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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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 24, 1997
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Post Apartment Homes, L.P.
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(Exact name of registrant as specified in its charter)
Georgia 0-28226 58-2053632
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
3350 Cumberland Circle, Atlanta, Georgia 30339
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (770) 850-4400
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Item 2. Acquisition or Disposition of Assets
On October 24, 1997, Columbus Realty Trust, a Texas real estate
investment trust ("Columbus"), merged with and into Post Interim Holding
Company, Inc. (formerly Post LP Holdings, Inc.), a wholly owned subsidiary of
Post Properties, Inc. ("PPI") (the "Merger") pursuant to the terms of an
Agreement and Plan of Merger dated as of August 1, 1997. Pursuant to the Merger,
each outstanding common share of beneficial interest, par value $.01 per share,
of Columbus will be converted into the right to receive 0.615 shares of common
stock of the Registrant, par value $.01 per share ("PPI Common Stock"), with
cash being paid in lieu of fractional shares of PPI Common Stock.
In connection with the Merger, the general partnership interest of the
Registrant ("Post") was transferred to Post GP Holdings, Inc., a wholly owned
subsidiary of PPI, and the units of limited partnership of the Registrant
previously held by PPI were transferred to Post LP Holdings, Inc. In addition,
following the Merger the assets of Columbus were transferred by Post LP
Holdings, Inc. to the Registrant in exchange for units of limited partnership.
As a result of the Merger, PPI is the largest multi-family REIT
concentrating on the development of upscale multi-family apartment homes in the
major metropolitan markets of the Southeast and Southwest, with a total market
capitalization of approximately $2.2 billion.
Item 7. Financial Statement, Pro Forma Financial Information and Exhibits.
(b) Pro Forma Financial Information
(i) Unaudited Pro Forma Consolidated Balance Sheet as of
June 30, 1997
(ii) Unaudited Pro Forma Combined Statements of
Operations For the Six Months Ended June 30, 1997
and the Year Ended December 31, 1996
(iii) Notes to Unaudited Pro Forma Balance Sheet and
Statement of Operations
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
POST APARTMENT HOMES, L.P.
(Registrant)
By: POST GP HOLDINGS, INC
as general partner
Date: November 7, 1997 By: John A. Williams
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John A. Williams
Chairman of the Board and Chief
Executive Officer
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POST APARTMENT HOMES, L.P.
BASIS OF PRESENTATION TO UNAUDITED PRO FORMA
COMBINED BALANCE SHEET
JUNE 30, 1997
The Post Apartment Homes, L.P. Unaudited Pro Forma Combined Balance Sheet
gives effect to the Merger of Post and Columbus as if the Merger had occurred on
June 30, 1997. The Unaudited Pro Forma Combined Balance Sheet gives effect to
the Merger under the "purchase" method of accounting in accordance with
Accounting Principles Board Opinion No. 16. In the opinion of management, all
significant adjustments necessary to reflect the effects of the Merger have been
made.
The Unaudited Pro Forma Combined Balance Sheet is presented for
comparative purposes only and is not necessarily indicative of what the actual
combined financial position of Post and Columbus would have been at June 30,
1997, nor does it purport to represent the future combined financial position
of Post and Columbus. This Post Apartment Homes, L.P. Unaudited Pro Forma
Combined Balance Sheet should be read in conjunction with, and is qualified in
its entirety by, the respective historical financial statements and notes
thereto of Post and Columbus.
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POST APARTMENT HOMES, L.P.
