<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10 - Q
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________________ to_____________________
Commission File Numbers 33-92990, 333-13477 and 333-22809
TIAA REAL ESTATE ACCOUNT
(Exact name of registrant as specified in its charter)
NEW YORK
(State or other jurisdiction of
incorporation or organization)
NOT APPLICABLE
(IRS Employer Identification No.)
C/O TEACHERS INSURANCE AND
ANNUITY ASSOCIATION OF AMERICA
730 THIRD AVENUE
NEW YORK, NEW YORK
(address of principal executive offices)
10017-3206
(Zip code)
(212) 490-9000
(Registrant's telephone number including area code)
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 (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X] No [ ]
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS.
INDEX TO UNAUDITED FINANCIAL STATEMENTS
OF THE TIAA REAL ESTATE ACCOUNT
SEPTEMBER 30, 2000
Page
------
Consolidated Statements of Assets and Liabilities......................... 3
Consolidated Statements of Operations..................................... 4
Consolidated Statements of Changes in Net Assets.......................... 5
Consolidated Statements of Cash Flows..................................... 6
Notes to Consolidated Financial Statements................................ 7
Consolidated Statement of Investments..................................... 12
2
<PAGE>
TIAA REAL ESTATE ACCOUNT
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
2000 1999
------------- --------------
(Unaudited)
<S> <C> <C>
ASSETS
Investments, at value:
Real estate properties
(cost: $1,626,518,311 and $1,253,650,281) ............................... $1,702,476,301 $1,312,503,554
Real estate joint venture
(cost: $24,674,574 and $0) .............................................. 24,847,932 --
Marketable securities
(cost: $481,963,114 and $395,662,203) ................................... 477,962,831 374,278,801
Cash ..................................................................... 145,055 617,599
Other..................................................................... 27,917,469 32,057,761
------------- -------------
TOTAL ASSETS 2,233,349,588 1,719,457,715
------------- -------------
LIABILITIES
Accrued real estate property level expenses and taxes ..................... 23,221,172 18,425,328
Security deposits held .................................................... 6,487,360 5,549,959
Other ..................................................................... 468,163 --
------------- -------------
TOTAL LIABILITIES 30,176,695 23,975,287
------------- -------------
NET ASSETS
Accumulation Fund ......................................................... 2,131,750,150 1,642,327,173
Annuity Fund .............................................................. 71,422,743 53,155,255
------------- -------------
TOTAL NET ASSETS $2,203,172,893 $1,695,482,428
============= =============
NUMBER OF ACCUMULATION UNITS OUTSTANDING--Notes 6 and 7...................... 13,847,659 11,487,360
============= =============
NET ASSET VALUE, PER ACCUMULATION UNIT--Note 6 .............................. $ 153.94 $ 142.97
============= =============
</TABLE>
See notes to consolidated financial statements.
3
<PAGE>
TIAA REAL ESTATE ACCOUNT
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
------------------ -----------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Real estate income, net:
Rental income .............................................. $ 52,030,764 $ 37,182,213 $ 139,303,225 $ 91,378,964
------------ ------------ ------------ ------------
Real estate property level expenses and taxes:
Operating expenses ....................................... 10,520,678 7,484,048 28,692,285 19,030,118
Real estate taxes ........................................ 5,969,832 4,818,340 16,532,575 10,696,731
------------ ------------ ------------ ------------
Total real estate property level expenses and taxes 16,490,510 12,302,388 45,224,860 29,726,849
------------ ------------ ------------ ------------
Real estate income, net 35,540,254 24,879,825 94,078,365 61,652,115
Income from real estate joint venture ......................... 397,389 -- 397,389 --
Interest ...................................................... 6,317,707 3,371,143 17,936,645 13,144,718
Dividends ..................................................... 1,479,219 1,954,756 4,904,265 5,907,159
------------ ------------ ------------ ------------
TOTAL INCOME 43,734,569 30,205,724 117,316,664 80,703,992
------------ ------------ ------------ ------------
Expenses--Note 3:
Investment advisory charges ................................. 1,525,198 886,712 4,133,678 3,308,768
Administrative and distribution charges ..................... 1,125,353 885,890 3,200,476 2,638,022
Mortality and expense risk charges .......................... 372,060 272,184 1,010,563 739,137
Liquidity guarantee charges ................................. 159,454 117,089 499,519 405,982
------------ ------------ ------------ ------------
TOTAL EXPENSES 3,182,065 2,161,875 8,844,236 7,091,909
------------ ------------ ------------ ------------
INVESTMENT INCOME, NET 40,552,504 28,043,849 108,472,428 73,612,083
------------ ------------ ------------ ------------
REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS
Net realized gain (loss) on :
Real estate properties ..................................... -- -- -- 6,205,560
Marketable securities ...................................... (241,717) (827,090) (330,902) (1,213,198)
------------ ------------ ------------ ------------
Net realized gain (loss) on investments (241,717) (827,090) (330,902) 4,992,362
------------ ------------ ------------ ------------
Net change in unrealized appreciation (depreciation) on:
Real estate properties ..................................... 8,918,621 5,696,933 17,104,717 3,310,600
Real estate joint venture .................................. 173,358 -- 173,358 --
Marketable securities ...................................... 5,921,339 (11,727,299) 17,383,119 (7,472,773)
------------ ------------ ------------ ------------
Net change in unrealized
appreciation (depreciation) on investments 15,013,318 (6,030,366) 34,661,194 (4,162,173)
------------ ------------ ------------ ------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS 14,771,601 (6,857,456) 34,330,292 830,189
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS BEFORE MINORITY INTEREST 55,324,105 21,186,393 142,802,720 74,442,272
Minority interest in net increase in net assets
resulting from operations .................................. -- -- -- 1,364,619
------------ ------------ ------------ ------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 55,324,105 $ 21,186,393 $ 142,802,720 $ 75,806,891
============ ============ ============ ============
</TABLE>
See notes to consolidated financial statements.
