will be available for general purposes of the
Company.
On April 29, 1996, the Company closed on a $43,907 ten-year, 7.79% loan
provided by FNMA. This loan is secured by mortgages on three properties in
Dallas, Texas. The loan proceeds, net of .75% financing fee and issue
discount of $673, were used in part to repay the Lehman Line of Credit and
pay down the balance on First Chicago/NBD revolving loan.
On June 11, 1996 the Company closed on two seven-year loans provided by
CIGNA aggregating $42,000 with an average interest rate of 7.31% and repaid
the Lehman Whole Loan. The total $85,907 in financings in April and June
1996 have the following effect on the Company's total debt:
. increase in weighted average annual interest rate of 0.4% to 6.9%
through August 1, 1997 and decrease in weighted average annual interest
rate of 0.2% during the four years thereafter;
. increase in weighted average term by 1.3 years to 5.3 years;
. increase in percentage of debt that is fixed-rate debt to 66% from 54%;
. decrease in deferred expenses and amortization, especially through
August 1, 1997;
. increase in unencumbered operating properties from one to five;
. net extraordinary or otherwise non-recurring charges and credits of
$781, which is primarily attributable to the non-cash write-off of deferred
expenses relating to the Lehman loans.
At June 30, 1996, the Company has $13,726 outstanding balance on its
$20,100 loan provided by Teachers Insurance and Annuity Association. This
loan is secured by AMLI at Regents Center in Overland Park, Kansas. The
remaining commitment is anticipated to fund later this year upon
substantial completion of the additional 124-unit Phase III under
construction at this property. The proceeds are anticipated to be used to
repay the $6,230 Harris Trust and Savings Bank construction loan.
At June 30, 1996, the $6,230 construction loan provided by Harris Trust and
Savings Bank for Phase III of AMLI at Regents Center has an outstanding
balance of $1,852. The loan, which is unsecured with respect to the
property under construction, bears LIBOR plus 2% floating interest rate and
will mature on October 9, 1996.
For the six months ended June 30, 1996 net cash provided by operating
activities was $13,399. For the six months ended June 30, 1995, cash
provided by operating activities was $11,944. The increase was primarily
attributable to the $1,193 increase in total revenues and the $866 decrease
in interest expense.
Cash flows used for investing activities increased to $35,424 for the six
months ended June 30, 1996 as compared with $15,850 for the six months
ended June 30, 1995. The increase is largely due to an increase in the
amounts expended for development costs of $12,867 and investments in
partnerships of $8,355.
Net cash flows provided by financing activities was $24,205 for the six
months ended June 30, 1996 and $3,287 for the six months ended June 30,
1995. Such cash flows for the six months ended June 30, 1996 reflected the
issuance of preferred shares of beneficial interest resulting in the net
cash proceeds of $23,918.
Funds from operations is defined as net income (computed in accordance with
generally accepted accounting principles), excluding gains (losses) from
debt restructuring and sales of property, plus depreciation of real estate
related assets and amortization, and after adjustments for unconsolidated
partnerships and joint ventures. Adjustments for unconsolidated
partnerships and joint ventures are calculated to reflect funds from
operations on the same basis.
Funds from operations is widely accepted in measuring the performance of
equity REITs. An understanding of the Company's funds from operations will
enhance the reader's comprehension of the Company's results of operations
and cash flows as presented in the financial statements and data included
elsewhere herein. Funds from operations should not be considered an
alternative to net income or any other GAAP measurement as a measure of the
results of the Company's operations, the Company's cash flows or liquidity.
Funds from operations for the six months ended June 30, 1996 and 1995 are
summarized as follows:
JUNE 30, JUNE 30,
1996 1995
------- -------
Net income before minority
interest and
extraordinary item $9,552 7,281
Depreciation 5,395 5,469
Other, net (1) (52) 783
------- ------
Funds from operations $14,895 13,533
======= ======
Total shares - weighted average,
including shares issuable upon
conversion of preferred
shares and units 15,500 14,427
======= ======
(1) Includes share of co-investment partnerships' depreciation, and
in 1996 non-recurring gain relating to the sale of an interest rate cap
contract and in 1995 non-recurring expenses associated with the AMLI brand
name.
The Company expects to pay quarterly dividends from cash available for
distribution. Until distributed, funds available for distribution will be
invested in short-term investment grade securities or used to temporarily
reduce outstanding balances on the Company's revolving lines of credit.
The Company expects to meet its short-term liquidity requirements by using
its working capital and any portion of net cash flow from operations not
distributed currently. The Company is of the opinion that its future net
cash flows will be adequate to meet operating requirements in both the
short and the long term and provide for payment of dividends by the Company
in accordance with REIT requirements. In order to qualify as a REIT, the
Company is required to distribute dividends to its shareholders equal to
95% of its REIT taxable income. The Company's 1996 estimated dividend
payment level equals an annual rate of $1.72 per share. The Company
estimates that approximately 35% of the total dividends to be paid in 1996
will be treated as a return of capital.
The Company expects to meet certain long-term liquidity requirements such
as scheduled debt maturities, repayment of loans for construction,
development, and acquisition activities through the issuance of long-term
secured and unsecured debt and additional equity securities of the Company
(or OP Units). On July 20, 1995, the Company's shelf registration became
effective. The registration provided for up to an aggregate of $200,000 of
preferred shares, common shares and security warrants which the Company may
issue from time to time.
On January 30, 1996, the Company issued 1,200,000 Series A cumulative
convertible preferred shares of beneficial interest for $20 per share, or
$24,000 directly to four institutional investors and Amli Realty Co.
("Amli") in a registered offering, without the use of a placement agent or
underwriter. The proceeds of the offering, less $82 of transaction costs,
were used to reduce the Company's debt, fund development costs and for
working capital requirements. Amli converted its 100,000 preferred shares
to 100,000 common shares on March 6, 1996.