UNAUDITED PRO FORMA COMBINED BALANCE SHEET
JUNE 30, 1997
PRO FORMA
POST COLUMBUS MERGER PRO FORMA
HISTORICAL(A) HISTORICAL(A) ADJUSTMENTS(B) COMBINED
------------- ------------- -------------- ----------
(IN THOUSANDS)
ASSETS
Real estate assets
Land..................................... $ 149,071 $ 46,663 $ 21,907(C) $ 217,641
Building and improvements................ 736,891 331,380 108,096(C) 1,176,367
Furniture, fixtures and equipment........ 76,835 4,912 81,747
Construction in progress (includes land
on properties under development)...... 203,477 73,459 276,936
Land held for future development......... 8,660 -- 8,660
---------- -------- -------- ----------
1,174,934 456,414 130,003 1,761,351
Less: accumulated depreciation........... (185,068) (46,576) 46,576(C) (185,068)
---------- -------- -------- ----------
Real estate held for investment.......... 989,866 409,838 176,579 1,576,283
Cash and cash equivalents................ 1,771 6,688 8,459
Restricted cash.......................... 1,016 313 1,329
Deferred charges, net.................... 9,652 1,361 86(D) 11,099
Other assets............................. 11,468 12,963 (2,078)(E) 22,353
---------- -------- -------- ----------
Total assets..................... $1,013,773 $431,163 $174,587 $1,619,523
========== ======== ======== ==========
LIABILITIES AND PARTNERS'/SHAREHOLDERS' EQUITY
Notes payable.............................. $ 473,683 $231,477 $(27,203)(F) $ 677,957
Accrued interest payable................... 4,305 332 4,637
Distribution payable....................... 16,220 -- 16,220
Accounts payable and accrued expenses...... 30,573 11,722 42,295
Security deposits and prepaid rents........ 5,179 2,225 7,404
Other liabilities.......................... -- 2,063 2,063
---------- -------- -------- ----------
Total liabilities................ 529,960 247,819 (27,203) 750,576
---------- -------- -------- ----------
Partners'/shareholders' equity
Partners' equity......................... 483,813 -- 385,134(G) 868,947
Common stock............................. -- 134 (134)(H) --
Additional paid-in capital............... -- 213,981 (213,981)(I) --
Accumulated earnings(deficit)............ -- (30,765) 30,765(J) --
Treasury stock........................... -- (6) 6(J) --
---------- -------- -------- ----------
Total partners'/shareholders'
equity......................... 483,813 183,344 201,790 868,947
---------- -------- -------- ----------
Total liabilities and
partners'/shareholders'
equity......................... $1,013,773 $431,163 $174,587 $1,619,523
========== ======== ======== ==========
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POST APARTMENT HOMES, L.P.
BASIS OF PRESENTATION TO UNAUDITED PRO FORMA
COMBINED STATEMENTS OF OPERATIONS'
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND THE YEAR ENDED DECEMBER 31, 1996
The Post Apartment Homes, L.P. Unaudited Pro Forma Combined Statements of
Operations for the six months ended June 30, 1997 and the year ended December
31, 1996 are presented as if the Merger had occurred on January 1, 1996. The
Post Apartment Homes, L.P. Unaudited Pro Forma Combined Statements of Operations
give effect to the Merger under the "purchase" method of accounting in
accordance with Accounting Principles Board of Opinion No. 16. In the opinion
of management, all significant adjustments necessary to reflect the effects of
these transactions have been made.
The Post Apartments Homes, L.P. Unaudited Pro Forma Combined Statements of
Operations are presented for comparative purposes only and are not necessarily
indicative of what the actual combined results of Post and Columbus would have
been for the six months ended June 30, 1997 and the year ended December 31,
1996, nor do they purport to be indicative of the results of operations in
future periods. The Post Apartment Homes, L.P. Unaudited Pro Forma Combined
Statements of Operations should be read in conjunction with, and are qualified
in their entirety by, the respective historical financial statements and notes
thereto of Post and Columbus.
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POST APARTMENT HOMES, L.P.
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1997
POST COLUMBUS MERGER PRO FORMA
HISTORICAL(K) HISTORICAL(K) ADJUSTMENTS COMBINED
------------- ------------- ----------- -----------
(IN THOUSANDS EXCEPT UNIT/SHARE AND PER UNIT/SHARE DATA)
Revenues:
Rental............................... $ 84,131 $ 26,879 $ 111,010
Property management - third party.... 1,092 71 1,163
Landscape services - third party..... 2,446 -- 2,446
Interest............................. 15 181 196
Other................................ 2,996 1,176 4,172
---------- ---------- ---------- -----------
Total revenues............... 90,680 28,307 118,987
---------- ---------- ---------- -----------
Expenses:
Property operating and maintenance
(exclusive of items shown
separately below)................. 31,132 9,449 40,581
Depreciation (real estate assets).... 12,563 6,056 292(L) 18,911
Depreciation (non-real estate
assets)........................... 495 145 640
Property management - third party.... 814 -- 814
Landscape services - third party..... 2,031 -- 2,031
Interest............................. 11,070 4,898 (1,435)(M) 14,533
Amortization of deferred loan
costs............................. 552 252 (211)(N) 593
General and administrative........... 3,419 1,331 (725)(O) 4,025
---------- ---------- ---------- -----------
Total expenses............... 62,076 22,131 (2,079) 82,128
---------- ---------- ---------- -----------
Income before net gain on sale of
assets and extraordinary item..... 28,604 6,176 2,079 36,859
Net gain on sale of assets........... 3,512 561 4,073
---------- ---------- ---------- -----------
Net income before extraordinary
item.............................. 32,116 6,737 2,079 40,932
Distribution to preferred
unitholders....................... (2,125) -- (1,906) (4,031)
---------- ---------- ---------- -----------
Net income available to common
unitholders/shareholders before
extraordinary item................ $ 29,991 $ 6,737 $ 173 $ 36,901
========== ========== ========== ===========
Per common unit/share data:
Weighted average common units/shares
outstanding -- primary............ 27,206,432 13,496,035 (5,076,905)(P) 35,625,562
Net income available to common
unitholders/shareholders before
extraordinary item................ $ 1.10 $ 0.50 $ (0.57) $ 1.04
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POST APARTMENT HOMES, L.P.
UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS
YEAR ENDED DECEMBER 31, 1996
POST COLUMBUS MERGER PRO FORMA
HISTORICAL(K) HISTORICAL(K) ADJUSTMENTS COMBINED
------------- ------------- ----------- ----------
(IN THOUSANDS EXCEPT UNIT/SHARE AND PER UNIT/SHARE DATA)
Revenues:
Rental.............................. $ 157,735 $ 45,910 $ 203,645
Property management - third party... 2,828 298 3,126
Landscape services - third party.... 4,834 - 4,834
Interest............................ 326 228 554
Other............................... 4,985 2,094 7,079
---------- ---------- ---------- ----------
Total revenues.............. 170,708 48,530 -- 219,238
---------- ---------- ---------- ----------
Expenses:
Property operating and maintenance
(exclusive of items shown
separately below)................ 57,335 16,365 73,700
Depreciation (real estate assets)... 22,676 10,257 2,440(L) 35,373
Depreciation (non-real estate
assets).......................... 927 346 1,273
Property management - third party... 2,055 - 2,055
Landscape services - third party.... 3,917 - 3,917
Interest............................ 22,131 7,884 (2,324)(M) 27,691
Amortization of deferred loan
costs............................ 1,352 393 (327)(N) 1,418
General and administrative.......... 7,716 2,073 (1,450)(O) 8,339
---------- ---------- ---------- ----------
Total expenses.............. 118,109 37,318 (1,661) 153,766
---------- ---------- ---------- ----------
Income before net gain on sale of
assets and extraordinary item.... 52,599 11,212 1,661 65,472
Net gain on sale of assets.......... 854 246 1,100
---------- ---------- ---------- ----------
Net income before extraordinary
item............................. 53,453 11,458 1,661 66,572
Distribution to preferred
unitholders...................... (1,063) (3,813) (4,876)
---------- ---------- ---------- ----------
Net income available to common
unitholders/shareholders before
extraordinary item............... $ 52,390 $ 11,458 $ (2,152) $ 61,696
========== ========== ========== ==========
Per common unit/share data:
Weighted average common units/shares
outstanding - primary............ 26,917,723 12,142,069 (3,722,939)(P) 35,336,853
Net income available to common
unitholders/shareholders before
extraordinary item............... $ 1.95 $ 0.94 $ (1.14) $ 1.75
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POST APARTMENT HOMES, L.P.
NOTES TO UNAUDITED PRO FORMA
BALANCE SHEET AND STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(A) Represents the respective historical balance sheet of Post and Columbus as
of June 30, 1997. Certain reclassifications have been made to Columbus'
historical balance sheet to conform to Post's balance sheet presentation.
(B) Represents adjustments to record the Merger in accordance with the purchase
method of accounting, based upon the assumed purchase price of $605,750
assuming a market value of $40.09 per share of PPI Common Stock, as
follows:
Issuance of 8,407 Units to PPI resulting from the issuance
of 8,407 shares of PPI Common Stock based on the 0.615
exchange for 13,669 Columbus Common Shares, which includes
260 Columbus Common Shares issued immediately prior to the
Merger.................................................... $337,009
Assumption of Columbus' liabilities (including $2,217 of
purchase adjustments)..................................... 250,036
Merger costs (see calculation below)........................ 18,705
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$605,750
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The following is a calculation of the estimated fees and other expenses
related to the Merger:
Buyout of employment agreements............................. $ 8,800
Advisory fees............................................... 7,455
Legal and accounting fees................................... 1,500
Other, including printing, filing and transfer costs........ 950
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Total............................................. $18,705
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(C) Represents the estimated increase in Columbus' real estate assets, net
based upon Post's purchase price and the adjustment to eliminate the basis
of Columbus' net assets acquired:
Purchase Price (see Note B)................................. $605,750
Less: Historical basis of Columbus' net assets acquired
Real estate assets..................................... (409,838)
Other assets, net of purchase adjustments.............. (19,333)
--------
Step-up to record fair value of Columbus' real estate
assets.................................................... $176,579
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The allocation to land and building and improvements to record the step-up
was based upon relative fair values of Columbus' real estate assets.
