-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, K28wCaWQdxNIBWmEmMNrpFo3R+73G5eY2NYu7P5pwTeG0RWdjoIEmMmz672CNJvy xrzAcEhO/bkrEkUxF7Z3JQ== 0001003410-97-000004.txt : 19970320 0001003410-97-000004.hdr.sgml : 19970320 ACCESSION NUMBER: 0001003410-97-000004 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970319 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DUKE REALTY LIMITED PARTNERSHIP CENTRAL INDEX KEY: 0001003410 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 351898425 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-20625 FILM NUMBER: 97559004 BUSINESS ADDRESS: STREET 1: 8888 KEYSTONE CROSSING STREET 2: SUITE 1200 CITY: INDIANAPOLIS STATE: IN ZIP: 46240 BUSINESS PHONE: 3175743631 MAIL ADDRESS: STREET 2: 8888 KEYSTONE CROSSING SUITE 1200 CITY: INDIANAPOLIS STATE: IN ZIP: 46240 10-K 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) /X/ Annual report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 (Fee Required) for the fiscal year ended December 31, 1996 ----------------- or / / Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 (No Fee Required) for the transition period from to ------ ------- Commission file number 0-20625 ------------------ DUKE REALTY LIMITED PARTNERSHIP ----------------------------------------------------------------- (Exact name of registrant as specified in its charter) Indiana 35-1898425 --------------------------------------- ------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 8888 Keystone Crossing, Suite 1200 Indianapolis, Indiana 46240 ---------------------------------------- ------------- (Address of principal executive offices) (Zip Code) (317) 846-4700 ------------------------- (Registrant's telephone number, including area code) SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: Title of each class: Name of each exchange on which registered: None N/A -------------------- ----------------------------------- SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: LIMITED PARTNER UNITS Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ----- ------ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ( X ) The aggregate market value of the Limited Partner Units held by non-affiliates of Registrant is $43,648,729 based on the last reported sale price of the common shares of Duke Realty Investments, Inc., into which Limited Partner Units are exchangeable, on March 7, 1997. The number of Limited Partnership Units outstanding as of March 7, 1997 was 3,309,758. DOCUMENTS INCORPORATED BY REFERENCE Part III incorporates by reference the Proxy Statement of Duke Realty Investments, Inc. related to the Annual Meeting of Shareholders to be held April 24, 1997. TABLE OF CONTENTS FORM 10-K Item No. Page(s) -------- ------- PART I 1. Business..............................................1 -4 2. Properties............................................4 -13 3. Legal Proceedings.....................................13 4. Submission of Matters to a Vote of Security Holders...13 PART II 5. Market for the Registrant's Equity and Related Security Holder Matters...............................13 6. Selected Financial Data...............................14 7. Management's Discussion and Analysis of Financial Condition and Results of Operations...................14- 22 8. Financial Statements and Supplementary Data...........22 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure...................22 PART III 10. Directors and Executive Officers of the Registrant....23-25 11. Executive Compensation................................25 12. Security Ownership of Certain Beneficial Owners and Management............................................25 13. Certain Relationships and Related Transactions........25 PART IV 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K...........................................26-52 Signatures.................................................53-54 Exhibits When used in this Form 10-K Report, the words "believes," "expects," "estimates" and similar expressions are intended to identify forward- looking statements. Such statements are subject to certain risks and uncertainties which could cause actual results to differ materially. In particular, among the factors that could cause actual results to differ materially are continued qualification as a real estate investment trust, general business and economic conditions, competition, increases in real estate construction costs, interest rates, accessibility of debt and equity capital markets and other risks inherent in the real estate business including tenant defaults, potential liability relating to environmental matters and illiquidity of real estate investments. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Partnership undertakes no obligation to publicly release the results of any revisions to these forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers are also advised to refer to Duke Realty Investments, Inc.'s Form 8-K Report as filed with the U.S. Securities and Exchange Commission on March 29, 1996 for additional information concerning these risks. PART I ITEM 1. BUSINESS Duke Realty Limited Partnership (the "Partnership") was formed on October 4, 1993, when Duke Realty Investments, Inc. (the "Predecessor Company" or the "General Partner") contributed all of its properties and related assets and liabilities along with the net proceeds of $309.3 million from the issuance of an additional 14,000,833 shares through an offering (the "1993 Offering") to the Partnership. Simultaneously, the Partnership completed the acquisition of Duke Associates, a full-service commercial real estate firm operating in the Midwest. The General Partner was formed in 1985 and qualifies as a real estate investment trust under provisions of the Internal Revenue Code. The General Partner is the sole general partner of the Partnership currently owning 88.9% of the partnership interest ("General Partner Units"). The remaining 11.1% of the Partnership is owned by limited partners ("Limited Partner Units" and, together with the General Partner Units, the "Common Units"). The Partnership's primary business segment is the ownership and rental of industrial, office and retail properties throughout the Midwest. As of December 31, 1996, it owned interests in a diversified portfolio of 266 rental properties comprising 31.2 million square feet (including 17 properties and one expansion comprising 3.8 million square feet under development). Substantially all of these properties are located in the Partnership's primary markets of Indianapolis, Indiana; Cincinnati, Cleveland, and Columbus, Ohio; Detroit, Michigan; St. Louis, Missouri and Nashville, Tennessee. In addition to its Rental Operations, the Partnership through its Service Operations provides, on a fee basis, leasing, management, construction, development and other real estate services for approximately 8.7 million square feet of properties owned by third parties. See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Item 8 "Financial Statements and Supplementary Data" for financial information of these industry segments. The Partnership conducts its Service Operations through Duke Realty Services Limited Partnership and Duke Construction Limited Partnership, in which the Partnership has an 89% profits interest (after certain preferred returns on partners' capital accounts) and effective control of their operations. All references to the "Partnership" in this Form 10-K Report include the Partnership and those entities owned or controlled by the Partnership, unless the context indicates otherwise. The Partnership has the largest commercial real estate operations in Indianapolis and Cincinnati and is one of the largest real estate companies in the Midwest. -1- The Partnership's headquarters and executive offices are located in Indianapolis, Indiana. In addition, the Partnership has seven regional offices located in Cincinnati, Ohio; Columbus, Ohio; Cleveland, Ohio; Decatur, Illinois; Detroit, Michigan; Nashville, Tennessee and St. Louis, Missouri. The Partnership had 480 employees as of December 31, 1996. BUSINESS STRATEGY The Partnership's business objective is to increase its Funds From Operations ("FFO") by (i) maintaining and increasing property occupancy and rental rates through the aggressive management of its portfolio of existing properties; (ii) expanding existing properties; (iii) developing and acquiring new properties; and (iv) providing a full line of real estate services to the Partnership's tenants and to third- parties. FFO is defined by the National Association of Real Estate Investment Trusts as net income or loss excluding gains or losses from debt restructuring and sales of property plus depreciation and amortization, and after adjustments for minority interest, unconsolidated partnerships and joint ventures (adjustments for minority interests, unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis). While management believes that FFO is a relevant measure of the Partnership's operating performance because it is widely used by industry analysts to measure the operating performance of equity REITs and real estate partnerships, such amount does not represent cash flow