- ---------------------------------------------------------------------- FORM 8-K/A SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------------------------------------------------------- AMENDMENT TO APPLICATION OR REPORT Filed pursuant to Section 12, 13 or 15(d) of THE SECURITIES EXCHANGE ACT OF 1934 UNITED DOMINION REALTY TRUST, INC. (Exact name of registrant as specified in its charter) AMENDMENT NO. 3 The undesigned registrant hereby amends Item 7 to its Current Report on Form 8-K dated December 28, 1995, which was filed with the Securities and Exchange Commission on January 11, 1996. The Consolidated Pro Forma Condensed Statement of Operations for the Twelve Months Ended December 31, 1994, the Consolidated Pro Forma Condensed Statement of Operations for the Nine Months Ended September 30, 1995, and the Notes to the Consolidated Pro Forma Condensed Financial Statements were revised to include the entire item being amended on Form 8-K/A No. 1 filed March 11, 1996 and Form 8-K/A No. 2 filed April 19, 1996. In addition, the Consolidated Pro Forma Condensed Statement of Operations for the Nine Months Ended September 30, 1995 was revised to reflect the changes made to the Statement on Form 10-Q/A No. 3, filed with the Commission on May 13, 1996. ITEM 7. Financial Statements, pro Forma Financial Information and Exhibits. (a) Financial Statements of Real Estate Properties Acquired (b) Pro Forma Financial Information (c) Exhibits (23) Consent of experts SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Amendment to be signed on its behalf by the undersigned, thereunto duly authorized. UNITED DOMINION REALTY TRUST, INC. (Registrant) /s/ JERRY A. DAVIS Jerry A. Davis Vice-President & Corporate Controller Date: December 28, 1995 ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits Description Location (a) Financial Statements of Businesses Acquired 3 through 14 (b) Pro Forma Financial Information 15 through 25 (c) Exhibits (23) Consents of Independent Auditors 26 through 29 [L.P. MARTIN & COMPANY LETTERHEAD] Independent Auditors' Report To the Owners of Marble Hill Apartments We have audited the accompanying statement of rental operations (as defined in Note 2) of Marble Hill Apartments for the year ended December 31, 1994. This financial statement is the responsibility of the management of Marble Hill Apartments. Our responsibility is to express an opinion on this statement 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 financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The statement was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (for inclusion in a Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described in Note 4, and is not intended to be a complete presentation of Marble Hill Apartments' revenues and expenses. In our opinion, the statement referred to above presents fairly, in all material respects, the income and operating expenses, as described in Note 2, of Marble Hill Apartments for the year ended December 31, 1994, in conformity with generally accepted accounting principles. /s/ L. P. MARTIN & COMPANY, P.C. L. P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia December 5, 1995 MARBLE HILL APARTMENTS STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 REVENUES FROM RENTAL PROPERTY $ 1,237,472 RENTAL PROPERTY EXPENSES: Real Estate Taxes 53,441 Repairs and Maintenance 274,840 Utilities 107,391 Property Management Fees 62,436 Other Operating Expenses 196,621 TOTAL RENTAL PROPERTY EXPENSES 694,729 INCOME FROM RENTAL OPERATIONS $ 542,743 The accompanying notes are an integral part of this statement. MARBLE HILL APARTMENTS NOTES TO THE STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 NOTE 1 - BASIS OF PRESENTATION Marble Hill Apartments (The Property) consists of a 253 unit townhouse residential apartment community located in Richmond, Virginia together with the existing leases. The assets that comprise the Property have been held as an investment of Shelter Properties VI Limited Partnership, a South Carolina limited partnership (the owner), throughout the year ended December 31, 1994. The accompanying financial statement presents the results of rental operations of the Property as a stand-alone entity. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Revenue and Expense Recognition The accompanying statement of rental operations has been prepared using the accrual method of accounting. Certain expenses such as depreciation, amortization, income taxes, mortgage interest expense and asset management fees are not reflected in the statement of rental operations, as required by Rule 3-14 of Regulation S-X of the Securities and Exchange Commission. Repairs and Maintenance Repairs and maintenance costs are expensed as incurred, while significant improvements, renovations and replacements are capitalized. NOTE 3 - PROPERTY MANAGEMENT FEES Property management services were provided through Insigna Management Group, L.P., an affiliate of the owner of the property. Fees for such services were 5% of gross receipts from operations. NOTE 4 - SALE OF PROPERTY The property was sold to UDR at Marble Hill, L.L.C. on September 28, 1995. This statement of rental operations has been prepared to be included in a Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc. [L.P. MARTIN & COMPANY LETTERHEAD] Independent Auditors' Report To the Owners of Mallards of Wedgewood Apartments We have audited the accompanying statement of rental operations (as defined in Note 2) of Mallards of Wedgewood Apartments for the year ended December 31, 1994. This financial statement is the responsibility of the management of Mallards of Wedgewood Apartments. Our responsibility is to express an opinion on this statement 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 financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The statement was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (for inclusion in a Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described in Note 4, and is not intended to be a complete presentation of Mallards of Wedgewood Apartments' revenues and expenses. In our opinion, the statement referred to above presents fairly, in all material respects, the income and operating expenses, as described in Note 2, of Mallards of Wedgewood Apartments for the year ended December 31, 1994, in conformity with generally accepted accounting principles. /s/ L. P. MARTIN & COMPANY, P.C. L. P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia December 6, 1995 MALLARDS OF WEDGEWOOD APARTMENTS STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 REVENUES FROM RENTAL PROPERTY $ 1,305,300 RENTAL PROPERTY EXPENSES: Real Estate Taxes 113,228 Repairs and Maintenance 168,920 Utilities 22,782 Property Management Fees 52,610 Other Operating Expenses 211,915 TOTAL RENTAL PROPERTY EXPENSES 569,455 INCOME FROM RENTAL OPERATIONS $ 735,845 The accompanying notes are an integral part of this statement. MALLARDS OF WEDGEWOOD APARTMENTS NOTES TO THE STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 NOTE 1 - BASIS OF PRESENTATION Mallards of Wedgewood Apartments (The Property) consists of a 240 unit garden style residential apartment community located in Lakeland, Florida together with the existing leases. The assets that comprise the Property have been held as an investment of Wedgewood Golf Associates, Ltd., a Florida limited partnership (the owner), throughout the year ended December 31, 1994. The accompanying financial statement presents the results of rental operations of the Property as a stand-alone entity. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Revenue and Expense Recognition The accompanying statement of rental operations has been prepared using the accrual method of accounting. Certain expenses such as depreciation, amortization, income taxes, mortgage interest expense and asset management fees are not reflected in the statement of rental operations, as required by Rule 3-14 of Regulation S-X of the Securities and Exchange Commission. Repairs and Maintenance Repairs and maintenance costs are expensed as incurred, while significant improvements, renovations and replacements are capitalized. NOTE 3 - PROPERTY MANAGEMENT FEES Property management services were provided through Insignia Management Group, L.P., an affiliate of the owner of the property. Fees for such services were 4% of gross receipts from operations. NOTE 4 - SALE OF PROPERTY The property was sold to United Dominion Realty Trust, Inc. on July 27, 1995. This statement of rental operations has been prepared to be included in a Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc. [L.P. MARTIN & COMPANY LETTERHEAD] Independent Auditors' Report To the Owners of Andover Place Apartments We have audited the accompanying statement of rental operations (as defined in Note 2) of Andover Place Apartments for the year ended December 31, 1994. This financial statement is the responsibility of the management of Andover Place Apartments. Our responsibility is to express an opinion on this statement 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 financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The statement was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (for inclusion in a Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described in Note 4, and is not intended to be a complete presentation of Briar Club Apartments' revenues and expenses. In our opinion, the statement referred to above presents fairly, in all material respects, the income and operating expenses, as described in Note 2, of Andover Place Apartments for the year ended December 31, 1994, in conformity with generally accepted accounting principles. /s/ L. P. MARTIN & COMPANY, P.C. L. P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia December 7, 1995 ANDOVER PLACE APARTMENTS STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 REVENUES FROM RENTAL PROPERTY $ 1,175,173 RENTAL PROPERTY EXPENSES: Real Estate Taxes 117,862 Repairs and Maintenance 298,993 Utilities 97,830 Property Management Fees (Note 3) 58,668 Other Operating Expenses 204,529 TOTAL RENTAL PROPERTY EXPENSES 777,882 INCOME FROM RENTAL OPERATIONS $ 397,291 The accompanying notes are an integral part of this statement. ANDOVER PLACE APARTMENTS NOTES TO THE STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 NOTE 1 - BASIS OF PRESENTATION Andover Place Apartments, formerly Vinings at Heritage Place, Phase II, (The Property) consists of a 200 unit garden style residential apartment community located in Orlando, Florida together with the existing leases. The assets that comprise the Property have been held as an investment of Heritage Place II Associates, Ltd., a Florida limited partnership (the owner), throughout the year ended December 31, 1994. The accompanying financial statement presents the results of rental operations of the Property as a stand-alone entity. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Revenue and Expense Recognition The accompanying statement of rental operations has been prepared using the accrual method of accounting. Certain expenses such as depreciation, amortization, income taxes, mortgage interest expense and asset management fees are not reflected in the statement of rental operations, as required by Rule 3-14 of Regulation S-X of the Securities and Exchange Commission. Repairs and Maintenance Repairs and maintenance costs are expensed as incurred, while significant improvements, renovations and replacements are capitalized. NOTE 3 - PROPERTY MANAGEMENT FEES Property management services were provided through Florida RS, Inc., an affilitate of the owner of the property. Fees for such services were 5% of gross receipts from operations. NOTE 4 - SALE OF PROPERTY The property was sold to United Dominion Realty Trust, Inc. on September 28, 1995. This statement of rental operations has been prepared to be included in a Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc. [L.P. MARTIN & COMPANY LETTERHEAD] Independent Auditors' Report To the Owners of Hunters Ridge at Walden Lake Apartments We have audited the accompanying statement of rental operations (as defined in Note 2) of Hunters Ridge at Walden Lake Apartments for the year ended December 31, 1994. This financial statement is the responsibility of the management of Hunters Ridge at Walden Lake Apartments. Our responsibility is to express an opinion on this statement 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 financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. The statement was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (for inclusion in a Current Report on Form 8-K of United Dominion Realty Trust, Inc.), as described in Note 4, and is not intended to be a complete presentation of Hunters Ridge at Walden Lake Apartments' revenues and expenses. In our opinion, the statement referred to above presents fairly, in all material respects, the income and operating expenses, as described in Note 2, of Hunters Ridge at Walden Lake Apartments for the year ended December 31, 1994, in conformity with generally accepted accounting principles. /s/ L. P. MARTIN & COMPANY, P.C. L. P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia November 21, 1995 HUNTERS RIDGE AT WALDEN LAKE APARTMENTS STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 REVENUES FROM RENTAL PROPERTY $ 1,923,110 RENTAL PROPERTY EXPENSES: Real Estate Taxes 181,104 Repairs and Maintenance 240,754 Utilities 181,398 Property Management Fees (Note 3) 77,051 Other Operating Expenses 368,916 TOTAL RENTAL PROPERTY EXPENSES 1,049,223 INCOME FROM RENTAL OPERATIONS $ 873,887 The accompanying notes are an integral part of this statement. HUNTERS RIDGE AT WALDEN LAKE APARTMENTS NOTES TO THE STATEMENT OF RENTAL OPERATIONS YEAR ENDED DECEMBER 31, 1994 NOTE 1 - BASIS OF PRESENTATION Hunters Ridge at Walden Lake Apartments (The Property) consists of a 352 unit garden style residential apartment community located in Plant City, Florida together with the existing leases. The assets that comprise the Property have been held as an investment of Walden Lake I Apartments, Ltd., a Florida limited partnership (the owner), throughout the year ended December 31, 1994. The accompanying financial statement presents the results of rental operations of the Property as a stand-alone entity. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Revenue and Expense Recognition The accompanying statement of rental operations has been prepared using the accrual method of accounting. Certain expenses such as depreciation, amortization, income taxes, mortgage interest expense and asset management fees are not reflected in the statement of rental operations, as required by Rule 3-14 of Regulation S-X of the Securities and Exchange Commission. Repairs and Maintenance Repairs and maintenance costs are expensed as incurred, while significant improvements, renovations and replacements are capitalized. NOTE 3 - PROPERTY MANAGEMENT FEES Property management services were provided through Lincoln Property Services, Inc., an affiliate of the owner of the property. Fees for such services were 4% of gross receipts from operations. NOTE 4 - SALE OF PROPERTY The property was sold to United Dominion Realty Trust, Inc. on June 30, 1995. This statement of rental operations has been prepared to be included in a Current Report on Form 8-K to be filed by United Dominion Realty Trust, Inc. UNITED DOMINION REALTY TRUST, INC. CERTAIN PROPERTIES ACQUIRED COMBINED SUMMARY OF REVENUES AND CERTAIN RENTAL EXPENSES FOR THE YEAR ENDED DECEMBER 31, 1994 (IN THOUSANDS OF DOLLARS) Rental income $ 5,641 Rental expenses (excluding depreciation): Utilities $ 409 Repairs and maintenance 983 Real estate taxes 466 Property management 251 Other rental expenses 982 3,091 ----- ------- Excess of revenues over certain rental expenses $ 2,550 ======= UNITED DOMINION REALTY TRUST, INC. CERTAIN PROPERTIES ACQUIRED COMBINED SUMMARY OF REVENUES AND CERTAIN RENTAL EXPENSES FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 (IN THOUSANDS OF DOLLARS) Rental income $ 3,670 Rental expenses (excluding depreciation): Utilities $ 256 Repairs and maintenance 627 Real estate taxes 320 Property management 171 Other rental expenses 555 1,929 ----- ------- Excess of revenues over certain rental expenses $ 1,741 ========== NOTES TO COMBINED SUMMARY OF REVENUES AND CERTAIN RENTAL EXPENSES The combined summary of revenues and certain rental expenses reflect the combined operations of Hunters Ridge Apartments, Mallards of Wedgewood Apartments, Marble Hill Apartments and Andover Place Apartments ("the properties"), for the year ended December 31, 1994 based upon the audited statements of rental operations of the properties appearing elsewhere herein and for the nine month period ended September 30, 1995 based upon the unaudited statements of rental operations of the property. During 1994 and a portion of 1995, the properties were owned by an entity other than United Dominion Realty Trust, Inc. (the "Company"). The combined summaries have been prepared on the accrual method of accounting. Rental expenses include repair and maintenance expenses, utilities, real estate taxes, insurance and certain other expenses. In accordance with the regulations of the Securities and Exchange Commission, mortgage interest expenses, depreciation, and general and