1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): JUNE 30, 1997
---------------
JP REALTY, INC.
(Exact Name of Registrant as Specified in Its Charter)
Maryland 1-12560 87-0515088
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification Number)
35 Century Park-Way, Salt Lake City, Utah 84115
- ------------------------------------------------------------------
(Address of Principal Executive Offices, Including Zip Code)
Registrant's Telephone Number, Including Area Code: (801) 486-3911
N/A
(Former Name of Former Address, if Changed Since Last Report)
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ITEM 2. ACQUISITION OF ASSETS
On June 1, 1997, JP Realty, Inc. (the "Company") acquired the
remaining 70% interest in Silver Lake Mall, Ltd., a limited
partnership owning Silver Lake Mall, from Roebbelen Engineering,
Inc. ("Roebbelen"). Silver Lake Mall, an enclosed regional mall
located in Coeur D'Alene, Idaho, contains 331,254 square feet of
total gross leaseable area ("Total GLA"), of which 6,936 square
feet is tenant owned. Prior to the acquisition, the Company had
been the property manager for Silver Lake Mall for a period of 17
months. The major anchor department stores at Silver Lake Mall are
JC Penney, Sears, The Emporium and Lamonts. At the time of its
acquisition, Silver Lake Mall was 99.5% occupied based on Total GLA
and had 98.4% of its mall shops occupied. The consideration paid
by the Company for the interest in Silver Lake Mall, Ltd. consisted
of 72,000 units of limited partner interest in Price Development
Company, Limited Partnership, the Company's operating partnership,
which at the time of acquisition had a value of $1,863,000. In
connection with the acquisition, the Company assumed debt of Silver
Lake Mall, Ltd. totaling $24,755,000. The Company utilized
$9,000,000 of its $50 million secured revolving credit facility
with Bank One, Arizona, NA and $2,936,000 of cash to pay down
$11,936,000 of the assumed debt. The Company purchased the mall
pursuant to a Contribution Agreement, the terms of which were
determined through arms-length negotiations between the parties.
Pursuant to the Contribution Agreement, Roebbelen will remain as a
guarantor on $4,300,000 of the debt assumed by the Company.
On June 30, 1997, the Company acquired Visalia Mall, an enclosed
regional mall containing 439,527 square feet of Total GLA located
in Visalia, California. The major anchor department stores at
Visalia Mall are JC Penney and Gottschalks. At the time of its
acquisition, Visalia Mall was 95.3% occupied based on Total GLA and
had 88.2% of its mall shops occupied. The purchase price paid for
Visalia Mall was $38,000,000, of which $37,000,000 was paid out of
the Company's credit facilities with Bank One, Arizona, NA and
Merrill Lynch Mortgage Capital, Inc., $593,000 was paid in cash and
$407,000 was paid in the form of property in a 1031 tax free
exchange. The Company purchased the mall from Connecticut General
Life Insurance Company, on behalf of its Closed-End Real Estate
Fund II, pursuant to an Agreement of Purchase and Sale, the terms
of which were determined through arms-length negotiations between
the parties.
The factors considered by the Company in determining the prices to
be paid for the two malls included their historical and/or expected
cash flow, nature of the tenants and terms of leases in place,
occupancy rates, opportunities for alternative and new tenancies,
current operating costs and taxes on the malls and anticipated
changes therein under Company ownership, the outparcels and
expansion areas available, the physical condition and locations of
the malls, the anticipated effect on the Company's financial
results and other factors. The Company took into consideration
capitalization rates at which it believes other shopping centers
have recently sold, and determined the price it was willing to pay
primarily on the factors discussed above relating to the malls and
their fit with the Company's operations.
Silver Lake Mall and Visalia Mall, which are each the dominant
enclosed regional mall in their respective market areas, contain an
aggregate of 770,781 square feet of Total GLA, of which 763,845
square feet is Company owned.
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ITEM 7. FINANCIAL STATEMENTS, PRO FORMA INFORMATION AND EXHIBITS
FINANCIAL STATEMENTS
The statements of revenues and certain expenses included in this
report comprise the following:
A statement of revenues and certain expenses for the year
ended December 31, 1996 and unaudited comparative interim
information for the three months ended March 31, 1997 and
1996 for the following shopping centers:
-Silver Lake Mall, Coeur D'Alene, Idaho
-Visalia Mall, Visalia, California
PRO FORMA FINANCIAL INFORMATION (UNAUDITED)
Unaudited pro forma financial information for JP Realty, Inc. is
presented as follows:
Condensed consolidated balance sheet as of March 31, 1997
Condensed consolidated statement of operations for the three
month period ended March 31, 1997 and for the year ended
December 31, 1996
Estimated twelve-month pro forma statement of taxable net
operating income and operating funds available
EXHIBITS - (23.1) Consent of Independent Accountants
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JP REALTY, INC.