4
<PAGE>
TIAA REAL ESTATE ACCOUNT
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
--------------------- -----------------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
FROM OPERATIONS
Investment income, net .............................. $ 40,552,504 $ 28,043,849 $ 108,472,428 $ 73,612,083
Net realized gain (loss) on investments ............. (241,717) (827,090) (330,902) 4,992,362
Net change in unrealized
appreciation (depreciation) on investments ..... 15,013,318 (6,030,366) 34,661,194 (4,162,173)
Minority interest in net increase in net assets
resulting from operations .......................... -- -- -- 1,364,619
-------------- -------------- -------------- --------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS 55,324,105 21,186,393 142,802,720 75,806,891
-------------- -------------- -------------- --------------
FROM PARTICIPANT TRANSACTIONS
Premiums ............................................ 35,830,433 30,175,399 117,271,493 91,734,806
Net transfers from TIAA ............................. 9,549,641 3,589,292 28,445,126 22,324,653
Net transfers from CREF Accounts .................... 113,564,961 60,732,012 260,057,798 232,458,291
Annuity and other periodic payments ................. (1,932,511) (1,171,035) (5,705,107) (3,231,887)
Withdrawals and death benefits ...................... (10,787,866) (7,853,422) (35,181,565) (22,002,974)
-------------- -------------- -------------- --------------
NET INCREASE IN NET ASSETS RESULTING
FROM PARTICIPANT TRANSACTIONS 146,224,658 85,472,246 364,887,745 321,282,889
-------------- -------------- -------------- --------------
NET INCREASE IN NET ASSETS 201,548,763 106,658,639 507,690,465 397,089,780
NET ASSETS
Beginning of period ................................. 2,001,624,130 1,486,798,028 1,695,482,428 1,196,366,887
-------------- -------------- -------------- --------------
End of period ....................................... $ 2,203,172,893 $ 1,593,456,667 $ 2,203,172,893 $ 1,593,456,667
============== ============== ============== ==============
</TABLE>
See notes to consolidated financial statements.
5
<PAGE>
TIAA REAL ESTATE ACCOUNT
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
---------------------- --------------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net increase in net assets resulting from operations $ 55,324,105 $ 21,186,393 $ 142,802,720 $ 75,806,891
Adjustments to reconcile net increase in net assets
resulting from operations to net cash used in
operating activities:
Increase in investments ............................ (206,846,313) (104,388,541) (518,504,709) (374,215,302)
Decrease (increase) in other assets ................ 854,164 (3,342,347) 4,140,292 (10,918,151)
Decrease in payable for securities transactions .... (467,990) (4,258,977) -- --
Increase in other liabilities ...................... 468,163 -- 468,163 --
Increase in accrued real estate property level
expenses and taxes ............................... 3,822,037 4,980,658 4,795,844 6,998,568
Increase in security deposits held ................. 476,584 1,168,419 937,401 1,204,205
Decrease in minority interest ...................... -- -- -- (19,913,592)
------------ ------------ ------------ ------------
NET CASH USED IN
OPERATING ACTIVITIES (146,369,250) (84,654,395) (365,360,289) (321,037,381)
------------ ------------ ------------ ------------
CASH FLOWS FROM PARTICIPANT TRANSACTIONS
Premiums ............................................ 35,830,433 30,175,399 117,271,493 91,734,806
Net transfers from TIAA ............................. 9,549,641 3,589,292 28,445,126 22,324,653
Net transfers from CREF Accounts .................... 113,564,961 60,732,012 260,057,798 232,458,291
Annuity and other periodic payments ................. (1,932,511) (1,171,035) (5,705,107) (3,231,887)
Withdrawals and death benefits ...................... (10,787,866) (7,853,422) (35,181,565) (22,002,974)
------------ ------------ ------------ ------------
NET CASH PROVIDED BY
PARTICIPANT TRANSACTIONS 146,224,658 85,472,246 364,887,745 321,282,889
------------ ------------ ------------ ------------
NET INCREASE (DECREASE) IN CASH (144,592) 817,851 (472,544) 245,508
CASH
Beginning of period ................................. 289,647 -- 617,599 572,343
------------ ------------ ------------ ------------
End of period ....................................... $ 145,055 $ 817,851 $ 145,055 $ 817,851
============ ============ ============ ============
</TABLE>
See notes to consolidated financial statements.
6
<PAGE>
TIAA REAL ESTATE ACCOUNT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1--ORGANIZATION
The TIAA Real Estate Account ("Account") is a segregated investment account of
Teachers Insurance and Annuity Association of America ("TIAA") and was
established by resolution of TIAA's Board of Trustees on February 22, 1995,
under the insurance laws of the State of New York, for the purpose of funding
variable annuity contracts issued by TIAA. The Account commenced operations on
July 3, 1995. Teachers REA, LLC, a wholly-owned subsidiary of the Account, began
operations in July 1996 and holds three properties in Virginia. Light Street
Partners, L.P. ("Light Street"), a wholly-owned subsidiary of the Account, began
operations in March 1997 and holds seven office buildings throughout the United
States. Prior to April 30, 1999, when the Account purchased the remaining 10%
interest, the Account had a 90% interest in Light Street. Teachers REA II, LLC,
a wholly-owned subsidiary of the Account, began operations in October 1997 and
holds one property in Pennsylvania. Teachers REA III, LLC, a wholly-owned
subsidiary of the Account, began operations in July 1998 and holds one property
in Florida.
The investment objective of the Account is a favorable long-term rate of return
primarily through rental income and capital appreciation from real estate
investments owned by the Account. The Account also invests in publicly-traded
securities and other instruments to maintain adequate liquidity for operating
expenses, capital expenditures and to make benefit payments.