administrative costs have been excluded from operating expenses, as they are dependent upon a particular owner, purchase price or financial arrangement. In assessing the properties, management considered the existing and potential tenant base, expected job growth in the area, occupancy rates, the competitive nature of the market and comparative rental rates. Furthermore, current and anticipated maintenance and repair costs, real estate taxes and anticipated capital improvements were assessed. UNITED DOMINION REALTY TRUST, INC. CONSOLIDATED PRO FORMA CONDENSED FINANCIAL STATEMENTS (UNAUDITED) The accompanying consolidated balance sheet at September 30, 1995 includes the acquisitions of Hunters Ridge Apartments, Mallards of Wedgewood Apartments, Marble Hill Apartments and Andover Place Apartments as the four properties were acquired on June 30, 1995, July 27, 1995, September 28, 1995 and September 29, 1995, respectively. There are no adjustments to the accompanying consolidated balance sheet at September 30, 1995. The consolidated pro forma condensed statements of operations for the year ended December 31, 1994 and the nine months ended September 30, 1995 assume the acquisition of the properties as if they had occurred at the beginning of each period presented. The consolidated pro forma condensed statements have been prepared by the management of the Company. The pro forma condensed financial statements of operations may not be indicative of the results that would have occurred had the acquisitions been completed on the dates indicated. Also, they necessarily are not indicative of future results. The consolidated pro forma condensed financial statements and Notes thereto, should be read in conjunction with the Company's audited financial statements for the year ended December 31, 1994 (included in the Trust's Form 10-K for the year ended December 31, 1994) and the unaudited financial statements as of September 30, 1995 and for the nine months then ended (included in the Company's Form 10-Q for the periods ended September 30, 1995) and the accompanying notes. UNITED DOMINION REALTY TRUST, INC. CONSOLIDATED BALANCE SHEET SEPTEMBER 30, 1995 (Unaudited) (In thousands, except share data) HISTORICAL (1) Assets Real estate owned Apartments $1,070,441 Shopping centers 1,722 Office and industrial buildings 4,608 1,076,771 Less accumulated depreciation 130,228 946,543 Real estate held for disposition 41,630 Cash and cash equivalents 7,031 Receivable from underwriters 57,354 Other assets 27,417 $1,079,975 Liabilities and shareholders' equity Mortgage notes payable $166,732 7 1/4% Notes due April 1, 1999 75,000 8 1/2% debentures due September 15, 2024 150,000 Other notes payable 134,992 Accounts payable, accrued expenses and other 22,984 Distributions payable to shareholders 12,610 562,318 Shareholders' equity: Preferred stock, no par value; 25,000,000 shares authorized: 9 1/4% Series A Cumulative Redeemable Preferred Stock (liquidation preference of $25 per share), 4,200,000 shares issued and outstanding 105,000 Common stock, $1 par value; 100,000,000 shares authorized 56,045,232 shares issued and outstanding 56,045 Additional paid in capital 477,186 Notes receivable from officer shareholders (5,959) Distributions in excess of earnings (114,794) Unrealized gain on securities available-for-sale 179 Total shareholders' equity 517,657 $1,079,975 See accompanying notes. UNITED DOMINION REALTY TRUST, INC. NOTES TO CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 1995 (1) Represents the Company's Historical Balance Sheet contained in its Quarterly Report on Form 10-Q for the nine months ended September 30, 1995. UNITED DOMINION REALTY TRUST, INC. CONSOLIDATED PRO FORMA CONDENSED STATEMENT OF OPERATIONS FOR THE TWELVE MONTHS ENDED DECEMBER 31, 1994 (UNAUDITED) (IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE DATA) ACQUISITIONS PREVIOUSLY REPORTED ON FORMS 8-K DATED APRIL 15, 1994, MAY 17, 1994, 1994 ACQUISITIONS MAY 26, 1994, ACQUISITIONS PRO FORMA REPORTED ON SEPTEMBER 1, 1994 AND PRO FORMA BEFORE 1995 FORM 8-K DATED HISTORICAL (1) OCTOBER 14, 1994 (2) ADJUSTMENTS ACQUISITIONS JUNE 30, 1995 (3) ------------ ------------------ ----------- ------------- ---------------- REVENUES Rental ncome $139,972 $27,128 $167,100 $11,095 Interest income 756 (111)(10) 645 ------------ ------------------ ----------- ------------- -------------- 140,728 27,128 (111) 167,745 11,095 EXPENSES Rental expenses: Utilities 11,206 2,019 13,225 681 Repairs & maintenance 21,216 4,205 25,421 1,453 Real estate taxes 9,658 2,296 11,954 741 Property management 4,645 1,304 ($328)(6) 5,621 441 Other operating expenses 12,141 3,629 (277)(7) 15,493 1,144 Depreciation of real estate owned 28,729 4,514 (8) 33,243 Interest 28,521 7,450 (9) 35,971 General and administrative 4,803 4,803 Other depreciation and amortization 691 691 ------------ ------------------ ----------- ------------- -------------- 121,610 13,453 11,359 146,422 4,460 Income before gains (losses) on sales of investments and extraordinary item 19,118 13,675 (11,470) 21,323 6,635 Gains (losses) on sales of investments 108 108 ------------ ------------------ ----------- ------------- -------------- Income before extraordinary item 19,226 13,675 (11,470) 21,431 6,635 Extraordinary item - early extinguishment of debt (89) (89) ------------ ------------------ ----------- ------------- -------------- Net income 19,137 13,675 (11,470) 21,342 6,635 Dividends to preferred shareholders -- 0 ============ ================== =========== ============= ============== Net income available to common shareholders $19,137 $13,675 ($11,470) $21,342 $6,635 ============ ================== =========== ============= ============== Net income per common share $ 0.41 $0.43 ============ ============= Distributions