from operations as defined by generally accepted accounting principles, should not be considered as an alternative to net income as an indicator of the Partnership's operating performance, and is not indicative of cash available to fund all cash flow needs. As a fully integrated commercial real estate firm, the Partnership believes that its in-house leasing, management, development and construction services and the Partnership's significant base of commercially zoned and unencumbered land in existing business parks should give the Partnership a competitive advantage in its future development activities. The Partnership believes that the analysis of real estate opportunities and risks can be done most effectively at regional or local levels. As a result, the Partnership intends to continue its emphasis on increasing its market share and effective rents in its primary markets within the Midwest. The Partnership also expects to utilize its approximately 1,200 acres of unencumbered land and its many business relationships with more than 2,800 commercial tenants to expand its build-to-suit business (development projects substantially pre-leased to a single tenant) and to pursue other development and acquisition opportunities in its primary markets and elsewhere in the Midwest. The Partnership believes that this regional focus will allow it to assess market supply and demand for real estate more effectively as well as to capitalize on its strong relationships with its tenant base. The Partnership's policy is to seek to develop and acquire Class A commercial properties located in markets with high growth potential for Fortune 500 companies and other quality regional and local firms. The Partnership's industrial and suburban office development focuses on business parks and mixed-use developments suitable for development of multiple projects on a single site where the Partnership can create and control the business environment. These business parks and mixed-use developments generally include restaurants and other amenities which the Partnership believes will create an atmosphere that is particularly efficient and desirable. The Partnership's retail development focuses on community, power and neighborhood centers in its existing markets. As a fully integrated real estate company, the Partnership is able to arrange for or provide to its industrial, office and retail tenants not only well located and well maintained facilities, but also additional services such as build-to-suit construction, tenant finish construction, expansion flexibility and advertising and marketing services. -2- Consistent with its business strategy of expanding in attractive Midwestern markets, the Partnership carefully analyzed the real estate investment potential of several major Midwestern metropolitan areas. Based on this analysis, management concluded that the St. Louis and Cleveland markets offer attractive real estate investment returns in the industrial and suburban office markets based on the following factors: (i) fragmented competition; (ii) strong real estate fundamentals; and (iii) favorable economic conditions. In 1995, the Partnership established a regional office in St. Louis and acquired 463,000 square feet of suburban office properties and 153 acres of land for the future development of industrial properties. In February 1996, the Partnership acquired a 782,000 gross square foot suburban office portfolio and the operating personnel of an independent real estate developer and operator in Cleveland. The Partnership intends to aggressively pursue the development and acquisition of additional rental properties in both the St. Louis and Cleveland markets. All of the Partnership's properties are located in areas that include competitive properties. Such properties are generally owned by institutional investors, other REITs or local real estate operators; however, no single competitor or small group of competitors is dominant in the Partnership's markets. The supply and demand of similar available rental properties may affect the rental rates the Partnership will receive on its properties. Based upon the current occupancy rates in the Partnership and competitive properties, the Partnership believes there will not be significant competitive pressure to lower rental rates in the near future. FINANCING STRATEGY The Partnership seeks to maintain a well-balanced, conservative and flexible capital structure by: (i) currently targeting a ratio of long- term debt to total market capitalization in the range of 25% to 40%; (ii) extending and sequencing the maturity dates of its debt; (iii) borrowing primarily at fixed rates; (iv) generally pursuing current and future long-term debt financings and refinancings on an unsecured basis; and (v) maintaining conservative debt service and fixed charge coverage ratios. Management believes that these strategies have enabled and should continue to enable the General Partner and the Partnership to access the debt and equity capital markets for their long-term requirements such as debt refinancings and financing development and acquisitions of additional rental properties. The General Partner and the Partnership have raised approximately $626 million through public debt and equity offerings during the three years ended December 31, 1996. Based on these offerings, the General Partner and the Partnership have demonstrated their abilities to access the public markets as a source of capital to fund future growth. In addition, as discussed under Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," the Partnership has a $150 million line of credit available for short-term fundings of development and acquisition of additional rental properties. The Partnership's debt to total market capitalization ratio (total market capitalization is defined as the total market value of all Common and Preferred Units outstanding plus outstanding indebtedness) at March 7, 1997 was 25.3%. The market value of the Common and Preferred Units is assumed to be equal to the General Partner's market value of Common and Preferred Shares. The Partnership's ratio of earnings to debt service and ratio of earnings to fixed charges for the year ended December 31, 1996 were 2.62x and 2.20x, respectively. In computing the ratio of earnings to debt service, earnings have been calculated by adding debt service to income before gains or losses on property sales. Debt service consists of interest expense and recurring principal amortization (excluding maturities) and excludes amortization of debt issuance costs. In computing the -3- ratio of earnings to fixed charges, earnings have been calculated by adding fixed charges, excluding capitalized interest, to income before gains or losses on property sales. Fixed charges consist of interest costs, whether expensed or capitalized, the interest component of rental expense, amortization of debt issuance costs and preferred stock dividend requirements. Management believes these measures to be consistent with its financing strategy. OTHER The Partnership's operations are not dependent on a single or few customers as no single customer accounts for more than 2% of the Partnership's total revenue. The Partnership's operations are not subject to any significant seasonal fluctuations. The Partnership believes it is in compliance with environmental regulations and does not anticipate material effects of continued compliance. For additional information regarding the Partnership's investments and operations, see Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations," and Item 8, "Financial Statements and Supplementary Data." For additional information about the Partnership's business segments see Item 8, "Financial Statements and Supplementary Data." ITEM 2. PROPERTIES As of December 31, 1996, the Partnership owns an interest in a diversified portfolio of 266 commercial properties encompassing approximately 31.2 million net rentable square feet (including 17 properties and one expansion comprising 3.8 million square feet under development) located primarily in five states and approximately 1,200 acres of land for future development. The properties are described on the following pages. -4-
