SECURITIES AND EXCHANGE COMMISSION
UNITED STATES
Washington, DC 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) October 7, 1998
REGENCY REALTY CORPORATION
(Exact name of registrant as specified in its charter)
Florida 1-12298 59-3191743
(State or other jurisdiction Commission (IRS Employer
of incorporation) File Number) Identification No.)
121 West Forsyth Street, Suite 200
Jacksonville, Florida 32202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number including area code: (904)-356-7000
Not Applicable
(Former name or former address, if changed since last report)
ITEM 5. OTHER INFORMATION
The factors considered by the Company in determining the price to be paid for
the shopping center included its historical and expected cash flow, nature of
the tenancies and terms of the leases in place, occupancy rates, opportunities
for alternative and new tenancies, current operating costs, physical condition
and location, and the anticipated impact on the Company's financial results. The
Company took into consideration capitalization rates at which it believes other
shopping centers have recently sold, but determined the purchase price on the
factors discussed above. No separate independent appraisals were obtained for
the property acquired.
The following summarizes the property acquired:
Property Acquisition Acquisition Occupancy at
Name Costs Date GLA City/State Acquisition
Pike Creek $22,897,676 8-04-98 234,580 Wilmington, DE 97%
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
A. Financial Statements and Pro Forma Financial Information
A) Financial Statements:
Pike Creek
Independent Auditors' Report
Statement of Revenues and Certain Expenses
for the year ended December 31, 1997
B) Pro Forma Financial Information:
Regency Realty Corporation
Pro Forma Condensed Consolidated Balance Sheet,
June 30, 1998 (unaudited)
Pro Forma Condensed Statement of Operations
for the six month period ended June 30, 1998 and the year
ended December 31, 1997 (unaudited)
C. Exhibits:
10. Material Contracts
(a) Purchase and Sale Agreement dated May 1, 1998, by and between
BIG VALLEY ASSOCIATES, LIMITED PARTNERSHIP, a Delaware limited
partnership ("Seller") and RRC ACQUISITIONS TWO, INC., A
Florida corporation ("Purchaser").
23. Consent of KPMG Peat Marwick LLP
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
REGENCY REALTY CORPORATION
(registrant)
October 7, 1998 By: /s/ J. Christian Leavitt
--------------------------------
J. Christian Leavitt
Vice President and Treasurer
Independent Auditors' Report
The Board of Directors
Regency Realty Corporation:
We have audited the accompanying statement of revenues and certain expenses of
Pike Creek Shopping Center for the year ended December 31, 1997. This financial
statement is the responsibility of management. Our responsibility is to express
an opinion on this statement of revenues and certain expenses based on our
audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the statement of revenues and certain expenses is free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the statement of revenues and certain
expenses. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
presentation of the statement of revenues and certain expenses. We believe that
our audit provides a reasonable basis for our opinion.
The accompanying statement of revenues and certain expenses of Pike Creek
Shopping Center was prepared for the purpose of complying with the rules and
regulations of the Securities and Exchange Commission and for inclusion in a
Form 8-K of Regency Realty Corporation and excludes material amounts, described
in note 1, that would not be comparable to those resulting from the proposed
future operation of the property. The presentation is not intended to be a
complete presentation of Pike Creek Shopping Center revenues and expenses.
In our opinion, the statement of revenues and certain expenses referred to above
presents fairly, in all material respects, the revenues and certain expenses,
described in note 1, of Pike Creek Shopping Center for the year ended December
31, 1997, in conformity with generally accepted accounting principles.
KPMG Peat Marwick LLP
Jacksonville, Florida
September 9, 1998
PIKE CREEK SHOPPING CENTER
Statement of Revenues and Certain Expenses
For the year ended December 31, 1997
Revenues:
Minimum rent $ 1,979,571
Recoveries from tenants 182,438
Percentage rent 195,536
-------------
Total revenues 2,357,545
-------------
Certain operating expenses:
Operating and maintenance 134,303
Real estate taxes 140,003
Management fees 93,408
General and administrative 79,978
-------------
Total expenses 447,692
-------------
Revenues in excess of certain expenses $ 1,909,853
=============
See accompanying notes to statement of revenues and certain expenses.
PIKE CREEK SHOPPING CENTER
Notes to Statement of Revenues and Certain Expenses
For the year ended December 31, 1997
1. Basis of Presentation
The statement of revenues and certain expenses relates to the operation
of a 234,580 square foot shopping center (the "Property") located in
Wilmington, Delaware.
