SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
FOR QUARTER ENDED March 31, 1997 COMMISSION FILE NO. 1-6622
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WASHINGTON REAL ESTATE INVESTMENT TRUST
- -----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MARYLAND 53-0261100
- -------------------------------- -----------------------------------
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
10400 CONNECTICUT AVENUE, KENSINGTON, MARYLAND 20895
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(Address of principal executive office) (Zip code)
Registrant's telephone number, including area code (301) 929-5900
---------------
- -----------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of the close of the period covered by this report.
SHARES OF BENEFICIAL INTEREST 31,827,844
- -----------------------------------------------------------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding twelve (12) months (or such shorter period that the
Registrant was required to file such report) and (2) has been subject to such
filing requirements for the past ninety (90) days.
YES X NO
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1
WASHINGTON REAL ESTATE INVESTMENT TRUST
INDEX
Page
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Part I: Financial Information
Item l. Financial Statements
Balance Sheets 3
Statements of Income 4
Statements of Cash Flows 5
Statement of Changes in Shareholders' Equity 6
Notes to Financial Statements 7
Item 2. Management's Discussion and Analysis 11
Part II: Other Information
Item l. Legal Proceedings 14
Item 2. Changes in Securities 14
Item 3. Defaults upon Senior Securities 14
Item 4. Submission of Matters to a Vote of Security Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
Signatures 15
Part I
FINANCIAL INFORMATION
The information furnished in the accompanying Balance Sheets, Statements of
Income, Statements of Cash Flows and Statement of Changes in Shareholders'
Equity reflect all adjustments, consisting of normal recurring items, which
are, in the opinion of management, necessary for a fair presentation of the
financial position, results of operations and of cash flows for the interim
periods. The accompanying financial statements and notes thereto should be
read in conjunction with the financial statements and notes for the three
years ended December 31, 1996 included in the Trust's 1996 Form 10-K Report
filed with the Securities and Exchange Commission.
2
Part I
Item I. Financial Statements
WASHINGTON REAL ESTATE INVESTMENT TRUST
CONSOLIDATED BALANCE SHEETS
(In Thousands)
(UNAUDITED)
MARCH 31, DECEMBER 31,
1997 1996
----------- ------------
Assets
Real estate at cost............................................... $370,260 $352,579
Accumulated depreciation.......................................... (48,935) (46,639)
--------- --------
321,325 305,940
Mortgage note receivable.......................................... 799 799
-------- --------
Total investment in real estate.............................. 322,124 306,739
Cash and temporary investments.................................... 1,042 1,676
Rents and other receivables, net of allowance for doubtful
accounts of $709 and $534, respectively......................... 3,827 3,429
Prepaid expenses and other assets................................. 6,530 6,644
-------- --------
$333,523 $318,488
-------- --------
-------- --------
Liabilities
Accounts payable and other liabilities............................ $ 4,774 $ 5,954
Tenant security deposits.......................................... 2,636 2,523
Advance rents..................................................... 1,806 1,798
Mortgage note payable............................................. 7,559 7,590
Lines of credit payable........................................... 22,000 5,000
Senior notes payable.............................................. 100,000 100,000
-------- --------
138,775 122,865
-------- --------
Shareholders' Equity
Shares of beneficial interest; $.01 par value; 100,000 shares
authorized: 31,828 shares issued and outstanding................ 318 318
Additional paid-in capital........................................ 194,430 195,305
-------- --------
194,478 195,623
-------- --------
$333,523 $318,488
-------- --------
-------- --------
See accompanying notes to financial statements
3
WASHINGTON REAL ESTATE INVESTMENT TRUST
CONSOLIDATED STATEMENTS OF INCOME
(In Thousands, except per share amounts)
(UNAUDITED)
THREE MONTHS ENDED
MARCH 31,
---------------------
1997 1996
--------- ---------
Real estate rental revenue.............................................. $18,498 $14,681
Real estate expenses.................................................... (6,081) (4,913)
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12,417 9,768
Depreciation............................................................ (2,295) (1,528)
-------- -------
Income from real estate................................................. 10,122 8,240
Other income............................................................ 70 121
Interest expense........................................................ (2,207) (654)