Partner- Net Percent ship's Year Land Rentable Occupied Name/ Ownership Owner- Constructed/ Area Area at Location Interest ship Expanded (Acres) (sq.ft.) 12/31/96 - --------- ---------- ------- ----------- ------ ------ -------- IN-SERVICE - ---------- INDUSTRIAL - ---------- INDIANAPOLIS, INDIANA PARK 100 BUSINESS PARK Building 38 Fee 100% 1978 1.11 6,000 100% Building 48 Fee 50% [1] 1984 8.63 127,410 100% Building 49 Fee 50% [1] 1982 4.55 89,600 100% Building 50 Fee 50% [1] 1982 4.09 51,200 100% Building 52 Fee 50% [1] 1983 2.70 34,800 100% Building 53 Fee 50% [1] 1984 4.23 76,800 100% Building 54 Fee 50% [1] 1984 4.42 76,800 100% Building 55 Fee 50% [1] 1984 3.83 43,200 100% Building 56 Fee 50% [1] 1984 15.94 300,000 100% Building 57 Fee 50% [1] 1984 7.70 128,800 100% Building 58 Fee 50% [1] 1984 8.03 128,800 100% Building 59 Fee 50% [1] 1985 5.14 83,200 100% Building 60 Fee 50% [1] 1985 4.78 83,200 62% Building 62 Fee 50% [1] 1986 7.70 128,800 100% Building 67 Fee 50% [1] 1987 4.23 72,350 100% Building 68 Fee 50% [1] 1987 4.23 72,360 100% Building 71 Fee 50% [1] 1987 9.06 193,400 100% Building 74 Fee 10%-50% [2] 1988 12.41 257,400 100% Building 76 Fee 10%-50% [2] 1988 5.10 81,695 100% Building 78 Fee 10%-50% [2] 1988 21.80 512,777 100% Building 79 Fee 100% 1988 4.47 66,000 100% Building 80 Fee 100% 1988 4.47 66,000 100% Building 83 Fee 100% 1989 5.34 96,000 100% Building 84 Fee 100% 1989 5.34 96,000 100% Building 85 Fee 10%-50% [2] 1989 9.70 180,100 100% Building 89 Fee 10%-50% [2] 1990 11.28 311,600 100% Building 91 Fee 10%-50% [2]1990/1996 7.53 196,800 100% Building 92 Fee 10%-50% [2] 1991 4.38 45,917 100% Building 95 Fee 100% 1993 15.23 336,000 100% Building 96 Fee 100% 1994 27.69 553,900 100% Building 97 Fee 100% 1994 13.38 280,800 80% Building 98 Fee 100% 1968/1995 37.34 508,306 100% Building 99 Fee 50% [3] 1994 18.00 364,800 100% Building 100 Fee 100% 1995 7.00 117,500 100% Building 101 Fee 50% [1] 1983 4.37 45,000 92% Building 105 Fee 50% [1] 1983 4.64 41,400 100% Building 106 Fee 50% [1] 1978 4.64 41,400 100% Building 107 Fee 100% 1984 3.56 58,783 40% Building 108 Fee 50% [1] 1983 6.36 60,300 86% Building 109 Fee 100% 1985 4.80 46,000 77% Building 113 Fee 50% [1] 1987 6.20 72,000 100% Building 114 Fee 50% [1] 1987 6.20 56,700 98% Building 117 Fee 10%-50% [2] 1988 13.36 135,600 99% Building 120 Fee 10%-50% [2] 1989 4.54 54,982 86% Building 122 Fee 100% 1990 6.17 73,274 100% Building 125 Fee 100% 1994/1996 13.81 195,080 100% Building 126 Fee 100% 1984 4.04 60,100 100% Building 127 Fee 100% 1995 6.50 93,600 100% Building 128 Fee 100% 1996 14.40 322,000 100% Building 129 Fee 100% 1996 16.00 320,000 54% Building 130 Fee 100% 1996 9.70 152,000 73% G'town Centre Bldg 1 Fee 100% 1987 5.85 111,883 51% G'town Centre Bldg 2 Fee 100% 1987 5.81 72,120 95% G'town Centre Bldg 3 Fee 100% 1987 5.10 45,536 56% PARK FLETCHER Building 2 Fee 50% [1] 1970 1.31 20,160 100% Building 4 Fee 50% [1] 1974 1.73 23,000 100% Building 6 Fee 50% [1] 1971 3.13 36,180 75% Building 7 Fee 50% [1] 1974 3.00 41,900 80% Building 8 Fee 50% [1] 1974 2.11 18,000 100%
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Partner- Net Percent ship's Year Land Rentable Occupied Name/ Ownership Owner- Constructed/ Area Area at Location Interest ship Expanded (Acres) (sq.ft.) 12/31/96 - --------- -------- ------ ----------- ------ ------- -------- Building 14 Fee 100% 1978 1.39 19,480 100% Building 15 Fee 50% [1] 1979 5.74 72,800 93% Building 16 Fee 50% [1] 1979 3.17 35,200 100% Building 18 Fee 50% [1] 1980 5.52 43,950 100% Building 21 Fee 50% [1] 1983 2.95 37,224 100% Building 22 Fee 50% [1] 1983 2.96 48,635 100% Building 26 Fee 50% [1] 1983 2.91 28,340 53% Building 27 Fee 25% [1] 1985 3.01 39,178 100% Building 28 Fee 25% [1] 1985 7.22 93,880 100% Building 29 Fee 50% [1] 1987 7.16 92,044 100% Building 30 Fee 50% [1] 1989 5.93 78,568 100% Building 31 Fee 50% [1] 1990 2.62 33,029 85% Building 32 Fee 50% [1] 1990 5.43 67,297 100% SHADELAND STATION Buildings 204 & 205 Fee 100% 1984 4.09 48,600 100% HUNTER CREEK BUSINESS PARK Building 1 Fee 10%-50% [2] 1989 5.97 86,500 100% Building 2 Fee 10%-50% [2] 1989 8.86 202,560 100% HILLSDALE TECHNECENTER Building 1 Fee 50% [1] 1986 9.16 73,436 100% Building 2 Fee 50% [1] 1986 5.50 83,600 100% Building 3 Fee 50% [1] 1987 5.50 84,050 100% Building 4 Fee 100% 1987 7.85 73,874 100% Building 5 Fee 100% 1987 5.44 67,500 93% Building 6 Fee 100% 1987 4.25 64,000 100% Franklin Road Fee 100% 1962,1971, 28.00 338,925 96% Business Center 1974 [4] Palomar Business Fee 100% 1973 4.50 99,350 100% Center Nampac Fee 100% 1974 6.20 83,200 100% NORTH AIRPORT PARK Thomson Consumer Fee 50% [5] 1996 52.00 599,040 100% Electronics 6060 Guion Road Fee 100% 1968/1974 14.05 175,840 100% /1977 4750 Kentucky Ave. Fee 100% 1974 11.01 125,000 100% 4316 West Minnesota Fee 100% 1970 10.40 121,465 100% CARMEL, INDIANA HAMILTON CROSSING Building 1 Fee 100% 1989 4.70 51,825 100% GREENWOOD, INDIANA SOUTH PARK BUSINESS CENTER Building 2 Fee 100% 1990 7.10 86,806 90% LEBANON, INDIANA LEBANON BUSINESS PARK American Air Filter Fee 100% 1996 10.40 153,600 100% Little, Brown and Fee 50% [5] 1996 31.60 500,455 100% Company CINCINNATI, OHIO PARK 50 TECHNECENTER Building 20 Fee 100% 1987 8.37 96,000 100% Building 25 Fee 100% 1989 12.20 78,328 91% GOVERNOR'S POINTE 4700 Building Fee 100% 1987 5.51 76,400 96% 4800 Building Fee 100% 1989 7.07 80,000 100% 4900 Building Fee 100% 1987 9.41 77,652 100%
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Partner- Net Percent Ship's Year Land Rentable Occupied Name/ Ownership Owner- Constructed/ Area Area at Location Interest Ship Expanded (Acres) (sq.ft.) 12/31/96 - --------- ---------- ------- --------- ------ ------ ------- WORLD PARK Building 5 Fee 100% 1987 5.00 59,700 100% Building 6 Fee 100% 1987 7.26 92,400 100% Building 7 Fee 100% 1987 8.63 96,000 100% Building 8 Fee 100% 1989 14.60 192,000 78% Building 9 Fee 100% 1989 4.47 58,800 91% Building 11 Fee 100% 1989 8.98 96,000 100% Building 14 Fee 100% 1989 8.91 166,400 100% Building 15 Fee 100% 1990 6.50 93,600 100% Building 16 Fee 100% 1989 7.00 93,600 100% MicroAge Fee 50% [1] 1994 15.10 304,000 100% ENTERPRISE BUSINESS PARK Building 1 Fee 100% 1990 7.52 87,400 91% Building 2 Fee 100% 1990 7.52 84,940 100% Building A Fee 100% 1987 2.65 20,888 100% Building B Fee 100% 1988 2.65 34,940 95% Building D Fee 100% 1989 5.40 60,322 71% TRI-COUNTY BUSINESS PARK Xetron Fee 10% [6] 1994 29.00 100,193 100% FAIRFIELD BUSINESS CENTER Building D Fee 100% 1990 3.23 40,223 100% Building E Fee 100% 1990 6.07 75,600 100% OTHER INDUSTRIAL - CINCINNATI U.S. Post Office Fee 40% [7] 1992 2.60 57,886 100% Building University Moving Fee 100% 1991 4.95 70,000 100% Creek Road Bldg I Fee 100% 1971 2.05 38,715 100% Creek Road Bldg II Fee 100% 1971 2.63 53,210 100% Cornell Commerce Fee 100% 1989 9.91 167,695 93% Center Mosteller Dist. Fee 100% 1957 [8] 25.80 357,796 64% Center Perimeter Park Fee 100% 1991 2.92 28,100 100% Building A Perimeter Park Fee 100% 1991 3.84 30,000 100% Building B COLUMBUS, OHIO Pet Foods Bldg Fee 100% 1993/1995 16.22 276,000 100% MBM Building Fee 100% 1978 3.98 83,000 100% SOUTH POINTE BUSINESS CENTER South Pointe A Fee 100% 1995 14.06 293,824 100% South Pointe B Fee 100% 1996 13.16 307,200 100% HEBRON, KENTUCKY SOUTHPARK BUSINESS CENTER Building 1 Fee 100% 1990 7.90 96,000 43% Building 3 Fee 100% 1991 10.79 192,000 100% CR Services Fee 100% 1994 22.50 214,840 100% Redken Fee 100% 1994 28.79 166,400 100% Laboratories LOUISVILLE, KENTUCKY Dayco Fee 50% [1] 1995 30.00 282,539 100% FLORENCE, KENTUCKY Empire Commerce Fee 100% 1973/1980 11.62 148,445 100% Center DECATUR, ILLINOIS PARK 101 BUSINESS CENTER Building 3 Fee 100% 1979 5.76 75,600 79% Building 8 Fee 100% 1980 3.16 50,400 84%
-7- [CAPTION] Partner- Net Percent ship's Year Land Rentable Occupied Name/ Ownership Owner- Constructed/ Area Area at Location Interest ship Expanded (Acres) (sq.ft.) 12/31/96 - --------- ---------- ------ ----------- ------ ------ -------- NASHVILLE, TENNESSEE HAYWOOD OAKS TECHNECENTER Building 2 Fee 100% 1988 2.94 50,400 100% Building 3 Fee 100% 1988 2.94 52,800 100% Building 4 Fee 100% 1988 5.23 46,800 94% Building 5 Fee 100% 1988 5.23 61,171 94% Building 6 Fee 100% 1989 10.53 113,400 100% Building 7 Fee 100% 1995 8.24 66,873 100% Greenbriar Fee 100% 1986 10.73 134,759 98% Business Park Keebler Building Fee 100% 1985 4.39 36,150 100% MILWAUKEE, WISCONSIN S.F. Music Box Fee 33.33% [9] 1993 8.90 153,600 100% Building ST. LOUIS, MISSOURI I-70 Center Fee 100% 1986 4.57 76,240 85% 1920 Beltway Fee 100% 1986 4.44 70,000 100% Interamerican Fee 100% 1996 21.24 403,200 71% Alfa Laval Fee 100% 1996 12.76 129,500 100% OFFICE - ------ INDIANAPOLIS, INDIANA PARK 100 BUSINESS PARK Building 34 Fee 100% 1979 2.00 22,272 89% Building 116 Fee 100% 1988 5.28 35,700 84% Building 118 Fee 100% 1988 6.50 35,700 100% Building 119 Fee 100% 1989 6.50 53,300 100% CopyRite Bldg Fee 50% [3] 1992 3.88 48,000 100% WOODFIELD AT THE CROSSING Two Woodfield Fee 100% 1987 7.50 17,818 78% Crossing Three Woodfield Fee 100% 1989 13.30 259,777 94% Crossing PARKWOOD CROSSING One Parkwood Fee 100% 1989 5.93 108,281 100% Two Parkwood Fee 100% 1996 5.96 93,300 100% SHADELAND STATION 7240 Shadeland Fee 66.67% [10] 1985 2.14 45,585 99% Station 7330 Shadeland Fee 100% 1988 4.50 42,619 100% Station 7340 Shadeland Fee 100% 1989 2.50 32,235 100% Station 7351 Shadeland Fee 100% 1983 2.14 27,740 100% Station 7369 Shadeland Fee 100% 1989 2.20 15,551 100% Station 7400 Shadeland Fee 100% 1990 2.80 49,544 100% Station KEYSTONE AT THE CROSSING F.C. Tucker Fee/Ground 100% 1978 N/A 4,840 100% Building Lease [11] 3520 Commerce Ground/Bldg. 100% 1976 N/A 30,000 100% Crossing Lease [12] 8465 Keystone Fee 100% 1983 1.31 28,298 93% Community MOB Fee 100% 1995 4.00 39,205 100% CARMEL, INDIANA CARMEL MEDICAL CENTER Building I Fee/Ground 100% 1985 N/A 40,060 77% Lease [13] Building II Fee/Ground 100% 1989 N/A 39,973 94% Lease [13]