The Property's financial statement is prepared on the accrual basis of
accounting in conformity with generally accepted accounting principles.
Subsequent to December 31, 1997, the Property was acquired by Regency
Realty Corporation (RRC) in a transaction accounted for as a purchase.
All operations of the Property will be included in the consolidated
financial statements of RRC beginning at the acquisition date.
The accompanying financial statement is not representative of the actual
operations for the period presented as certain expenses, which may not be
comparable to the expenses expected to be incurred by RRC in the proposed
future operation of the Property, have been excluded. RRC is not aware of
any material factors relating to the Property that would cause the
reported financial information not to be necessarily indicative of future
operating results. Costs not directly related to the operation of the
Property have been excluded, and consist of interest, depreciation,
professional fees, and certain other non operating expenses.
2. Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
PIKE CREEK SHOPPING CENTER
Notes to Statement of Revenues and Certain Expenses
3. Operating Leases
For the year ended December 31, 1997, the following tenants paid minimum
rent which exceeded 10% of the total minimum rent earned by the Property:
Minimum
Tenant Rent Paid
ACME Markets $ 440,000
Kmart Corporation 370,745
The Property is leased to tenants under operating leases with expiration
dates extending to the year 2011. Future minimum rent under noncancelable
operating leases as of December 31, 1997, excluding tenant reimbursements
of operating expenses and excluding additional contingent rentals based
on tenants' sales volume, are as follows:
Year ending December 31, Amount
1998 $ 1,904,402
1999 1,746,945
2000 1,566,526
2001 722,183
2002 483,116
Thereafter 3,619,066
Regency Realty Corporation
Pro Forma Condensed Consolidated Financial Statements
The following unaudited pro forma condensed consolidated balance sheet is based
upon the historical consolidated balance sheet of Regency Realty Corporation
(the Company) as of June 30, 1998 as if the Company had completed the
acquisition of two additional shopping centers and completed the issuance of
$100 million senior term notes subsequent to period end. The following
unaudited pro forma consolidated statements of operations of the Company are
based upon the historical consolidated statements of operations for the
six-month period ended June 30, 1998 and the year ended December 31, 1997.
These statements are presented as if the Company had acquired all of its
properties as of January 1, 1997. These unaudited pro forma condensed
consolidated financial statements should be read in conjunction with the
Company's Form 10-K as of and for the three years ended December 31, 1997 and
Form 10-Q filed for the period ended June 30, 1998.
The unaudited pro forma condensed consolidated financial statements are not
necessarily indicative of what the actual financial position or results of
operations of the Company would have been at June 30, 1998 or December 31, 1997
assuming the transactions had been completed as set forth above, nor does it
purport to represent the financial position or results of operations of the
Company in future periods.
Regency Realty Corporation
Pro Forma Condensed Consolidated Balance Sheet
June 30, 1998
(Unaudited)
(in thousands)
Historical Adjustments Pro Forma
Assets
Real estate investments, at cost $ 1,050,352 36,243 (a) 1,086,595
Construction in progress 31,133 - 31,133
Less: accumulated depreciation 46,160 - 46,160
-------------- -------------- --------------
Real estate rental property, net 1,035,325 36,243 1,071,568
-------------- -------------- --------------
Investments in real estate partnerships 22,401 - 22,401
-------------- -------------- --------------
Net real estate investments 1,057,726 36,243 1,093,969
-------------- -------------- --------------
Cash and cash equivalents 12,733 - 12,733
Tenant receivables, net of allowance for
uncollectible accounts 10,684 - 10,684
Deferred costs, less accumulated amortization 4,497 - 4,497
Other assets 7,458 1,250 (b) 8,708
-------------- -------------- --------------
Total Assets $ 1,093,098 37,493 1,130,591
============== ============== ==============
Liabilities and Stockholders' Equity
Mortgage loans payable $ 317,796 - 317,796
Acquisition and development line of credit 89,731 (62,507) (a)(b) 27,224
Notes payable - 100,000 (b) 100,000
-------------- -------------- --------------
Total debt 407,527 37,493 445,020
Accounts payable and other liabilities 17,064 - 17,064
Tenant's security and escrow deposits 2,763 - 2,763
-------------- -------------- --------------
Total liabilities 427,354 37,493 464,847
-------------- -------------- --------------
Exchangeable preferred units 78,800 - 78,800
Exchangeable operating partnership units 26,912 - 26,912
Limited partners' interest in consolidated partnerships 7,520 - 7,520
-------------- -------------- --------------
113,232 - 113,232
Common stock and additional paid in capital 567,014 - 567,014
Distributions in excess of net income (14,502) - (14,502)
-------------- -------------- --------------
Total stockholders' equity 552,512 - 552,512
-------------- -------------- --------------
Total liabilities and stockholders' equity $ 1,093,098 37,493 1,130,591
============== ============== ==============
See accompanying notes to pro forma condensed consolidated balance sheet.