TIAA employees, under the direction of TIAA's Board of Trustees and its
Investment Committee, manage the investment of the Account's assets pursuant to
investment management procedures adopted by TIAA for the Account. TIAA's
investment management decisions for the Account are also subject to review by
the Account's independent fiduciary, The Townsend Group. TIAA also provides all
portfolio accounting and related services for the Account. TIAA-CREF Individual
& Institutional Services, Inc. ("Services"), a subsidiary of TIAA, which is
registered with the Commission as a broker-dealer and is a member of the
National Association of Securities Dealers, Inc., provides administrative and
distribution services pursuant to a Distribution and Administrative Services
Agreement with the Account.
NOTE 2--SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements may require management to make estimates
and assumptions that affect the reported amounts of assets, liabilities, income,
expenses and related disclosures. Actual results may differ from those
estimates. The following is a summary of the significant accounting policies
consistently followed by the Account, which are in conformity with accounting
principles generally accepted in the United States.
BASIS OF PRESENTATION: The accompanying consolidated financial statements
include the Account and its wholly-owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated in consolidation.
VALUATION OF REAL ESTATE PROPERTIES: Investments in real estate properties are
stated at fair value, as determined in accordance with procedures approved by
the Investment Committee of the Board of Trustees and in accordance with the
responsibilities of the Board as a whole; accordingly, the Account does not
record depreciation. Fair value for real estate properties is defined as the
most probable price for which a property will sell in a competitive market under
all conditions requisite to a fair sale. Determination of fair value involves
subjective judgement because the actual market value of real estate can be
determined only by negotiation between the parties in a sales transaction. Real
estate properties owned by the Account are initially valued at their respective
purchase prices (including acquisition costs). Subsequently, independent
appraisers value each real estate property at least once a year. The independent
fiduciary must approve all independent appraisers used by the Account. The
independent fiduciary can also require additional appraisals if it believes that
a property's value has changed materially or otherwise to assure that the
Account is valued correctly. TIAA's appraisal staff performs a valuation review
of each real estate property on a quarterly basis and updates the property value
if it believes that the value of the property has changed since the previous
valuation review or appraisal. The independent fiduciary reviews and approves
any such valuation adjustments which exceed certain prescribed limits. TIAA
continues to use the revised value to calculate the Account's net asset value
until the next valuation review or appraisal.
7
<PAGE>
TIAA REAL ESTATE ACCOUNT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
VALUATION OF JOINT VENTURES: Investments in joint ventures are accounted for
using the equity method of accounting. This method requires that the Account
record an unrealized gain or loss on its proportionate share of the joint
ventures' gain or loss. Distributions received from the joint venture will
reduce the Account's investment.
VALUATION OF MARKETABLE SECURITIES: Equity securities listed or traded on any
United States national securities exchange are valued at the last sale price as
of the close of the principal securities exchange on which such securities are
traded or, if there is no sale, at the mean of the last bid and asked prices on
such exchange. Short-term money market instruments are stated at market value.
Portfolio securities for which market quotations are not readily available are
valued at fair value as determined in good faith under the direction of the
Investment Committee of the Board of Trustees and in accordance with the
responsibilities of the Board as a whole.
ACCOUNTING FOR INVESTMENTS: Real estate transactions are accounted for as of the
date on which the purchase or sale transactions for the real estate properties
close (settlement date). Rent from real estate properties consists of all
amounts earned under tenant operating leases, including base rent, recoveries of
real estate taxes and other expenses and charges for miscellaneous services
provided to tenants. Rental income is recognized in accordance with the billing
terms of the lease agreements. The Account bears the direct expenses of the real
estate properties owned. These expenses include, but are not limited to, fees to
local property management companies, property taxes, utilities, maintenance,
repairs, insurance and other operating and administrative costs. An estimate of
the net operating income earned from each real estate property is accrued by the
Account on a daily basis and such estimates are adjusted as soon as actual
operating results are determined. Realized gains and losses on real estate
transactions are accounted for under the specific identification method.
Securities transactions are accounted for as of the date the securities are
purchased or sold (trade date). Interest income is recorded as earned and, for
short-term money market instruments, includes accrual of discount and
amortization of premium. Dividend income is recorded on the ex-dividend date.
Realized gains and losses on securities transactions are accounted for on the
average cost basis.
FEDERAL INCOME TAXES: Based on provisions of the Internal Revenue Code, the
Account is taxed as a segregated asset account of TIAA. The Account should incur
no material federal income tax attributable to the net investment experience of
the Account.
RECENT ACCOUNTING PRONOUNCEMENT: In June 1998, the Financial Accounting Standard
Board issued Statement of Financial Accounting Standards ("SFAS") No. 133,
Accounting for Derivative Instruments and Hedging Activities, as amended, which
is required to be adopted effective January 1, 2001 for entities with fiscal
years ending December 31, 2000. SFAS No. 133, as amended, requires the
recognition of all derivatives on the balance sheet at fair value. Derivatives
that are not hedges must be adjusted to fair value through income. Derivatives
that are hedges, depending on the nature of the hedge, will either be adjusted
to fair value by offsetting the change in the hedged assets, liabilities, or
firm commitments through earnings, or recognized in other comprehensive income
until the hedged item is recognized in earnings. The ineffective portion of a
derivative's change in fair value will be immediately recognized in earnings.
Because the Account does not use derivatives, management does not anticipate
that the adoption of SFAS No. 133, as amended, will have an effect on the
earnings or financial position of the Account
8
<PAGE>
TIAA REAL ESTATE ACCOUNT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 3--MANAGEMENT AGREEMENTS
Under established management agreements, various services necessary for the
operation of the Account are provided, at cost, by TIAA and Services. TIAA
provides investment management services for the Account while distribution and
administrative services are provided by Services in accordance with a
Distribution and Administrative Services Agreement between the Account and
Services. Prior to April 30, 1999, an affiliate of the former minority partner
in Light Street provided certain management services for the properties owned by
Light Street. The charges for such services, for the nine months ended September
30, 1999 amounted to $345,928 for investment advisory expenses and $104,673 for
administrative expenses which are recorded accordingly in the accompanying
consolidated statements of operations. TIAA also provides a liquidity guarantee
to the Account, for a fee, to ensure that sufficient funds are available to meet
participant transfer and cash withdrawal requests in the event that the
Account's cash flows and liquid investments are insufficient to fund such
requests. TIAA also receives a fee for assuming certain mortality and expense
risks.