General and administrative.............................................. (957) (755)
------- -------
Net Income.............................................................. $ 7,028 $ 6,952
------- -------
------- -------
Per share information based on the weighted average
number of shares outstanding
Shares................................................................. 31,822 31,752
Net income.............................................................. $ 0.22 $ 0.22
------- -------
------- -------
Dividends paid.......................................................... $ 0.26 $ 0.25
------- -------
------- -------
See accompanying notes to financial statements
4
WASHINGTON REAL ESTATE INVESTMENT TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(UNAUDITED)
THREE MONTHS ENDED
MARCH 31,
----------------------
1997 1996
--------- ---------
Cash Flow From Operating Activities
Net income............................................................. $ 7,028 $ 6,952
Adjustments to reconcile net income to net cash provided by operating
activities
Depreciation........................................................... 2,295 1,528
Changes in other assets................................................ (284) (409)
Changes in other liabilities........................................... (1,059) 150
-------- --------
Net cash provided by operating activities........................... 7,980 8,221
--------- --------
Cash Flow From Investing Activities
Capital improvements to real estate.................................... (3,948) (1,405)
Real estate acquisitions, net.......................................... (13,732) (10,783)
-------- --------
Net cash used in investing activities............................... (17,680) (12,188)
--------- --------
Cash Flow From Financing Activities
Dividends paid......................................................... (8,275) (7,938)
Borrowings--Line of credit............................................. 17,000 11,000
Principal payments--Mortgage note payable.............................. (31) (28)
Share options exercised................................................ 372 --
-------- --------
Net cash provided by financing activities........................... 9,066 3,034
-------- --------
Net decrease in cash and temporary investments........................... (634) (933)
Cash and temporary investments at beginning of year...................... 1,676 3,532
-------- --------
Cash and temporary investments at end of period.......................... $ 1,042 $ 2,599
-------- --------
-------- --------
Supplemental disclosure of cash flow information:
Cash paid during the first three months for interest..................... 3,876 $ 615
-------- --------
-------- --------
See accompanying notes to financial statements
5
WASHINGTON REAL ESTATE INVESTMENT TRUST
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 1997
(Unaudited)
(In Thousands)
ADDITIONAL SHAREHOLDERS'
SHARES PAR VALUE PAID IN CAPITAL EQUITY
---------- ----------- --------------- -------------
Balance, December 31, 1996................................. 31,803 $318 $195,305 $195,623
Net income................................................. 7,028 7,028
Dividends.................................................. (8,275) (8,275)
Share options exercised.................................... 25 0 372 372
------ ---- -------- -------
Balance, March 31, 1997.................................... 31,828 $318 $194,430 $194,748
------ ---- -------- --------
------ ---- -------- --------
See accompanying notes to financial statements
6
WASHINGTON REAL ESTATE INVESTMENT TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1997 (Unaudited)
NOTE A: NATURE OF BUSINESS
Washington Real Estate Investment Trust ("WRIT" or the "Trust") is a
self-administered qualified equity real estate investment trust successor to
a trust organized in 1960. The Trust's business consists of the ownership of
income-producing real estate properties in the Mid-Atlantic Region.
WRIT operates in a manner intended to enable it to qualify as a real estate
investment trust under the Internal Revenue Code (the "Code"). In accordance
with the Code, a trust which distributes its capital gains and at least 95%
of its taxable income to its shareholders each year, and which meets certain
other conditions, will not be taxed on that portion of its taxable income
which is distributed to its shareholders. Accordingly, no provision for
Federal income taxes is required.
In June 1996, WRIT changed its domicile from the District of Columbia to the
State of Maryland. Issued and outstanding shares were assigned a par value
of $.01 per share.
NOTE B: ACCOUNTING POLICIES
Basis of Presentation
The following unaudited financial statements have been prepared pursuant to
the rules and regulations of the Securities and Exchange Commission. Certain
information and note disclosures normally included in annual financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to those rules and
regulations, although the company believes that the disclosures made are
adequate to make the information presented not misleading.
