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): December 29, 1995
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(Exact Name of Registrant as Specified in its Charter)
Massachusetts 0-13473 04-2830750
(State of (Commission (IRS Employer
Organization) File No.) Identification No.)
200 Berkeley Street
Boston, MA 02117 (800) 722-5457
(Address of principal executive (Registrant's telephone
offices, including zip code) number, including area
code)
Not Applicable
(Former name or former address, if changed since last report)
Page 1 of 23
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
ITEM 2 - Acquisition or Disposition of Assets
- ---------------------------------------------
Disposition of the Fisherman's Village Apartments
- -------------------------------------------------
On December 29, 1995, the Partnership sold its last remaining property, the
Fisherman's Village Apartments, for a net sales price of approximately
$9,377,000, after deductions for commissions and selling expenses incurred
in connection with the sale of the property. The sale of the property
resulted in a non-recurring gain of approximately $818,000, which
represents the difference between the net sales price and the property's
net book value of approximately $8,559,000. The Partnership received net
cash proceeds of approximately $1,183,000 from the sale of the property
(representing the excess of the net sales proceeds over the related
mortgage indebtedness on the property in the amount of approximately
$8,194,000, which indebtedness was then held by the Managing General
Partner.
Based upon the Managing General Partner's analysis of comparable sales
transactions and its review of the offers received during the property's
marketing period, the Managing General Partner accepted the offer from
United Dominion Realty Trust, Inc. (the "Buyer"). There is no relationship
between the Buyer and the Partnership or any associate, director or officer
of the Managing General Partner.
The sale was made pursuant to a Purchase and Sale Agreement dated December
6, 1995, which is included as Exhibit 1 of this report. In connection with
this sale, the Partnership retired the underlying mortgage on the property
in the amount of $8,193,774, which indebtedness was then held by the
Managing General Partner.
The sale of the Fisherman's Village Apartments resulted in the termination
of the Partnership's operations, and the Partnership will be dissolved in
accordance with the Amended Agreement of Limited Partnership of the
Partnership (the "Partnership Agreement").
ITEM 7 - Financial Statements
- -----------------------------
(A) Financial Statements
Pro Forma Balance Sheet at September 30, 1995 4
Pro Forma Statement of Operations for the Nine Months Ended
September 30, 1995 5
Pro Forma Statement of Operations for the Year Ended December 31,
1994 6
Notes to Pro Forma Financial Statements 7
(B) Exhibits
1.Purchase and Sale Agreement between John Hancock Properties
Limited Partnership and United Dominion Realty Trust, Inc.
dated December 6, 1995 11
2
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
On December 29, 1995, the Partnership sold the Fisherman's Village
Apartments property to the Buyer for a gross sales price of $9,800,000.
The Pro Forma Balance Sheet reflects the financial position of the
Partnership as if the Fisherman's Village Apartments property had been sold
on September 30, 1995. The Pro Forma Statement of Operations for the nine
months ended September 30, 1995 reflects the continued operations of the
Partnership as if the Fisherman's Village Apartments property had been sold
on December 31, 1994. In addition, the Pro Forma Statement of Operations
for the year ended December 31, 1994 reflects the continued operations of
the Partnership as if the Fisherman's Village Apartments property had been
sold on December 31, 1993. In addition, the Partnership sold the
Northgreen Apartments property on June 1, 1995. The Pro Forma Statements
of Operations for the nine months ended September 30, 1995 and for the year
ended December 31, 1994, presented below, do not reflect any adjustments
relating to the operations of this property. For further information
regarding the sale of the Northgreen Apartments property, please refer to
the Partnership's Report on Form 8-K dated June 1, 1995.
