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
October 14, 1998
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Date of report (Date of
earliest event reported)
WILSHIRE REAL ESTATE INVESTMENT TRUST INC.
(Exact name of registrant as specified in its charter)
Maryland 0-23911 52-2081138
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(State or other Commission File Number (I.R.S. Employer
jurisdiction of Identification Number)
incorporation)
1776 SW Madison Street, Portland, OR97205
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(Address of principal executive offices)(Zip Code)
(503) 223-5600
Registrant's telephone number, including area code
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Not Applicable
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(Former name or former address, if changed since
last report)
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Item 2. ACQUISITION OR DISPOSITION OF ASSETS.
Between October 14 and October 16, 1998, Wilshire Real Estate
Investment Trust Inc. ("WREIT" or the "Company") sold certain real estate
related assets at their carrying value to various unrelated third parties for
$525.2 million. The sales price was determined through arms length negotiations
between the various purchasers and the Company. The cash proceeds from the sale
were used to repay principal and interest on the existing bonds payable and
repurchase agreements for which these securities served as collateral totaling
$518.6 million.
The assets sold consisted of 45 classes of subordinate mortgage-backed
securities representing interests in 39 securitizations by 11 different issuers
which had a carrying value at the date of sale of $152.9 million and a $372.3
million pool of one-to-four family fully amortizing mortgage loans secured by
first liens.
The market for mortgage-backed securities and, in particular,
subordinate credit related tranches of these securities has experienced
dramatically widening spreads throughout the last ten weeks. Liquidity problems
affecting certain Wall Street firms, hedge funds and other financial instruments
investors have exacerbated this market phenomenon through forced liquidations of
their assets. This has led to an increased need for liquidity at WREIT both to
meet collateral calls and as a preemptive measure to protect against future MBS
spread distortions that the Company expects may be experienced by the markets in
general.
As a result, the Company, through these asset sales, has reduced debt
and increased current liquidity, enabling it to meet collateral calls. The
Company recognized an impairment loss of approximately $28.6 million during the
quarter ended September 30, 1998. In addition, the Company may recognize
impairment losses on unsold assets and assets sold which are not required to be
covered under Form 8-K.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(b) Pro forma financial information related to the assets sold listed under
Item 2 is attached hereto, and incorporated herein by reference, as Exhibit 99.
(c) Exhibits
The following exhibits are filed as part of this report:
99 Pro forma financial information
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SIGNATURES
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 hereunto duly authorized.
WILSHIRE REAL ESTATE
INVESTMENT TRUST INC.
Date: November 5, 1998 By: /S/ Chris Tassos
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Chris Tassos
Executive Vice President and
Chief Financial Officer
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INDEX TO EXHIBITS FILED HEREWITH
EXHIBIT DESCRIPTION PAGE
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99 PRO FORMA FINANCIAL INFORMATION B NARRATIVE FORMAT 5
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