Accounting Pronouncements
In February 1997, FASB issued SFAS No. 128 "Earnings per Share" ("FAS 128").
FAS 128 changes the requirements for calculation and disclosure of earnings
per share. This statement eliminates the calculation of primary earnings per
share and requires the disclosure of basic earnings per share and diluted
earnings per share. WRIT will adopt this statement's required disclosures in
connection with the financial statements issued for the reporting period
ended December 31, 1997. The adoption of this statement will have an
immaterial impact to WRIT's current disclosures.
During 1997, FASB issued SFAS No. 129 "Disclosure of Information about
Capital Structure" ("FAS 129"). FAS 129 continues the existing requirements
to disclose the pertinent rights and privileges of all securities other than
ordinary common stock but expands the number of companies subject to portions
of its requirements. The adoption of this statement will have no impact to
WRIT's current disclosures.
In 1995 WRIT formed a subsidiary partnership, WRIT Limited Partnership, a
Maryland limited partnership, in which WRIT currently owns 99.9% of the
partnership interest. WRIT Limited Partnership's financial statements are
being consolidated with WRIT's financial statements. All significant
intercompany balances and transactions have been eliminated. Minority
Interests are included in other income (expense) and accounts payable and
other liabilities on the accompanying consolidated statements.
7
WASHINGTON REAL ESTATE INVESTMENT TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1997 (Unaudited)
Revenue Recognition
Residential properties are leased under operating leases with terms of
generally one year or less, and commercial properties are leased under
operating leases with average terms of three years. WRIT recognizes rental
income from its residential and commercial leases when earned and accounts
for all rental abatements on a straight-line basis.
Deferred Financing Costs
Costs associated with the issuance of senior subordinated notes are
capitalized and being amortized using the effective interest rate method over
the term of the related notes.
Real Estate and Depreciation
Buildings are depreciated on a straight-line basis over estimated useful
lives not exceeding 50 years. Effective January 1, 1995, WRIT revised its
estimate of useful lives for major capital improvements to real estate. All
capital improvement expenditures associated with replacements, improvements,
or major repairs to real property are depreciated using the straight-line
method over their estimated useful lives ranging from 3 to 30 years. All
tenant improvements are amortized using the straight-line method over 5 years
or the term of the lease if it differs significantly from 5 years. Capital
improvements placed in service prior to January 1, 1995 will continue to be
depreciated on a straight-line basis over their previously estimated useful
lives not exceeding 30 years. Maintenance and repair costs are charged to
expense as incurred.
WRIT recognizes impairment losses on long-lived assets used in operations
when indicators of impairment are present and the net undiscounted cash flows
estimated to be generated by those assets are less than the assets' carrying
amount. As of March 31, 1997, no such losses have been recorded.
Cash and Temporary Investments
Cash and temporary investments includes cash equivalents with original
maturities of 90 days or less.
Use of Estimates in the Financial Statements
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make certain estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
8
WASHINGTON REAL ESTATE INVESTMENT TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1997 (Unaudited)
NOTE C: REAL ESTATE INVESTMENTS
WRIT's real estate investment portfolio, at cost, consists of properties
located in Maryland, Washington, D.C., Virginia and Delaware as follows:
March 31, 1997
(In Thousands)
--------------
Office buildings $164,927
Shopping centers 85,657
Apartment buildings 61,108
Industrial distribution centers 58,568
--------
$370,260
--------
--------
Properties acquired by WRIT during the first quarter of 1997 are as follows:
Acquisition Rentable Acquisition Cost
Date Property Type Square Feet (In Thousands)
- ----------- --------------------------- --------- ----------- ----------------
2/28/97 Ammendale Technology Park I Industrial 167,000 $ 7,847
2/28/97 Ammendale Technology Park II Industrial 108,000 5,885
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275,000 $13,732
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NOTE D: UNSECURED LINES OF CREDIT PAYABLE
As of March 31, 1997, WRIT had an unsecured credit commitment of $25 million,
$4 million of which was outstanding with an interest rate of 6.83%. Interest
only is payable monthly, in arrears, on the unpaid principal balance. All
new advances and interest rate adjustments upon the expiration of WRIT's
interest lock-in dates will bear interest at LIBOR plus a spread based on
WRIT's credit rating on its publicly issued debt. All unpaid interest and
principal can be prepaid prior to the expiration of WRIT's interest rate
lock-in periods subject to a yield maintenance obligation and all unpaid
principal and interest are due January 31, 1999.