AMLI at Autumn Chase Phase II, a 224-unit apartment development in Dallas,
Texas is substantially complete and currently in lease-up. AMLI at
Gleneagles Phase II, a 264-unit development also located in Dallas, Texas
is expected to be completed later in 1996. The approximate development
costs (including land cost) are $24,500. The Company has also commenced
development activities on additional sites in Austin, Texas and Overland
Park, Kansas. Furthermore, the Company has started planning and pre-
development activities on four additional sites in Fort Worth, Dallas,
Atlanta and Kansas. The costs of these development activities are expected
to be funded from existing credit availability and/or in partnership with
institutional investors.
In February 1996, the Company acquired two land parcels in Atlanta, Georgia
and Aurora, Illinois for a total price of $11,023. The Atlanta parcel was
acquired for cash and a note that was paid off in May 1996. The
consideration for the Aurora land parcel was satisfied in part by 26,182 OP
Units, with the remaining purchase price paid in cash. A 272-unit
apartment community is under development on the Aurora site. The Company
intends to develop an 800-unit apartment community on the Atlanta site
either for its own account or in partnership with an institutional
investor.
AMLI at Pleasant Hill, a 502-unit apartment development through a co-
investment partnership is substantially complete. Total development costs
of approximately $26,100 were funded first from the venturers' capital
contributions and thereafter are being funded from the $15,500 fixed rate
construction and permanent loan provided by the co-venturer.
In November 1995, the Company, through a co-investment joint venture, began
construction of the 446-unit AMLI at Barrett Lakes apartment community on
54 acres of land located in Atlanta, Georgia. Of the total estimated
development costs of $27,800, the co-venturer has provided $16,680 of
construction and permanent financing for this development, and the
remaining costs are being funded from the Company's and the co-investor's
equity contributions.
CAPITAL EXPENDITURES
Capital expenditures are those made for assets having a useful life in
excess of one year and include replacements (including carpeting and
appliances) and betterments, such as unit upgrades, enclosed parking
facilities and similar items.
In conjunction with acquisitions of existing properties, it is the
Company's policy to provide in its acquisition budgets adequate funds to
complete any deferred maintenance items and to otherwise make the
properties acquired competitive with comparable newly-constructed
properties. In some cases, the Company will provide in its acquisition
budget additional funds to upgrade or otherwise improve new acquisitions.
INFLATION
Virtually all apartment leases at the Properties and co-investment
properties are for six or twelve months' duration. This enables the
Company to pass along inflationary increases in its operating expenses on a
timely basis. Because the Company's property operating expenses (exclusive
of depreciation and amortization) are approximately 43.0% of rental and
other revenue, increased inflation typically results in comparable
increases in income before interest and general and administrative
expenses, so long as rental market conditions allow increases in rental
rates while maintaining stable occupancy.
An increase in general price levels may immediately precede, or accompany,
an increase in interest rates. The Company's exposure to rising interest
rates is mitigated by the existing debt level of approximately 41% of the
Company's current total market capitalization, by including intermediate
term fixed rate debt, and by having interest rate protection in place on
substantially all of its variable rate indebtedness through February 1997.
As a result, for the foreseeable future, increases in interest expense
resulting from increasing inflation are anticipated to be less than future
increases in income before interest and general and administrative
expenses.
RESULTS OF OPERATIONS
During the period from January 1, 1995 through June 30, 1996 growth in
property revenues and property operating expenses resulted from increases
at properties owned as of January 1, 1995, and from the newly constructed
properties.
During the same period, the Company has invested in five co-investment
partnerships, which own the 236-unit AMLI at Windbrooke in Buffalo Grove,
Illinois, the 242-unit AMLI at Willeo Creek in Roswell, Georgia, the 316-
unit AMLI at Greenwood Forest in Houston, Texas, the 592-unit AMLI at Chevy
Chase in Buffalo Grove, Illinois, and the 488-unit AMLI at Willowbrook in
Willowbrook, Illinois.
For the six months ended June 30, 1996, net income attributable to common
shares was $5,907, or $.51 per share, on total revenues of $37,945. For
the six months ended June 30, 1995 net income was $5,851 or $.50 per share
on total revenues of $36,752.
On a "same community" basis, weighted average occupancy of the apartment
units decreased slightly to 94.3% for the six months ended June 30, 1996
from 95.6% for the same period in the prior year. For the six months ended
June 30, 1996, weighted average collected rents increased by 5.1% to $645
from $614 per unit per month for the six months ended June 30, 1995.
COMPARISON OF SIX MONTHS ENDED JUNE 30, 1996 TO SIX MONTHS ENDED JUNE 30,
1995.
Income before non-recurring item, minority interest, and extraordinary item
increased to $8,968 for the six months ended June 30, 1996 from $7,281 for
the six months ended June 30, 1995. This increase in net income was
primarily attributable to a $866 decrease in interest expense and a $1,193
increase in total revenues, reduced by a $981 increase in property
operating expenses. For the six months ended June 30, 1996 and 1995 net
income was $6,707 and $5,851, respectively.
Total property revenues increased by $822 or 2.3%. On the same community
basis total property revenues increased by $1,601 or 4.7%.
Property operating expenses increased by $981, or 6.6%. On the same
community basis property operating expenses increased by $1,114 or 7.9%.
Interest expense, net of the amounts capitalized, decreased from $6,680 to
$5,814, or 13.0%.
General and administrative expenses increased from $1,000 for the six
months ended June 30, 1995 to $1,128 for the six months ended June 30,
1996.
