1
Exhibit 20
FIRST UNION REAL ESTATE EQUITY and MORTGAGE INVESTMENTS
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Combined Balance Sheets
Unaudited (In thousands, except shares) September 30, December 31,
1997 1996
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ASSETS
Investments in real estate
Land $ 110,269 $ 52,891
Buildings and improvements 659,167 406,672
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769,436 459,563
Less - Accumulated depreciation (115,174) (112,614)
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Total investments in real estate 654,262 346,949
Investment in joint venture 1,497 30,776
Mortgage loans receivable 28,125 42,266
Other assets
Cash and cash equivalents 21,312 2,951
Short- term investments, at cost 12,651
Accounts receivable and prepayments 20,008 8,440
Intangibles 35,366
Management and lease agreements 11,729
Deferred charges, net 11,020 5,225
Unamortized debt issue costs 7,788 3,923
Other 12,321
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$ 816,079 $ 440,530
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LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Mortgage loans $ 322,114 $ 129,068
Senior notes 100,000 100,000
Bank loans 65,944 25,800
Accounts payable and accrued liabilities 46,326 14,549
Deferred obligations 10,812 10,825
Deferred capital gain and other deferred income 9,568 7,735
Other liabilities 10,495
Shareholders' equity, including preferred shares of beneficial interest, $25
liquidation preference, 2,300,000 shares authorized and outstanding and shares
of beneficial interest, $1 par, unlimited
authorization, outstanding 1997 - 28,137,441; 1996 - 17,621,799 250,820 152,553
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$ 816,079 $ 440,530
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2
Exhibit 20
FIRST UNION REAL ESTATE EQUITY and MORTGAGE INVESTMENTS
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Combined Statements of Income
Unaudited (In thousands, except per share data) Three Months Ended Nine Months Ended
September 30, September 30,
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1997 1996 1997 1996
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Revenues
Rents $ 70,440 $ 18,553 $145,643 $55,102
Interest - Mortgage loans 648 1,129 2,221 3,600
- Short-term investments 812 1,620 9
Equity in (loss) income from joint venture (172) 412
Management fees 1,099 2,706
Other 308 53 1,601 284
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73,135 19,735 154,203 58,995
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Expenses
Property operating 52,989 6,341 101,695 19,517
Real estate taxes 2,490 2,132 7,106 6,198
Depreciation and amortization 5,276 3,092 12,724 9,858
Interest - Mortgage loans 3,799 2,303 8,489 6,368
- Senior notes 2,219 2,219 6,656 6,871
- Bank loans and other 1,307 1,358 3,338 4,274
General and administrative 3,110 1,246 8,138 4,769
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71,190 18,691 148,146 57,855
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Net income before preferred dividend 1,945 1,044 6,057 1,140
Preferred dividend (1,207) (3,622)
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Net income applicable to shares of beneficial interest $ 738 $ 1,044 $ 2,435 $ 1,140
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Per share
Net income applicable to shares of beneficial interest $ .03 $ .06 $ .10 $ .07
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Adjusted shares of beneficial interest 27,967 17,224 24,158 17,237
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3
FIRST UNION REAL ESTATE EQUITY and MORTGAGE INVESTMENTS
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Exhibit 20
Combined Statements of Changes in Cash
Unaudited (In thousands) Three Months Nine Months
Ended September 30, Ended September 30,
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1997 1996 1997 1996
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Cash provided by (used for) operations
Net income before preferred dividend $ 1,945 $ 1,044 $ 6,057 $ 1,140
Adjustments to reconcile net income to net
cash provided by operations --
Depreciation and amortization 5,276 3,092 12,724 9,858
Increase in deferred charges, net (1,084) (280) (4,631) (854)
Increase in deferred interest on
mortgage investments, net (19) (102) (102) (295)
(Decrease) increase in deferred obligations (4) 44 (13) 126
Increase in deferred income 207 996
Net changes in other assets and liabilities 1,452 7,772 5,798 3,833
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Net cash provided by operations 7,773 11,570 20,829 13,808
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Cash provided by (used for) investing
Repayment of mortgage investment 16,200 7,000
Investment in short-term investments (12,651) (12,651)
Principal received from mortgage investments 57 45 159 131
Proceeds from sale of properties 4,023 13,011 1,825
Advance deposit for property acquisitions (2,000) (2,000)
Acquisition of joint venture interests, net of cash aquired (72,900) (72,900)
Investment in joint venture (30,000) (30,000)
Investment in Impark (36,574)
Investment in capital and tenant improvements (7,857) (3,132) (16,946) (16,578)
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Net cash used for investing (91,328) (33,087) (111,701) (37,622)
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Cash provided by (used for) financing
Increase in mortgage loans 12,000 2,737 48,500
Increase (decrease) in short-term loans 38,975 12,270 13,175 (5,660)
Repayment of mortgage loans - Normal payments (632) (847) (1,839) (2,369)
- Balloon payments (13,835)
Dividends paid to shares of beneficial interest (3,076) (1,921) (7,378) (5,869)
Dividends paid to preferred shares of beneficial interest (1,208) (3,663)
Debt issue costs paid (202) (536) (1,013) (1,313)
Purchase of First Union shares (7,125)
Sale of First Union shares 51 121,049 81
Sale of interest rate protection agreement 1,025
Repayment of Medium Term Notes (5,000) (5,000)
Other (6)
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Net cash provided by financing 33,908 15,966 109,233 22,264
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(Decrease) increase in cash and cash equivalents (49,647) (5,551) 18,361 (1,550)
Cash and cash equivalents at beginning of period 70,959 7,403 2,951 3,402
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Cash and cash equivalents at end of period $ 21,312 $ 1,852 $ 21,312 $ 1,852
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Notes to Combined Financial Statements
1. Income per share of beneficial interest has been computed on weighted
average shares and share equivalents outstanding for the applicable
periods.
2. In April 1997, the Trust's affiliated management company purchased voting
control of Imperial Parking Ltd. (Impark) for $75 million including the
assumption of $26 million in debt and the issuance of $10.5 million of
non-voting common stock in Impark to its former owners.
3. In September 1997, the Trust purchased the interests of its joint venture
partners in eight shopping malls and a 50% interest in another mall for $88
million in cash and the assumption of $203 million in debt. The Trust
accounted for its purchase of the joint venture interests using purchase
accounting.