Regency Realty Corporation
Notes to Pro Forma Condensed Consolidated Balance Sheet
June 30, 1998
(Unaudited)
(in thousands)
(a) Acquisitions of Shopping Centers:
In January 1998, the Company entered into an agreement to acquire shopping
centers from various entities comprising the Midland Group consisting of
21 shopping centers plus 11 shopping centers under development. The
Company had acquired 20 of the 21 Midland shopping centers prior to June
30, 1998 containing 2.0 million square feet for approximately $167.1
million. Those shopping centers are included in the Company's June 30,
1998 balance sheet. The one remaining shopping center, Windmiller Farms,
was acquired on July 15, 1998 using funds drawn on the Line. The center
was acquired for an aggregate purchase price of $13.3 million which is
reflected in the pro forma balance sheet.
Subsequent to June 30, 1998, the Company expects to acquire an additional
three properties under development for $41.3 million. In addition, during
1998, the Company expects to pay $4.6 million in additional costs related
to joint venture investments and other transaction costs related to
acquiring the various shopping centers from Midland, and during 1999 and
2000 expects to pay contingent consideration of $23.0 million. The
following table represents the properties under development which the
Company expects to acquire from Midland upon completion of construction
during 1998. These properties are not included in these pro forma
condensed consolidated financial statements.
Expected
Acquisition Purchase
Date Price
--------------- ---------------
Garner Festival October-98 $ 20,571
Nashboro October-98 7,260
Crooked Creek October-98 13,471
---------------
$ 41,302
===============
In addition, the Company acquired one other shopping center for an
aggregate purchase price of $22.9 million which is reflected in the pro
forma balance sheet. The shopping center, Pike Creek Shopping Center, was
acquired on August 4, 1998 using funds drawn on the Line.
(b) Represents the proceeds from a $100 million debt offering completed July
15, 1998, less offering costs of 1.25%. At closing, the Company used the
net proceeds from the Offering ($98.8 million) for the repayment of the
balance outstanding on the Line and the remainder was used to offset the
$36.2 million borrowed on the Line for the acquisitions of Pike Creek and
Windmiller Farms. The Company has recorded $1.2 million of financing costs
as an "Other Asset" to be amortized over the term of the Notes.
Regency Realty Corporation
Pro Forma Consolidated Statements of Operations
For the Six Month Period Ended June 30, 1998
and the Year Ended December 31, 1997
(Unaudited)
(In thousands, except share and per share data)
For the Six Month Period Ended June 30, 1998
Midland Acquisition Other
Historical Properties Properties Adjustments Pro Forma
(d) (e)
Revenues:
Minimum rent $ 47,661 3,913 3,074 (697) (i) 53,951
Percentage rent 1,662 - 154 (8) (i) 1,808
Recoveries from tenants 10,639 542 716 (67) (i) 11,830
Management, leasing and brokerage fees 5,406 - - - 5,406
Equity in income of investments
in real estate partnerships 146 - - - 146
-------------- -------------- -------------- ----------- --------------
65,514 4,455 3,944 (772) 73,141
-------------- -------------- -------------- ----------- --------------
Operating expenses:
Depreciation and amortization 11,385 817 (f) 902 (f) (453) (i) 12,651
Operating and maintenance 8,472 283 333 (122) (i) 8,966
General and administrative 7,262 231 205 (25) (i) 7,673
Real estate taxes 5,788 488 484 (81) (i) 6,679
-------------- -------------- -------------- ----------- --------------
32,907 1,819 1,924 (681) 35,969
-------------- -------------- -------------- ----------- --------------
Interest expense (income):
Interest expense 12,873 2,646 (g) 2,168 (h) (3,220) (j) 14,467
Interest income (966) - - - (966)
-------------- -------------- -------------- ----------- --------------
11,907 2,646 2,168 (3,220) 13,501
-------------- -------------- -------------- ----------- --------------
Income before minority interest
and gain on sale of real
estate investments 20,700 (10) (148) 3,129 23,671
Gain on sale of real estate investments 10,746 - - (9,336) (i) 1,410
Minority interest (1,092) - (3) 202 (893)
-------------- -------------- -------------- ----------- --------------
Net income 30,354 (10) (151) (6,005) 24,188
Preferred distributions - - - (3,250) (k) (3,250)
-------------- -------------- -------------- ----------- --------------
Net income for shareholders $ 30,354 (10) (151) (9,255) 20,938
============== ============== ============== =========== ==============
Net income per share (note (l)):
Basic $ 1.11 $ 0.73
============== ==============
Diluted $ 1.06 $ 0.72
============== ==============
See accompanying notes to pro forma consolidated statements of operations.