3
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
PRO FORMA BALANCE SHEET
SEPTEMBER 30, 1995
(Unaudited)
Pro Forma
Historical Adjustment for
Summary the Fisherman's Pro Forma
September 30, Village September 30,
1995 Apartments 1995
---- ---------- ----
Assets:
Cash and cash equivalents $1,181,015 $1,025,614 $2,206,629
Restricted cash 341,703 (341,703) -
Note receivable, net of allowance - - -
Prepaid expenses and other assets 9,068 (4,506) 4,562
Investment in property:
Land 1,688,726 (1,688,726) -
Buildings and improvements 11,773,887 (11,773,887) -
----------- ----------- ----------
13,462,613 (13,462,613) -
Less: accumulated depreciation (4,810,132) 4,810,132 -
----------- ----------- ----------
8,652,481 (8,652,481) -
----------- ----------- ----------
Total assets $10,184,267 ($7,973,076) $2,211,191
=========== ========== ==========
Liabilities:
Accounts payable and accrued expenses $411,046 ($391,531) $19,515
Accounts payable to affiliates 21,988 - 21,988
Note payable to affiliate - - -
Long-term debt 8,693,775 (8,693,775) -
----------- ----------- ----------
Total liabilities 9,126,809 (9,085,306) 41,503
Partners' equity/(deficit):
General Partners' (669,340) 669,340 -
Limited Partners' 1,726,798 442,890 2,169,688
----------- ----------- ----------
Total partners' equity 1,057,458 1,112,230 2,169,688
----------- ----------- ----------
Total liabilities and partners' equity $10,184,267 ($7,973,076) $2,211,191
=========== ========== ==========
See Notes to Pro Forma Financial Statements
4
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
PRO FORMA STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995
(Unaudited)
Historical
Summary Pro Forma Pro Forma
For the Nine Adjustment for For the Nine
Months Ended the Fisherman's Months Ended
September 30, Village September 30,
1995 Apartments 1995
---- ---------- ----
Income:
Rental income $1,855,365 ($1,244,327) $611,038
Interest income 73,748 - 73,748
Gain on sale of property 3,983,713 - 3,983,713
---------- ---------- ----------
Total income 5,912,826 (1,244,327) 4,668,499
Expenses:
Interest 688,244 (484,566) 203,678
Property operating expenses 882,260 (689,405) 192,855
Depreciation 380,064 (284,891) 95,173
General and administrative 96,693 - 96,693
---------- ---------- ----------
Total expenses 2,047,261 (1,458,862) 588,399
---------- ---------- ----------
Net income $3,865,565 $214,535 $4,080,100
========== ========== ==========
Allocation of net income:
General Partners' $38,656 $2,145 $40,801
Limited Partners' 3,826,909 212,390 4,039,299
---------- ---------- ----------
$3,865,565 $214,535 $4,080,100
========== ========== ==========
Net income per Limited Partnership
Unit outstanding $174.31 $9.68 $183.99
======= ===== ======
See Notes to Pro Forma Financial Statements
5
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
PRO FORMA STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
Historical Pro Forma
Summary Adjustment for Pro Forma
For the Year Ended the Fisherman's For the Year Ended
December 31, Village December 31,
1994 Apartments 1994
---- ---------- ----
(Audited) (Unaudited) (Unaudited)
Income:
Rental income $3,190,235 ($1,749,203) $1,441,032
Interest income 30,141 - 30,141
---------- ---------- ----------
Total income 3,220,376 (1,749,203) 1,471,173
Expenses:
Interest 1,141,871 (653,193) 488,678
Property operating expenses 1,373,439 (837,553) 535,886
Depreciation 624,361 (391,811) 232,550
General and administrative 138,570 - 138,570
Recovery of uncollectible note
receivable (13,903) - (13,903)
---------- ---------- ----------
Total expenses 3,264,338 (1,882,557) 1,381,781
---------- ---------- ----------
Net income/(loss) ($43,962) $133,354 $89,392
========== ========== ==========
Allocation of net income/(loss):
General Partners' ($440) $1,334 $894
Limited Partners' (43,522) 132,020 88,498
---------- ---------- ----------
($43,962) $133,354 $89,392
========== ========== ==========
Net income/(loss) per Limited Partnership
Unit outstanding ($1.98) $6.01 $4.03
===== ===== =====
See Notes to Pro Forma Financial Statements
6
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
Notes to Pro Forma Financial Statements
(Unaudited)
Note 1 - Fisherman's Village Apartments
- ---------------------------------------
On December 29, 1995, the Partnership sold its last remaining property, the
Fisherman's Village Apartments, for a net sales price of approximately
$9,377,000, after deductions for commissions and selling expenses incurred
in connection with the sale of the property. The sale of the property
resulted in a non-recurring gain of approximately $818,000, which
represents the difference between the net sales price and the property's
net book value of approximately $8,559,000. In connection with this sale,
the Partnership retired the underlying mortgage on the property in the
amount of $8,194,000, which indebtedness was then held by the Managing
General Partner. The Partnership received net cash proceeds of
approximately $1,183,000 from the sale of the property (representing the
excess of the net sales proceeds over the related mortgage indebtedness on
the property).
The historical financial statements are adjusted to show the effects
resulting from the sale of the Fisherman's Village Apartments property on
the Partnership's operations, assets and liabilities. The Pro Forma
Balance Sheet at September 30, 1995 reflects the financial position of the
Partnership as if the Fisherman's Village Apartments property had been sold
on September 30, 1995. The Pro Forma Statement of Operations for the nine
months ended September 30, 1995 reflects the continued operations of the
Partnership as if the Fisherman's Village Apartments property had been sold
on December 31, 1994. In addition, the Pro Forma Statement of Operations
for the year ended December 31, 1994 reflects the continued operations of
the Partnership as if the Fisherman's Village Apartments property had been
sold on December 31, 1993.