INDEX TO FINANCIAL STATEMENTS
- -------------------------------------------------------------------
SILVER LAKE MALL AND VISALIA MALL
Report of Independent Accountants . . . . . . . . . . . . . . F-2
Statements of Revenues and Certain
Expenses for the Year Ended December
31, 1996. . . . . . . . . . . . . . . . . . . . . . . . . . F-3
Statements of Revenues and Certain
Expenses for the Three Month Period
Ended March 31, 1997 and 1996 (unaudited) . . . . . . . . . F-4
Notes to Statements of Revenues and
Certain Expenses. . . . . . . . . . . . . . . . . . . . . . F-5
JP REALTY, INC.
Pro Forma - Unaudited:
Condensed Consolidated Balance Sheet as
of March 31, 1997 . . . . . . . . . . . . . . . . . . . . . F-6
Condensed Consolidated Statement of
Operations for the Three-Month Period
Ended March 31, 1997 and for the Year
Ended December 31, 1996 . . . . . . . . . . . . . . . . . . F-8
Estimated Twelve Month Pro Forma
Statement of Taxable Net Operating Income
and Operating Funds Available . . . . . . . . . . . . . . . F-13
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholders of
JP Realty, Inc.
We have audited the accompanying statements of revenues and certain
expenses of Silver Lake Mall and Visalia Mall for the year ended
December 31, 1996. These historical statements are the
responsibility of management. Our responsibility is to express an
opinion on these historical statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the
historical statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the historical statements. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the
overall presentation of the historical statements. We believe that
our audits provide a reasonable basis for our opinion.
The accompanying historical statements were prepared on the basis
described in Note 2, for the purpose of complying with the rules
and regulations of the Securities and Exchange Commission (for
inclusion in the current report on Form 8-K of JP Realty, Inc.) and
are not intended to be a complete presentation of the revenues and
expenses of Silver Lake Mall and Visalia Mall.
In our opinion, the historical statements referred to above present
fairly, in all material respects, the revenues and certain expenses
of Silver Lake Mall and Visalia Mall, on the basis described in
Note 2, for the year ended December 31, 1996, in conformity with
generally accepted accounting principles.
PRICE WATERHOUSE LLP
Salt Lake City, Utah
July 1, 1997
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JP REALTY, INC.
SILVER LAKE MALL AND VISALIA MALL
STATEMENT OF REVENUES AND CERTAIN EXPENSES
- -------------------------------------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 1996
------------------------------------
SILVER LAKE VISALIA
MALL MALL
----------- -----------
Revenues
Minimum Rents $ 2,519,590 $ 4,263,963
Percentage and
Overage Rents 153,838 137,938
Recoveries from Tenants 1,039,943 1,814,530
------------ ------------
3,713,371 6,216,431
------------ ------------
Certain Expenses
Operating and Maintenance 852,719 1,949,862
Real Estate Taxes 387,282 355,837
------------ ------------
1,240,001 2,305,699
------------ ------------
Revenues in Excess of
Certain Expenses $ 2,473,370 $ 3,910,732
============ ============
See accompanying notes to
Statement of Revenues and Certain Expenses
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JP REALTY, INC.
SILVER LAKE MALL AND VISALIA MALL
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
- ------------------------------------------------------------------
FOR THE THREE MONTH PERIOD ENDED
MARCH 31, 1997 (UNAUDITED)
----------------------------------------
SILVER LAKE VISALIA
MALL MALL
----------- -----------
Revenues
Minimum Rents $ 630,519 $ 1,093,166
Percentage and
Overage Rents 22,500 13,500
Recoveries From Tenants 252,189 467,433
------------ ------------
905,208 1,574,099
------------ ------------
Certain Expenses
Operating and Maintenance 199,337 430,879
Real Estate Taxes 94,305 108,375
------------ ------------
293,642 539,254
------------ ------------
Revenues in Excess of
Certain Expenses $ 611,566 $ 1,034,845
============ ============
FOR THE THREE MONTH PERIOD ENDED
MARCH 31, 1996 (UNAUDITED)
----------------------------------------
SILVER LAKE VISALIA
MALL MALL
----------- -----------
Revenues
Minimum Rents $ 610,850 $ 997,034
Percentage and
Overage Rents 32,739 16,800
Recoveries From Tenants 208,595 374,859
------------ ------------
852,184 1,388,693
------------ ------------
Certain Expenses
Operating and Maintenance 208,721 409,495
Real Estate Taxes 97,125 82,500
------------ ------------
305,846 491,995
------------ ------------
Revenues in Excess of
Certain Expenses $ 546,338 $ 896,698
============ ============
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JP REALTY, INC.