declared per common share $ 0.78 $0.78 ============ ============= Weighted average number of common shares outstanding 46,182 4,022 (19) 50,204 ACQUISITIONS PREVIOUSLY JUNE 30, 1995 REPORTED ON DECEMBER 28, 1995 PRO FORMA FORM 8-K DATED PRO FORMA PRO ADJUSTMENTS DECEMBER 28, 1995 (4) ADJUSTMENTS FORMA ------------- ----------------- -------------- --------- REVENUES Rental ncome $5,641 $183,836 Interest income 645 -------------- --------------- -------------- --------- 0 5,641 0 184,481 EXPENSES Rental expenses: Utilities 409 14,315 Repairs & maintenance 983 27,857 Real estate taxes 466 13,161 Property management ($60)(11) 251 ($58)(14) 6,195 Other operating expenses 982 17,619 Depreciation of real estate owned 1,637 (12) 869 (15) 35,749 Interest 716 (16) 36,687 General and administrative 4,803 Other depreciation and amortization 691 -------------- --------------- -------------- --------- 1,577 3,091 1,527 157,077 Income before gains (losses) on sales of investments and extraordinary item (1,577) 2,550 (1,527) 27,404 Gains (losses) on sales of investments 108 -------------- --------------- -------------- --------- Income before extraordinary item (1,577) 2,550 (1,527) 27,512 Extraordinary item - early extinguishment of debt (89) -------------- --------------- -------------- --------- Net income (1,577) 2,550 (1,527) 27,423 Dividends to preferred shareholders 6,289 (13) 2,031 (17) 8,320 ============== =============== ============== ========= Net income available to common shareholders ($7,866) $2,550 ($3,558) $19,103 ============== =============== ============== ========= Net income per common share $0.38 ========= Distributions declared per common share $0.78 ========= Weighted average number of common shares outstanding 50,204 SEE ACCOMPANYING NOTES. UNITED DOMINION REALTY TRUST, INC. CONSOLIDATED PRO FORMA CONDENSED STATEMENT OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 (UNAUDITED) (IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE DATA) ACQUISITIONS PREVIOUSLY REPORTED ON ACQUISITIONS DECEMBER 28, FORM 8-K JUNE 30, 1995 REPORTED ON 1995 DATED ACQUISITIONS FORM 8-K DATED ACQUISITIONS HISTORICAL JUNE 30, PRO FORMA DECEMBER 28, PRO FORMA PRO (1) 1995 (3) ADJUSTMENTS (5) 1995 (4) ADJUSTMENTS FORMA ---------- ----------------- --------------- -------------- ------------- ------- INCOME Rental Income $143,082 $2,849 $1,045 $3,670 $150,646 Interest income 1,031 0 (269)(18) 762 --------- ---------- ------------- ------------- ----------- -------- 144,113 2,849 1,045 3,670 (269) 151,408 EXPENSES Rental expenses: Utilities 10,627 174 64 256 11,121 Repairs & maintenance 22,493 268 98 627 23,486 Real estate taxes 10,115 184 67 320 10,686 Property management 4,153 113 20 (11) 171 ($45)(14) 4,412 Other operating expenses 12,631 289 106 555 13,581 Depreciation of real estate owned 28,545 559 (12) 529 (15) 29,633 Interest 30,563 532 (16) 31,095 General and administrative 3,771 3,771 Other depreciation and amortization 835 835 Impairment loss on real estate held for disposition 1,700 1,700 --------- ---------- ------------- ------------- ------------ -------- 125,433 1,028 914 1,929 1,016 130,320 Income before gains (losses) on sales of investments and extraordinary item 18,680 1,821 131 1,741 (1,285) 21,088 Gains (losses) on sales of investments 4,844 4,844 ---------- ---------- ------------- ------------- ------------- -------- Net income 23,524 1,821 131 1,741 (1,285) 25,932 Dividends to preferred shareholders 4,209 1,964 (13) 635 (17) 6,808 ---------- ---------- ------------- ------------- ------------ -------- Net income available to common shareholders $ 19,315 $1,821 ($1,833) $1,741 ($1,920) $ 19,124 ========== ========== ============= ============= ============= ======== Net income per common share $ 0.37 $ 0.37 ========== ======== Distributions declared per common share $ 0.675 $ 0.675 ========== ======== Weighted average number of common shares outstanding 51,597 51,597 SEE ACCOMPANYING NOTES. UNITED DOMINION REALTY TRUST, INC. NOTES TO CONSOLIDATED PRO FORMA CONDENSED STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND THE YEAR ENDED DECEMBER 31, 1994 (UNAUDITED) BASIS OF PRESENTATION The accompanying consolidated pro forma statements of operations assume the (i) the acquisition of four apartment communities previously reported on Form 8-K dated December 28, 1995, (ii) the acquisition of nine apartment communities previously reported on Form 8-K dated June 30, 1995, and (iii) the acquisition of apartment communities previously reported on Forms 8-K dated April 15, 1994, May 17, 1994, May 26, 1994, September 1, 1994 and October 14, 1994, at the beginning of each period presented. For 1995 and 1994, the pro forma statements of operations include the April 24, 1995, sale of 4.2 million shares of 91/4% Cumulative Redeemable Preferred Stock with a $25 liquidation preference value ("preferred stock"). Net proceeds from the sale of the preferred stock were used to fund the Acquisitions Previously Reported on Form 8-K dated June 30, 1995 and to temporarily repay in full, then existing bank debt until such time additional acquisitions were completed. Of the 4.2 million shares sold, 2.7 million shares were assumed to be used to acquire the Acquisitions Previously Reported on Form 8-K dated June 30, 1995 and 878,589 shares were assumed to have been used to acquire Hunters Ridge Apartments and Mallards of Wedgewood Apartments (two of the properties included in the acquisitions previously reported on Form 8-K dated December 28, 1995). Therefore, such consolidated pro forma statements of operations assume the issuance of 3.6 million shares of preferred stock from the period January 1, 1995 to April 24, 1995 for the nine months ended September 30, 1995 and the sale of 3.6 million shares