SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported) April 16, 1996
Property Resources Equity Trust
(Exact Name of Registrant as Specified in its Charter)
California 0-15880 94-3959770
State or other Commission File Number IRS Employer
jurisdiction of Identification
incorporation Number
1800 Gateway Drive, San Mateo, CA 94404
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (415)312-3000
ITEM 2. DISPOSITION OF ASSETS
Agora Office Building
4205 North Seventh Avenue
Phoenix, Arizona
On April 16, 1996, pursuant to a contract entered into on February 26, 1996 and
amended April 15, 1996, Property Resources Equity Trust (the "Registrant") sold
the Agora Office Building, located in Phoenix Arizona (the "Property").
The total sales price included a $100,000 cash payment at sale closing and a
$750,000 promissory note payable to the Registrant (the "Note"), secured by the
Property and tenant rents. The unaffiliated purchaser is Presson Equity
Partners, an Arizona general partnership (the "Buyer"). A real estate brokerage
commission of $34,000 was paid to Rein & Grossoehme Commercial Real Estate,
L.L.C., an unaffiliated real estate broker retained by the Registrant under a
listing agreement dated August 24, 1995. The Property was purchased by the
Registrant in September of 1986. The total all cash cost of the Property to the
Registrant (including closing costs and acquisition fees) was $2,659,632.
The proceeds to the Registrant from the sale are as follows:
Sales Price $850,000
Less:
Brokerage Commission 34,000
Closing Costs 1,473
Closing Prorations 40,925
------------------
76,398
------------------
Net Proceeds to the Registrant 773,602
------------------
Less:
Note Principal Amount* 750,000
------------------
Net Cash Proceeds to the Registrant at sale closing $ 23,602
==================
*The terms of the Note include a 7% interest rate, a two year term and monthly
principal and interest payments of $5,814.74. The Note also includes, among
other things, provisions for late charges and certain remedies, including a
foreclosure of the Property, if a default occurs. The Note is non-recourse to
the other assets of the Buyer. If all payments are made according to the terms
of the Note, the Buyer will pay the Registrant $102,761 in interest over the
term of the Note, as well as, the Note principal amount.
There was no material relationship between the Buyer and the Registrant or any
of the affiliates, directors or officers of the Registrant or Property
Resources, Inc. (the "Advisor") or any associate of any director or officer of
the Registrant or the Advisor.
ITEM 7: PROFORMA FINANCIAL INFORMATION
In lieu of proforma financial statements, the following narrative describes the
proforma financial statement effects resulting from the above-mentioned real
estate disposition:
Had this transaction taken place as of December 31, 1995, certain proforma
effects would have been reflected in the balance sheet of Property Resources
Equity Trust as of December 31, 1995. Rental property would be reduced by
$1,088,000 to $8,448,000; accumulated depreciation would be reduced by $386,000
to $1,777,000; cash and cash equivalents would be increased by $24,000 to
$636,000; other assets would be decreased by $15,000 to $63,000; note receivable
would be reflected in the amount of $750,000; and total assets would be
increased by $57,000. Deposits and other liabilities would be decreased by
$35,000 to $53,000.
Had this transaction taken place as of January 1, 1995, certain proforma effects
would have been reflected in the statement of operations of Property Resources
Equity Trust for the year ended December 31, 1995. Rent revenue would be
decreased by $148,000 to $947,000; interest income would be increased by $52,000
to $92,000; depreciation and amortization expense would be decreased by $10,000
to $235,000; operating expense would be decreased by $107,000 to $215,000;
related party expense would be decreased by $1,000 to $95,000; gain on sale of
property would be relected in the amount of $93,000 and net income would be
increased by $115,000 to $346,000.
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 heretofore duly authorized.
Dated April 29, 1996 PROPERTY RESOURCES EQUITY TRUST
/s/ David P. Goss
David P. Goss
President