UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: December 19, 2003
(Date of earliest event reported)
Inland Western Retail Real Estate Trust, Inc.
(Exact name of registrant as specified in the charter)
Maryland | 333-103799 | 42-1579325 |
(State or other jurisdiction of incorporation) | (Commission File No.) | (IRS Employer Identification No.) |
2901 Butterfield Road
Oak Brook, Illinois 60523
(Address of Principal Executive Offices)
(630) 218-8000
(Registrant's telephone number including area code)
Not Applicable
(Former name or former address, if changed since last report)
Item 2. Acquisition or Disposition of Assets
Shaw's Supermarket, New Britain, Connecticut
On December 31, 2003, we purchased a single user retail center known as Shaw's Supermarket, New Britain, containing 65,658 gross leasable square feet. The property is located in New Britain, Connecticut.
We purchased this property from an unaffiliated third party. Our total acquisition cost was approximately $13,656,000. This amount may increase by additional costs which have not yet been finally determined. We expect any additional costs to be insignificant. Our acquisition cost was approximately $208 per square foot of leasable space.
We purchased this property with our own funds. However, we expect to place financing on the property at a later date. We do not intend to make significant repairs and improvements to this property over the next few years. However, if we were to make any repairs or improvements, the tenant would be obligated to pay a substantial portion of any monies spent pursuant to the provisions of its lease.
Shaw's Supermarket was built in 1995. One tenant, Shaw's Supermarket, leases 100% of the total gross leasable area of the property. The lease with this tenant requires the tenant to pay base annual rent on a monthly basis as follows:
On December 31, 2003, we purchased a single user retail center known as Shaw's Supermarket, New Britain, containing 65,658 gross leasable square feet. The property is located in New Britain, Connecticut.
We purchased this property from an unaffiliated third party. Our total acquisition cost was approximately $13,656,000. This amount may increase by additional costs which have not yet been finally determined. We expect any additional costs to be insignificant. Our acquisition cost was approximately $208 per square foot of leasable space.
We purchased this property with our own funds. However, we expect to place financing on the property at a later date. We do not intend to make significant repairs and improvements to this property over the next few years. However, if we were to make any repairs or improvements, the tenant would be obligated to pay a substantial portion of any monies spent pursuant to the provisions of its lease.
Shaw's Supermarket was built in 1995. One tenant, Shaw's Supermarket, leases 100% of the total gross leasable area of the property. The lease with this tenant requires the tenant to pay base annual rent on a monthly basis as follows:
Approximate | Base Rent | |||||
GLA Leased | % of Total | Per | Lease | Term | ||
Lessee | (Sq. Ft.) | GLA | Annum ($) | Beginning | To | |
Shaw's Supermarkets- New Britain | 65,658 | 100 | 1,083,357 | 05/96 | 04/16 | |
For federal income tax purposes, the depreciable basis in this property will be approximately $10,242,000. When we calculate depreciation expense for tax purposes, we will use the straight-line method. We depreciate buildings and improvements based upon estimated useful lives of 40 and 20 years, respectively.
Pavilion at King's Grant, Concord, North Carolina
On December 31, 2003, we purchased a newly constructed shopping center known as Pavilion at King's Grant, containing 79,009 gross leasable square feet (which includes 65,000 square feet of ground lease space). The center is located at 8050 Concord Mills Boulevard in Concord, North Carolina.
We purchased this property from an unaffiliated third party. Our total acquisition cost was approximately $8,151,000. This amount may increase by additional costs which have not yet been finally determined. We expect any additional costs to be insignificant. One tenant, Toys 'R Us, is currently paying half rent. When the tenant begins paying full rent, we will pay the balance of the purchase price of approximately $1,563,000. Our total acquisition cost is expected to be approximately $123 per square foot of leasable space.
We purchased this property with our own funds. However, we expect to place financing on the property at a later date.
We do not intend to make significant repairs and improvements to this property over the next few years. However, if we were to make any repairs or improvements, the tenants would be obligated to pay a substantial portion of any monies spent pursuant to the provisions of their respective leases.
One tenant, Jared Jewelers, leases more than 10% of the total gross leasable area of the property. The lease with this tenant requires the tenant to pay base annual rent on a monthly basis as follows:
Base Rent | |||||
Approximate | Per Square | ||||
GLA Leased | % of Total | Foot Per | Lease | Term | |
Lessee | (Sq. Ft.) | GLA | Annum ($) | Beginning | To |
Toys 'R Us * | 49,000 | 62 | 5.10 | 10/02 | 10/12 |
Olive Garden* | 8,500 | 11 | 9.41 | 04/02 | 04/12 |
* ground lease
For federal income tax purposes, the depreciable basis in this property will be approximately $7,285,000. When we calculate depreciation expense for tax purposes, we will use the straight-line method. We depreciate buildings and improvements based upon estimated useful lives of 40 and 20 years, respectively.