<TABLE>
OCCUPANCY
The following is a listing of approximate physical occupancy levels by quarter for the Company's wholly-owned
properties:
<CAPTION>
1996 1995
NUMBER ------------------------------------- ------------------------------
OF At At At At At At At At
LOCATION/PROPERTY UNITS 12/31 9/30 6/30 3/31 12/31 9/30 6/30 3/31
- ----------------- ------ ---- ---- ---- ----- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
DALLAS/FT. WORTH, TEXAS
AMLI at Autumn Chase 226 96% 94% 93% 93% 96% 100%
AMLI at Bear Creek 350 95% 95% 93% 97% 94% 99%
AMLI at Beekman Place 224 95% 97% 96% 99% 96% 97%
AMLI at Chase Oaks 250 95% 98% 96% 97% 99% 96%
AMLI at Gleneagles 326 97% 95% 96% 97% 100% 98%
AMLI on the Green 424 98% 97% 92% 95% 97% 98%
AMLI at Nantucket 312 95% 98% 96% 97% 99% 97%
AMLI of North Dallas 808 97% 97% 95% 98% 98% 97%
AMLI at Reflections 212 88% 95% 93% 98% 98% 93%
AMLI on Rosemeade 236 98% 98% 95% 99% 98% 98%
AMLI on Timberglen 260 96% 97% 92% 99% 98% 94%
AMLI at Valley Ranch 460 95% 95% 94% 96% 98% 91%
----- --- --- --- --- --- ---
4,088 96% 96% 94% 97% 98% 96%
----- --- --- --- --- --- ---
AUSTIN, TEXAS
AMLI at the Arboretum 231 97% 96% 95% 98% 99% 93%
AMLI in Great Hills 344 97% 96% 91% 94% 95% 98%
AMLI at Martha's Vineyard 360 95% 95% 94% 96% 94% 96%
----- --- --- --- --- --- ---
935 96% 96% 93% 96% 96% 96%
----- --- --- --- --- --- ---
ATLANTA, GEORGIA
AMLI at Sope Creek 463 95% 93% 95% 97% 95% 98%
AMLI at Sope Creek lease lease lease
Phase IV 232 98% 98% up up up N/A
AMLI at Spring Creek 1,180 96% 96% 94% 96% 96% 96%
AMLI at Vinings 208 99% 99% 98% 100% 99% 97%
AMLI at West Paces 337 97% 92% 96% 99% 97% 98%
----- --- --- --- --- --- ---
2,420 96% 95% 95% 97% 96% 97%
----- --- --- --- --- --- ---
EASTERN KANSAS
AMLI at Alvamar 152 96% 95% 96% 96% 94% 94%
AMLI at Crown Colony 156 96% 86% 86% 96% 94% 96%
AMLI at Regents Center 300 94% 98% 94% 92% 98% 96%
AMLI at Sherwood 300 97% 89% 91% 98% 92% 91%
----- --- --- --- --- --- ---
908 96% 93% 92% 95% 95% 94%
----- --- --- --- --- --- ---
INDIANAPOLIS, INDIANA
AMLI at Riverbend 996 94% 94% 93% 95% 95% 93%
----- --- --- --- --- --- ---
ORANGE COUNTY, CALIFORNIA
Club Laguna N/A N/A N/A N/A N/A 91% 95%
----- --- --- --- --- --- ---
CHICAGO, ILLINOIS
AMLI at Park Sheridan 253 97% 96% 92% 99% 94% 96%
----- ----- ----- ----- ----- ----- -----
9,600 95.8% 95.4% 93.9% 96.7% 96.2% 95.8%
===== ===== ===== ===== ===== ===== =====
</TABLE>
PART II OTHER INFORMATION
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
No reports on Form 8-K have been filed during the quarter ended June 30,
1996. The Exhibits filed as part of this report are listed below.
EXHIBIT NO. DOCUMENT DESCRIPTION
27. Financial Data Schedule
99. Financial and Operating Data
furnished to Shareholders and Analysts
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
AMLI RESIDENTIAL PROPERTIES TRUST
Date: August 13, 1996 By: /s/ ALLAN J. SWEET
Allan J. Sweet
President and Trustee
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Date: August 13, 1996 By: /s/ GREGORY T. MUTZ
Gregory T. Mutz
Chairman of the Board of Trustees
Date: August 13, 1996 By: /s/ ALLAN J. SWEET
Allan J. Sweet
President and Trustee
Date: August 13, 1996 By: /s/ CHARLES C. KRAFT
Charles C. Kraft
Principal Accounting Officer
Principal Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE SIX MONTHS ENDED JUNE 30, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 4,459
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 471,119
<DEPRECIATION> 44,552
<TOTAL-ASSETS> 470,340
<CURRENT-LIABILITIES> 0
<BONDS> 230,888
0
11
<COMMON> 118
<OTHER-SE> 185,747
<TOTAL-LIABILITY-AND-EQUITY> 470,340
<SALES> 0
<TOTAL-REVENUES> 37,945
<CGS> 0
<TOTAL-COSTS> 28,977
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,814
<INCOME-PRETAX> 7,825
<INCOME-TAX> 0
<INCOME-CONTINUING> 7,825
<DISCONTINUED> 0
<EXTRAORDINARY> 1,118
<CHANGES> 0
<NET-INCOME> 6,707
<EPS-PRIMARY> .51
<EPS-DILUTED> .51
</TABLE>
EXHIBIT 99
- ----------
AMLI RESIDENTIAL PROPERTIES TRUST
FINANCIAL AND OPERATING DATA
June 30, 1996
1. Funds from Operations
2. Statements of Operations
3. Balance Sheets
4. Selected Financial Information
5. Debt
6. Debt Maturities
7. Same Community Comparison - Wholly-Owned - three months
ended June 30, 1996 and 1995
8. Same Community Comparison - Wholly-Owned - six months ended
June 30, 1996 and 1995
9. Same Community Comparison - Wholly-Owned & Co-Investments -
three months ended June 30, 1996 and 1995
10. Same Community Comparison - Wholly-Owned & Co-Investments -
six months ended June 30, 1996 and 1995
11. Property Information
12. Development Activities
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
FUNDS FROM OPERATIONS
Unaudited - Dollars in thousands except per share data
<CAPTION>
1996 1996
Three Three 1995
Months Months 1995 Three Months ended 1994
ended ended Year ended ----------------------------------------- Year ended
June 30 Mar. 31 Dec. 31 Dec.31 Sep. 30 Jun. 30 Mar. 31 Dec. 31,
-------- -------- ---------- ------ ------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
PRO FORMA
REVENUES
- --------
Property revenues:
Rental $ 17,766 $ 17,431 $ 69,341 $ 17,284 $ 17,488 $ 17,440 $ 17,129 $ 61,480
Other 814 711 2,797 703 763 677 654 2,347
-------- -------- -------- -------- -------- -------- -------- --------
Total Property
Revenues 18,580 18,142 72,138 17,987 18,251 18,117 17,783 63,827