of preferred stock for the full year ended December 31, 1994. For 1994, the consolidated pro forma statement of operation includes the June 22, 1994 sale of 8,479,400 shares of common stock in a public offering at $14.25 per share, as if the sale had occurred on January 1, 1994. Net proceeds from the sale were used to acquire 21 apartment properties included in a 25 property portfolio as reported to the Securities and Exchange Commission on Form 8-K Dated May 26, 1994. (1) Represents the Trust's Historical Statements of Operations contained in its Quarterly Report on Form 10-Q for the nine months ended September 30, 1995 and its Annual Report on Form 10-K for the year ended December 31, 1994. (2) Amounts appearing under the column entitled "Acquisitions Previously Reported on Forms 8-K dated April 15, 1994, May 17, 1994, May 26, 1994, September 1, 1994 and October 14, 1994" give effect to significant acquisitions that have been previously reported to the Securities and Exchange Commission by the Trust on Forms 8-K dated April 15, 1994, May 17, 1994, May 26, 1994, September 1, 1994 and October 14, 1994. A reconciliation of net income to previously filed Forms 8-K and/or 8-K/A is as follows: Filing to Update Net Income 8-K Filed 8-K (In thousands) April 15, 1994 8-K/A June 7, 1994 $ 845 May 17, 1994 8-K/A July 26, 1994 546 May 26, 1994 8-K August 31, 1994 * 6,619 September 1, 1994 8-K/A November 11, 1994 2,242 October 14, 1994 8-K/A December 29, 1994 3,423 --------- $13,675 * The Form 8-K dated August 31, 1994 updated the Form 8-K dated May 26, 1994 for the six month period ended June 30, 1994. (3) Amounts appearing under the column entitled "Acquisitions Previously Reported on Form 8-K dated June 30, 1995" give effect to significant acquisitions that have been previously reported to the Securities and Exchange Commission by the Trust on Form 8-K dated June 30, 1995. (4) Represents actual rental income and related operating expenses of the "Acquisitions Previously Reported on Form 8-K dated December 28, 1995", as reported elsewhere herein. (5) Represents operations of the Acquisitions Previously Reported on Form 8-K Dated June 30, 1995 for the 33 day period from April 1, 1995 to May 3, 1995, which represents the period not owned by the Trust during the second quarter of 1995 (based on the operating statements of the properties for the stub period January 1, 1995 to March 31, 1995). The Form 8-K dated June 30, 1995 contains pro forma financial statements for the three month period ended March 31, 1995. (6) To record the net decrease in property management fees for the acquisitions previously reported to the Securities and Exchange Commission on Forms 8-K dated April 15, 1994, May 17, 1994, May 26, 1994, September 1, 1994 and October 14, 1994. The Trust internally manages its apartment portfolio at a cost of approximately 3.5% of rental income. The Trust uses 98% of the amount reported as rental income in calculating the property management fee, as 2% of the amount reported as rental income is assumed to be other income which is not subject to management fee. (7) To record the net decrease in insurance expense to reflect that the Trust insures its apartments for approximately $107.22 per unit less than the historical insurance expense of the 5,170 apartment units contained in the Portfolio Acquisition (acquired on July 1, 1994) previously reported to the Securities and Exchange Commission on Form 8-K dated May 26, 1994. (8) To record depreciation expense on the acquisitions previously reported to the Securities and Exchange Commission on Forms 8-K dated April 15, 1994, May 17, 1994, May 26, 1994, September 1, 1994 and October 14, 1994. Depreciation is based upon the allocation of the purchase price of the properties. Depreciation is computed on a straight line basis over the estimated useful lives of the related assets which range from 15 to 35 years. The allocation and estimated useful lives are as follows: Estimated Twelve Month Allocation of Useful Life Depreciation Purchase Price In Years Adjustment ** Buildings $264,712,528 35 $3,937,223 Other Improvements 16,623,950 15 576,935 Land 43,179,203 N/A -- ------------ ---------- $324,515,681 $4,514,158 ============ ========== ** The Acquisitions Previously Reported were purchased by the Trust at various times during 1994. The depreciation expense adjustment is computed for each property based on the number of days not owned by the Trust during 1994. The weighted average number of days the properties were not owned by the Trust during 1994 was 190.01 days (out of 365 days). (9) To record interest expense on the Acquisition Previously Reported on Forms 8-K dated April 15, 1994, May 17, 1994, May 26, 1994, September 1, 1994 and October 14, 1994 at market interest rates available to the Trust at the time of each respective acquisition with debt aggregating $237,591,416 and a weighted average interest rate of 5.7492% which was assumed to have been used as follows: (i) variable-rate bank debt aggregating $161,147,168 used to fund the acquisitions at market interest rates available to the Trust at the time of each respective acquisition, (ii) fixed-rate medium-term notes payable aggregating $39,827,598, (iii) the assumption of fixed-rate mortgage notes payable aggregating $30,646,650 and (iv) the assumption of a fixed-rate tax-exempt bond in the amount of $5,970,000. The acquisitions previously reported were purchased by the Trust at various times during 1994. The interest expense adjustment is computed for each property based on the number of days not owned by the Trust during 1994. The weighted average number of days the properties were not owned by the Trust during 1994 was 199.08 days (out of 365 days). (10) Reflects the reduction of interest income