SILVER LAKE MALL AND VISALIA MALL
NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES
- -------------------------------------------------------------------
1. OPERATION OF PROPERTIES
The accompanying statements of revenues and certain expenses relate
to the operations of Silver Lake Mall and Visalia Mall (the
"Properties") located in Coeur D'Alene, Idaho and Visalia,
California, respectively. Silver Lake Mall was opened in 1989. JP
Realty, Inc. (the "Company") the owner of a 30% interest in Silver
Lake Mall, acquired the remaining 70% interest on June 1, 1997.
Visalia Mall was opened in 1965 and was acquired by the Company on
June 30, 1997.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying statements of revenues and certain expenses have
been prepared on the accrual basis of accounting.
The accompanying financial statements are not representative of the
actual operations for the period presented, as certain revenues and
expenses, which may not be comparable to the revenues and expenses
to be earned or incurred by the Company in the future operations of
the Properties, have been excluded. Revenues excluded consist of
interest and other revenues unrelated to the continuing operations
of the Properties. Expenses excluded consist of interest,
depreciation of the building and improvements, amortization of
deferred costs, and other general and administrative costs not
directly related to the future operations of the Properties.
INCOME RECOGNITION
Minimum rents are recognized when earned which approximates a
straight-line basis.
UNAUDITED FINANCIAL INFORMATION
The interim financial data for the three month period ended March
31, 1997 and 1996 is unaudited; however, in the opinion of the
Company, the interim data includes all adjustments, consisting only
of normal recurring adjustments, necessary for a fair statement of
the results for the interim periods. The results for the periods
presented are not necessarily indicative of the results for the
full year.
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JP REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
MARCH 31, 1997
- -------------------------------------------------------------------
(UNAUDITED)
The following unaudited pro forma condensed consolidated balance
sheet is presented as if the acquisition of the Properties acquired
on June 1, 1997 and June 30, 1997 had occurred as of March 31,
1997. This pro forma condensed consolidated balance sheet should
be read in conjunction with the pro forma condensed consolidated
statement of operations of the Company presented herein and the
historical financial statements and notes thereto of the Company
included in the JP Realty, Inc. Forms 10-K and 10-Q for the year
ended December 31, 1996 and the three month period ended March 31,
1997, respectively.
The unaudited pro forma condensed consolidated balance sheet does
not purport to represent what the actual financial position of the
Company would have been at March 31, 1997, nor does it purport to
represent the future financial position of the Company.
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JP REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
MARCH 31, 1997 (DOLLARS IN THOUSANDS)
- -------------------------------------------------------------------
(UNAUDITED)
COMPANY PRO FORMA COMPANY
HISTORICAL ADJUSTMENTS(A) PRO FORMA
---------- ------------- ----------
ASSETS
Net Real Estate Assets $ 373,012 $ 63,046 $ 436,058
Other Assets 20,120 (3,407) 16,713
------------ ------------ ------------
$ 393,132 $ 59,639 $ 452,771
============ ============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Borrowings $ 126,217 $ 58,486 $ 184,703
Accumulated Loss In
Excess of Equity
Investment 1,555 (1,555) --
Other Liabilities 21,407 845 22,252
------------ ------------ ------------
149,179 57,776 206,955
------------ ------------ ------------
Minority Interests 34,006 1,863 35,869
------------ ------------ ------------
Shareholders' Equity
Common Stock 2 -- 2
Additional Paid-in
Capital 232,038 -- 232,038
Accumulated Dividends in
Excess of Net Income (22,093) -- (22,093)
------------ ------------ ------------
209,947 -- 209,947
------------ ------------ ------------
$ 393,132 $ 59,639 $ 452,771
============ ============ ============
(A) Reflects the Properties acquired on June 1, 1997 and June 30,
1997 as if the acquisition had occurred as of March 31, 1997.