The $25.0 million credit commitment requires WRIT to pay the lender an
unused commitment fee at the rate of .175% per annum on the amount by which
$25.0 million exceeds the balance of outstanding advances and term loans. At
March 31, 1997, $21 million of this commitment was unused. This fee is
payable monthly. This commitment also contains certain financial covenants
related to debt, net worth, and cash flow, and non-financial covenants which
WRIT has met as of March 31, 1997.
On July 27, 1995 WRIT renegotiated its other $25.0 million unsecured credit
commitment and replaced it with an unsecured credit commitment of $50.0
million from the same bank and a participating bank for the express purpose
of purchasing income-producing property and to make capital improvements to
real property.
As of March 31, 1997, $21 million was outstanding on the $50.0 million credit
commitment with rates ranging from 6.04% to 6.29%. Interest only is payable
monthly, in arrears, on the unpaid principal balance. All unpaid interest
and principal are due July 25, 1997, and can be prepaid prior to this date
without any prepayment fee or yield maintenance obligation. Any new advances
shall bear interest at LIBOR plus a spread based on WRIT's interest coverage
ratio.
9
WASHINGTON REAL ESTATE INVESTMENT TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1997 (Unaudited)
This credit agreement provides WRIT the option to convert any advances or
portions thereof into a term loan at any time after January 27, 1996 and
prior to July 25, 1997. The principal amount of each term loan, if any,
shall be repaid on July 27, 1999. Such term loan(s) may be prepaid subject
to a prepayment fee.
The $50.0 million credit commitment requires WRIT to pay the lender an unused
commitment fee at the rate of 0.15% per annum on the amount by which $50.0
million exceeds the balance of outstanding advances and term loans. At March
31, 1997, $32.0 million of this commitment was unused. This fee is payable
quarterly in arrears. This commitment also contains an interest coverage
ratio covenant and certain other non-financial covenants which WRIT has met
as of March 31, 1997.
NOTE E: SENIOR NOTES PAYABLE
On August 8, 1996 WRIT entered into an underwriting agreement to sell $50
million of 7.125% 7-year unsecured notes due August 13, 2003, and $50 million
of 7.25% unsecured 10-year notes due August 13, 2006. This transaction
closed on August 13, 1996. The 7-year notes were sold at 99.107% of par and
the 10-year notes were sold at 98.166% of par. Net proceeds to the Trust
after deducting underwriting expenses were $97.6 million. The 7-year notes
bear an effective interest rate of 7.46% and the 10 year notes bear an
effective interest rate of 7.49% for a combined effective interest rate of
7.47%. WRIT used the proceeds of these notes to pay down its lines of credit
and to finance acquisitions and capital improvements to its properties. These
notes also contain certain financial and non-financial covenants which WRIT
has met as of March 31, 1997.
10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATION - Three Months Ended March 31, 1997 Compared to the
Three Months Ended March 31, 1996
WRIT Management's Discussion and Analysis of Financial Condition and Results
of Operations contains statements that may be considered forward looking.
These statements contain a number of risks and uncertainties as discussed
herein and in the company's reports filed with the Securities and Exchange
Commission that could cause actual results to differ materially.
REAL ESTATE RENTAL REVENUE:
Total revenues for the three months ended March 31, 1997 increased 26% ($3.8
million) to $18.5 million from $14.7 million in the first three months of
1996.
For the first three months of 1997, WRIT's office building had increases of
33.6% in revenues and operating income, over the first three months of 1996.