Regency Realty Corporation
Pro Forma Consolidated Statements of Operations
For the Six Month Period Ended June 30, 1998
and the Year Ended December 31, 1997
(Unaudited)
(In thousands, except share and per share data)
For the Year Ended December 31, 1997
Branch Midland Acquisition Other
Historical Properties Properties Properties Adjustments Pro Forma
(c) (d) (e)
Revenues:
Minimum rent $ 70,103 3,596 16,482 17,130 (4,136) (i) 103,175
Percentage rent 2,151 167 - 495 - 2,813
Recoveries from tenants 17,052 751 2,240 3,899 (548) (i) 23,394
Management, leasing and brokerage fees 7,997 1,060 - - - 9,057
Equity in income of investments
in real estate partnerships 33 - - - - 33
------------- --------- ----------- ---------- ------------ -----------
97,336 5,574 18,722 21,524 (4,684) 138,472
------------- --------- ----------- ---------- ------------ -----------
Operating expenses:
Depreciation & amortization 16,303 972 2,994 (f) 4,340 (f) (855) (i) 23,754
Operating and maintenance 14,212 595 1,194 2,306 (1,260) (i) 17,047
General and administrative 9,964 683 1,042 1,083 (49) (i) 12,723
Real estate taxes 8,692 404 1,635 2,450 (447) (i) 12,734
------------- --------- ----------- ---------- ------------ -----------
49,171 2,654 6,865 10,179 (2,611) 66,258
------------- --------- ----------- ---------- ------------ -----------
Interest expense (income):
Interest expense 19,667 1,517 10,353 (g) 11,778 (h) (6,439) (j) 36,876
Interest income (1,000) (33) - - - (1,033)
------------- --------- ----------- ---------- ------------ -----------
18,667 1,484 10,353 11,778 (6,439) 35,843
------------- --------- ----------- ---------- ------------ -----------
Income before minority interest
and gain on sale of real
estate investments 29,498 1,436 1,504 (433) 4,366 36,371
Gain on sale of real estate investments 451 - - - (451) (i) -
Minority interest (2,547) 1,010 (38) (2) (142) (1,719)
------------- --------- ----------- ---------- ------------ -----------
Net income 27,402 2,446 1,466 (435) 3,773 34,652
Preferred distributions - - - - (6,500) (k) (6,500)
------------- --------- ----------- ---------- ------------ -----------
Net income for shareholders $ 27,402 2,446 1,466 (435) (2,727) 28,152
============= ========= =========== ========== ============ ===========
Net income per share (note (l)):
Basic $ 1.28 $ 1.32
============= ===========
Diluted $ 1.23 $ 1.23
============= ===========
See accompanying notes to pro forma consolidated statements of operations.
Regency Realty Corporation
Notes to Pro Forma Consolidated Statements of Operations
For the Six Month Period
Ended June 30, 1998 and
the Year ended December 31, 1997
(Unaudited)
(In thousands, except unit and per unit data)
(c) Reflects pro forma results of operations for the Branch Properties for
the period from January 1, 1997 to March 7, 1997 (acquisition
date).
(d) Reflects revenues and certain expenses for the Midland Properties for the
period from January 1, 1998 to the earlier of the respective acquisition
date of the property or June 30, 1998, and for the year ended December 31,
1997.