Fee payments are made from the Account on a daily basis to TIAA and Services
according to formulas established each year with the objective of keeping the
fees as close as possible to the Account's actual expenses. Any differences
between actual expenses and daily charges are adjusted quarterly.
NOTE 4--REAL ESTATE PROPERTIES
Had the Account's real estate properties which were purchased during the nine
months ended September 30, 2000 been acquired at the beginning of the period
(January 1, 2000), rental income and real estate property level expenses and
taxes for the nine months ended September 30, 2000 would have increased by
approximately $25,310,000 and $7,465,000, respectively. In addition, interest
income for the nine months ended September 30, 2000 would have decreased by
approximately $10,860,000. Accordingly, the total proforma effect on the
Account's net investment income for the nine months ended September 30, 2000
would have been an increase of approximately $6,985,000, if the real estate
properties acquired during the nine months ended September 30, 2000 had been
acquired at the beginning of the period.
NOTE 5--LEASES
The Account's real estate properties are leased to tenants under operating lease
agreements which expire on various dates through 2021. Aggregate minimum annual
rentals for the properties owned, excluding short-term residential leases, are
as follows:
<TABLE>
<CAPTION>
Years Ending
December 31,
------------
<S> <C>
2000 $117,385,097
2001 130,611,600
2002 113,954,087
2003 101,206,301
2004 83,328,505
Thereafter 240,865,311
-----------
Total $787,350,901
===========
</TABLE>
Certain leases provide for additional rental amounts based upon the recovery of
actual operating expenses in excess of specified base amounts.
9
<PAGE>
TIAA REAL ESTATE ACCOUNT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 6--CONDENSED CONSOLIDATED FINANCIAL INFORMATION
Selected condensed consolidated financial information for an Accumulation Unit
of the Account is presented below.
<TABLE>
<CAPTION>
FOR THE JULY 3, 1995
NINE MONTHS FOR THE YEARS ENDED (COMMENCEMENT
ENDED DECEMBER 31, OF OPERATIONS) TO
SEPTEMBER 30, ------------------------------------------- DECEMBER 31,
2000 (1) 1999 1998 1997 1996 1995 (1)
-------- ---- ---- ---- ---- --------
(Unaudited)
<S> <C> <C> <C> <C> <C> <C>
Per Accumulation Unit Data:
Rental income................................. $ 10.700 $ 12.168 $ 10.425 $ 7.288 $ 6.012 $ 0.159
Real estate property level
Expenses and taxes.......................... 3.474 3.975 3.403 2.218 1.850 0.042
------- ------- ------- ------- ------- -------
Real estate income, net 7.226 8.193 7.022 5.070 4.162 0.117
Income from real estate joint venture......... .031 - - - - -
Dividends and interest........................ 1.754 2.292 3.082 2.709 2.716
------- ------- ------- ------- ------- -------
Total income 9.011 10.485 10.104 7.779 7.471 2.833
Expense charges (2)........................... 0.679 0.853 0.808 0.580 0.635 0.298
------- ------- ------- ------- ------- -------
Investment income, net 8.332 9.632 9.296 7.199 6.836 2.535
Net realized and unrealized
gain on investments......................... 2.643 1.164 0.579 3.987 1.709 0.031
------- ------- ------- ------- ------- -------
Net increase in
Accumulation Unit Value..................... 10.975 10.796 9.875 11.186 8.545 2.566
Accumulation Unit Value:
Beginning of period......................... 142.968 132.172 122.297 111.111 102.566 100.000
------- ------- ------- ------- ------- -------
End of period............................... $153.943 $142.968 $132.172 $122.297 $111.111 $102.566
======= ======= ======= ======= ======= =======
Total return................................... 7.68% 8.17% 8.07% 10.07% 8.33% 2.57%
Ratios to Average Net Assets:
Expenses (2)................................ 0.46% 0.63% 0.64% 0.58% 0.61% 0.30%
Investment income, net...................... 5.64% 7.13% 7.34% 7.25% 6.57% 2.51%
Portfolio turnover rate:
Real estate properties...................... 1.68% 4.46% 0% 0% 0% 0%
Marketable securities....................... 21.37% 27.68% 24.54% 7.67% 15.04% 0%
Thousands of Accumulation Units
Outstanding at end of period................ 13,848 11,487 8,834 6,313 3,296 1,172
</TABLE>
(1) The percentages shown for this period are not annualized.
(2) Expense charges per Accumulation Unit and the Ratio of Expenses to Average
Net Assets prior to April 30, 1999 include the portion of expenses related
to the 10% minority interest in Light Street and for all periods exclude
real estate property level expenses and taxes. If the real estate property
level expenses and taxes were included, the expense charge per Accumulation
Unit for the nine months ended September 30, 2000 would be $4.153 ($4.828,
$4.211, $2.798 and $2.485 for the years ended December 31, 1999, 1998, 1997
and 1996 respectively, and $0.340 for the period July 3, 1995 through
December 31, 1995) and the Ratio of Expenses to Average Net Assets for the
nine months ended September 30, 2000 would be 2.80% (3.58%, 3.32%, 2.82%
and 2.39% for the years ended December 31, 1999, 1998, 1997 and 1996
respectively, and 0.34% for the period July 3, 1995 through
December 31, 1995).