These increases were due primarily to the acquisitions of the Maryland Trade
Center I and II office buildings in May 1996, the expansion of 7700 Leesburg
Pike in December 1996 and increases in occupancy at the 1901 Pennsylvania
Avenue and 1220 19th Street office buildings. Comparing those office
buildings owned by WRIT for the entire first three months of 1996 to their
results in the first three months of 1997, revenues and operating income
increased 6.5% and 4.8% respectively, over the first three months of 1996.
These increases were due primarily to the expansion of 7700 Leesburg Pike in
December 1996 and increases in occupancy at the 1901 Pennsylvania Avenue and
1220 19th Street office buildings
For the first three months of 1997, WRIT's shopping center revenues remained
unchanged and operating income increased 6.7% over the first three months of
1996. Revenues remained unchanged due to rate and occupancy gains for the
group offset by reduced CAM recoveries for the group which resulted from
decreased utility and snow removal expenses. Operating income increased due
to decreased utility and snow removal expenses which were higher in the first
quarter of 1996 due to the unusually severe weather. There were no property
additions in WRIT's shopping center portfolio in the first three months of
1997 compared to the first three months of 1996.
For the first three months of 1997, WRIT's apartment revenues and operating
income increased 46% and 47.6% respectively, over the first three months of
1996. These increases were due primarily to the acquisition of Walker House
Apartments in March 1996 and the Ashby in August of 1996. Comparing those
apartment buildings owned by WRIT for the entire first three months of 1996
to their results in the first three months of 1997, revenue and operating
income increased 2.9% and 7.2% respectively, over the first three months of
1996. The increases in revenues and operating income were due primarily to
increased rental rates for the group and decreased utility and snow removal
expenses which were higher in the first quarter of 1996 due to the unusually
severe weather, offset partially by increased vacancy at Country Club Towers.
For the first three months of 1997, WRIT's industrial distribution center
revenues and operating income increased 25.5% and 24.9% respectively, over
the first three months of 1996 This was due primarily to the acquisition in
October 1996 of the Alban business center and the acquisition in December
1996 of the Earhart Building, partially offset by increased bad debt and
leasing commissions. Comparing those industrial distribution centers
owned by WRIT for the entire first three months of 1996 to their same results
in the first three months of 1997, revenue and operating income decreased
5.8% and 6.3% respectively, from the first three months of 1996. These
decreases are primarily due to increased bad debt and leasing commissions.
OPERATING EXPENSES AND OTHER RESULTS OF OPERATIONS
Depreciation expense increased $767,000 to $2.3 million as compared to $1.5
million for the first three months of 1996. This was primarily due to 1996
acquisitions of $69.9 million and 1996 capital and tenant
improvement expenditures which totaled $12 million.
11
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
OPERATING EXPENSES AND OTHER RESULTS OF OPERATIONS (continued)
Other income decreased as compared to the first three months of 1996 due to
decreased investment earnings. This decrease resulted from a lower average
balance of cash and temporary investments in the first quarter of 1997 as
compared to the first quarter of 1996.
Total interest expense was $2.2 million for the first three months of 1997 as
compared to $654,000 for the first three months of 1996. This increase is
primarily attributed to the issuance of $100 million in debt securities in
August 1996. For the first three months of 1997, senior notes payable
interest expense was $1.8 million, lines of credit interest expense was
$167,000 attributable to advances for 1996 and 1997 acquisitions and mortgage
interest expense was $171,000. For the first three months of 1996, lines of
credit interest expense was $481,000 attributable to advances for 1995 and
1996 acquisitions and mortgage interest expense was $173,000.
General and administrative expenses increased $125,000 to $880,000 as
compared to $755,000 for the first three months of 1996. The increase for
the first three months of 1997 as compared to the first three months of 1996
is primarily attributable to personnel additions in 1996 and incentive
compensation charged to operations in the first quarter of 1997 but not
charged to operations in the first quarter of 1996. General and
administrative expenses as a percentage of revenue decreased to 4.75% in the
first three months of 1997 from 5.14% in the first three months of 1996.