-8- [CAPTION] Partner- Net Percent ship's Year Land Rentable Occupied Name/ Ownership Owner- Constructed/ Area Area at Location Interest ship Expanded (Acres) (sq.ft.) 12/31/96 - --------- ---------- ------ ----------- ------ ----- -------- GREENWOOD, INDIANA SOUTH PARK BUSINESS CENTER Building 1 Fee 100% 1989 5.40 39,715 97% Building 3 Fee 100% 1990 3.25 35,900 100% St. Francis Fee/Ground 100% 1995 N/A 95,579 85% Medical Building Lease [14] CINCINNATI, OHIO GOVERNOR'S HILL 8600 Governor's Fee 100% 1986 10.79 200,584 97% Hill 8700 Governor's Fee 100% 1985 4.98 58,617 100% Hill 8790 Governor's Fee 100% 1985 5.00 58,177 95% Hill 8800 Governor's Fee 100% 1985 2.13 28,700 100% Hill GOVERNOR'S POINTE 4605 Governor's Fee 100% 1990 8.00 175,485 100% Pointe 4705 Governor's Fee 100% 1988 7.50 140,984 100% Pointe 4770 Governor's Fee 100% 1986 4.50 76,037 94% Pointe PARK 50 TECHNECENTER SDRC Building Fee 100% 1991 13.00 221,215 100% Building 17 Fee 100% 1985 8.19 70,644 97% DOWNTOWN CINCINNATI 311 Elm Street Ground/Bldg. 100% 1902/1986 N/A 90,127 100% Lease [15] [16] 312 Plum Street Fee 100% 1987 0.69 230,489 66% 312 Elm Street Fee 100% 1992 1.10 378,786 97% KENWOOD Kenwood Commons Fee 50% [17] 1986 2.09 46,145 100% Building I Kenwood Commons Fee 50% [17] 1986 2.09 46,434 96% Building II Ohio National Fee 100% 1996 9.00 212,125 98% TRI-COUNTY Triangle Office Fee 100% 1965/1985 15.64 172,650 82% Park [18] Tri-County Fee 100% 1971,1973, 11.27 102,166 82% Office Park 1982 [19] Executive Plaza I Fee 100% 1980 5.83 87,912 99% Executive Plaza II Fee 100% 1981 5.02 88,885 100% BLUE ASH West Lake Center Fee 100% 1981 11.76 179,974 90% Lake Forest Place Fee 100% 1985 13.50 217,264 94% Huntington Bank Fee 100% 1986 0.94 3,235 100% Building OTHER OFFICE - CINCINNATI Fidelity Drive Fee 100% 1972 8.34 38,000 100% Building Franciscan Fee/Ground 100% 1996 N/A 36,634 100% Health System Lease[20] COLUMBUS, OHIO TUTTLE CROSSING 4600 Lakehurst Fee 100% 1990 7.66 106,300 100% (Sterling 1) 4650 Lakehurst Fee 100% 1990 13.00 164,639 100% (Litel) 5555 Parkcenter Fee 100% 1992 6.09 83,971 100% (Xerox) 4700 Lakehurst Fee 100% 1994 3.86 49,600 100% (Indiana Insurance) Sterling 2 Fee 100% 1995 3.33 57,660 100% John Alden Fee 100% 1995 6.51 101,112 100% Cardinal Health Fee 100% 1995 10.95 132,854 100% Nationwide Fee 100% 1996 17.90 315,102 100% Sterling 3 Fee 100% 1996 3.56 64,500 100% Metrocenter III Fee 100% 1983 5.91 73,757 100% Veterans Fee 100% 1994 4.98 118,000 100% Administration Clinic Scioto Corporate Fee 100% 1987 7.58 57,251 98% Center
-9- [CAPTION] Partner- Net Percent ship's Year Land Rentable Occupied Name/ Ownership Owner- Constructed/ Area Area at Location Interest ship Expanded (Acres) (sq.ft.) 12/31/96 - --------- ---------- ------ ----------- ------ ------ -------- CLEVELAND, OHIO Rock Run - North Fee 100% 1984 5.00 60,272 100% Rock Run - Center Fee 100% 1985 5.00 61,174 100% Rock Run - South Fee 100% 1986 5.00 63,107 100% Freedom Square I Fee 100% 1980 2.59 39,622 100% Freedom Square II Fee 100% 1987 7.41 115,156 100% Corporate Plaza I Fee 100% 1989 6.10 112,951 100% Corporate Plaza II Fee 100% 1991 4.90 103,638 100% One Corporate Fee 100% 1989 5.30 87,739 95% Exchange Corporate Center I Fee 100% 1985 5.33 104,402 77% Corporate Center II Fee 100% 1987 5.32 99,260 83% Corporate Place Fee 100% 1988 4.50 84,768 90% Corporate Circle Fee 100% 1983 6.65 120,444 98% LIVONIA, MICHIGAN SEVEN MILE CROSSING 38705 Seven Mile Fee/Ground 100% 1988 N/A 113,066 96% Lease [21] 38701 Seven Mile Fee/Ground 100% 1989 N/A 132,153 99% Lease [21] ST. LOUIS, MISSOURI Laumeier I Fee 100% 1987 4.29 113,852 97% Laumeier II Fee 100% 1988 4.64 110,541 100% Westview Place Fee 100% 1988 2.69 114,722 99% Westmark Fee 100% 1987 6.95 123,889 100% RETAIL - ------ INDIANAPOLIS, INDIANA PARK 100 BUSINESS PARK Building 32 Fee 100% 1978 0.82 14,504 79% Building 121 Fee 100% 1989 2.27 19,716 76% CASTLETON CORNER Michael's Plaza Fee 100% 1984 4.50 46,374 100% Cub Plaza Fee 100% 1986 6.83 60,136 95% FORT WAYNE, INDIANA Coldwater Crossing Fee 100% 1990 35.38 246,365 88% GREENWOOD, INDIANA GREENWOOD CORNER First Indiana Fee 100% 1988 1.00 2,400 100% Bank Branch Greenwood Corner Fee 100% 1986 7.45 50,840 46% Shoppes DAYTON, OHIO Sugarcreek Plaza Fee 100% 1988 17.46 77,940 93% CINCINNATI, OHIO Governor's Plaza Fee 100% 1990 35.00 181,493 100% King's Mall Fee 100% 1990 5.68 52,661 98% Shopping Center I King's Mall Fee 100% 1988 8.90 67,725 93% Shopping Center II Steinberg's Fee 100% 1993 1.90 21,008 100% Park 50 Plaza Fee 100% 1989 2.20 18,000 43% Kohl's Fee 100% 1994 12.00 80,684 100% Sports Unlimited Fee 100% 1994 7.00 67,148 100% Eastgate Square Fee 100% 1990/1996 11.60 94,182 100% Office Max Fee 100% 1995 2.25 23,484 100% Sofa Express - Fee 100% 1995 1.13 15,000 100% Governor's Plaza Bigg's Fee 100% 1996 14.00 157,791 100% Supercenter
-10-
Partner- Net Percent ship's Year Land Rentable Occupied Name/ Ownership Owner- Constructed/ Area Area at Location Interest ship Expanded (Acres) (sq. ft.) 12/31/96 - --------- ---------- ------ ----------- ------ ------ -------- BLOOMINGTON, ILLINOIS Lakewood Plaza Fee 100% 1987 11.23 87,010 92% CHAMPAIGN, ILLINOIS Market View Fee 100% 1985 8.50 86,553 90% COLUMBUS, OHIO Galyans Trading Fee 100% 1994 4.90 74,636 100% Company Tuttle Retail Fee 100% 1995/1996 13.44 144,244 100% Center
UNDER CONSTRUCTION - ------------------ Partner- Net Percent ship's Expected Land Rentable Pre-leased Ownership Owner- In-Service Area Area at Interest ship Date (Acres) (sq.ft.) 12/31/96 ----------- ------- ----------- ------ --------- -------- INDUSTRIAL - ---------- INDIANAPOLIS, INDIANA PARK FLETCHER BUSINESS PARK Building 33 Fee 50% [1] Jan-97 7.50 112,000 36% PARK 100 BUSINESS PARK Building 131 Fee 100% May-97 21.00 404,900 100% Building 96 Fee 100% Mar-97 8.40 183,950 100% Expansion NORTH AIRPORT PARK Building 2 Fee 100% May-97 22.50 377,280 34% LEBANON, INDIANA LEBANON BUSINESS PARK Purity Wholesale Fee 100% Jul-97 32.60 556,248 100% Pamida Fee 100% May-97 14.90 200,000 100% HEBRON, KENTUCKY Skyport Building I Fee 100% May-97 15.10 316,800 0% CLEVELAND, OHIO Mr. Coffee Fee 100% Aug-97 35.00 458,000 100% EARTH CITY, MISSOURI Earth City Fee 100% Feb-97 14.70 244,800 0% Building 52 NASHVILLE, TENNESSEE HAYWOOD OAKS TECHNECENTER Building 8 Fee 100% Sep-97 15.44 71,500 0% OFFICE - ------ INDIANAPOLIS, INDIANA PARKWOOD CROSSING Three Parkwood Fee 100% Jul-97 6.24 121,246 0% RIVER ROAD Software Fee 100% Jan-98 6.90 100,000 80% Artistry COLUMBUS, OHIO TUTTLE CROSSING Parkwood Place Fee 100% Jun-97 9.08 156,000 100% CompManagement Fee 100% Oct-97 4.46 67,841 59% CLEVELAND, OHIO Freedom Square III Fee 100% Jul-97 2.00 71,025 0% Landerbrook Fee 100% Nov-97 8.00 106,571 21%
-11-
Partner- Net Percent ship's Expected Land Rentable Pre-leased Ownership Owner- In-Service Area Area at Interest ship Date (Acres) (sq.ft.) 12/31/96 ---------- ------ ----------- ------ ------ -------- RETAIL - ------ CINCINNATI, OHIO Fountain Place Fee 25% [22] Sep-97 1.98 232,301 90% FLORENCE, KENTUCKY Sofa Express Fee 100% Jul-97 1.78 20,250 100% -------- ---------- 2,133.05 31,202,862 ======== ==========
[1] These buildings are owned by a limited liability company in which the Partnership is a 50.1% member. The Partnership shares in the profit or loss from such buildings in accordance with the Partnership's ownership interest. This limited liability company owns a 50% general partnership interest in Park Fletcher Buildings 27 and 28 and shares in the profit or loss from these buildings in accordance with the limited liability company's interest. [2] These buildings are owned by a partnership in which the Partnership is a partner. The Partnership owns a 10% capital interest in the partnership and receives a 50% interest in the residual cash flow after payment of a 9% preferred return to the other partner on its capital interest. [3] This building is owned in partnership with a tenant of the building. The Partnership owns a 50% general partnership interest in the partnership. The Partnership shares in the profit or loss from the building in accordance with such ownership interest. [4] This building was constructed in three phases; 1962, 1971 and 1974. [5] This building was contributed to the limited liability company referenced in footnote [1] in 1996. [6] This building is owned by a partnership in which the Partnership owns a 10% limited partnership interest. The Partnership shares in the cash flow from the building in accordance with such ownership interest. [7] This building is owned by a limited partnership in which the Partnership has a 1% general partnership interest and a 39% limited partnership interest. The Partnership shares in the profit or loss from such building in accordance with the Partnership's ownership interest. [8] This building was renovated in 1996. [9] This building is owned by a partnership in which the Partnership owns a 33.33% limited partnership interest. The Partnership shares in the profit or loss from the building in accordance with such ownership interest. [10] The Partnership owns a 66.67% general partnership interest in the partnership owning this building. The Partnership shares in the profit or loss of this building in accordance with such ownership interest. [11] The Partnership owns the building and has a leasehold interest in the land underlying this building with a lease term expiring October 31, 2067. [12] The Partnership has a