For the period ended June 30, 1998
Property Acquisition Minimum Recoveries Operating and Real General and
Name Date Rent from Tenants Maintenance Estate Taxes Administrative
------------ ------------- -------------- -------------- -------------- --------------
Windmiller Farms 7/15/98 $ 574 $ 90 $ 34 $ 71 $ 32
Franklin Square 4/29/98 414 56 52 31 32
St. Ann Square 4/17/98 217 44 18 35 12
East Point Crossing 4/29/98 268 52 16 35 17
North Gate Plaza 4/29/98 234 33 18 27 10
Worthington Park 4/29/98 281 68 22 40 19
Beckett Commons 3/1/98 113 7 6 14 4
Cherry Grove Plaza 3/1/98 239 11 13 22 21
Bent Tree Plaza 3/1/98 137 11 7 59 8
West Chester Plaza 3/1/98 130 12 13 42 7
Brookville Plaza 3/1/98 95 5 5 8 4
Lake Shores Plaza 3/1/98 123 10 5 16 6
Evans Crossing 3/1/98 116 4 5 8 6
Statler Square 3/1/98 164 15 13 1 8
Kernersville Plaza 3/1/98 120 4 8 8 8
Maynard Crossing 3/1/98 272 38 13 15 15
Shoppes at Mason 3/1/98 116 27 15 33 6
Lake Pine Plaza 3/1/98 152 13 10 8 9
Hamilton Meadows 3/1/98 148 42 10 15 7
------------- -------------- -------------- --------------- -----------
$ 3,913 $ 542 $ 283 $ 488 $ 231
============= ============== ============== ================ ===========
For the year ended December 31, 1997
Property Acquisition Minimum Recoveries Operating and Real General and
Name Date Rent from Tenants Maintenance Estate Taxes Administrative
------------ ---------- ------------ -------------- ---------------- -------------
Windmiller Farms 7/15/98 $ 1,157 $ 181 $ 69 $ 143 $ 64
Franklin Square 4/29/98 1,270 171 158 94 98
St. Ann Square 4/17/98 741 149 60 119 42
East Point Crossing 4/29/98 821 159 50 107 51
North Gate Plaza 4/29/98 718 100 56 84 32
Worthington Park 4/29/98 862 208 67 124 59
Beckett Commons 3/1/98 687 140 38 83 47
Cherry Grove Plaza 3/1/98 1,445 175 85 131 105
Bent Tree Plaza 3/1/98 786 130 64 59 48
West Chester Plaza 3/1/98 807 70 72 84 45
Brookville Plaza 3/1/98 571 42 34 50 30
Lake Shores Plaza 3/1/98 759 156 55 96 32
Evans Crossing 3/1/98 613 84 34 50 33
Statler Square 3/1/98 913 76 43 54 60
Kernersville Plaza 3/1/98 605 58 29 51 33
Maynard Crossing 3/1/98 1,367 133 78 95 104
Shoppes at Mason 3/1/98 644 56 61 65 38
Lake Pine Plaza 3/1/98 827 93 54 51 46
Hamilton Meadows 3/1/98 889 59 87 95 75
---------- ------------ -------------- ---------------- -------------
$ 16,482 $ 2,240 $ 1,194 $ 1,635 $ 1,042
========== ============ ============== ================ =============
Regency Realty Corporation
Notes to Pro Forma Consolidated Statements of Operations
For the Six Month Period
Ended June 30, 1998 and
the Year ended December 31, 1997
(Unaudited)
(In thousands, except unit and per unit data)
(e) Reflects revenues and certain expenses for the Acquisition Properties for
the period from January 1, 1998 to the earlier of the respective
acquisition date of the property or June 30, 1998, and for the year ended
December 31, 1997.