Pavilion at King's Grant was built in 2002 and 2003. As of December 30, 2003, this property was 100% occupied, with a total 79,009 square feet leased to six tenants. The following table sets forth certain information with respect to those leases:
Approximate GLA Leased | Current Annual | Base Rent Per Square Foot | ||
Lessee | (Sq. Ft.) | Lease Ends | Rent ($) | Per Annum ($) |
Radio Shack | 2,400 | 04/08 | 40,800 | 17.00 |
Panera Bread | 5,609 | 10/13 | 109,376 | 19.50 |
Jared Jewelers | 6,000 | 01/23 | 220,020 | 36.67 |
Toys 'R Us * | 49,000 | 10/12 | 250,000 | 5.10 |
Olive Garden * | 8,500 | 04/12 | 80,000 | 9.41 |
Red Lobster * | 7,500 | 05/12 | 80,000 | 10.67 |
* ground lease
In general, each tenant will pay its proportionate share of real estate taxes, insurance and common area maintenance costs, although the leases with some tenants may provide that the tenant's liability for such expenses is limited in some way, usually so that their liability for such expenses does not exceed a specified amount.
Newnan Crossing West, Newnan, Georgia
On December 24, 2003, we purchased an existing shopping center known as Newnan Crossing West, containing 131,196 gross leasable square feet. The center is located at 591 Bullsboro Drive in Newnan, Georgia.
We purchased this property from an unaffiliated third party. Our total acquisition cost was approximately $16,808,000. This amount may increase by additional costs which have not yet been finally determined. We expect any additional costs to be insignificant. Our acquisition cost was approximately $128 per square foot of leasable space. We intend to purchase an additional 181,798 gross leasable square feet (phase II), for approximately $26,404,000, in early 2004 when the existing first mortgage can be repaid.
We purchased this property with our own funds. However, we expect to place financing on the property at a later date.
We do not intend to make significant repairs and improvements to this property over the next few years. However, if we were to make any repairs or improvements, the tenants would be obligated to pay a substantial portion of any monies spent pursuant to the provisions of their respective leases.
One tenant, BJ's, leases more than 10% of the gross leasable area of the portion of the property acquired to date. The lease with this tenant requires the tenant to pay base annual rent on a monthly basis as follows:
Base Rent | |||||
Approximate | Per Square | ||||
GLA Leased | % of Total | Foot Per | Lease | Term | |
Lessee | (Sq. Ft.) | GLA | Annum ($) | Beginning | To |
BJ's | 115,396 | 40 | 8.75 | 05/03 | 01/24 |
For federal income tax purposes, the depreciable basis in this property will be approximately $40,320,000. When we calculate depreciation expense for tax purposes, we will use the straight-line method. We depreciate buildings and improvements based upon estimated useful lives of 40 and 20 years, respectively.
Newnan Crossing West was built in 1999. As of December 30, 2003, the property was 100% occupied, with a total 131,196 square feet leased to eight tenants. The following table sets forth certain information with respect to those leases:
Approximate GLA Leased | Current Annual | Base Rent Per Square Foot | ||
Lessee | (Sq. Ft.) | Lease Ends | Rent ($) | Per Annum ($) |
Planet Smoothie | 1,040 | 10/08 | 18,200 | 17.50 |
Banana Beach | 1,200 | 10/08 | 21,600 | 18.00 |
Cingular | 1,760 | 10/08 | 31,680 | 18.00 |
Great Clips | 1,200 | 10/08 | 21,600 | 18.00 |
The Corner Tavern | 5,000 | 11/08 | 85,000 | 17.00 |
My Friend's Place | 1,600 | 11/08 | 28,800 | 18.00 |
Ted's Montana Grill | 4,000 | 12/08 | 64,000 | 16.00 |
BJ's | 115,396 | 01/24 | 1,009,715 | 8.75 |
In general, each tenant will pay its proportionate share of real estate taxes, insurance and common area maintenance costs, although the leases with some tenants may provide that the tenant's liability for such expenses is limited in some way, usually so that their liability for such expenses does not exceed a specified amount.
Eckerd Drug Stores
On December 24, 2003, we purchased the following two separate existing freestanding retail properties known as Eckerd Drug Stores, containing a total of 27,648 gross leasable square feet.
Location | Square Feet | Completion Date | Purchase Price ($) |
Danforth and Santa Fe | 13,824 | 2003 | 3,364,000 |
Edmond, Oklahoma | |||
36th and Robinson | 13,824 | 2003 | 5,288,000 |
Norman, Oklahoma |
We purchased these Eckerd Drug Stores from an unaffiliated third party. Our total acquisition cost was approximately $8,652,000. This amount may increase by additional costs which have not yet been finally determined. We expect any additional costs to be insignificant. Our acquisition cost was approximately $313 per square foot of leasable space.
We purchased these properties with our own funds. However, we expect to place financing on the properties at a later date.