leasehold interest in this building with a lease term expiring May 9, 2006. [13] The Partnership owns these buildings and has a leasehold interest in the land underlying these buildings, with the lease term expiring November 16, 2043. [14] The Partnership owns this building and has a leasehold interest in the land underlying this building with a lease term expiring August 2045, with two 20-year options to renew. [15] The Partnership has a leasehold interest in the building and the underlying land with a lease term expiring March 31, 2020. The Partnership has an option to purchase the fee interest in the property throughout the term of the lease. [16] This building was renovated in 1986. [17] These buildings are owned by a partnership in which the Partnership has a 50% general partnership interest. The Partnership shares in the profit or loss from such buildings in accordance with such ownership interest. [18] This building was renovated in 1985. -12- [19] Tri-County Office Park consists of four buildings. One was built in 1971, two were built in 1973, and one was built in 1982. [20] The Partnership owns this building and has a leasehold interest in the land underlying this building with a lease term expiring June 2095. [21] The Partnership owns these buildings and has a leasehold interest in the land underlying these buildings with a lease term expiring May 31, 2057. [22] These buildings are owned through a limited liability company in which the partnership is a 25% member. The limited liability company will own a 57.5% interest in the Fountain Place retail project. ITEM 3. LEGAL PROCEEDINGS There are no pending legal proceedings to which the Partnership or any subsidiary was a party or to which any of their property is subject other than routine litigation incidental to the Partnership's business. In the opinion of management, such litigation is not material to the Partnership's business operations or financial condition. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of security holders during the fourth quarter of the year ended December 31, 1996. PART II ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED SECURITY HOLDER MATTERS There is no established public trading market for the Common Units. The following table sets forth the cash distributions paid during each quarter. Comparable cash distributions are expected in the future. As of March 1, 1997, there were 159 record holders of Common Units. On January 30, 1997, the Partnership declared a quarterly cash distribution of $0.51 per Common Unit payable on February 28, 1997 to Common Unitholders of record on February 14, 1997.
1996 DISTRIBUTIONS 1995 DISTRIBUTIONS ------------------- ------------------- QUARTER ENDED ------------- December 31 $ .51 $ .49 September 30 .51 .49 June 30 .49 .47 March 31 .49 .47
-13- ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA The following sets forth selected consolidated financial and operating information on a historical basis for the Partnership for each of the years in the five-year period ended December 31, 1996. The following information should be read in conjunction with Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" for the Partnership and Item 8, the "Financial Statements and Supplementary Data" included in this Form 10-K. The historical operating data for the years ended December 31, 1996, 1995, 1994 and 1993 has been derived from the historical financial statements of the Partnership and the Predecessor Company. The historical operating data for the year ended December 31, 1992 has been derived from the historical financial statements of the Predecessor Company. (in thousands, except per share amounts)
1996 1995 1994 1993 1992 ---- ---- ---- ---- ---- Results of Operations: Revenues: Rental Operations $ 162,160 $ 113,641 $ 89,299 $ 33,648 $ 17,675 Service Operations 19,929 17,777 18,473 5,654 - -------- -------- ------- -------- ------- Total Revenues $ 182,089 $ 131,418 $107,772 $ 39,302 $ 17,675 ======== ======== ======== ======== ======== Net Income (Loss) Available to Common Units $ 58,713 $ 41,600 $ 32,968 $ 6,670 $ (653) ======== ======== ======== ======== ========= Per Unit Data (1): Net Income (Loss) per Common Unit $ 1.84 $ 1.55 $ 1.54 $ 1.02 $ (.32) Distributions per Common Unit 2.00 1.92 1.84 1.68 1.68 Weighted Average Common Units Outstanding 31,980 26,791 21,467 6,540 2,045 Balance Sheet Data: Total Assets $1,362,399 $1,046,532 $775,884 $633,885 $121,881 Total Debt $ 525,815 $ 454,820 $298,640 $248,433 $ 80,707 Total Preferred Partners' Equity $ 72,856 - - - - Total Partners' Equity $ 769,269 $ 540,221 $447,298 $349,695 $ 36,129 Total Common Units Outstanding at end of year (1) 33,182 28,303 24,384 20,478 2,045 Other Data: Funds From Operations (2) $ 87,434 $ 64,846 $ 47,907 $ 13,474 $ 3,764 Cash Flow Provided by (Used by): Operating activities $ 95,470 $ 78,637 $ 51,856 $ 14,363 $ 5,453 Investing activities (277,009) (289,569) (116,227) (315,025) (710) Financing activities 181,203 176,187 94,733 310,717 (4,952)
(1)Information for 1993 and 1992 has been adjusted for the 1 for 4.2 reverse stock split of the Predecessor Company effected prior to the completion of the 1993 reorganization. (2)Funds From Operations, is defined by the National Association of Real Estate Investment Trusts as net income or loss excluding gains or losses from debt restructuring and sales of property plus depreciation and amortization, and after adjustments for minority interest, unconsolidated partnerships and joint ventures (adjustments for minority interests, unconsolidated partnerships and joint ventures are calculated to reflect Funds From Operations on the same basis). Funds From Operations does not represent cash flow from operations as defined by generally accepted accounting principles, should not be considered as an alternative to net income as an indicator of the Partnership's operating performance, and is not indicative of cash available to fund all cash flow needs. In March 1995, NAREIT issued a clarification of its definition of FFO effective for years beginning after December 31, 1995. The clarification provides that amortization of deferred financing costs and depreciation of non-rental real estate assets are no longer to be added back to net income in arriving at FFO. The Partnership adopted these changes effective January 1, 1996, and the calculations of FFO for the years ended December 31, 1995, 1994, 1993 and 1992 have been revised accordingly. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW -------- The Partnership's operating results depend primarily upon income from the rental operations of its industrial, office and retail properties located in its primary - 14 - markets. This income from rental operations is substantially influenced by the supply and demand for the Partnership's rental space in its primary markets. In addition, the Partnership's continued growth is dependent upon its ability to maintain occupancy rates and increase rental rates on its in-service portfolio and to continue development and acquisition of additional rental properties. The Partnership's primary markets in the Midwest have continued to offer strong and stable local economies and have provided attractive new development opportunities because of their central location, established manufacturing base, skilled work force and moderate labor costs. Consequently, the Partnership's occupancy rate of its in- service portfolio has exceeded 92.0% the last two years and was 95.0% at December 31, 1996. The Partnership expects to maintain its overall occupancy at comparable levels and also expects to increase rental rates as leases are renewed or new leases are executed. This stable occupancy as well as increasing rental rates should improve the Partnership's results of operations from its in-service properties. The Partnership's strategy for continued growth also includes developing and acquiring additional rental properties in its primary markets and expanding into other attractive Midwestern markets. A new statistic that the Partnership started tracking in 1996 is Same Property Performance which compares those properties that were fully in-service for all of 1995 and 1996. Because of the rapid growth of the Partnership, this population of properties only represented about 42.2% of the in-service portfolio at year end. As a result of the loss of a 90,000 square foot downtown Cincinnati office tenant in 1996, along with the effects of a property tax reassessment in another downtown Cincinnati property, Same Property FFO increased only 1.1%. Without the decrease in the downtown Cincinnati portfolio, Same Property FFO increase for this portfolio would have been 2.7%. The following table sets forth information regarding the Partnership's in-service portfolio of rental properties as of December 31, 1996 and 1995 (square feet in thousands):
Total Percent of Square Feet Total Square Feet Percent Occupied --------------- ------------------ ---------------- Type 1996 1995 1996 1995 1996 1995 ---- ---- ---- ---- ---- ---- ---- INDUSTRIAL Service Centers 3,151 2,802 11.5% 14.0% 94.0% 94.7% Bulk 15,173 10,890 55.4% 54.3% 95.1% 96.5% OFFICE Suburban 6,319 3,874 23.1% 19.3% 96.6% 94.7% CBD 699 699 2.5% 3.5% 87.1% 92.3% Medical 370 332 1.3% 1.6% 92.8% 90.3% RETAIL 1,690 1,476 6.2% 7.3% 93.7% 93.8% ------ ------ ----- ----- Total 27,402 20,073 100.0% 100.0% 95.0% 95.4% ====== ====== ===== =====