Silver Lake Mall transaction contributed $25,046 to Net Real
estate Assets, ($2,407) to other Assets, $21,486 to Borrowings,
($1,555) to Accumulated Loss in Excess of Equity Investment,
$845 to Other Assets, and $1,863 to Minority Interest. The
Visalia Mall transaction contributed $38,000 to Net Real Estate
Assets, ($1,000) to Other Assets and $37,000 to Borrowings.
Silver Lake Mall was funded through the issuance of partnership
units, payment of cash, and the assumption of liabilities.
Visalia Mall was funded through the use of existing credit
facility and cash.
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JP REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 1997
AND FOR THE YEAR ENDED DECEMBER 31, 1996
- -------------------------------------------------------------------
(UNAUDITED)
On January 28, 1997, the Company sold 1,500,000 shares of common
stock in an underwritten public offering at an offering price of
$27.125 per share. Net proceeds to the Company totaled $38,600,000
and were used to purchase additional interests in PDC. PDC used
the proceeds to reduce borrowings outstanding under the $50,000,000
credit facility. The unaudited pro forma condensed statement of
operations for the three month period ended March 31, 1997 and for
the year ended December 31, 1996 is presented as if the public
offering of common stock and the acquisition of the Properties
purchased on June 1, 1997 and June 30, 1997 had occurred on January
1, 1997 and January 1, 1996, respectively.
Pro forma information is based upon the historical consolidated
results of operations of the Company for the three month period
ended March 31, 1997 and for the year ended December 31, 1996,
giving effect to the transactions described above. The pro forma
condensed consolidated statement of operations should be read in
conjunction with the pro forma condensed consolidated balance sheet
of the Company presented herein and the historical financial
statements and notes thereto of the Company included in the JP
Realty, Inc. Forms 10-K and 10-Q for the year ended December 31,
1996 and the three month period ended March 31, 1997.
The unaudited pro forma condensed consolidated statement of
operations is not necessarily indicative of what the actual results
of operations of the Company would have been assuming the
transactions had been completed as set forth above, nor does it
purport to represent the Company's results of operations for future
periods.
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JP REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 1997
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
- -------------------------------------------------------------------
(UNAUDITED)
ACQUIRED
PROPERTIES AND
COMPANY COMMON STOCK COMPANY
HISTORICAL(A) OFFERING(B) PRO FORMA
------------ ------------ -----------
REVENUES
Minimum Rents $ 13,207 $ 1,724 $ 14,931
Percentage and
Overage Rents 1,003 36 1,039
Recoveries from Tenants 3,878 719 4,597
Interest and Other
Income 287 (38)(C) 249
------------ ----------- ------------
18,375 2,441 20,816
EXPENSES
Operating Expenses
Before Depreciation
and Interest 6,077 833 6,910
Interest 1,676 735 2,411
Depreciation and
Amortization 3,067 330 3,397
------------ ----------- ------------
Net Operating Income 7,555 543 8,098
Minority Interests in
Income of Consolidated
Partnerships (71) -- (71)
------------ ----------- ------------
Income Before Minority
Interests of PDC
Unitholders 7,484 543 8,027
Minority Interests of
PDC Unitholders (1,270) (119) (1,389)
------------ ----------- ------------
Net Income $ 6,214 $ 424 $ 6,638
============ =========== ============
Net Income Per Share
of Common Stock $ .36 $ .38(D)
============ =========== ============
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JP REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 1997
(DOLLARS IN THOUSANDS)
- -------------------------------------------------------------------
(UNAUDITED)
(A) Reflects the JP Realty, Inc. historical consolidated
statement of operations for the period January 1, 1997 to
March 31, 1997.
(B) Reflects revenues and expenses of the Properties acquired
on June 1, 1997 and June 30, 1997 for the three months
ended March 31, 1997 and the common stock offering on
January 28, 1997, as if consummated on January 1, 1996 as
follows:
Silver Lake Visalia Common Stock
Mall Mall Offering Total
-------- ------- -------- -----
Minimum Rent $ 631 $ 1,093 $ -- $ 1,724
Percentage and
Overage Rent 22 14 -- 36
Recoveries from
Tenants 252 467 -- 719
Operating Expenses 294 539 -- 833
Interest (1) 423 601 (289) 735
Depreciation (2) 131 199 -- 330
(1) Reflects interest expense on $46,000 outstanding under
the revolving credit facilities, drawn for purposes of
the acquisition of the Properties, at a rate equal to
the average interest rate incurred under the credit
facilities, and interest on $12,997 of assumed debt at
8.5% fixed rate.