One tenant, Eckerd Drug Stores, leases 100% of the total gross leasable area of each property. The leases with this tenant require the tenant to pay base annual rent on a monthly basis as follows:
Lessee/ | Approximate GLA Leased | % of Total GLA of each | Current Annual | Base Rent Per Square Foot Per | Lease | Term |
Location | (Sq. Ft.) | Property | Rent ($) | Annum ($) | Beginning | To |
Danforth & Santa Fe | 13,824 | 100 | 289,292 | 20.93 | 12/03 | 12/23 |
Edmond, OK | ||||||
36th & Robinson | 13,824 | 100 | 454,806 | 32.90 | 12/03 | 12/23 |
Norman, OK |
A twenty year lease commenced as of the date of acquisition with no increases during the term of the lease. Each lease includes four options, each for a term of five years.
These properties are on triple net leases and the tenant will be responsible for all repairs.
For federal income tax purposes, the depreciable basis in these properties will be approximately $6,490,000 When we calculate depreciation expense for tax purposes, we will use the straight-line method. We depreciate buildings and improvements based upon estimated useful lives of 40 and 20 years, respectively.
Darien Towne Centre, Darien, Illinois
On December 19, 2003, we purchased an existing shopping center known as Darien Towne Centre containing 217,505 gross leasable square feet. The center is located at 2189 75th Street, in Darien, Illinois.
We purchased this property from an unaffiliated third party. Our total acquisition cost was approximately $30,000,000. This amount may increase by additional costs which have not yet been finally determined. We expect any additional costs to be insignificant. Our acquisition cost was approximately $138 per square foot of leasable space.
Simultaneously with the purchase this property, we obtained a new loan in the amount of $16,500,000. The loan requires interest only payments based on a rate of 4.65% per annum and matures December 2010.
We do not intend to make significant repairs and improvements to this property over the next few years. However, if we were to make any repairs or improvements, the tenants would be obligated to pay a substantial portion of any monies spent pursuant to the provisions of their respective leases.
Three tenants, Home Depot, Circuit City and PetSmart, each lease more than 10% of the total gross leasable area of the property. The leases with these tenants require the tenants to pay base annual rent on a monthly basis as follows:
Base Rent | |||||
Approximate | Per Square | ||||
GLA Leased | % of Total | Foot Per | Lease | Term | |
Lessee | (Sq. Ft.) | GLA | Annum ($) | Beginning | To |
Home Depot | 109,200 | 50 | 8.35 | 05/94 | 04/03 |
8.60 | 05/03 | 04/08 | |||
9.10 | 05/08 | 04/14 | |||
Circuit City | 32,984 | 15 | 10.50 | 05/94 | 01/05 |
11.55 | 02/05 | 01/10 | |||
12.71 | 02/10 | 01/15 | |||
PetSmart | 25,487 | 12 | 11.20 | 10/94 | 09/04 |
11.70 | 10/04 | 09/09 |
For federal income tax purposes, the depreciable basis in this property will be approximately $22,500,000. When we calculate depreciation expense for tax purposes, we will use the straight-line method. We depreciate buildings and improvements based upon estimated useful lives of 40 and 20 years, respectively.
Darien Towne Centre was built in 1994. As of December 1, 2003, this property was 95% occupied, with a total 206,657 square feet was leased to 13 tenants. The following table sets forth certain information with respect to those leases:
Approximate GLA Leased | Renewal | Current Annual | Base Rent Per Square Foot | ||
Lessee | (Sq. Ft.) | Lease Ends | Options | Rent ($) | Per Annum ($) |
Jenny Craig | 2,000 | 02/04 | 1/5 yr. | 42,600 | 21.30 |
Payless/Soccer Post | 2,986 | 07/04 | - | 52,852 | 17.70 |
Great Clips | 1,532 | 08/04 | 1/5 yr. | 31,498 | 20.56 |
Murray's Discount Auto | 10,000 | 10/04 | 1/10 yr. | 110,000 | 11.00 |
Signature Cleaners | 1,500 | 11/04 | - | 37,260 | 24.84 |
Gingiss Formalwear | 2,000 | 12/04 | - | 34,000 | 17.00 |
Gladstone Realtors | 2,468 | 03/05 | - | 44,498 | 18.03 |
Deals | 12,000 | 07/07 | 1/5 yr. | 120,000 | 10.00 |
PetSmart | 25,487 | 09/09 | 5/5 yr. | 285,454 | 11.20 |
Panera Bread | 4,500 | 12/13 | - | 94,500 | 21.00 |
Home Depot | 109,200 | 04/14 | - | 911,820 | 8.35 |
Circuit City | 32,984 | 01/15 | - | 346,332 | 10.50 |
TGI Fridays | * | 05/94 | 72,600 | * |
* ground lease
In general, each tenant will pay its proportionate share of real estate taxes, insurance and common area maintenance costs, although the leases with some tenants may provide that the tenant's liability for such expenses is limited in some way, usually so that their liability for such expenses does not exceed a specified amount.
Item 7. Financial Statements and Exhibits
- Financial Statements
To be subsequently filed.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
INLAND WESTERN RETAIL REAL ESTATE TRUST, INC.
By:/s/ Kelly Tucek
Name: Kelly Tucek
Title: Treasurer
Date: December 31, 2003