Management expects occupancy of the in-service property portfolio to remain stable because (i) only 10.7% and 12.3% of the Partnership's occupied square footage is subject to leases expiring in 1997 and 1998, respectively, and (ii) the Partnership's renewal percentage averaged 80%, 65% and 73% in 1996, 1995 and 1994, respectively. - 15 - The following table reflects the Partnership's in-service lease expiration schedule as of December 31, 1996, by product type indicating square footage and annualized net effective rents under expiring leases (in thousands, except per square foot amounts):
Industrial Office Retail Total Portfolio Portfolio Portfolio Portfolio -------------- -------------- -------------- --------------- Yr. of Square Square Square Square Exp. Feet Rent Feet Rent Feet Rent Feet Rent ------ ------- ------ ------ ------ -------- ------ ------ ------ 1997 2,003 $ 8,163 713 $ 7,357 73 $ 744 2,789 $ 16,264 1998 2,303 8,628 777 8,382 110 1,168 3,190 18,178 1999 2,254 9,798 919 9,936 116 1,180 3,289 20,914 2000 2,119 8,451 809 9,831 103 1,262 3,031 19,544 2001 2,496 9,869 855 9,393 115 1,299 3,466 20,561 2002 443 2,076 731 7,771 110 1,063 1,284 10,910 2003 292 1,766 243 2,773 39 364 574 4,903 2004 923 3,759 97 1,143 13 125 1,033 5,027 2005 1,440 4,552 540 6,356 177 1,505 2,157 12,413 2006 1,854 5,952 344 4,258 5 66 2,203 10,276 There- after 1,263 4,141 1,030 13,439 722 6,120 3,015 23,700 ------ ------ ------ ------ ----- ------ ------ ------- Total Leased 17,390 $67,155 7,058 $80,639 1,583 $14,896 26,031 $162,690 ====== ====== ===== ====== ===== ====== ====== ======= Total Port- folio 18,324 7,388 1,690 27,402 ====== ===== ===== ====== Annualized net effective rent per square foot leased $ 3.86 $ 11.43 $ 9.41 $ 6.25 ======= ====== ===== ======
This stable occupancy, along with increasing rental rates in each of the Partnership's markets, will allow the in-service portfolio to continue to provide a comparable or increasing level of earnings from rental operations. The Partnership also expects to realize growth in earnings from rental operations through (i) the development and acquisition of additional rental properties in its primary markets; (ii) the expansion into other attractive Midwestern markets; and (iii) the completion of the 3.8 million square feet of properties under development at December 31, 1996 over the next five quarters. The 3.8 million square feet of properties under development should provide future earnings from rental operations growth for the Partnership as they are placed in service as follows (in thousands, except percentages):
Anticipated Estimated Anticipated In-Service Square Percent Project Stabilized Date Feet Pre-Leased Costs Return ---------------- ------- ---------- --------- ----------- 1st Quarter 1997 762 58% $ 21,309 11.6% 2nd Quarter 1997 1,234 54% 39,976 11.6% 3rd Quarter 1997 1,531 81% 50,827 11.1% 4th Quarter 1997 and thereafter 274 52% 28,240 12.3% ----- ------- 3,801 66% $140,352 11.6% ===== =======
-16- RESULTS OF OPERATIONS --------------------- A summary of the Partnership's operating results and property statistics for each of the years in the three-year period ended December 31, 1996 is as follows (in thousands, except number of properties and per Common Unit amounts):
1996 1995 1994 ------ ------ ------ Rental Operations revenue $162,160 $113,641 $89,299 Service Operations revenue 19,929 17,777 18,473 Earnings from Rental Operations 54,158 37,206 26,929 Earnings from Service Operations 6,436 6,564 7,075 Operating income 56,541 40,526 30,743 Net income available for common units $ 58,713 $ 41,600 $32,968 Weighted average common units outstanding 31,980 26,791 21,467 Net income per common unit $ 1.84 $ 1.55 $ 1.54 Number of in-service properties at end of year 249 201 127 In-service square footage at end of year 27,402 20,073 12,896 Under development square footage at end of year 3,801 3,448 2,362
COMPARISON OF YEAR ENDED DECEMBER 31, 1996 TO YEAR ENDED DECEMBER 31, 1995 -------------------------------------------------------------------------- Rental Operations ----------------- The Partnership increased its in-service portfolio of rental properties from 201 properties comprising 20.1 million square feet at December 31, 1995 to 249 properties comprising 27.4 million square feet at December 31, 1996 through the acquisition of 34 properties totaling 3.4 million square feet and the placement in service of 16 properties and four building expansions totaling 4.1 million square feet developed by the Partnership. The Partnership also disposed of two properties totaling 182,000 square feet. These 48 net additional rental properties primarily account for the $48.5 million increase in revenues from Rental Operations from 1995 to 1996. The increase from 1995 to 1996 in rental expenses, real estate taxes and depreciation and amortization expense is also a result of the additional 48 in-service rental properties. Interest expense increased by approximately $9.8 million. This increase was primarily because of interest expense on the $150.0 million of unsecured notes which the Partnership issued in September 1995. These notes bear interest at an effective rate of 7.46% and were outstanding a full year in 1996 as compared to approximately three months in 1995. The Partnership also issued $90.0 million of unsecured debt under its medium-term note program in 1996 which bears interest at a weighted average rate of 7.20%. The proceeds from these debt issuances were used to fund development and acquisition of additional rental properties during 1995 and 1996. As a result of the above mentioned items, earnings from rental operations increased $17.0 million from $37.2 million for the year ended December 31, 1995 to $54.2 million for the year ended December 31, 1996. Service Operations ------------------ Service Operations revenues increased from $17.8 million to $19.9 million for the year ended December 31, 1996 as compared to the year ended December 31, 1995 primarily as a result of increases in construction management fee revenue because of an increase in construction volume. Service Operations -17- expenses increased from $11.2 million to $13.5 million for the year ended December 31, 1996 as compared to the year ended December 31, 1995 primarily as a result of an increase in operating expenses resulting from the overall growth of the Partnership and the additional regional offices opened in 1995 and 1996. As a result of the above-mentioned items, earnings from Service Operations decreased from $6.6 million to $6.4 million for the years ended December 31, 1995 and 1996, respectively. General and Administrative Expense --------------------------------- General and administrative expense increased from $3.2 million for the year ended December 31, 1995 to $4.1 million for the year ended December 31, 1996 primarily as a result of increased state and local taxes due to the growth in revenues and net income of the Partnership. Property advertising expense as well as other administrative expenses also increased as a result of the expanding size of the Partnership. Other Income (Expense) --------------------- Interest income decreased from $1.7 million for the year ended December 31, 1995 to $1.2 million for the year ended December 31, 1996 as a result of the temporary short-term investment of a greater amount of excess proceeds from the 1995 debt and equity offerings compared to excess proceeds invested from the 1996 debt and equity offerings. During the year ended December 31, 1996, the Partnership sold a 251,000 square foot corporate headquarters facility to John Alden Life Insurance Company in Miami, Florida pursuant to a purchase option contained in John Alden's original agreement to lease the building. The project was sold for approximately $32.9 million and the Partnership recognized a gain of approximately $1.6 million on the sale. The Partnership also realized gains totaling $2.9 million in 1996 related to the sale of a retail center and several parcels of land. Net Income Available for Common Units ------------------------------------ Net income available for common units for the year ended December 31, 1996 was $58.7 million compared to net income available for common units of $41.6 million for the year ended December 31, 1995. This increase results primarily from the changes in the operating results of rental and service operations explained above. COMPARISON OF YEAR ENDED DECEMBER 31, 1995 TO YEAR ENDED DECEMBER 31, 1994 -------------------------------------------------------------------------- Rental Operations ----------------- The Partnership increased its in-service portfolio of rental properties from 127 properties comprising 12.9 million square feet at December 31, 1994 to 201 properties comprising 20.1 million square feet at December 31, 1995 through the acquisition of 60 properties totaling 4.6 million square feet and the placement in service of 17 properties and two building expansions totaling 