-------- -------- -------- -------- -------- -------- -------- --------
Property operating
expenses (7,634) (7,237) (28,451) (7,186) (7,355) (7,134) (6,776) (24,957)
Property management
fees (464) (454) (1,803) (450) (455) (453) (445) (1,602)
-------- -------- -------- -------- -------- -------- -------- --------
Property expenses (8,098) (7,691) (30,254) (7,636) (7,810) (7,587) (7,221) (26,559)
Operating expense
ratio 43.6% 42.4% 41.9% 42.5% 42.8% 41.9% 40.6% 41.6%
Net operating income 10,482 10,451 41,884 10,351 10,441 10,530 10,562 37,268
-------- -------- -------- -------- -------- -------- -------- --------
OTHER INCOME
- ------------
Share of Service
companies' income
(loss) (95) (56) 3 (37) 0 40 100
Interest from
Service Companies 114 114 455 113 114 114 114 455
Other interest 140 125 407 99 146 92 70 491
Share of partner-
ships cash flow 486 256 466 196 131 67 72 197
Fee income -
acquisitions 92 158 220 66 116 38
Fee income -
developments 99 32 206 70 35 24 77 267
Fee income -
asset management 143 77 224 57 57 56 54 38
Other 45 25 189 68 42 42 37 261
-------- -------- -------- -------- -------- -------- -------- --------
AMLI RESIDENTIAL PROPERTIES TRUST
FUNDS FROM OPERATIONS - CONTINUED
1996 1996
Three Three 1995
Months Months 1995 Three Months ended 1994
ended ended Year ended ----------------------------------------- Year ended
June 30 Mar. 31 Dec. 31 Dec.31 Sep. 30 Jun. 30 Mar. 31 Dec. 31,
-------- -------- ---------- ------ ------- ------- ------- ----------
PRO FORMA
Total other income 1,024 731 2,170 632 525 511 502 1,809
General and adminis-
trative (532) (596) (1,932) (486) (446) (492) (508) (1,407)
-------- -------- -------- -------- -------- -------- -------- --------
EBITDA 10,974 10,586 42,122 10,497 10,520 10,549 10,556 37,670
-------- -------- -------- -------- -------- -------- -------- --------
Interest expense (2,996) (2,818) (12,926) (3,082) (3,164) (3,325) (3,355) (10,253)
Amortization of
deferred costs (400) (451) (1,792) (450) (450) (431) (461) (2,415)
-------- -------- -------- -------- -------- -------- -------- --------
Funds from
operations
(FFO) $ 7,578 $ 7,317 $ 27,404 $ 6,965 $ 6,906 $ 6,793 $ 6,740 $ 25,002
Capital expen-
ditures paid
from FFO (394) (333) (1,714) (425) (550) (429) (310) (893)
Other (Co-in-
vestments
Cap exp) (12) (9) (29) (9) (10) (5) (5) 0
-------- -------- -------- -------- -------- -------- -------- --------
Funds available
for distribu-
tion (FAD) $ 7,172 $ 6,975 $ 25,661 $ 6,531 $ 6,346 $ 6,359 $ 6,425 $ 24,109
-------- -------- -------- -------- -------- -------- -------- --------
FFO per share $ 0.481 $ 0.480 $ 1.900 $ 0.483 $ 0.479 $ 0.471 $ 0.467 $ 1.733
FAD per share $ 0.455 $ 0.457 $ 1.779 $ 0.453 $ 0.440 $ 0.441 $ 0.445 $ 1.671
Dividend
per share $ 0.43 $ 0.43 $ 1.72 $ 0.43 $ 0.43 $ 0.43 $ 0.43 $ 1.68
Dividend as a
% of FFO 89.3% 89.6% 90.5% 89.1% 89.8% 91.3% 92.0% 96.9%
Dividend as a
% of FAD 94.4% 94.0% 96.7% 95.0% 97.8% 97.6% 96.6% 100.5%
</TABLE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
STATEMENTS OF OPERATIONS
Unaudited - Dollars in thousands except per share data
<CAPTION>
1996 1996
Three Three 1995
Months Months 1995 Three Months ended 1994
ended ended Year ended ----------------------------------------- Year ended
June 30 Mar. 31 Dec. 31 Dec.31 Sep. 30 Jun. 30 Mar. 31 Dec. 31,
-------- -------- ---------- ------ ------- ------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
REVENUES
- --------
Property Revenue:
Rental $ 17,766 $ 17,431 $ 69,341 $ 17,284 $ 17,488 $ 17,440 $ 17,129 $ 61,123
Other 814 711 2,797 703 763 677 654 2,338
Interest from and
share of Service
Companies' income
(loss) 19 58 458 76 114 114 154 498
Other interest 140 125 407 99 146 92 70 491
Gain on sale of
residential
property and
interests rate
caps 0 0 0 0 0 0 0 0
Other 508 373 874 302 150 216 206 765
-------- -------- -------- -------- -------- -------- -------- --------
Total Revenue $ 19,247 $ 18,698 $ 73,877 $ 18,464 $ 18,661 $ 18,539 $ 18,213 $ 65,215
-------- -------- -------- -------- -------- -------- -------- --------
AMLI RESIDENTIAL PROPERTIES TRUST
STATEMENTS OF OPERATIONS - CONTINUED
1996 1996
Three Three 1995
Months Months 1995 Three Months ended 1994
ended ended Year ended ----------------------------------------- Year ended
June 30 Mar. 31 Dec. 31 Dec.31 Sep. 30 Jun. 30 Mar. 31 Dec. 31,
-------- -------- ---------- ------ ------- ------- ------- ----------
EXPENSES
- --------
Personnel 1,727 1,594 6,287 1,589 1,599 1,601 1,498 5,290
Advertising and
promotion 478 472 1,702 421 486 441 354 1,465
Utilities 1,001 1,066 4,125 1,046 1,092 943 1,044 3,782
Building repairs
and maintenance 1,182 1,115 4,554 1,223 1,269 1,108 954 3,999
Landscaping and
grounds maintenance 524 331 1,811 409 434 581 387 1,405
Real estate taxes 2,173 2,120 7,947 1,989 1,937 1,972 2,049 7,169
Insurance 253 234 914 218 230 236 230 843
Other operating
expenses 296 305 1,111 291 308 252 260 881
Property management
fees 464 454 1,803 450 455 453 445 1,422
Interest, net of
capitalized 2,996 2,818 12,926 3,082 3,164 3,325 3,355 11,557
Amortization of
deferred costs 400 451 1,792 450 450 431 461 2,448
Depreciation of
real property 2,133 2,121 8,704 2,102 2,163 2,234 2,205 7,894
Depreciation of
personal property 593 548 2,081 465 586 507 523 2,733
General and
administrative 532 596 1,932 486 446 492 508 1,616