(D) Increase due to estimated loan costs incurred to refinance Columbus' debt
($1,056) net of elimination of Columbus' historical deferred loan costs
($970).
(E) Decrease due to recognition of historical deferred compensation expense
upon vesting of certain options of Columbus prior to the Merger.
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POST APARTMENT HOMES, L.P.
NOTES TO UNAUDITED PRO FORMA -- (CONTINUED)
BALANCE SHEET AND STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(F) Decrease to notes payable reflects the financing of the following:
Net proceeds from issuance of PPI preferred stock........... $(48,325)
Transaction costs........................................... 18,705
Loan costs on refinanced debt............................... 1,056
Prepayment penalties on existing debt....................... 1,161
Registration costs.......................................... 200
--------
$(27,203)
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(G) Increase to partners' equity to reflect the following:
Contribution of proceeds from PPI related to its issuance of
8,407 units at $40.09 per share........................... $ 337,009
Contribution of proceeds from PPI related to its issuance of
2,000,000 preferred shares................................ 48,325
Less:
Registration costs incurred in connection with the
Merger................................................. (200)
---------
$ 385,134
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(H) Decrease results from elimination of Columbus Common Shares at $.01 par
value ($134).
(I) Decrease represents elimination of Columbus' historical paid in capital as
a result of the Merger.
(J) Reflects the elimination of Columbus' distribution in excess of accumulated
earnings and treasury stock to partners' equity, as a result of the Merger.
(K) Represents the respective historical statement of operations of Post and
Columbus for the period indicated. Certain reclassifications have been made
to Columbus' Historical Statement of Operations to conform to Post's
Statement of Operations presentation.
(L) Represents the net increase in depreciation of real estate owned as a
result of recording Columbus' real estate assets at fair value versus
historical cost. Depreciation is computed on a straight-line basis over the
estimated useful lives of the related assets which have a useful life of
approximately 35 years.
The calculation of the fair value of depreciable real estate assets at June
30, 1997 is as follows:
Historical basis of Columbus' real estate property, net..... $409,838
Plus: Step up to Columbus' real estate property, net (see
Note C)................................................... 176,579
--------
Pro forma basis of Columbus' real estate property at fair
value..................................................... 586,417
Less: Fair value allocated to land.......................... (68,570)
Construction in progress.............................. (73,459)
--------
Pro forma basis of Columbus' depreciable real estate
property at fair value.................................... $444,388
========
Calculation of depreciation of real estate property for the six months
ended June 30, 1997:
Depreciation expense based upon an estimated useful life of
approximately 35 years.................................... $ 6,348
Less: Historic Columbus depreciation of real estate
property.................................................. (6,056)
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Pro forma adjustment........................................ $ 292
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POST APARTMENT HOMES, L.P.
NOTES TO UNAUDITED PRO FORMA -- (CONTINUED)
BALANCE SHEET AND STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Calculation of depreciation of real estate property for the year ended
December 31, 1996 is as follows:
Depreciation expense based upon an estimated useful life of
approximately 35 years.................................... $12,697
Less: Historic Columbus depreciation of real estate
property.................................................. 10,257
-------
Pro forma adjustment........................................ $ 2,440
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(M) Decrease results from refinancing of Columbus' debt at lower interest
rates.
(N) Decrease results from the elimination of amortization of Columbus' deferred
financing costs, which costs would be eliminated in connection with the
Merger, net of estimated amortization of deferred financing costs for
refinanced debt.
(O) Decrease results from identified historical costs of certain items which
will be eliminated or reduced as a result of the Merger as follows:
Duplication of public company expenses...................... $ 650
Reduction in salaries and benefits.......................... 600
Other....................................................... 200
------
Annual total...................................... $1,450
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(P) Decrease of Weighted Average Common Shares Outstanding based on the
conversion of Columbus Common Shares to Post Common Stock at a conversion
ratio of 0.615 Columbus Common Shares per Post Common Stock and a par value
of $.01.
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