For the period ended June 30, 1998
Property Acquisition Minimum Percentage Recoveries Operating and Real General and
Name Date Rent Rent from Tenants Maintenance Estate Taxes Administrative
------------ ------------ ----------- -------------- ------------ ------------ ---------
Delk Spectrum 1/14/98 $ 48 $ - $ 5 $ 2 $ 3 $ 2
Bloomingdale Square 2/11/98 214 6 53 25 24 21
Silverlake 6/3/98 346 - 60 36 36 18
Highland Square 6/17/98 516 51 86 46 79 60
Shoppes @104 6/19/98 620 - 133 72 79 28
Fleming Island 6/30/98 348 - 289 39 194 36
Pike Creek 8/4/98 982 97 90 113 69 40
------------ ----------- -------------- ------------ ------------ ---------
$ 3,074 $ 154 $ 716 $ 333 $ 484 $ 205
============ ============ ============== ============ ============ =========
For the year ended December 31, 1997
Property Acquisition Minimum Percentage Recoveries Operating and Real General and
Name Date Rent Rent from Tenants Maintenance Estate Taxes Administrative
------------ ------------ ----------- ------------ ------------ ------------- -------------
Oakley Plaza 3/14/97 $ 142 - $ 14 $ 13 $ 13 $ 8
Mariner's Village 3/25/97 185 6 37 45 33 7
Carmel Commons 3/28/97 297 11 63 38 35 22
Mainstreet Square 4/15/97 193 - 34 42 30 15
East Port Plaza 4/25/97 543 - 107 96 65 33
Hyde Park Plaza 6/6/97 1,702 118 339 144 265 84
Rivermont Station 6/30/97 642 - 124 65 56 34
Lovejoy Station 6/30/97 306 - 63 36 29 9
Tamiami Trails 7/10/97 508 - 163 124 66 30
Garden Square 9/19/97 671 - 232 144 99 50
Kingsdale 10/10/97 1,334 - 300 325 221 75
Boynton Lakes Plaza 12/1/97 1,159 - 391 267 250 80
Pinetree Plaza 12/23/97 279 - 51 50 37 21
Delk Spectrum 1/14/98 1,355 10 145 57 88 46
Bloomingdale Square 2/11/98 1,863 43 459 215 209 184
Silverlake 6/3/98 819 - 142 85 85 43
Highland Square 6/17/98 1,122 111 187 99 171 130
Shoppes @104 6/19/98 1,332 - 285 154 170 60
Fleming Island 6/30/98 698 - 581 79 388 72
Pike Creek 8/4/98 1,980 196 182 228 140 80
------------ ----------- ------------ --------- ------------- ---------------
$ 17,130 $ 495 $ 3,899 $ 2,306 $ 2,450 $ 1,083
============ =========== ============ ========= ============= ===============
Regency Realty Corporation
Notes to Pro Forma Consolidated Statements of Operations
For the Six Month Period
Ended June 30, 1998 and
the Year ended December 31, 1997
(Unaudited)
(In thousands, except unit and per unit data)
(f) Depreciation expense is based on the estimated useful life of the
properties acquired. For properties under construction, depreciation
expense is calculated from the date the property is placed in service
through the end of the period. In addition, the six month period ended
June 30, 1998 and year ended December 31, 1997 calculations reflect
depreciation expense on the properties from January 1, 1997 to the earlier
of the respective acquisition date of the property or June 30, 1998.
For the period ended June 30, 1998
Property Building and Year Building Depreciation
Name Improvements Built/Renovated Useful Life Adjustment
-------------- ----------------- ----------- -------------
Delk Spectrum $ 10,417 1991 34 $ 11
Bloomingdale Square 13,189 1987 30 51
Silverlake Shopping Center 7,584 1988 31 103
Highland Square 9,049 1960 20 208
Shoppes @104 6,439 1990 33 91
Fleming Island 4,773 1994 37 64
Pike Creek 18,082 1981 24 374
----------------
Acquisition Properties pro
forma depreciation adjustment $ 902
================
Midland Properties $ 131,065 Ranging from Ranging from
1986 to 1996 29 to 40 $ 817
================
For the year ended December 31, 1997
Property Building and Year Building Depreciation
Name Improvements Built/Renovated Useful Life Adjustment
-------------- ------------------ --------------- ----------------
Oakley Plaza $ 6,428 1988 31 $ 41
Mariner's Village 5,979 1986 29 47
Carmel Commons 9,335 1979 22 101
Mainstreet Square 4,581 1988 31 43
Hyde Park Plaza 33,734 1995 38 382
East Port Plaza 8,179 1991 34 76
Rivermont Station 9,548 1996 39 121
Lovejoy Station 5,560 1995 38 73
Tamiami Trails 7,598 1987 30 133
Garden Square 7,151 1991 34 151
Kingsdale 10,023 1997 27 288
Boynton Lakes Plaza 9,618 1993 36 244
Pinetree Plaza 3,057 1982 25 120
Delk Spectrum 10,417 1991 34 306
Bloomingdale Square 13,189 1987 30 440
Silverlake Shopping Center 7,584 1988 31 245
Highlands Square 9,049 1960 20 452
Shoppes @104 6,439 1990 33 195
Fleming Island 4,773 1994 37 129
Pike Creek 18,082 1981 24 753
Acquisition Properties pro ----------------
forma depreciation adjustment $ 4,340
================
Midland Properties 131,065 Ranging from Ranging from
1986 to 1996 29 to 40 $ 2,994
================
Regency Realty Corporation
Notes to Pro Forma Consolidated Statements of Operations
For the Six Month Period
Ended June 30, 1998 and
the Year ended December 31, 1997
(Unaudited)
(In thousands, except unit and per unit data)
(g) To reflect interest expense on the Line required to complete the
acquisition of the Midland Properties at the average interest rate
afforded the Company (6.525%) and the assumption of $97.0 million of debt.
