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 (Date of earliest event reported): November 21,1997
CENTURY REALTY TRUST
(Exact name of registrant as specified in its charter)
INDIANA 0-7716 35-1284316
(State or other jurisdiction (Commission (IRS Employer
incorporation) File Number) Identification No.)
823 Chamber of Commerce Building, Indianapolis, IN 46204
(Address of principal executive offices)
Registrant's telephone number, including area code: (317) 632-5467
Not applicable
(Former name or former address, if changed since last report)
ITEM 2. Acquisition or Disposition of Assets
On November 21, 1997, Century Realty Trust (the "Trust"),
through a wholly-owned qualified R.E.I.T. subsidiary, CR
Management, Inc. (the "Buyer"), acquired from a single
unrelated seller, J. Scott Porter, and MP Realty Group of
Richmond, Indiana (the "Seller"), the General Partner interest in
five Limited Partnerships, each of which owned, as its principle
asset, a single apartment property. Pursuant to the acquisition
agreement, five new limited partnerships (the "Operating
Partnerships") were formed to acquire the assets and liabilities
from the five old partnerships (the "Selling Partnerships"). The
operating partnerships issued, in the aggregate, approximately
285,000 operating partnership units (O.P. units) to the selling
partnerships for their contribution of net assets, and
approximately 2,900 O.P. units representing a one percent equity
interest, to CR Management, Inc. The Buyer also assumed
management control of the partnerships and their respective
apartment properties. For its one percent equity interest,
acquisition of the General Partner interest, and management
control, the Buyer paid $687,500 in cash and assumed total
General Partner responsibility for both the selling partnerships
and the operating partnerships. In addition, the Trust agreed
to use its best efforts to grant to each beneficial owner of
O.P. units, within two years after closing, the right to
exchange his/her units, on a one-for-one basis, for shares of
beneficial interest of the Trust. After ten years from closing,
the Trust, at its option, can require that any O.P. units not
previously exchanged, be exhanged for Trust shares. At the time
of closing, the average quoted Bid price of the Trust's shares
of beneficial interest (OTC Electronic Bulletin Board) was
$11.625 per share. The share-equivalent value of the 285,000
O.P. units ($3.3 million) plus the cash investment of $687,500
represents the approximate purchase price of the real estate and
other assets ($14.3 million) less assumed mortgage debt and
other liabilities ($10.7 million) of the operating partnerships.
In the aggregate, the apartment properties represent 92.3% of
the total partnership assets.
Following is a listing of the selling partnerships and operating
partnerships:
Selling Operating
MP Realty Group
- Barcelona Associates, L.P. Barcelona Apartments, L.P.
MP Realty Group
- Beech Grove Associates, L.P. Beech Grove Apartments, L.P.
MP Realty Group
- Hampton Court Associates, L.P. Hampton Court Apartments, L.P.
MP Realty Group
- Sheffield Square Associates, L.P. Sheffield Square Apartments, L.P.
MP Realty Group
- West Wind Terrace Associates, L.P. West Wind Terrace Apartments, L.P.
Following is a description of the properties owned by the subject
partnerships:
Year
Name Location Units Built
Barcelona Kokomo, IN 64 1971
Beech Grove Jeffersonville, IN 182 1973
Hampton Court Indianapolis, IN 92 1980
Sheffield Square New Albany, IN 152 1974
West Wind Terrace Indianapolis, IN 96 1967
Each of the properties was built as a garden-style apartment
community, and has been operated as such from its inception. It
is the intent of the Trust that each property will continue to
be operated as a multi-family apartment community. It is the
further intent of the Trust to grant, within the two years specified
in the acquisition agreement, to each beneficial owner of O.P. units,
the right to exchange those units for shares of the Trust. The Trust
expects that most O.P. unit holders will, over time, exercise their
exchange option and that the Trust will, thereby, over time increase
its equity ownership interest in the partnerships.
The cash investment and other transactional and organizational
fees and expenses related to the acquisition was financed by
$850,000 of short-term borrowings under the Trust's $3 million
unsecured credit facility with NBD Bank, N.A. Subsequent to
such borrowings, the Trust has a total of $2.75 million in loans
outstanding under the credit facility.
The partnership valuations (purchase prices) which were
negotiated with the Seller with respect to each selling
partnership through their investment banker, were determined
through an internal analysis by the Trust of the historical cash
flows and fair market values of the acquired properties with
adjustments for the Trust's estimates of the costs of
operations. Those estimates were based on many years of
experience by the Trust's management in operating multi-family
apartment communities in Indiana of comparable ages and sizes.
The Seller is not, and never has been, affiliated with the
Trust, any trustee or officer of the Trust or any associate of
any such Trustee or officer, except that King R.Traub, an
officer and trustee of the Trust, directly or indirectly, is a
limited partner in four of the five selling partnerships. In
the aggregate, Mr.Traub has a beneficial interest in 2,576 O.P.
units which represents less than one percent of the total
limited partner interests. Traub and Company, Inc., of which
King R.Traub is a principal, was paid fees totaling $111,875 by
the selling partnerships for its services as investment banker
in this transaction. Mr. Traub, in his capacity as an officer
and Trustee of the Trust, abstained from all discussions,
negotiations and decisions related to this transaction.
ITEM 7. Financial Statements and Exhibits.
(a) Financial statements for the properties acquired and
noted in Item 2 are not available at this time and will
be filed as soon as possible, but not later than 60
days from the date of this Form 8-K.
(b) Pro forma Financial Information.
Pro forma financial statements of the Registrant reflecting
the interests acquired and noted in Item 2 are not available
at this time and will be filed as soon as possible, but not
later than 60 days from the date of this Form 8-K.
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.
CENTURY REALTY TRUST
Date: __________________ By:___________________________________
John I. Bradshaw, Jr.
Executive Vice President
Secretary and Treasurer
Date: ___________________ By:___________________________________
David F. White
Controller