Note 2 - Distributions and Allocations
- --------------------------------------
Profits from the normal operations of the Partnership for each fiscal year,
or portion thereof, are allocated between the Limited Partners and the
General Partners in the same proportion as Distributable Cash from
Operations, as defined in the Partnership Agreement, provided that (i) in
no event shall the General Partners be allocated less than 1% of any such
profits from normal operations, and (ii) if there is any fiscal year which
produces no Distributable Cash from Operations but which produces profits
for tax purposes from normal operations, such profits are allocated 90% to
the Limited Partners and 10% to the General Partners.
7
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
Notes to Pro Forma Financial Statements (Continued)
(Unaudited)
Note 2 - Distributions and Allocations (continued)
- --------------------------------------
Losses from the normal operations of the Partnership for each fiscal year
or portion thereof are allocated 99% to the Limited Partners and 1% to the
General Partners. Distributable Cash from Operations is distributed 90% to
the Limited Partners and 10% to the General Partners; provided, however,
that in each fiscal year the General Partners will defer their receipt of
any Distributable Cash from Operations to the extent necessary to provide
the Limited Partners a non-cumulative return in such year equal to 4% of
their Invested Capital, as defined in the Partnership Agreement. All
distributions of Distributable Cash from Operations deferred by the General
Partners accrue and are payable to them, to the extent possible, out of
subsequent years' Distributable Cash from Operations remaining after the
receipt by the Limited Partners of the aforesaid 4% return, or out of cash
from sales and refinancings, as specified below.
Upon the occurrence of a Sale or Refinancing, as defined in the Partnership
Agreement, of a Partnership property, the Managing General Partner will
first apply the proceeds to the payment of all debts and liabilities of the
Partnership then due and then fund any reserves for contingent liabilities
which it deems to be appropriate.
Cash from Sales or Refinancings, as defined in the Partnership Agreement,
are distributed to the Limited Partners until the Limited Partners have
received, first, a return of their total Invested Capital, and, second,
such additional amount as may be necessary, after giving effect to all
previous distributions of Distributable Cash from Operations and of Cash
from Sales or Refinancings to the extent required to satisfy any deficiency
in the Cumulative Return on Investment, as defined in the Partnership
Agreement, to produce in the aggregate a Cumulative Return on Investment of
7% per annum for all fiscal quarters commencing on or after January 1,
1986, and ending prior to the date of such distribution. The General
Partners are then entitled to receive an amount of Cash from Sales or
Refinancings equal to any portion of the General Partners' share of
Distributable Cash from Operations which was previously deferred in order
to permit the payment to the Limited Partners of a non-cumulative return in
each year equal to 4% of their Invested Capital. Any Cash from Sales or
Refinancings remaining after the Limited Partners have received a return of
their total Invested Capital plus the Cumulative Return on Investment of 7%
per annum for all fiscal quarters commencing on or after January 1, 1986,
and ended prior to the date of such distribution, and after the General
Partners have received an amount of such cash equal to any such deferred
payment of Distributable Cash from Operations, will be distributed 85% to
the Limited Partners and 15% to the General Partners.
8
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
Notes to Pro Forma Financial Statements (Continued)
(Unaudited)
Note 2 - Distributions and Allocations (continued)
- --------------------------------------
In connection with the sale of the last of the Partnership's properties,
and therefore the termination of the operations of the Partnership, the
Partnership Agreement provides that cash from the Sale of the last of the
Partnership's properties is distributed in the same manner as Cash from
Sales or Refinancings, except that before any other distribution is made to
the Partners, each Partner shall first receive from such cash, an amount
equal to the then positive balance, if any, in such Partner's Capital
Account, as defined in the Partnership Agreement, after crediting or
charging to such account the profits or losses for tax purposes from such
sale. To the extent, if any, that a Partner is entitled to receive a
distribution of cash based upon a positive balance in its Capital Account
prior to such distribution, such distribution will be credited against the
amount of such cash the Partner would have been entitled to receive based
upon the manner of distribution of Cash from Sales or Refinancings, as
specified in the previous paragraph.
Profits from the sale of the last of the Partnership's properties will be
allocated to any Partners having a deficit balance in their capital account
in an amount equal to the deficit balance. Any remaining profits will be
allocated in the same order as cash from the sale would be distributed.
9
JOHN HANCOCK PROPERTIES LIMITED PARTNERSHIP
(A Massachusetts Limited Partnership)
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report on Form 8-K to be signed on its
behalf by the undersigned, hereunto duly authorized, on the 17th day of
January, 1996.
John Hancock Properties Limited Partnership
By: John Hancock Realty Equities, Inc.,
Managing General Partner
By: WILLIAM M. FITZGERALD
---------------------
William M. Fitzgerald, President
By: RICHARD E. FRANK
---------------------
Richard E. Frank, Treasurer
(Chief Accounting Officer)