SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 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 13, 1998 NEW ENGLAND LIFE PENSION PROPERTIES II; A REAL ESTATE LIMITED PARTNERSHIP (Exact Name of Registrant as Specified in its Charter) Massachusetts (State or Other Jurisdiction of Incorporation) 0-13323 04-2803902 (Commission File Number) (IRS Employer Identification No.) 225 Franklin Street, Boston, MA 02110 (Address of principal executive offices) (Zip Code) (617) 261-9000 Registrant's Telephone Number, Including Area Code Not Applicable (Former Name or Former Address, if Changed Since Last Report) Item 2. Acquisition or Disposition of Assets. - ---------------------------------------------- On October 13, 1998, New England Life Pension Properties II; A Real Estate Limited Partnership (the "Partnership") sold the property known as Case Communications to an unaffiliated third party (the "Buyer") for total gross proceeds of $20,008,520. The terms of the sale were determined by arms-length negotiation between the Buyer and AEW Real Estate Advisors, Inc., on behalf of the Partnership. The Partnership received net proceeds of approximately $18,069,000 representing repayment for its ground lease and mortgage loan investments and residual proceeds. The Partnership recognized a gain of approximately $6,119,000. Item 7. Financial Statements and Exhibits. - ------------------------------------------- In connection with the disposition of the asset discussed in Item 2 above, pro forma financial statements are presented below. The pro forma balance sheet is presented for the period ended June 30, 1998 (Exhibit A). The pro forma income statements are presented for the fiscal year ended December 31, 1997 (Exhibit B) and the period ended June 30, 1998 (Exhibit C). SIGNATURE 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 hereunto duly authorized. Date: October 27, 1998 NEW ENGLAND LIFE PENSION PROPERTIES II; A REAL ESTATE LIMITED PARTNERSHIP (Registrant) By: Copley Properties Company II, Inc. General Partner By: J. Christopher Meyer III -------------------------------- Name: J. Christopher Meyer III Title: President, Chief Executive Officer and Director New England Life Pension Properties II; EXHIBIT A A Real Estate Limited Partnership Pro Forma Balance Sheet June 30, 1998 Unaudited Pro Forma June 30, 1998 June 30, 1998 Adjustment Pro Forma ------------- ------------- ------------- ASSETS Real estate investments: Property, net $ 11,649,067 $ (11,649,067)(a) $ - ------------- ------------- ------------- 11,649,067 (11,649,067) - Cash and cash equivalents 3,967,597 18,068,655 (a) 22,036,252 Interest and rent receivables 15,949 - 15,949 ------------- ------------- ------------- $ 15,632,613 6,419,588 $ 22,052,201 ============= ============= ============= LIABILITIES AND PARTNERS' CAPITAL Accounts payable $ 39,070 - $ 39,070 Accrued management fee 185,708 - 185,708 Deferred disposition fees 1,172,249 300,128 (b) 1,472,377 ------------- ------------- ------------- Total liabilities 1,397,027 300,128 1,697,155 ------------- ------------- ------------- Partners' capital: Limited partners ($172.58 per unit; 110,000 units authorized, 39,917 units issued and outstanding) 14,123,936 6,058,265 (a) 20,182,201 General partner 111,650 61,195 (a) 172,845 ------------- ------------- ------------- Total partners' capital 14,235,586 6,119,460 20,355,046 ------------- ------------- ------------- $ 15,632,613 $ 6,419,588 $ 22,052,201 ============= ============= ============= New England Life Pension Properties II; EXHIBIT B A Real Estate Limited Partnership Pro Forma Income Statement December 31, 1997 Unaudited Pro Forma December 31, 1997 December 31, 1997 Adjustment Pro Forma ----------------- ------------- ----------------- Investment Activity Property rentals $ 2,960,401 $ (726,093)(c) $ 2,234,308 Property operating expenses (950,646) 195,527 (c) (755,119) Depreciation and amortization (641,035) 76,172 (c) (564,863) ----------- ---------- ----------- 1,368,720 (454,394) 914,326 Ground rentals and interest on mortgage loans 1,564,335 (1,391,061)(c) 173,274 ----------- ---------- ----------- Total real estate operations 2,933,055 (1,845,455) 1,087,600 Gain on sales of property 3,723,281 6,119,460 (a) 9,842,741 ----------- ---------- ----------- Total real estate activity 6,656,336 4,274,005 10,930,341 Interest on cash equivalents and short term investments 387,853 - 387,853 ----------- ---------- ----------- Total investment activity 7,044,189 4,274,005 11,318,194 Portfolio Expenses Management fee 218,407 (159,733)(f) 58,674 General and administrative 138,225 (3,650)(g) 134,575 ----------- ---------- ----------- 356,632 (163,383) 193,249 ----------- ---------- ----------- Net income $ 6,687,557 $4,437,388 $11,124,945 =========== ========== =========== Net income per limited partnership unit $ 165.86 $ 110.05 (d) $ 275.91 =========== ========== =========== Number of limited partnership units outstanding during the period 39,917 39,917 39,917 =========== ========== =========== New England Life Pension Properties II; EXHIBIT C A Real Estate Limited Partnership Pro Forma Income Statement June 30, 1998 Unaudited Pro Forma June 30, 1998 June 30, 1998 Adjustment Pro Forma ------------- ---------- ------------- Investment Activity Property rentals $1,386,068 (1,378,968)(e) $ 7,100 Property operating expenses (372,554) 357,069 (e) (15,485) Depreciation and amortization (173,818) 173,818 (e) - ----------- ---------- ----------- Total real estate operations 839,696 (848,081) (8,385) Gain on sale of property - 6,119,460 (a) 6,119,460 ----------- ---------- ----------- Total real estate activity 839,696 5,271,379 6,111,075 Interest on cash equivalents and short term investments 101,367 - 101,367 ----------- ---------- ----------- Total investment activity 941,063 5,271,379 6,212,442 Portfolio Expenses Management fee 226,981 (86,675)(f) 140,306 General and administrative 69,618 - 69,618 ----------- ---------- ----------- 296,599 (86,675) 209,924 ----------- ---------- ----------- Net income $ 644,464 $5,358,054 $6,002,518 =========== ========== =========== Net income per limited partnership unit $ 15.98 $ 132.89 (d) $ 148.87 =========== ========== =========== Number of limited partnership units outstanding during the period 39,917 39,917 39,917 =========== ========== =========== Pro Forma Financial Statement Footnotes: (a) Disposition of asset as discussed in Item 2 herein and allocation of the gain on such disposition to the Partners. (b) Disposition fee incurred in connection with the disposition of the asset discussed in Item 2 herein. (c) Removal of 1997 operating activity related to the disposed asset discussed in Item 2 herein. (d) Calculation of net income per limited partnership unit after the removal of operating activity and addition of the gain related to the disposed asset discussed in Item 2 herein. (e) Removal of 1998 year-to-date operating activity related to the disposed asset discussed in Item 2 herein. (f) Removal of management fees based on distributions received during the pro forma period from the disposed asset discussed in Item 2 herein. (g) Removal of appraisal fees incurred during the pro forma period for the disposed asset discussed in Item 2 herein.