-------- -------- -------- -------- -------- -------- -------- --------
Total expenses 14,752 14,225 57,689 14,221 14,619 14,576 14,273 52,504
-------- -------- -------- -------- -------- -------- -------- --------
Non-recurring item
income (expense) 584 0 818 (16) 1,456 (497) (125) 749
-------- -------- -------- -------- -------- -------- -------- --------
Income (loss) before
taxes, minority
interest and
extraordinary item 5,079 4,473 17,006 4,227 5,498 3,466 3,815 13,460
-------- -------- -------- -------- -------- -------- -------- --------
Income taxes 0 0 0 0 0 0 0 62
-------- -------- -------- -------- -------- -------- -------- --------
AMLI RESIDENTIAL PROPERTIES TRUST
STATEMENTS OF OPERATIONS - CONTINUED
1996 1996
Three Three 1995
Months Months 1995 Three Months ended 1994
ended ended Year ended ----------------------------------------- Year ended
June 30 Mar. 31 Dec. 31 Dec.31 Sep. 30 Jun. 30 Mar. 31 Dec. 31,
-------- -------- ---------- ------ ------- ------- ------- ----------
Income (loss) before
minority interest
and extraordinary
items 5,079 4,473 17,006 4,227 5,498 3,466 3,815 13,398
Minority interest 920 807 3,287 806 1,051 669 761 2,681
-------- -------- -------- -------- -------- -------- -------- --------
Income (loss) before
extraordinary items 4,159 3,666 13,719 3,421 4,447 2,797 3,054 10,717
Extraordinary items
net of minority
interests (1,118) 0 0 0 0 0 0 (2,007)
-------- -------- -------- -------- -------- -------- -------- --------
Net income (loss) $ 3,041 $ 3,666 $ 13,719 $ 3,421 $ 4,447 $ 2,797 $ 3,054 $ 8,710
======== ======== ======== ======== ======== ======== ======== ========
Net income (loss)
allocable to
preferred shares $ 473 $ 327
Net income (loss)
allocable to
common shares $ 2,568 $ 3,339 $ 13,719 $ 3,421 $ 4,447 $ 2,797 $ 3,054 $ 8,710
======== ======== ======== ======== ======== ======== ======== ========
INCOME (LOSS) PER
COMMON SHARE:
Before extra-
ordinary item $ 0.31 $ 0.29 $ 1.18 $ 0.29 $ 0.38 $ 0.24 $0.26 $0.92
Extraordinary item ($ 0.09) $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $0.00 $(0.17)
Income per
common share $ 0.22 $ 0.29 $ 1.18 $ 0.29 $ 0.38 $ 0.24 $0.26 $0.75
======== ======== ======== ======== ======== ======== ======== ========
AMLI RESIDENTIAL PROPERTIES TRUST
STATEMENTS OF OPERATIONS - CONTINUED
1996 1996
Three Three 1995
Months Months 1995 Three Months ended 1994
ended ended Year ended ----------------------------------------- Year ended
June 30 Mar. 31 Dec. 31 Dec.31 Sep. 30 Jun. 30 Mar. 31 Dec. 31,
-------- -------- ---------- ------ ------- ------- ------- ----------
PRO FORMA
FUNDS FROM OPERATIONS
- ---------------------
Income (loss) before
taxes, minority
interest and
extraordinary item $ 5,079 $ 4,473 $17,006 $ 4,227 $ 5,498 $ 3,466 $ 3,815 $ 14,878
-------- -------- -------- -------- -------- -------- -------- --------
Depreciation of
real property 2,133 2,121 8,704 2,102 2,163 2,234 2,205 7,894
Depreciation of
personal property 593 548 2,081 465 586 507 523 2,733
Non-recurring items (584) 0 (818) 16 (1,456) 497 125 (749)
Other 357 175 431 155 115 89 72 246
-------- -------- -------- -------- -------- -------- -------- --------
Funds from opera-
tions (FFO) $ 7,578 $ 7,317 $27,404 $ 6,965 $ 6,906 $ 6,793 $6,740 $25,002
FFO per share $ 0.481 $ 0.480 $1.900 $ 0.483 $ 0.479 $ 0.471 $0.467 $1.733
-------- -------- -------- -------- -------- -------- -------- --------
Capital expenditures
paid from FFO ($ 394) $ (333) $(1,714) $ (425) $ (550) $ (429) $(310) $(893)
Other (Co-investments
Cap exp) (12) (9) (29) (9) (10) (5) (5) 0
-------- -------- -------- -------- -------- -------- -------- --------
Funds available for
distribution (FAD) $ 7,172 $ 6,975 $25,661 $ 6,531 $ 6,346 $ 6,359 $6,425 $24,109
FAD per share $ 0.455 $ 0.457 $1.779 $ 0.453 $ 0.440 $ 0.441 $0.445 $1.671
-------- -------- -------- -------- -------- -------- -------- --------
Dividends per share $ 0.43 $ 0.43 $1.72 $ 0.43 $ 0.43 $ 0.43 $0.43 $1.68
======== ======== ======== ======== ======== ======== ======== ========
Dividends as a
% of FFO 89.3% 89.6% 90.5% 89.1% 89.8% 91.3% 92.0% 96.9%
Dividends as a
% of FAD 94.4% 94.0% 96.7% 95.0% 97.8% 97.4% 96.6% 100.5%
======== ======== ======== ======== ======== ======== ======== ========
</TABLE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONDENSED BALANCE SHEETS
Unaudited - Dollars in thousands except per share data
<CAPTION>
June 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
1996 1996 1995 1995 1995 1995 1994
--------- --------- ---------- ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
- ------
Rental apartments
Land $ 58,643 $58,643 $58,643 $56,755 $59,723 $59,723 $59,723
Depreciable property 361,879 361,330 361,011 351,518 377,190 376,508 375,713
-------- -------- -------- -------- -------- -------- --------
420,522 419,973 419,654 408,273 436,913 436,231 435,436
Less accumulated depreciation (44,552) (41,826) (39,157) (36,590) (35,043) (32,302) (29,574)
-------- -------- -------- -------- -------- -------- --------
375,970 378,147 380,497 371,683 401,870 403,929 405,862
Property under development 50,597 42,763 23,211 30,758 21,494 12,948 16,326
Investments in partnerships 24,351 17,758 12,255 9,425 9,444 8,516 2,948
Cash and cash equivalents 4,459 2,080 2,829 2,890 3,391 3,884 4,010
Security deposits 1,881 1,874 1,880 1,906 2,054 2,016 2,049