For properties under construction, interest expense is calculated from the
date the property is placed in service through the end of the period.
Pro forma interest adjustment for
the six month period ended June 30, 1998 $ 2,646
===============
Pro forma interest adjustment for
the year ended December 31, 1997 $ 10,353
===============
(h) To reflect interest expense on the Line required to complete the
acquisition of the Acquisition Properties at the average interest rate
afforded the Company (6.525%). The six month period ended June 30, 1998
and year ended December 31, 1997 calculation reflects interest expense on
the properties from January 1, 1997 to the respective acquisition date of
the property.
Pro forma interest adjustment for
the six-month period ended June 30, 1998 $ 2,168
================
Pro forma interest adjustment for
the year ended December 31, 1997 $ 11,778
================
(i) In December, 1997, the Company sold one office building for $2.6 million
and recognized a gain on the sale of $451,000. During the first quarter of
1998, the Company sold three office buildings and a parcel of land for
$26.7 million, and recognized a gain on the sale of $9.3 million. The
adjustments to the pro forma statements of operations reflect the reversal
of the revenues and expenses from the office buildings generated during
1997 and 1998, including the gains on the sale of the office buildings as
if the sales had been completed on January 1, 1997. The Company believes
that excluding the results of operations and gains related to the office
buildings sold is necessary for an understanding of the continuing
operations of the Company.
(j) To reflect (i) interest expense and loan cost amortization on the $100
million debt offering offset by (ii) the reduction of interest expense on
the Line and mortgage loans from the proceeds of the debt offering, the
issuance of the preferred units and the proceeds from the sale of the
office buildings referred to in note (i).
Pro forma interest adjustment for
the six-month period ended June 30, 1998 $ (3,220)
==================
Pro forma interest adjustment for
the year ended December 31, 1997 $ (6,439)
==================
(k) To reflect the distribution on the offering of preferred units at an
assumed annual rate of 8.125% for the six-month period ended June
30, 1998 and year ended December 31, 1997.
Regency Realty Corporation
Notes to Pro Forma Consolidated Statements of Operations
For the Six Month Period
Ended June 30, 1998 and
the Year ended December 31, 1997
(Unaudited)
(In thousands, except unit and per unit data)
(l) The following summarizes the calculation of basic and diluted earnings
per unit for the six-month period ended June 30, 1998 and the
year ended December 31, 1997:
For the Six For the year
Months Ended Ended
June 30, 1998 December 31, 1997
---------------- -------------------
Basic Earnings Per Share (EPS) Calculation:
Weighted average common shares outstanding 24,837 17,424
================ ===================
Net income for common stockholders $ 20,938 $ 28,152
Less: dividends paid on Class B common stock 2,689 5,140
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Net income for Basic EPS $ 18,249 23,012
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Basic EPS $ 0.73 1.32
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Net income for Basic EPS $ 18,249 23,012
Add: minority interest of exchangeable partnership units 693 1,214
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Net income for Diluted EPS $ 18,942 24,226
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Diluted Earnings Per Share (EPS) Calculation:
Weighted average common shares outstanding for Basic EPS 24,837 17,424
Exchangeable operating partnership units 1,135 1,243
Incremental units to be issued under common
stock options using the Treasury method 27 80
Contingent units or shares for the acquisition
of real estate 428 955
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Total Diluted Shares 26,427 19,702
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Diluted EPS $ 0.72 $ 1.23
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