10
<PAGE>
TIAA REAL ESTATE ACCOUNT
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 7--ACCUMULATION UNITS
Changes in the number of Accumulation Units outstanding were as follows:
<TABLE>
<CAPTION>
FOR THE FOR THE
NINE MONTHS YEAR
ENDED ENDED
SEPTEMBER 30, 2000 DECEMBER 31, 1999
------------------ -----------------
(UNAUDITED)
<S> <C> <C>
Accumulation Units:
Credited for premiums.................................. 791,715 918,728
Credited for transfers, net disbursements and
Amounts applied to the Annuity Fund.................. 1,568,584 1,734,721
Outstanding:
Beginning of year.................................... 11,487,360 8,833,911
------------ ------------
End of period........................................ 13,847,659 11,487,360
============ ============
</TABLE>
NOTE 8--COMMITMENTS
During the normal course of business, the Account enters into discussions and
agreements to purchase or sell real estate properties. As of September 30, 2000,
the Account had five outstanding commitments totaling approximately $64.2
million to purchase real estate properties.
11
<PAGE>
TIAA REAL ESTATE ACCOUNT
CONSOLIDATED STATEMENT OF INVESTMENTS (UNAUDITED)
SEPTEMBER 30, 2000
REAL ESTATE PROPERTIES--77.20%
<TABLE>
<CAPTION>
LOCATION / DESCRIPTION VALUE
---------------------- -------------
<S> <C>
ARIZONA:
Biltmore Commerce Center - Office building......................................................... $ 38,637,946
Southbank Building - Office building............................................................... 13,200,000
CALIFORNIA:
88 Kearny Street - Office building ................................................................ 80,132,690
Eastgate Distribution Center - Industrial building................................................. 13,600,000
Larkspur Courts - Apartments....................................................................... 58,000,000
Northpoint Commerce Center - Industrial building................................................... 38,816,155
Ontario Industrial Properties - Industrial building................................................ 63,000,000
Westcreek - Apartments ............................................................................ 16,702,600
COLORADO:
Arapahoe Park East - Industrial building........................................................... 12,405,580
The Lodge at Willow Creek - Apartments............................................................. 30,500,000
Monte Vista - Apartments ......................................................................... 21,025,000
FLORIDA:
Golfview - Apartments ............................................................................. 27,510,000
The Greens at Metrowest - Apartments............................................................... 14,100,000
Plantation Grove - Shopping center................................................................. 7,350,000
Royal St. George - Apartments...................................................................... 16,650,000
Sawgrass Portfolio - Office building............................................................... 39,200,000
Westinghouse Facility - Industrial building....................................................... 6,200,000
GEORGIA:
Satellite Distribution Center - Industrial building................................................ 19,600,000
ILLINOIS:
Columbia Center III - Office building.............................................................. 42,300,000
Glenpointe Business Park - Industrial building..................................................... 16,113,340
Parkview Plaza - Office building................................................................... 52,500,000
Rockrun Business Park - Industrial building........................................................ 9,350,000
Rolling Meadows - Shopping center.................................................................. 11,950,000
Woodcreek Business Park - Industrial building...................................................... 7,000,000
IOWA:
Interstate Acres - Industrial building............................................................. 13,500,000
KENTUCKY:
IDI Kentucky Portfolio - Industrial building....................................................... 25,500,000
MARYLAND:
FedEx Distribution Facility - Industrial building.................................................. 7,700,000
Longview Executive Park - Office building.......................................................... 28,003,479
Saks Distribution Center - Industrial building..................................................... 30,950,000
MASSACHUSETTS:
Two Newton Center - Office building................................................................ 21,797,970
MICHIGAN:
Indian Creek - Apartments.......................................................................... 17,100,000
MINNESOTA:
Interstate Crossing - Industrial building.......................................................... 6,300,000
River Road Distribution Center - Industrial building............................................... 4,300,000
NEVADA:
UPS Distribution Facility - Industrial building.................................................... 11,000,000
12
<PAGE>
<CAPTION>
LOCATION / DESCRIPTION VALUE
---------------------- -------------
<S> <C>
NEW JERSEY:
371 Hoes Lane - Office building.................................................................... $ 16,980,643
10 Waterview Boulevard - Office building........................................................... 31,300,000
Konica Photo Imaging Headquarters - Industrial building............................................ 17,200,000
Morris Corporate Center III - Office building...................................................... 103,119,739
NEW YORK:
780 Third Avenue - Office building................................................................. 164,402,886
The Colorado - Apartments.......................................................................... 60,441,754
NORTH CAROLINA:
Lynnwood Collection - Shopping center.............................................................. 7,900,000
Millbrook Collection - Shopping center............................................................. 7,300,000
OHIO:
Bent Tree - Apartments ........................................................................... 14,700,000
Columbus Portfolio - Office building............................................................... 34,200,000
Northmark Business Center - Office building........................................................ 13,100,000
OREGON:
Five Centerpointe - Office building................................................................ 18,244,640
PENNSYLVANIA:
Lincoln Woods - Apartments......................................................................... 23,200,000
TEXAS:
Butterfield Industrial Park - Industrial building.................................................. 4,850,000 (1)
The Crest at Shadow Mountain - Apartments.......................................................... 9,654,425
The Legends at Chase Oaks - Apartments............................................................. 26,400,000
UTAH:
USF&G Building - Office building................................................................... 8,700,000
VIRGINIA:
Ashford Meadows - Apartments....................................................................... 64,174,878
Fairgate at Ballston - Office building............................................................. 30,800,000
Monument Place - Office building................................................................... 36,500,000
River Oaks - Shopping center ...................................................................... 11,300,000
WASHINGTON:
The Bay Court at Harbour Pointe - Apartments....................................................... 35,013,036
WASHINGTON DC:
1801 K Street N W - Office building................................................................ 140,999,540
-------------
TOTAL REAL ESTATE PROPERTIES (Cost $1,626,518,311)............................................... 1,702,476,301
-------------
</TABLE>
(1) Leasehold interest only.