Deferred costs, net 2,509 4,922 5,415 5,832 6,125 5,857 6,211
Other assets 10,573 9,419 7,140 8,218 6,418 5,939 5,213
-------- -------- -------- -------- -------- -------- --------
Total assets $470,340 $456,963 $433,227 $430,712 $450,796 $443,089 $442,619
======== ======== ======== ======== ======== ======== ========
LIABILITIES AND SHAREHOLDERS EQUITY
- -----------------------------------
Debt $230,888 $218,267 $215,255 $210,040 $232,802 $223,847 $217,687
Accrued interest payable 992 1,127 1,230 1,159 1,568 1,511 1,137
Accrued real estate taxes 5,057 3,577 6,471 6,615 4,694 3,414 6,212
Construction costs payable 1,821 2,213 1,369 2,237 261 534 591
Security deposits and prepaid rents 2,191 2,185 2,439 2,420 2,679 2,522 2,699
Other liabilities 1,701 1,741 1,223 1,023 870 601 1,389
-------- -------- -------- -------- -------- -------- --------
Total liabilities 242,650 229,110 227,987 223,494 242,874 232,429 229,715
-------- -------- -------- -------- -------- -------- --------
Minority interest 41,814 40,249 39,077 39,522 39,945 41,151 42,743
-------- -------- -------- -------- -------- -------- --------
AMLI RESIDENTIAL PROPERTIES TRUST
CONDENSED BALANCE SHEETS - CONTINUED
June 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
1996 1996 1995 1995 1995 1995 1994
--------- --------- ---------- ------ ------- ------- -------
Shareholders' equity
Preferred shares, $.01 par value 11 11
Shares of beneficial interest,
$.01 par value 118 118 117 117 117 116 115
Additional paid-in capital 243,854 242,927 218,752 218,685 218,393 217,713 216,577
Retained earnings (15,419) (18,309) (20,705) (24,126) (28,573) (31,370) (34,424)
Dividends paid (42,688) (37,143) (32,001) (26,980) (21,960) (16,950) (12,107)
-------- -------- -------- -------- -------- -------- --------
Total shareholders' equity 185,876 187,604 166,163 167,696 167,977 169,509 170,161
-------- -------- -------- -------- -------- -------- --------
Total liabilities and
shareholders' equity $470,340 $456,963 $433,227 $430,712 $450,796 $443,089 $442,619
======== ======== ======== ======== ======== ======== ========
</TABLE>
<TABLE>
Amli Residential Properties Trust
Selected Quarterly Financial Information
June 30, 1996
(in thousands except for per share data)
<CAPTION>
June 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
1996 1996 1995 1995 1995 1995 1994
--------- --------- ---------- ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Total Debt $230,888 $218,267 215,255 210,040 232,802 223,847 217,687
Total Debt (1) 267,348 244,149 227,204 220,260 242,051 231,767 223,495
Total Shares and
Units Outstanding (2) 15,796 15,653 14,427 14,427 14,427 14,427 14,427
Value per Common Share
- end of quarter $20.750 $20.125 $20.00 $19.25 $19.00 $17.75 $18.75
Total Equity (Market
Value) - end of quarter 327,775 315,014 288,534 277,714 274,107 256,074 270,501
Total Market Capitalization 558,663 533,281 503,789 487,754 506,909 479,921 488,188
Total Market Capitalization (1) 595,123 559,163 515,738 497,974 516,158 487,841 493,996
======== ======== ======== ======== ======== ======== ========
Total Revenues (3) 19,247 18,698 18,464 18,661 18,539 18,213 17,651
EBITDA (4) 10,974 10,586 10,497 10,520 10,549 10,556 10,432
FFO 7,578 7,317 6,965 6,906 6,793 6,740 6,747
FAD 7,172 6,975 6,531 6,346 6,359 6,425 6,471
Dividends 6,771 6,558 6,203 6,203 6,203 6,203 6,059
Debt service (excluding
capitalized interest) 3,279 3,060 3,320 3,372 3,529 3,558 3,384
Interest Expense 2,996 2,818 3,082 3,164 3,325 3,355 3,203
G & A Expense 532 596 486 446 492 508 391
Total Shares and
Units Outstanding
- Wtd. Avg. 15,746 15,254 14,427 14,427 14,427 14,427 14,427
======== ======== ======== ======== ======== ========= ========
Amli Residential Properties Trust
Selected Quarterly Financial Information - CONTINUED
June 30, 1996
(in thousands except for per share data)
June 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31,
1996 1996 1995 1995 1995 1995 1994
--------- --------- ---------- ------ ------- ------- -------
Debt Service Coverage Ratio 3.35 3.46 3.16 3.12 2.99 2.97 3.08
Interest Coverage Ratio 3.66 3.76 3.41 3.32 3.17 3.15 3.26
Debt as % of Total
Market Capitalization 41.33% 40.93% 42.73% 43.06% 45.93% 46.64% 44.59%
Debt as % of Total
Market Capitalization (1) 44.92% 43.66% 44.05% 44.23% 46.89% 47.51% 45.24%
EBITDA as % of Total
Market Capitalization 7.86% 7.94% 8.33% 8.63% 8.32% 8.80% 8.55%
FFO as % of Total
Market Equity 9.25% 9.29% 9.66% 9.95% 9.91% 10.53% 9.98%
G&A as % of Total
Market Capitalization 0.38% 0.45% 0.39% 0.37% 0.39% 0.42% 0.32%
G&A as % of Total Revenues 2.76% 3.19% 2.63% 2.39% 2.65% 2.79% 2.22%
Dividends as % of FFO 89.3% 89.6% 89.1% 89.8% 91.3% 92.0% 89.8%
Dividends as % of FAD 94.4% 94.0% 95.0% 97.8% 97.4% 96.6% 93.6%
======== ======== ======== ======== ======== ========= ========
Apartment Units - Wholly Owned
In Operation 9,600 9,600 9,600 9,368 9,789 9,789 9,789
Under Development 884 612 612 844 720 456 456
Apartment Units - Co-Investment
In Operation 3,175 2,687 2,245 2,003 2,003 1,687 1,451
Under Development 1,170 948 948 502 502 502 502
-------- -------- -------- -------- -------- -------- --------
Total Units 14,829 13,847 13,405 12,717 13,014 12,434 12,198
======== ======== ======== ======== ======== ========= ========
<FN>
(1) Including proportionate share of debt of Co-investment partnerships accounted for using the equity
method.