3.2 million square feet developed by the Partnership. The Partnership also disposed of three properties totaling 570,000 square feet. These 74 net additional rental properties primarily account for the $24.3 million increase in revenues from Rental Operations from 1994 to 1995. The increase from 1994 to 1995 in rental expenses, real estate taxes and depreciation and amortization expense is also a result of the additional 74 in-service rental properties. -18- Interest expense increased by approximately $2.6 million. This increase was primarily because of interest expense on the $150.0 million of unsecured notes which the Partnership issued in September 1995. These notes bear interest at an effective rate of 7.46%. The proceeds from these notes were used to (i) retire the outstanding balance of $35.0 million on the Partnership's unsecured line of credit; (ii) retire $39.5 million of mortgage debt which had a weighted average interest rate of 6.08% and was scheduled to reset at a market interest rate in the fourth quarter of 1995; and (iii) fund development and acquisition of additional rental properties during the fourth quarter of 1995. As a result of the above mentioned items, earnings from rental operations increased $10.3 million from $26.9 million for the year ended December 31, 1994 to $37.2 million for the year ended December 31, 1995. Service Operations ----------------- Earnings from Service Operations decreased by approximately $500,000 in 1995 as compared to 1994. This decrease results primarily from a decrease in construction fees even though total construction volume remained consistent. This decrease in fees resulted from certain contracts with above-market fees in 1994 which were not obtained in 1995. Property management, maintenance and leasing fees remained consistent from 1994 to 1995. Payroll expense decreased from 1994 to 1995 as a result of the allocation of a greater portion of these costs to the Partnership's Rental Operations segment. Other operating expenses did not change materially. Other Income (Expense) --------------------- Interest income increased from $1.1 million for the year ended December 31, 1994 to $1.7 million for the year ended December 31, 1995 as a result of the temporary short-term investment of excess proceeds from the 1995 debt and equity offerings. As part of its October 1993 acquisition of Duke Associates, the Partnership acquired an option to purchase an interest in an entity which provided telecommunication services to tenants in properties owned and managed by the Partnership. At the time the option was acquired, the option was not considered to have value because of recurring net operating losses by such entity. Subsequent to the acquisition of the option, the entity made changes in its operations, principally entering into new contracts for the purchase of telecommunication services and the provision of billing services, which significantly improved its operating results. As a result of these improvements in operating results, the entity entered into an agreement to sell its telecommunications business to an unaffiliated third party at an amount significantly in excess of the Partnership's option price. The net proceeds from the sale were then loaned to a subsidiary of the Partnership with a mortgage on certain property. The Partnership subsequently exercised its option to acquire the interest in this entity and recognized a gain of approximately $2.0 million based on the difference between its option price and the net proceeds received from the sale to the unaffiliated third-party. Such gain is included in earnings from property sales in 1994. Net Income Available for Common Units ------------------------------------- Net income available for common units for the year ended December 31, 1995 was $41.6 million compared to net income available for common units of $33.0 million for the year ended December 31, 1994. This increase results primarily from the changes in the operating results of rental and service operations explained above. -19- LIQUIDITY AND CAPITAL RESOURCES Net cash provided by operating activities totaling $95.5 million, $78.6 million and $51.9 million for the years ended December 31, 1996, 1995 and 1994, respectively, represents the primary source of liquidity to fund distributions to unitholders and minority interests and to fund recurring costs associated with the renovation and re- letting of the Partnership's properties. The primary reason for the increases in net cash provided by operating activities is, as discussed above under "Results of Operations," the increase in net income each year resulting from the expansion of the in-service portfolio through development and acquisitions of additional rental properties. Net cash used by investing activities totaling $277.0 million, $289.6 million and $116.2 million for the years ended December 31, 1996, 1995 and 1994, respectively, represents the investment of funds by the Partnership to expand its portfolio of rental properties through the development and acquisition of additional rental properties. In 1996, $328.4 million was invested in the development and acquisition of additional rental properties and land held for development and $9.9 million was used for recurring building and tenant improvements and leasing costs. Included in the $328.4 million of development and acquisition of rental properties and land held for development for the year ended December 31, 1996 is $44.5 million related to the acquisition of eight suburban office buildings totaling 782,000 gross square feet in Cleveland, Ohio. The purchase price of these eight buildings was approximately $76.0 million which included the assumption of $23.1 million of mortgage debt and the issuance of $8.4 million of Common Units. Also in 1996, the Partnership sold two properties and several parcels of land and received $50.8 million of net sales proceeds. These proceeds were used to fund a portion of the 1996 development and acquisition activity. In 1995, $250.3 million was invested in the development and acquisition of additional rental properties and land held for development and $8.6 million was used for recurring building and tenant improvements and leasing costs. In 1994, $106.9 million was invested in the development and acquisition of additional rental properties and land held for development and $5.9 million was used for recurring building and tenant improvements and leasing costs. Net cash provided by financing activities totaling $181.2 million, $176.2 million and $94.7 million for the years ended December 31, 1996, 1995 and 1994, respectively, is comprised of debt and equity issuances, net of distributions to unitholders and minority interests and repayments of outstanding indebtedness. In March 1996, the Partnership received $125.3 million of net proceeds from the General Partner's common stock offering which was used to pay down amounts outstanding on the unsecured line of credit. During 1996, the Partnership also received $5.5 million of net proceeds from the issuance of common stock under the General Partner's Direct Stock Purchase and Dividend Reinvestment Plan. The Partnership used these net proceeds to fund the development and acquisition of additional rental properties. In August 1996, the Partnership received $72.3 million of net proceeds from the General Partner's preferred stock offering. In July 1996, the Partnership issued $40.0 million of unsecured debt under its medium-term note program. These notes mature in July 2000 and bear interest at 7.28%. In November 1996, the Partnership issued $50.0 million of unsecured debt under its medium- term note program. These notes mature in November 2004 and bear interest at 7.14%. The Partnership used the net proceeds from the preferred offering and the two medium-term note offerings to pay off approximately $82.5 million of existing secured debt which was scheduled to mature in the fourth quarter of 1996 or early 1997 and the remainder to fund the development and acquisition of additional rental properties. In 1995, the Partnership received $96.3 million of net proceeds from the General Partner's common stock offering and used the proceeds to fund development and acquisition of additional rental properties. In 1995, the Partnership also received $150.0 million from an unsecured debt offering and used the proceeds to retire outstanding mortgage indebtedness and to fund acquisition and development of additional rental properties. In 1994, the Partnership received $92.1 million of net proceeds from the General Partner's common stock offering and -20- $60.0 million from a seven-year mortgage loan. Of the $152.1 million of these proceeds, the Partnership used $16.1 million to retire outstanding mortgage indebtedness, and the remainder primarily to fund development and acquisition of additional rental properties. The recurring capital needs of the Partnership are funded primarily through the undistributed net cash provided by operating activities. An analysis of the Partnership's recurring capital expenditures is as follows (in thousands):