associated with the use of short-term investments to acquire the Portfolio Acquisition (as previously reported on form 8-K dated May 26, 1994), Regatta Shores Apartments (as previously reported on Form 8-K dated September 1, 1994) and for the acquisition of Mediterranean Village Apartments, Briar Club Apartments, Covington Crossing Apartments and Hunters Trace Apartments (as previously reported on Form 8-K dated October 14, 1994) at market interest rates in effect at the time of the acquisition. #Days Interest Short-term Interest Interest Income Property Investment Rate Adjustment Adjustment ---------- ------------ --------- ----------- ---------- Regatta Shores $ 7,364,376 4.50% 8/365 $ 7,263 Mediterranean Village 14,003,901 5.10% 3/365 5,870 Briar Club, Covington Crossing and Hunters Trace 15,057,181 5.30% 4/365 8,745 Portfolio Acquisition 80,000,000 5.06% 8/365 88,723 ------------ ---------- $116,425,458 $ 110,601 ============ ========== (11) Reflects the net decrease in property management fees for the Acquisitions Previously Reported on Form 8-K dated June 30, 1995. The Trust internally manages its apartment properties at a cost of approximately 3.5% of rental income. The Trust uses 98% of the amount reported as rental income in calculating the property management fee, as 2% of the amount reported as rental income is assumed to be other income which is not subject to management fee. (12) Reflects the net adjustments to depreciation expense to record the Acquisitions Previously Reported on Form 8-K dated June 30, 1995 at the beginning of each period presented. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets. Buildings have been depreciated over 35 years and other improvements of 15 years based upon the initial cost of the Acquisitions Previously Reported on Form 8-K dated June 30, 1995 of $65.7 million. The allocation and estimated useful lives are as follows: Estimated Twelve Useful Months Nine Months Allocation of Life Depreciation Depreciation Purchase Price In Years Adjustment** Adjustment** Building $50,495,338 35 $1,442,724 $492,931 Other Improvements 2,916,939 15 194,463 66,441 Land 12,292,524 N\A -- -- ---------- ------------ ----------- $65,704,801 $1,637,187 $559,372 =========== ============ =========== ** The Acquisitions Previously Reported on Form 8-K Dated June 30, 1995 were purchased by the Trust on May 4, 1995, as such, the depreciation adjustment for the nine months ended September 30, 1995 is computed for the 123 day period (out of 360 days) the properties were not owned by the Trust. The twelve months ended December 31, 1994 includes a pro forma adjustment for the full year. (13) Reflects the adjustment to net income to record dividends paid to preferred shareholders on 2,719,412 shares of preferred stock in calculating net income available to common shareholders for the 114 day period (out of 365 days) from the period January 1, 1995 to April 24, 1995 for the nine months ended September 30, 1995. The twelve months ended December 31, 1994 includes a pro forma adjustment for the full year. (14) Reflects the net decrease in property management fees for the properties. The Trust internally manages its apartment properties at a cost of approximately 3.5% of rental income. The Trust uses 98% of the amount reported as rental income in calculating the property management fee, as 2% of the amount reported as rental income is assumed to be other income which is not subject to management fee. (15) Reflects the net adjustments to depreciation expense to record the properties at the beginning of each period presented. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets. Buildings have been depreciated over 35 years and other improvements of 15 years based upon the initial cost of the properties of $32.9 million. The allocation and estimated useful lives are as follows: Estimated Useful Twelve Month Nine Month Allocation of Life Depreciation Depreciation Purchase Price In Years Adjustment** Adjustment** Building $25,438,503 35 $726,814 $442,549 Other Improvements 2,138,662 15 142,577 86,814 Land 5,290,780 N\A -- -- ----------- ------------ ------------ $32,867,945 $869,391 $529,363 =========== ============ ============ ** The Acquisitions Previously reported on Form 8-K Dated December 28, 1995 were purchased by the Trust at various times during the second and third quarters of 1995. The depreciation adjustment is computed for each property based on the number of days the properties were not owned by the Trust. The weighted average number of days the properties were not owned by the Trust during 1995 was 219.20 days (out of 360 days). The twelve months ended December 31, 1994 includes a pro forma adjustment for the full year. (16) Reflects the additional interest expense associated with the acquisition of the properties as follows: (i) variable-rate bank debt aggregating $2.7 million used to fund the acquisitions at assumed interest rates equal to market rates in effect at the time of each respective acquisition and the assumption of (ii) the assumption of a fixed-rate a mortgage note in the amount of $3.3 million bearing interest of 7.6% in connection with the acquisition of Marble Hill Apartments and (iii) the assumption of a $5.6 million variable-rate tax-exempt housing bond bearing interest of 5.14% in connection with the acquisition of Andover Place Apartments. Twelve Month Nine Month Amount Interest Interest Interest Property Type of Debt Debt Rate Adjustment** Adjustment** Marble Hill Bank Debt $ 2,629,662 6.48% $170,402 $126,517 Marble Hill Mortgage Debt 3,344,066 7.60% 254,149 188,697 Andover Place Bank Debt 46,284 6.48% 2,999 2,227 Andover Place Tax-Exempt Bonds 5,620,000 5.14% 288,868 214,475 ----------- ----- -------- -------- $11,640,012 $716,418 $531,916 =========== ======== ======== ** For the nine months ended September 30, 1995, the interest expense adjustment is for 271 days (based on a 365 day year) as the properties were purchased on September 28, 1995. The twelve months ended December 31, 1994 includes a pro forma adjustment for the full year. (17) Reflects the adjustment to net income to record dividends paid to preferred shareholders on 878,589 shares of preferred stock in calculating net income available to common shareholders for the 114 day period (out of 365 days) from January 1, 1995 to April 24, 1995 assumed to have been used to acquire Hunters Ridge Apartments and Mallards of Wedgewood Apartments. The twelve months ended December 31, 1994 includes a pro forma adjustment for the full year. (18) Reflects the reduction of interest income associated with the use of short-term investments to acquire the Hunters Ridge Apartments (66 of the 365 days during 1995) and Mallards of Wedgewood Apartments (93 of the 365 days during 1995) at market interest rates in effect at the time of the acquisition. As discussed in the "Basis of Presentation", Hunters Ridge Apartments and Mallards of Wedgewood Apartments were assumed to have been acquired with 878,589 shares of the preferred stock. The net proceeds from the sale of the preferred stock were received on April 24, 1995 and were temporarily invested in short-term investments until such time as these acquisitions occurred. Purchase Interest Interest Income Property Price Rate Adjustment Hunters Ridge $13,403,983 6.17% $149,544 Mallards of Wedgewood 7,823,950 6.00% 119,610 ----------- -------- $21,227,933 $269,154 =========== ======== 19. Represents the adjustment to the weighted average number of common shares outstanding to account for the sale of 8,479,400 shares of common stock in a public offering at $14.25 per share on June 22, 1994, as if the sale had occurred on January 1, 1994. Net proceeds from the sale were used to acquire 21 apartment properties included in a 25 property portfolio as reported to the Securities and Exchange Commission on Form 8-K Dated May 26, 1994. [L.P. MARTIN & COMPANY LETTERHEAD] CONSENT OF INDEPENDENT AUDITORS The Board of Directors United Dominion Realty Trust, Inc. We consent to the incorporation by reference in the previously filed Registration Statement Form S-3 No. 33-40433, Registration Statement Form S-3 No. 33-32930, Registration Statement Form S-3 No. 33-55159, Registration Statement Form S-3 No. 33-64275, Registration Statement Form S-8 No. 33-47926, Registration Statement Form S-8 No. 33-48000, and Registration Statement Form S-8 No. 33-58201 of United Dominion Realty Trust, Inc. of our report dated November 21, 1995, with respect to the statement of rental operations of Hunters Ridge at Walden Lake Apartments for the year ended December 31, 1994, included in this Form 8-K/A, Amendment to Application or Report on Form 8-K dated December 28, 1995. /s/ L.P. MARTIN & COMPANY, P.C. L.P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia March 8, 1996 [L.P. MARTIN & COMPANY LETTERHEAD] CONSENT OF INDEPENDENT AUDITORS The Board of Directors United Dominion Realty Trust, Inc. We consent to the incorporation by reference in the previously filed Registration Statement Form S-3 No. 33-40433, Registration Statement Form S-3 No. 33-32930, Registration Statement Form S-3 No. 33-55159, Registration Statement Form S-3 No. 33-64275, Registration Statement Form S-8 No. 33-47926, Registration Statement Form S-8 No. 33-48000, and Registration Statement Form S-8 No. 33-58201 of United Dominion Realty Trust, Inc. of our report dated December 7, 1995, with respect to the statement of rental operations of Andover Place Apartments for the year ended December 31, 1994, included in this Form 8-K/A, Amendment to Application or Report on Form 8-K dated December 28, 1995. /s/ L.P. MARTIN & COMPANY, P.C. L.P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia March 8, 1996 [L.P. MARTIN & COMPANY LETTERHEAD] CONSENT OF INDEPENDENT AUDITORS The Board of Directors United Dominion Realty Trust, Inc. We consent to the incorporation by reference in the previously filed Registration Statement Form S-3 No. 33-40433, Registration Statement Form S-3 No. 33-32930, Registration Statement Form S-3 No. 33-55159, Registration Statement Form S-3 No. 33-64275, Registration Statement Form S-8 No. 33-47926, Registration Statement Form S-8 No. 33-48000, and Registration Statement Form S-8 No. 33-58201 of United Dominion Realty Trust, Inc. of our report dated December 6, 1995, with respect to the statement of rental operations of Mallards of Wedgewood Apartments for the year ended December 31, 1994, included in this Form 8-K/A, Amendment to Application or Report on Form 8-K dated December 28, 1995. /s/ L.P. MARTIN & COMPANY, P.C. L.P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia March 8, 1996 [L.P. MARTIN & COMPANY Letterhead] CONSENT OF INDEPENDENT AUDITORS The Board of Directors United Dominion Realty Trust, Inc. We consent to the incorporation by reference in the previously filed Registration Statement Form S-3 No. 33-40433, Registration Statement Form S-3 No. 33-32930, Registration Statement Form S-3 No. 33-55159, Registration Statement Form S-3 No. 33-64275, Registration Statement Form S-8 No. 33-47926, Registration Statement Form S-8 No. 33-48000, and Registration Statement Form S-8 No. 33-58201 of United Dominion Realty Trust, Inc. of our report dated December 5, 1995 with respect to the statement of rental operations of Marble Hill Apartments for the year ended December 31, 1994, included in this Form 8-K/A, Amendment to Application or Report on Form 8-K dated December 28, 1995. /s/ L.P. MARTIN & COMPANY, P.C. L.P. Martin & Company, P.C. Certified Public Accountants Richmond, Virginia March 8, 1996