(2) Including 1,100 preferred shares convertible to common shares.
(3) Excluding non-recurring gain of $960 in the third quarter of 1994 and $1,564 in the third quarter of 1995
and $751 in the second quarter of 1996.
(4) Includes other income, net of G & A expenses.
(5) Time weighted so as to appropriately state percentage relationship to FFO and FAD.
</TABLE>
<TABLE>
Amli Residential Properties Trust
Debt
June 30, 1996
(in thousands)
<CAPTION>
Fixed Tax Lehman Lehman Wachovia Harris LOC/ Citicorp/
Total Rate Exempt Whole Line of Line of Const. First
Debt Mortgages Bonds Loan Credit Credit Loan Chgo. Other
-------- -------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dec. 31, 1994 $217,687 54,845 40,750 54,835 44,000 19,518 2,989 750
Borrowings 7,527 6,500 1,027
Repayments (1,367) (203) (1,164)
-------- -------- -------- -------- -------- -------- --------- --------- --------
Mar. 31, 1995 $223,847 54,642 40,750 54,835 50,500 20,545 1,825 750
Borrowings 9,159 4,500 2,855 1,304 500
Repayments (204) (204)
-------- -------- -------- -------- -------- -------- --------- --------- --------
Jun. 30, 1995 $232,802 54,438 40,750 54,835 55,000 23,400 3,129 500 750
Borrowings 21,375 13,800 7,575
Repayments (44,137) (208) (40,800) (3,129)
-------- -------- -------- -------- -------- -------- --------- --------- --------
Sep. 30, 1995 $210,040 68,030 40,750 54,835 14,200 30,975 0 500 750
Borrowings 5,453 1,800 1,560 250 1,843
Repayments (238) (238)
-------- -------- -------- -------- -------- -------- --------- --------- --------
Dec. 31, 1995 $215,255 67,792 40,750 54,835 16,000 32,535 250 2,343 750
Borrowings 9,504 491 5,606 3,407
Repayments (6,492) (242) (6,000) (250)
-------- -------- -------- -------- -------- -------- --------- --------- --------
Mar. 31, 1996 $218,267 67,550 40,750 54,835 10,000 32,535 491 7,949 4,157
Borrowings 89,095 85,234 1,361 2,500
Repayments (76,474) (283) (54,835) (10,000) (7,949) (3,407)
-------- -------- -------- -------- -------- -------- --------- --------- --------
Jun. 30, 1996 $230,888 $152,501 $40,750 $0 $0 $32,535 $1,852 $2,500 $750
======== ======== ======== ======== ======== ======== ======== ======== ========
Amount Capped $31,250 5,845
Capped To Feb 15, 1997 Feb 15, 1998
Maximum Effective
Rate - Capped Portion 4.23% 5.38%
======== ========
Amli Residential Properties Trust
Debt - CONTINUED
<FN>
Tax Exempt Bonds All-in rate reflects maximum (including all Housing Authority, Trustee, and Credit
Enhancement Costs) effective rate with 3% rate cap in place.
Lehman Whole Loan This loan was paid in full in June 1996.
Lehman $39.6 Million
Line of Credit This loan was paid in full in April 1996.
Wachovia $60 Million
Line of Credit Interest at LIBOR+135. $14,000 has been swapped to a 6.65% fixed rate to February 24,
1997, $12,400 has been swapped to a 6.47% fixed rate to February 15, 1997 and $5,845 has been capped based on 30
day LIBOR of 3.875% through February 15, 1998. On July 8, 1996, this facility was increased to $60 million and
the pricing on the outstanding balances was lowered to LIBOR + 135% (LIBOR + 1.65% on construction loans until
stabilized).