Interest expense is reduced by using the $38,600 in net
proceeds from the January 28, 1997 common stock
offering. The proceeds were used to retire borrowings
outstanding on the Company's $50,000 credit facility.
(2) Reflects depreciation on $52,831 of the purchase price
allocated to buildings, over a 40-year useful life.
(C) Adjustment reflects a reduction in outside management fees
for the Company received for management services of Silver
Lake Mall prior to the acquisition.
(D) Based upon 17,380,000 shares of Common Stock and 200,000
shares of Price Group stock outstanding. Earnings per
share will be unaffected by partners who elect to exchange
PDC units in the operating partnership on a one-for-one
basis for common stock of the Company, as holders of such
Units and stockholders effectively share equally in the net
income of the operating partnership.
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JP REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
- -------------------------------------------------------------------
(UNAUDITED)
ACQUIRED
ADJUSTMENTS PROPERTIES AND
COMPANY AS PREVIOUSLY COMMON STOCK COMPANY
HISTORICAL(A) REPORTED(B) OFFERING(C) PRO FORMA
------------ ----------- ----------- ---------
Revenues
Minimum Rents $ 52,447 $ 866 $ 6,784 $ 60,097
Percentage and
Overage Rents 4,061 46 292 4,399
Recoveries from
Tenants 15,557 239 2,855 18,651
Interest and Other
Income 884 0 (148)(D) 736
------------ ---------- ----------- ---------
72,949 1,151 9,783 83,883
Expenses
Operating Expenses
Before Depreciation
and Interest 24,405 339 3,546 28,290
Interest 7,776 593 2,074 10,443
Depreciation and
Amortization 11,979 179 1,321 13,479
------------ --------- ---------- ---------
Net Operating
Income 28,789 40 2,842 31,671
Minority Interests in
Income of Consolidated
Partnerships (269) -- -- (269)
Gain on Sale of Real
Estate 94 -- -- 94
------------ --------- ---------- ---------
Income Before Minority
Interests of PDC
Unitholders 28,614 40 2,842 31,496
Minority Interests of
PDC Unitholders (5,244) (14) (200) (5,458)
------------ --------- --------- ----------
Net Income $ 23,370 $ 26 $ 2,642 $ 26,038
============ ========= ========= ==========
Net Income Per
Share of Common
Stock $ 1.46 $ 1.51(E)
============ ===========
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JP REALTY, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996 (DOLLARS IN THOUSANDS)
(UNAUDITED)
(A) Reflects the JP Realty, Inc. historical consolidated
statement of operations for the period January 1, 1996 to
December 31, 1996.
(B) Reflects revenue and expenses for the Purchase of Grand Teton
Mall April 4, 1996 as if acquired on January 1, 1996.
(C) Reflects revenues and expenses of the Properties acquired
on June 1, 1997 and June 30, 1997 for the 12 months ended
December 31, 1996 and the common stock offering on January
28, 1997, as if consummated on January 1, 1996 as follows:
SILVER LAKE VISALIA COMMON STOCK
MALL MALL OFFERING TOTAL
----------- ------- --------- --------
Minimum Rents $ 2,520 $ 4,264 -- $ 6,784
Percentage and
Overage Rent 154 138 -- 292
Recoveries from Tenants 1,040 1,815 -- 2,855
Operating Expenses 1,240 2,306 -- 3,546
Interest (1) 1,690 2,405 (2,021) 2,074
Depreciation (2) 525 796 -- 1,321
(1) Reflects interest expense on $46,000 outstanding under
the revolving credit facilities, drawn for purposes of
the acquisition of the Properties, at a rate equal to
the average interest rate incurred under the credit
facilities, and interest on $12,997 of assumed debt at
a 8.5% fixed rate.
Interest expense is reduced by using the $38,600 in
net proceeds from the January 28, 1997 common stock
offering. The proceeds were used to retire borrowings
outstanding on the Company's $50,000 credit facility.
Prior to April 4, 1996, only $10,000 was outstanding
on this credit facility. As a result, the interest
expense reduction is computed based on that amount
during the period January 1, 1996 to April 4, 1996.
(2) Reflects depreciation on $52,831 of the purchase price
allocated to buildings, over a 40-year useful life.
