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EXHIBIT 99.1
FIRST UNION REAL ESTATE EQUITY and MORTGAGE INVESTMENTS Proforma
Combined Balance Sheets as of December 31, 1998
(in thousands)
1998
1998 Adjustments Proforma
---- ----------- --------
ASSETS
Investments in real estate
Land $ 130,340 (31,549) $ 98,791
Buildings and improvements 676,519 (250,391) 426,128
--------- -------- ---------
806,859 (281,940) 524,919
Less - Accumulated depreciation (165,357) 97,368 (67,989)
--------- -------- ---------
Total investments in real estate 641,502 (184,572)(a) 456,930
Investment in joint venture 1,722 1,722
Mortgage loans and notes receivable 5,508 5,508
Other assets
Cash and cash equivalents - unrestricted 28,649 -- 28,649
- restricted 16,526 16,526
Accounts receivable and prepayments 21,809 21,809
Investments 5 5
Inventory 2,798 2,798
Goodwill, net 45,379 45,379
Management and lease agreements, net 1,852 1,852
Deferred charges and other, net 6,864 6,864
Unamortized debt issue costs 7,758 (718)(a) 7,040
Other 6,312 -- 6,312
--------- -------- ---------
Total assets $ 786,684 (185,290) $ 601,394
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LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Mortgage loans $ 345,042 (52,956)(a) $ 292,086
Notes payable 94,996 (60,327)(a) 34,669
Senior notes 12,538 -- (a) 12,538
Bank loans 125,821 (101,000)(a) 24,821
Accounts payable and accrued liabilities 42,659 42,659
Deferred obligations 10,602 10,602
Deferred capital gains and other deferred income 3,283 3,283
--------- -------- ---------
Total liabilities 634,941 (214,283) 420,658
--------- -------- ---------
Minority interest 1,047 1,047
Shareholders' equity
Preferred shares of beneficial interest, $25 liquidation preference,
2,300,000 shares authorized and 1,349,000 outstanding 31,737 31,737
Shares of beneficial interest, $1 par, unlimited authorization, outstanding 31,416 31,416
Paid-in capital 89,660 28,993(a) 118,653
Foreign currency translation adjustment (2,117) (2,117)
--------- -------- ---------
Total shareholders' equity 150,696 28,993 179,689
--------- -------- ---------
$ 786,684 -- $ 601,394
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(a) To reflect the registrant's sale of two office buildings and a shopping
center and the potential sales of nine additional shopping malls, one
office building and eight apartment complexes which are under contract to
be sold. The net proceeds after closing costs, mortgage prepayment fees and
mortgage prepayments would be $161.3 million. For the purposes of the
historical balance sheet, the remaining proceeds are used to repay $60.3
million of Notes payable and $101 million of Bank loans. The sale of the
two office buildings and a shopping center resulted in gross proceeds of
$27.2 million which represents 3% of the registrant's December 31, 1998
total assets.