</TABLE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
PORTFOLIO INDEBTEDNESS SUMMARY
June 30, 1996
(Dollars in thousands)
<S> <C> <C>
RATE ASSUMPTIONS
LIBOR 5.48%
LIBOR Cap 3.88%
Tax Exempt 3.35% F = Fixed Rate
Tax Exempt Cap 3.00% V = Variable Rate
</TABLE>
<TABLE>
<CAPTION>
Original Outstand- Maturity
/Max ing Interest Maturity (years)
Borrower Lender Amount Balance Rate Rate Date 6/30/96
<S> <C> <C> <C> <C> <C> <C> <C>
F ARP, L.P. IDS American Express$ 5,000 4,795 9.38% 3/1/97 0.7
F ARP, L.P. Lincoln National 4,800 4,466 9.90% 9/28/97 1.2
F ARP, L.P. Prudential 8,500 8,201 7.70% 10/31/97 1.3
F ARP, L.P. Allstate 7,060 6,724 7.42% 11/1/97 1.3
F ARP, L.P. Prudential 4,800 4,573 7.05% 6/30/98 2.0
F ARP, L.P. Prudential 7,050 6,746 7.02% 10/5/98 2.3
F ARP, L.P. CIGNA 31,000 31,000 7.30% 6/11/03 7.0
F ARP, L.P. CIGNA 11,000 11,000 7.34% 6/11/03 7.0
F ARP, L.P. Fleet 7,320 7,075 7.75% 7/1/03 7.0
F ARP, L.P. Nationwide 11,500 10,998 7.63% 7/10/03 7.0
F ARP, L.P. TIAA 20,100 13,726 8.73% 9/1/05 9.2
F ARP, L.P. (1) FNMA 43,907 43,197 7.79% 4/29/06 9.8
- ------------------------------------------------------------------------------------------------------------------
V ARP, L.P. Harris Trust & Savings 6,300 1,852 7.48% LIBOR + 2.00% 10/9/96 0.3
V ARP, L.P. First Chicago NBD 29,500 2,500 7.13% LIBOR + 1.65% 2/28/98 1.7
V ARP, L.P. (2) Wachovia Bank 12,400 12,400 6.47% LIBOR + 1.35% 5/31/98 1.9
V ARP, L.P. Wachovia Bank 2,354 2,354 6.65% LIBOR + 1.35% 5/31/98 1.9
V ARP, L.P. (3) Wachovia Bank 5,845 5,845 5.23% LIBOR + 1.35% 5/31/98 1.9
V ARP, L.P. Wachovia Bank 3,161 3,161 6.65% LIBOR + 1.35% 5/31/98 1.9
V ARP, L.P. Wachovia Bank 8,775 8,775 6.65% LIBOR + 1.35% 5/31/98 1.9
- ------------------------------------------------------------------------------------------------------------------
V ARP, L.P. (4) Tax-Exempt Bonds 31,250 31,250 4.23% Tax Ex + 1.23% 9/30/99 3.3
V ARP, L.P. Tax-Exempt Bonds 9,500 9,500 4.58% Tax Ex + 1.23% 9/30/99 3.3
- ------------------------------------------------------------------------------------------------------------------
F ARP, L.P. AIA 750 750 4.00% Demand -
TOTAL 230,888 7.01% 5.3
==================================================================================================================
Co-Investments (5) Various 36,460 7.76% Various 6.6
- ------------------------------------------------------------------------------------------------------------------
TOTAL including Co-Investment $ 267,348 7.12% 5.5
==================================================================================================================
</table AMLI RESIDENTIAL PROPERTIES TRUST
DEVELOPMENT ACTIVITY
SECOND QUARTER 1996
<CAPTION>
Total Construc- Percent
Number Cost Esti- Percent tion First Comple- Stabili- Construc-
of (mil- mated Owner- Start Units tion zation tion Percent
Community Name Units lions) Yield ship Date Occupied Date Date Complete Leased
- -------------- ------ ------ ----- ------- --------- -------- ------- -------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
UNDER
CONSTRUCTION
- ------------
ATLANTA,
GEORGIA
- -------
Amli at:
Pleasant Hill 502 26.2 11.9% 40% 3Q/94 2Q/95 3Q/96 4Q/96 93% 90%
Barrett Lakes 446 27.8 10.2% 35% 3Q/95 4Q/96 4Q/97 2Q/98 17% N/A
River Park 222 15.4 9.8% 40% 4Q/95 4Q/96 2Q/97 4Q/97 17% N/A
DALLAS, TEXAS
- -------------
Amli at:
Autumn
Chase II 224 10.7 11.3% 100% 1Q/95 4Q/95 2Q/96 4Q/96 99% 97%
Gleneagles II 264 13.4 11.2% 100% 3Q/95 2Q/96 4Q/96 2Q/97 61% 13%
AURORA, ILLINOIS
- ----------------
Amli at:
Aurora
Crossing* 272 24.3 10.1% 100% 2Q/96 4Q/96 3Q/97 4Q/97 5% N/A
OVERLAND PARK,
KANSAS
- --------------
Amli at:
Regents
Center III 124 7.5 10.2% 100% 3Q/95 3Q/96 4Q/96 1Q/97 42% N/A
----- ------ ----- ---- ----- ----- ----- ----- --- ----
Total/Average 2,054 $125.3 10.7%
====== ====== =====
Total Construc- Percent
Number Cost Esti- Percent tion First Comple- Stabili- Construc-
of (mil- mated Owner- Start Units tion zation tions Percent
Community Name Units lions) Yield ship Date Occupied Date Date Complete Leased
- -------------- ------ ------ ----- ------- --------- -------- ------- -------- --------- -------
PLANNING STAGE
- --------------
ATLANTA, GEORGIA
- ----------------
Amli at:
Northwinds I 400
DALLAS/
FORTH WORTH,
TEXAS
- -------------
Amli:
at Fossil Creek* 384
at Autumn
Chase III 240
on Rosemeade II 200
AUSTIN, TEXAS
- -------------
Amli at:
Wells Branch* 576
TOPEKA, KANSAS
- --------------
Amli at:
Crown
Colony II 64
<FN>
* The land for this development is wholly-owned. Amli anticipates developing this property in partnership with an
institutional investor.
Under Construction: These developments have been announced, are financed and are currently under development.
Planning Stages: These developments are in the planning and preliminary development stages.
The following is a "Safe Harbor" Statement under the Private Securities Litigation Reform
Act of 1995 and Section 21E of the Securities Exchange Act of 1934. The projections contained in the table above
that are not historical facts are forward-looking statements. Risks associated with the Company's development,
construction and lease-up activities, which could impact the forward-looking statements made include: development
opportunities may be abandoned; construction costs of a community may exceed original estimates, possibly making
the community uneconomical; construction and lease-up may not be completed on schedule, resulting in increased debt
service and construction costs; estimates of the costs of improvements to bring an acquired property up to the
standards established for the market position intended for that property may prove inaccurate.
</TABLE>