(D) Adjustment reflects a reduction in outside management fees
for the Company received for management services of Silver
Lake Mall prior to the acquisition.
(E) Based upon 17,070,000 shares of Common Stock and 200,000
shares of Price Group stock outstanding. The number of
shares assumed to be outstanding as a result of the
1,500,000 share offering on January 28, 1997 includes only
those shares equivalent to the amount of proceeds used to
retire borrowings outstanding, as described in Note (C)
above. Earnings per share will be unaffected by partners
who elect to exchange PDC units in the operating
partnership on a one-for-one basis for common stock of the
Company, as holders of such Units and stockholders
effectively share equally in the net income of the
operating partnership.
17
JP REALTY, INC.
ESTIMATED TWELVE-MONTH PRO FORMA STATEMENT
OF TAXABLE NET OPERATING INCOME AND OPERATING FUNDS AVAILABLE
DOLLARS IN THOUSANDS
- -------------------------------------------------------------------
(UNAUDITED)
The following unaudited statement is a pro forma estimate of
taxable income and funds available from operations of the Company
for the year ended December 31, 1996. The pro forma statement is
based on the Company's historical operating results for the twelve-
month period ended December 31, 1996 adjusted for the effects of
the Company's acquisition of the Properties purchased on June 1,
1997 and June 30, 1997. This statement does not purport to
forecast actual operating results for any period in the future.
This statement should be read in conjunction with (i) the financial
statements of the Company and (ii) the pro forma condensed
financial statements of the Company.
ESTIMATE OF TAXABLE NET OPERATING INCOME:
Company historical net income before minority interest, exclusive of
depreciation and amortization (Note 1). . . . . . . . . $ 40,593
Properties acquired on June 1, 1997 and June 30, 1997 - historical
earnings from operations before minority interest, as adjusted,
exclusive of depreciation and amortization (Note 2) . . . . . 4,163
Estimated 1996 tax depreciation and amortization (Note 3):
1996 tax depreciation and amortization. . . . . . . . . .(13,337)
Pro forma tax depreciation for properties acquired during
1997. . . . . . . . . . . . . . . . . . . . . . . . . . . (1,321)
---------
Pro forma taxable income before allocation to minority
interest and dividends deduction. . . . . . . . . . . . . 30,098
Estimated allocation to minority interest (Note 4). . . . . (5,216)
Estimated dividends deduction (Note 5). . . . . . . . . . .(29,359)
---------
$ (4,477)
=========
Pro forma taxable net operating income. . . . . . . . . . $ --
=========
ESTIMATE OF OPERATING FUNDS AVAILABLE:
Pro forma taxable income before allocation to minority
interest and dividends deduction. . . . . . . . . . . . $ 30,098
Add pro forma depreciation. . . . . . . . . . . . . . . . 14,658
---------
Estimated pro forma operating funds available (Note 6). . $ 44,756
=========
18
JP REALTY, INC.
ESTIMATED TWELVE-MONTH PRO FORMA STATEMENT
OF TAXABLE NET OPERATING INCOME AND FUNDS AVAILABLE
- -------------------------------------------------------------------
(UNAUDITED)
Note 1 - The historical earnings from operations represent the
Company's earnings from operations before minority
interest for the twelve months ended December 31, 1996
as reflected in the Company's historical financial
statements.
Note 2 - The historical earnings from operations for the
Properties acquired on June 1, 1997 and June 30, 1997
represent the revenues and certain expenses as referred
to in the pro forma condensed consolidated statement of
operations for the year ended December 31, 1996
included elsewhere herein.
Note 3 - Tax depreciation for the Company is based upon the
Company's tax basis in the Properties. The costs are
generally depreciated on a straight-line method over a
40-year life.
Note 4 - Estimated allocation of taxable income to minority
interests is based on a 17.33 percent minority interest
in the operating partnership.
Note 5 - Estimated dividends deduction is based on 17,270,163
pro forma shares outstanding at the dividend rate of
$1.70 per share.
Note 6 - Operating funds available does not represent cash
generated from operating activities in accordance with
generally accepted accounting principles and is not
necessarily indicative of cash available to fund cash
needs.
19
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 hereunto duly authorized.
JP REALTY, INC.
Date November 10, 1997 /s/G. Rex Frazier
- ------------------------------- ---------------------------
G. Rex Frazier
PRESIDENT AND CHIEF
OPERATING OFFICER