REAL ESTATE JOINT VENTURE--1.13%
<TABLE>
<CAPTION>
LOCATION / DESCRIPTION VALUE
---------------------- -------------
<S> <C>
VIRGINIA:
Tyson's Executive Plaza II - Office building....................................................... 24,847,932
-------------
TOTAL REAL ESTATE JOINT VENTURE (Cost $24,674,574)................................................. 24,847,932
-------------
</TABLE>
MARKETABLE SECURITIES--21.67%
REAL ESTATE INVESTMENT TRUSTS--3.80%
<TABLE>
<CAPTION>
SHARES ISSUER VALUE
------ ------ -------------
<S> <C> <C>
75,000 Alexandria Real Estate Equities, Inc. ......................................... 2,573,438
120,000 AMB Property Corporation ..................................................... 2,947,500
89,900 AMB Property Corporation Series A ............................................. 2,129,506
80,000 Archstone Communities Trust ................................................... 1,965,000
13
<PAGE>
<CAPTION>
SHARES ISSUER VALUE
------ ------ -------------
<S> <C> <C>
47,300 Boston Properties, Inc........................................................... $ 2,030,944
130,400 Brandywine Realty Trust.......................................................... 2,640,600
200,000 Carramerica Realty Series B...................................................... 4,300,000
53,000 Centerpoint Properties Corp...................................................... 2,441,312
108,100 Corporate Office Properties Trust, Inc........................................... 1,074,244
36,000 Cousins Properties, Inc.......................................................... 1,550,250
90,000 Developers Diversified Realty Corp............................................... 1,895,625
226,300 Duke-Weeks Realty Corp........................................................... 5,459,488
340,913 Equity Office Properties Trust................................................... 10,589,610
121,700 Equity Residential Properties Trust ............................................. 5,841,600
25,000 Federal Realty Investment Trust Pfd.............................................. 515,625
98,300 Gables Residential Trust, Pfd Series A........................................... 2,015,150
74,900 Hospitality Properties Trust..................................................... 1,750,787
26,000 Istar Financial, Pfd Series C.................................................... 482,625
17,600 Kimco Realty Corp................................................................ 743,600
149,800 Macerich Company................................................................. 3,183,250
6,200 Mack-Cali Realty Corp ........................................................... 174,762
82,100 Manufactured Home Communities, Inc............................................... 2,052,500
103,200 Prologis Trust................................................................... 2,451,000
19,900 Prologis Trust-Pfd Series A...................................................... 480,087
167,700 Public Storage, Inc.............................................................. 4,014,319
93,600 Rouse Company.................................................................... 2,334,150
280,900 Simon Property Group, Inc........................................................ 6,583,594
140,000 Starwood Hotels & Resorts Worldwide.............................................. 4,375,000
35,500 Storage USA, Inc................................................................. 1,082,750
75,000 Sun Communities, Inc............................................................. 2,371,875
100,400 Taubman Centers, Inc............................................................. 1,160,875
35,000 Taubman Centers, Inc Pfd Series A................................................ 634,375
-------------
TOTAL REAL ESTATE INVESTMENT TRUSTS (Cost $87,693,073).............................................. 83,845,441
-------------
</TABLE>
CORPORATE BONDS-- 0.45%
<TABLE>
<CAPTION>
PRINCIPAL ISSUER, COUPON AND MATURITY DATE VALUE
--------- -------------------------------- -------------
<S> <C> <C>
$ 5,000,000 Avco Financial Services, Inc
5.75% 01/23/01.................................................................. 4,976,500
5,000,000 Ford Motor Credit Co
5.75% 01/25/01.................................................................. 4,976,300
-------------
TOTAL CORPORATE BONDS (Cost $10,034,650)............................................................. 9,952,800
-------------
</TABLE>
COMMERCIAL PAPER--17.42%
<TABLE>
<CAPTION>
PRINCIPAL ISSUER, COUPON AND MATURITY DATE VALUE
--------- -------------------------------- -------------
<S> <C> <C>
10,315,000 American Express Credit Corp.
6.47% 11/01/00.................................................................. 10,255,583
500,000 American Express Credit Corp.
6.46% 11/21/00.................................................................. 495,312
7,090,000 American Telephone & Telegraph Co
6.47% 12/01/00.................................................................. 7,010,812
520,000 Bellsouth Capital Funding Corp.
6.45% 12/06/00.................................................................. 513,723
17,175,000 Corporate Asset Funding Corp. Inc.
6.50% 10/02/00.................................................................. 17,168,698
17,105,000 Daimler Chrysler North America Holding
6.49% 10/31/00.................................................................. 17,009,559
14
<PAGE>
<CAPTION>
PRINCIPAL ISSUER, COUPON AND MATURITY DATE VALUE
--------- -------------------------------- -------------
<S> <C> <C>
$ 3,800,000 Eastman Kodak Co.
6.48% 11/29/00.................................................................. $ 3,758,928
2,358,000 Eastman Kodak Co.
6.48% 12/04/00.................................................................. 2,330,390
3,390,000 Emerson Elec. Co.
6.45% 12/14/00.................................................................. 3,344,232
25,000,000 Equilon Enterprises LLC
6.49% 10/03/00.................................................................. 24,986,257
2,664,000 Fortune Brands
6.50% 11/17/00.................................................................. 2,640,948
16,875,000 Gillette, Co.
6.57% 10/05/00.................................................................. 16,859,602
25,000,000 Goldman Sachs Group, LP
6.49% 10/23/00.................................................................. 24,896,340
2,335,000 Hewlett Packard Co.
6.52% 10/27/00.................................................................. 2,323,636
5,040,000 Honeywell, Inc.
6.48% 10/18/00.................................................................. 5,023,644
6,685,000 Minnesota Mining & Mfg. Co.
6.46% 12/27/00.................................................................. 6,579,106
14,750,000 Motiva Enterprises LLC
6.49% 10/16/00.................................................................. 14,707,455
890,000 Motorola Credit Corp.
6.51% 10/27/00.................................................................. 885,668
1,200,000 Motorola, Inc.
6.47% 12/27/00.................................................................. 1,180,992
10,000,000 Natural Rural Utilities Coop Finance
6.48% 11/07/00.................................................................. 9,931,600
3,163,000 Paccar Financial Corp.
6.45% 12/21/00.................................................................. 3,116,311
10,350,000 Park Avenue Receivables Corp.