CAPITAL RESOURCES AND LIQUIDITY
WRIT has utilized the proceeds of share offerings, medium and long-term fixed
interest rate debt, bank lines of credit and cash flow from operations for
its capital needs. External sources of capital will continue to be available
to WRIT from its existing unsecured credit commitments and management
believes that additional sources of capital are available from selling
additional shares and/or the sale of medium or long-term notes. The funds
raised would be used to pay off any outstanding advances on our lines of
credit and for new acquisitions and capital improvements.
On March 12, 1997, WRIT filed a shelf registration statement with the
Securities and Exchange Commission which registers up to $200 million of
securities for sale at WRIT's option. The securities to be sold may be any
combination of common shares, debt, preferred stock or common share warrants.
Any issuance of preferred shares would require the prior approval of the
Board of Trustees and a majority of the shareholders. The shelf registration
statement effectively pre-files a registration statement for securities
thereby shortening the time required to get to market when a decision to
raise capital is made. The registration statement is effective for an
unlimited period as long as WRIT continues to meet certain Securities and
Exchange Commission reporting requirements.
WRIT has line of credit commitments in place from commercial banks for up to
$75.0 million which bear interest at an adjustable spread over LIBOR based on
the Trust's interest coverage ratio and public debt rating. As of March
31,1997, WRIT had outstanding under its lines of credit $22 million in
advances with an average interest rate of 6.16%, and $53 million available
for future advances. These advances were used for the acquisition of the
Ammendale Technology Park I and II and capital improvements and major
renovations to WRIT's various properties. The $22 million in advances have
maturities ranging from May 25, 1997 until September 25, 1997. WRIT intends
to renew these advances at the then current market rate.
12
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
CAPITAL RESOURCES AND LIQUIDITY(continued)
Cash flow from operating activities totaled $8.0 million for the first three
months of 1997, as a result of net income of $7.0 million, depreciation of
$2.3 million, decreases in other assets of $284,000 and decreases in
liabilities (other than mortgage note, senior notes and lines of credit
payable) of $1.1 million. The majority of the decrease in cash flow from
operating activities was due to the decrease in accounts payable resulting
from the semi-annual interest payment on the senior notes, offset partially
by increased depreciation resulting from a larger portfolio.
Net cash used in investing activities for the first three months of 1997 was
$17.6 million including property acquisitions of $13.7 million and capital
improvements to real estate of $3.9 million
Net cash provided by financing activities for the first three months of 1997
was $9.1 million, including line of credit borrowings of $17 million and
proceeds from share options exercised of $372,000, offset by principal
repayments of $31,000 on the mortgage note payable and $8.3 million in
dividends paid. Rental revenue has been the principal source of funds to pay
WRIT's operating expenses, interest expense and dividends to shareholders.
Management believes that it has the liquidity and the capital resources
necessary to meet all of its known obligations and to make additional
property acquisitions and capital improvements when appropriate to enhance
long-term growth.
Historically WRIT has acquired 100% ownership in property. However, in 1995
WRIT formed a subsidiary partnership, WRIT Limited Partnership, in which WRIT
currently owns 99.9% of the partnership interest. As of March 31, 1997, WRIT
Limited Partnership has acquired 10 properties for cash contributed or loaned
to the partnership by WRIT. WRIT intends to use WRIT Limited Partnership to
offer property owners an opportunity to contribute properties in exchange for
WRIT Limited Partnership units. Such a transaction will enable property
owners to diversify their holdings and to obtain a tax deferred contribution
for WRIT Limited Partnership units rather than make a taxable cash sale. To
date, no such exchange transactions have occurred. WRIT believes that WRIT
Limited Partnership will provide WRIT an opportunity to acquire real estate
assets which might not otherwise have been offered to it.
13
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None
(27) Financial Data Schedule
(b) Reports on Form 8-K
None
14
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has fully caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WASHINGTON REAL ESTATE INVESTMENT TRUST
//Larry E. Finger//
---------------------------------------
Larry E. Finger,
Senior Vice President Finance
and Chief Financial Officer
//Laura M. Franklin//
---------------------------------------
Laura M. Franklin,
Vice President Finance
and Chief Accounting Officer
Date: May 15, 1997
15