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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
DATE OF REPORT (Date of earliest event reported): December 21, 1999
CHARLES E. SMITH RESIDENTIAL REALTY, INC.
(Exact name of registrant as specified in its charter)
Commission File Number: 1934 Act File Number: 1-13174
Maryland 54-1681655
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2345 Crystal Drive 22202
Crystal City, VA (Zip Code)
(Address of principal
executive offices)
Registrant's telephone number including area code: (703) 920-8500
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Item 2. Property Acquisitions
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On December 22, 1999, Charles E. Smith Residential Realty L.P. ("the
Operating Partnership"), of which Charles E. Smith Residential Realty, Inc.
("the Company") is the sole general partner, announced plans to acquire an
eight-building, 2,669 unit high-rise apartment portfolio located in Southeast,
Florida. Ocean View at Aventura Beach ("Aventura") is a three building, 1,199
unit property. Ocean View at Sunset Pointe ("Hollywood") is a five building,
1,470 unit property. Closing on Aventura occurred December 21, 1999, with the
closing of Hollywood expected within the next 30 days. The total investment
will be $178 million cash, funded with proceeds from the disposition of four
multifamily assets and the Company's bank credit line. The Company plans to
reposition the properties by making substantial renovations of approximately $33
million over the next two years.
In December 1999, the Company sold five multifamily properties totaling 1,420
units for approximately $78 million (Potomac View, Fort Chaplin, Windsor Towers,
Columbian-Stratford, and Suburban Towers). Four of the five sales were
completed as tax deferred I.R.C. Section 1031 exchanges. Under generally
accepted accounting principles, the Company recognized gains on the five sales
totaling $58 million. Proceeds of $57 million from three of the sales were used
to fund the $76 million purchase of Aventura. The balance was drawn on the
Company's line of credit. The remaining $102 million acquisition of Hollywood
will be funded by proceeds of $8 million on one asset sale with the balance
drawn on the Company's line of credit.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
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(A) Pro Forma and historical financial information for Archon will be filed
within 60 days of the due date of this report on Form 8-K.
(B) Exhibits
99.1 Press Release dated December 22, 1999 of the Company
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, hereunto duly authorized, on this 5th day of
January 2000.
CHARLES E. SMITH RESIDENTIAL REALTY, INC.
By: /s/ W.D. Minami
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W.D. Minami
Senior Vice President and
Chief Financial
Officer of the Registrant
/s/ Steven E. Gulley
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Steven E. Gulley
Chief Accounting Officer of
the Registrant
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EXHIBIT INDEX
EXHIBIT NO. EXHIBIT
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99.1 Press Release dated December 22, 1999 of the Company
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EXHIBIT 99.1
[CHARLES E. SMITH RESIDENTIAL REALTY, INC. LOGO APPEARS HERE]
FOR IMMEDIATE RELEASE
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December 22, 1999
Contact: Investors - Chandler Spears
703/769-1044
Media - Susan Goyette
703/769-6746
CHARLES E. SMITH RESIDENTIAL ANNOUNCES $210 MILLION HIGH RISE PORTFOLIO
ACQUISITION/REPOSITIONING IN SOUTHEAST FLORIDA
Company Re-Deploys $71 Million From Disposition of Existing Assets
Arlington, Va. -- Charles E. Smith Residential Realty, Inc. (NYSE:SRW), the
nation's leading urban multifamily REIT, announced today that it will acquire a
2,669-unit portfolio in Southeast Florida from a partnership of institutional
investors. The portfolio includes eight high-rise buildings, four on the
oceanfront and the others on the intracoastal waterway. All are located in the
Hollywood Beach/Aventura area.
The total investment will include approximately $178 million payable to the
seller, and an estimated $33 million in capital improvements planned over the
next two years. The transaction will be funded with proceeds from the
disposition of four multifamily assets and the Company's bank credit line.
Closing on three of the buildings occurred on December 21, 1999. Closing on the
remaining five buildings is expected to take place within 30 days.
Similar to Smith Residential's recent acquisition in South Miami Beach, this
portfolio represents another repositioning opportunity for the Company in
Southeast Florida. Value-adding upgrades planned include in-unit washer/dryers,
additional parking, kitchen/bath renovations, and window and balcony
modifications to improve views.
"This acquisition maintains the momentum of our urban living strategy and
geographic diversification program," said Ernest Gerardi, Jr., President of
Charles E. Smith Residential.
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S. Florida Acquisition Page - 2
"One third of our approximately 24,000-unit portfolio is now in the key growth
markets of Chicago, Boston and Southeast Florida. In our targeted market in
Southeast Florida - from Miami Beach north to Palm Beach - we have achieved
critical mass with over 4,200 units. With this acquisition we will own four of
only eight rental multifamily buildings directly on the oceanfront between Miami
Beach and Ft. Lauderdale - and three of the four non-Smith-owned buildings are
scheduled for condominium conversion."
John Guinee, Smith Residential's Chief Investment Officer, added, "This
acquisition takes advantage of a significant lifestyle transition occurring in
the urban/high-rise corridor east of I-95. The former largely retiree
population has changed to a broader demographic profile that is consistent with
our focus on urban living markets. The Southeast Florida market continues to
show strong, well-diversified employment growth, adding 60,000 jobs annually in
wide-ranging fields, including international trade, professional and financial
services, health care, entertainment and tourism. This growth has created a
healthy rental market."
The acquired properties are all located near shopping and entertainment venues
including Aventura Mall, Bal Harbor Shops and the Turnberry Resort. Five of the
buildings in Hollywood Beach are within a short walk of the new 1,000+ room
Diplomat Hotel and Convention Center, scheduled to open in the 4th quarter of
2000, which will offer 50,000 square feet of high-end retail, including a dozen
restaurants. All of the properties feature large apartment units, averaging
over 1,000 square feet, as well as an extensive array of amenities including
swimming pools, tennis courts, fitness facilities and business centers.
The four disposition properties, totaling 1,248 units, include Potomac View,
Windsor Towers and Columbian-Stratford in Northern Virginia and Fort Chaplin in
Washington, D.C., with total proceeds of approximately $71 million.
Charles E. Smith Residential Realty, Inc. is a self-managed real estate
investment trust listed on the New York Stock Exchange under the symbol "SRW."
The Company and its subsidiaries and affiliates own, acquire, develop, and
manage multifamily residential units in Washington, D.C.,
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S. Florida Acquisition Page - 3
Northern Va., Chicago, Boston and Southeast Florida. The Company owns
approximately 24,000 units and has approximately 3,000 units under pre-purchase
and/or construction. The total market capitalization of the Company - Charles E.
Smith Residential Realty, Inc., including its Operating Partnership -exceeds
$2.3 billion. Investor information, including press releases about Charles E.
Smith Residential Realty, is available on the Company's website
at www.charlesesmith.com and also through PR Newswire "News on Call" by fax
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800-758-5804, ext. 101271, or at www.prnewswire.com.
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This news release contains forward-looking statements regarding the Company's
outlook, including statements of goals, intentions, and expectations based on
assumptions about general economic and market conditions, competitive dynamics
and other factors that, by their nature, are subject to significant
uncertainties, some of which are discussed in the Company's filings with the
Securities and Exchange Commission. Because of these uncertainties, and the
assumptions on which statements in this release are based, actual future results
may differ materially.
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