6.51% 10/04/00.................................................................. 10,342,427
10,145,000 Park Avenue Receivables Corp.
6.54% 10/27/00.................................................................. 10,095,633
10,945,000 Pfizer, Inc
6.46% 10/31/00.................................................................. 10,883,921
10,000,000 Receivables Capital Corp.
6.51% 10/10/00.................................................................. 9,981,825
28,435,000 Receivables Capital Corp.
6.52% 10/17/00.................................................................. 28,347,878
26,910,000 Salomon Smith Barney Holdings, Inc.
6.49% 10/20/00.................................................................. 26,812,975
10,000,000 Sigma Finance Inc.
6.51% 11/17/00.................................................................. 9,913,472
17,850,000 Sigma Finance Inc.
6.48% 12/11/00.................................................................. 17,618,484
478,000 United Parcel Svc. America Inc.
6.47% 11/29/00.................................................................. 472,833
28,365,000 Ventures Business Trust
6.51% 10/06/00.................................................................. 28,333,893
18,620,000 Verizon Network Funding Corp.
6.49% 11/03/00.................................................................. 18,506,051
20,000,000 Verizon Network Funding Corp.
6.49% 11/21/00.................................................................. 19,812,512
15
<PAGE>
<CAPTION>
PRINCIPAL ISSUER, COUPON AND MATURITY DATE VALUE
--------- -------------------------------- -------------
<S> <C> <C>
$18,060,000 Wal-mart stores
6.50% 10/11/00.................................................................. $ 18,023,890
--------------
TOTAL COMMERCIAL PAPER (Amortized cost $384,235,391)................................................ 384,164,590
--------------
TOTAL MARKETABLE SECURITIES (Cost $481,963,114)........................................................ 477,962,831
--------------
TOTAL INVESTMENTS--100.00% (Cost $2,133,155,999)....................................................... $2,205,287,064
==============
</TABLE>
See notes to consolidated financial statements.
16
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
At September 30, 2000, the Account held a total of 58 real estate
properties representing 78.33% of the Account's total investment portfolio.
These include twenty office properties (one of which is held in joint venture),
eighteen industrial properties, fifteen apartment complexes, and five
neighborhood shopping centers. The Account also held investments in commercial
paper, representing 17.4% of the portfolio, real estate investment trusts
(REITs), representing 3.8% of the portfolio, and corporate bonds, representing
0.5% of the portfolio.
The Account purchased one apartment property, two office properties
(one of which is held in joint venture) and one industrial property during the
third quarter of 2000. The Account continues to pursue suitable property
acquisitions, and is currently in various stages of negotiations with a number
of prospective sellers. While attractive acquisition prospects are available in
the current market, significant competition exists for the most desirable
properties.
RESULTS OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO
NINE MONTHS ENDED SEPTEMBER 30, 1999
The Account's total net return was 7.68% for the nine months ended
September 30, 2000 and 5.56% for the same period in 1999. The Account's net
investment income, after deduction of all expenses, was $108,472,428 for the
nine months ended September 30, 2000 and $73,612,083 for the same period in
1999, a 47% increase. This increase was primarily the result of a 38% increase
in net assets and a 38% increase in the Account's real estate holdings from
September 30, 1999 to September 30, 2000.
The Account had net realized and unrealized gains on investments of
$34,330,292 and $830,189 for the nine months ended September 30, 2000 and 1999,
respectively. This difference was due primarily to the appreciation of the
Account's real estate holdings and the significant increase in value of the
Account's marketable securities, primarily in REIT holdings, during the first
nine months of 2000 over the same period in 1999.
The Account's real estate holdings generated approximately 81% and 76%
of the Account's total investment income (before deducting Account level
expenses) during the nine months ended September 30, 2000 and 1999,
respectively. The remaining portion of the Account's total investment income was
generated by marketable securities investments.
Gross real estate rental income was $139,303,225 for the nine months
ended September 30, 2000 and $91,378,964 for the same period in 1999. This
increase was primarily due to the increase in the number of properties owned by
the Account from 53 properties as of September 30, 1999 to 58 properties as of
September 30, 2000. Interest income on the Account's short- and intermediate-
term investments for the nine months ended September 30, 2000 and 1999 totaled
$17,936,645 and $13,144,718, respectively. This increase was due primarily to
the
17
<PAGE>
growth in the Account's assets. Dividend income on the Account's investments in
REITs totaled $4,904,265 and $5,907,159, respectively, for the same periods.
Shares of REITs totaled 3.80% of the Account investments as of September 30,
2000 and 5.85% as of September 30, 1999. The decrease in the Account's REIT
allocation accounted for the decreased dividend income for first nine months of
2000, as compared with the same period in 1999.
Total property level expenses for the nine months ended September 30,
2000 were $45,224,860, of which $16,532,575 was attributable to real estate
taxes and $28,692,285 was attributable to operating expenses. Total property
level expenses for the nine months ended September 30, 1999 were $29,726,849, of
which $10,696,731 was attributable to real estate taxes and $19,030,118
represented operating expenses. The increase in property level expenses during
the first nine months of 2000 reflected the increased number of properties in
the Account.
The Account also incurred expenses for the nine months ended September
30, 2000 and 1999 of $4,133,678 and $3,308,768, respectively, for investment
advisory services, $3,200,476 and $2,638,022, respectively, for administrative
and distribution services and $1,510,082 and $1,145,119 respectively, for the
mortality and expense risks assumed and the liquidity guarantee. Such expenses
increased as a result of the larger net asset base in the Account for the first
nine months of 2000 over the first nine months of 1999.
THREE MONTHS ENDED SEPTEMBER 30, 2000 COMPARED TO
THREE MONTHS ENDED SEPTEMBER 30, 1999
The Account's total net return was 2.67% for the three months ended
September 30, 2000 and 1.38% for the same period in 1999. The Account's net
investment income, after deduction of all expenses, was $40,552,504 for the
three months ended September 30, 2000 and $28,043,849 for the same period in
1999, a 45% increase. This was primarily the result of the increase in net
assets and in the Account's real estate holdings from September 30, 1999 to
September 30, 2000.
The Account had net realized and unrealized gains of $14,771,601 for
the three months ended September 30, 2000 compared to net realized and
unrealized losses on investments of $6,857,456 for the three months ended
September 30, 1999. This difference was due, in part, to the fact that the
Account's real estate holdings appreciated more during the three months ended
September 30, 2000 than in the same period of 1999. Also, the Account's
marketable securities (primarily its REIT holdings) increased in value during
the three months ended September 30, 2000 while they decreased in value in same
period of 1999.
The Account's real estate holdings generated approximately 82% of the
Account's total investment income (before deducting Account level expenses)
during both the three months ended September 30, 2000 and 1999. The remaining
portion of the Account's total investment income was generated by investments in
marketable securities.
Gross real estate rental income was $52,030,764 for the three months
ended September 30, 2000 and $37,182,213 for the same period in 1999. The higher
real estate income for the 2000 period was due primarily to the increase in the
number of properties owned by the Account. Interest income on the Account's
short- and intermediate-term investments for the three months ended September
30, 2000 and 1999 totaled $6,317,707 and $3,371,143, respectively.
18
<PAGE>
This increase was due primarily to the growth of the real estate assets as of
September 30, 2000 compared to the earlier time period. Dividend income on the
Account's investments in REITs totaled $1,479,219 and $1,954,756, respectively,
for the same periods. This decrease was primarily due to the decrease in the
Account's REIT allocation.
Total property level expenses for the three months ended September 30,
2000 were $16,490,510, of which $5,969,832 was attributable to real estate taxes
and $10,520,678 was attributable to operating expenses. Total property level
expenses for the three months ended September 30, 1999 were $12,302,388, of
which $4,818,340 was attributable to real estate taxes and $7,484,048
represented operating expenses. The increase in property level expenses during
the three month period ended September 30, 2000 reflected the increased number
of properties in the Account.
The Account also incurred expenses for the three months ended September
30, 2000 and 1999 of $1,525,198 and $886,712, respectively, for investment
advisory services, $1,125,353 and $885,890, respectively, for administrative and
distribution services and $531,514 and $389,273, respectively, for the mortality
and expense risks assumed and the liquidity guarantee. Such expenses increased
as a result of the larger net asset base of the Account for the three months
ended September 30, 2000 over the three months ended September 30, 1999.
LIQUIDITY AND CAPITAL RESOURCES
For the nine months ended September 30, 2000 and 1999, the Account
received $117,271,493 and $91,734,806, respectively, in premiums and
$288,502,924 and $254,782,944, respectively, in net participant transfers from
other TIAA and CREF accounts.
At September 30, 2000 and 1999, the Account's liquid assets (i.e., its
REITs, short- and intermediate-term investments, government securities and cash)
had a value of $478,107,886 and $337,111,797, respectively. The REIT holdings at
September 30, 2000 and 1999 were $83,845,441 and $92,749,438, respectively. We
plan to use much of the Account's liquid assets, exclusive of the REITs, to
purchase additional suitable real estate properties. The remaining liquid
assets, exclusive of the REITs, will continue to be available to meet expense
needs and redemption requests (e.g., cash withdrawals or transfers).
If the Account's liquid assets and its cash flow from operating
activities and participant transactions are not sufficient to meet its cash
needs, including redemption requests, TIAA's general account will purchase
liquidity units in accordance with TIAA's liquidity guarantee to the Account.
19
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
There are no material current or pending legal proceedings that the Account
is a party to, or to which the Account's assets are subject.
ITEM 2. CHANGES IN SECURITIES.
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS.
Not applicable.
ITEM 5. OTHER INFORMATION.
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) EXHIBITS
(3) (A) Charter of TIAA (as amended)
(B) Bylaws of TIAA (as amended) **
(4) (A) Forms of RA, GRA, GSRA, SRA, and IRA Real Estate Account
Endorsements* and Keogh Contract***
(B) Forms of Income-Paying Contracts *
(10)(A) Independent Fiduciary Agreement by and among TIAA, the Registrant,
and The Townsend Group***
(B) Custodial Services Agreement by and between TIAA and Morgan
Guaranty Trust Company of New York with respect to the Real
Estate Account *
(C) Distribution and Administrative Services Agreement by and between
TIAA and TIAA-CREF Individual & Institutional Services, Inc.
(as amended) (filed previously as Exhibit (1)) *
(27) Financial Data Schedule of the Account's Financial Statements for the
three months ended September 30, 2000
20
<PAGE>
--------------------
* - Previously filed and incorporated herein by reference to Post-Effective
Amendment No. 2 to the Account's Registration Statement on Form S-1 filed
April 30, 1996 (File No. 33- 92990).
** - Previously filed and incorporated herein by reference to the Account's Form
10-Q Quarterly Report for the period ended September 30, 1997 filed
November 13, 1997 (File No. 33-92990).
*** - Previously filed and incorporated herein by reference to Post-Effective
Amendment No. 6 to the Account's Registration Statement on Form S-1 filed
April 26, 2000 (File No. 333-22809).
(b) REPORTS ON 8-K. The Account filed a report on Form 8-K on August 30, 2000
under Item 5 of the form with respect to the acquisition of a property for its
portfolio.
21
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DATE: November 13, 2000
TIAA REAL ESTATE ACCOUNT
By: TEACHERS INSURANCE AND ANNUITY
ASSOCIATION OF AMERICA
By: /s/ Lisa Snow
---------------------------------
Lisa Snow
Vice President and Chief Counsel,
Corporate Law
DATE: November 13, 2000
By: /s/ Richard L. Gibbs
---------------------------------
Richard L. Gibbs
Executive Vice President
(Principal Accounting Officer)
22
<PAGE>
Exhibit Index
(3)(A) Charter of TIAA (as amended)
(27) Financial Data Schedule