1996 1995 1994 ------ ------- ------ Tenant improvements $6,048 $4,312 $3,056 Leasing costs 3,032 3,519 2,407 Building improvements 780 757 474 ----- ----- ----- Total $9,860 $8,588 $5,937 ===== ===== =====
The Partnership has a $150.0 million unsecured line of credit available to fund the development and acquisition of additional rental properties and to provide working capital as needed. This line of credit matures in April 1998 and bears interest at the 30-day London Interbank Offered Rate ("LIBOR") plus 1.25%. Borrowings of $24.0 million under this line of credit as of December 31, 1996 bear interest at an effective rate of 6.9375%. The Partnership also has a demand $10.0 million secured line of credit which is available to provide working capital. This facility bears interest payable monthly at the 30-day LIBOR rate plus .75%. Borrowings of $10.0 million are outstanding on this line of credit at December 31, 1996 and bear interest at an effective rate of 6.23%. The current 30-day LIBOR rate as of March 3, 1997 is 5.4375%. The General Partner and the Partnership currently have on file two Form S-3 Registration Statements with the Securities and Exchange Commission (the "Shelf Registrations") which have remaining availability as of December 31, 1996 of $470.0 million to issue additional common stock, preferred stock or unsecured debt securities. The General Partner and the Partnership intend to issue additional securities under such Shelf Registrations to fund the development and acquisition of additional rental properties. The total debt outstanding at December 31, 1996 consists of notes totaling $525.8 million with a weighted average interest rate of 7.55% maturing at various dates through 2017. The Partnership has $264.0 million of unsecured debt and $261.8 million of secured debt outstanding at December 31, 1996. Scheduled principal amortization of such debt totaled $2.1 million for the year ended December 31, 1996. A summary of the scheduled future amortization and maturities of the Partnership's indebtedness is as follows (in thousands):
Repayments ------------------------------------- Weighted Average Scheduled Interest Rate of Year Amortization Maturities Total Future Repayments ---- ------------ ---------- -------- ----------------- 1997 $ 3,388 $ 10,000 $ 13,388 6.72% 1998 4,410 70,590 75,000 7.07% 1999 5,146 28,470 33,616 6.17% 2000 3,227 44,853 48,080 7.38% 2001 2,930 59,954 62,884 8.72% 2002 3,189 50,000 53,189 7.36% 2003 902 68,216 69,118 8.48% 2004 978 50,000 50,978 7.15% 2005 1,064 100,000 101,064 7.48% 2006 1,160 - 1,160 7.46% Thereafter 17,338 - 17,338 7.61% ------- ------- ------- Total $43,732 $482,083 $525,815 7.55% ====== ======= =======
The $10.0 million of maturities in 1997 represents the outstanding balance as of December 31, 1996 on the Partnership's demand secured line of credit. -21- The Partnership intends to pay regular quarterly distributions from net cash provided by operating activities. A quarterly distribution of $.51 per common unit was declared on January 30, 1997 which represents an annualized distribution of $2.04 per common unit. FUNDS FROM OPERATIONS Management believes that Funds From Operations ("FFO"), which is defined by the National Association of Real Estate Investment Trusts as net income or loss excluding gains or losses from debt restructuring and sales of property plus depreciation and amortization, and after adjustments for minority interest, unconsolidated partnerships and joint ventures (adjustments for minority interest, unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis), is the industry standard for reporting the operations of real estate investment trusts. The following reflects the calculation of the Partnership's FFO for the years ended December 31 (in thousands):
1996 1995 1994 ------- -------- -------- Net income available for common units $ 58,713 $ 41,600 $ 32,968 Add back: Depreciation and amortization 31,363 23,118 16,785 Share of joint venture depreciation and amortization 1,890 411 352 Earnings from property sales (4,532) (283) (2,198) ------- ------- -------- FUNDS FROM OPERATIONS $ 87,434 $ 64,846 $ 47,907 ======= ======= ======= CASH FLOW PROVIDED BY (USED BY): Operating activities $ 95,470 $ 78,637 $ 51,856 Investing activities (277,009) (289,569) (116,227) Financing activities 181,203 176,187 94,733
The increase in FFO for the three-year period results primarily from the increased in-service rental property portfolio as discussed above under "Results of Operations." In March 1995, NAREIT issued a clarification of its definition of FFO effective for years beginning after December 31, 1995. The clarification provides that amortization of deferred financing costs and depreciation of non-rental real estate assets are no longer to be added back to net income in arriving at FFO. The Partnership adopted these changes effective January 1, 1996, and the calculations of FFO for the years ended December 31, 1995 and 1994 have been revised accordingly. While management believes that FFO is the most relevant and widely used measure of the Partnership's operating performance, such amount does not represent cash flow from operations as defined by generally accepted accounting principles, should not be considered as an alternative to net income as an indicator of the Partnership's operating performance, and is not indicative of cash available to fund all cash flow needs. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The financial statements and supplementary data are included under Item 14 of this Report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. -22- PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The Partnership does not have any directors or officers. The information required by this Item for Directors and certain Executive Officers of the General Partner will be contained in a definitive proxy statement of Duke Realty Investments, Inc. which the Registrant anticipates will be filed no later than March 24, 1997, which proxy statement is incorporated herein by reference, and thus this part has been omitted in accordance with General Instruction G(3) to Form 10-K. The following information is provided regarding the executive officers of the General Partner who do not serve as Directors of the General Partner: GARY A. BURK Age 45, President of Construction Services and Executive Vice President of Duke Services, Inc. - Mr. Burk joined the Partnership in 1979, and has been responsible for the Partnership's construction management operations since 1986. WILLIAM J. DEBOER Age 41, Vice President of Construction Services - Mr. DeBoer joined the Partnership in 1983. Prior to that time, Mr. DeBoer was with Tousley Bixler Construction, an Indianapolis general contractor. ROSS C. FARRO Age 53, Vice President, Cleveland Group - Mr. Farro joined the Partnership in January 1996 and is responsible for the Cleveland activities of the Partnership. Prior to joining the Partnership, Mr. Farro was an independent real estate developer and operator. ROBERT D. FESSLER Age 39, Vice President, Ohio Industrial Group - Mr. Fessler joined the Partnership in 1987 and is responsible for the Cincinnati industrial activities of the Partnership. Prior to joining the Partnership, Mr. Fessler was a leasing representative with Trammel Crow. JOHN R. GASKIN Age 35, Vice President, General Counsel and Secretary - Mr. Gaskin joined the Partnership in 1990. Prior to joining the Partnership, Mr. Gaskin worked as an associate attorney in a mid-size Indianapolis, Indiana law firm. JAMES W. GRAY Age 36, Vice President, Cincinnati Office Group - Mr. Gray joined the Partnership in 1989 and has been responsible for the Partnership's Cincinnati office activities since 1994. Prior to that time, Mr. Gray was Vice President and General Counsel of Brian Properties, Inc., a Chicago area commercial real estate developer. RICHARD W. HORN Age 39, Vice President of Acquisitions - Mr. Horn joined the Partnership in 1984. Mr. Horn is responsible for the acquisition activities of the Partnership and oversees the Nashville and Michigan operations of the Partnership. -23- DONALD J. HUNTER Age 37, Vice President, Columbus Group - Mr. Hunter joined the Partnership in 1989 and is responsible for the Columbus activities of the Partnership. Prior to joining the Partnership, Mr. Hunter was with Cushman and Wakefield, a national real estate firm. STEVEN R. KENNEDY Age 40, Vice President of Construction Services - Mr. Kennedy joined the Partnership in 1986. Prior to that time, Mr. Kennedy was a Project Manager for Charles Pankow Builders, Inc. WAYNE H. LINGAFELTER Age 37, Vice President, Indiana Office Group - Mr. Lingafelter joined the Partnership in 1987 and is responsible for the Indiana office activities of the Partnership. Prior to that time, Mr. Lingafelter was with the management consulting firm of DRI, Inc. WILLIAM E. LINVILLE, III Age 42, Vice President, Industrial Group - Mr. Linville joined the Partnership in 1987 and is responsible for all industrial activities of the Partnership. Prior to that time, Mr. Linville was Vice President and Regional Manager of the CB Commercial Brokerage Office in Indianapolis. DAVID R. MENNEL Age 42, General Manager of Services Operations and President and Treasurer of Duke Services, Inc.- Mr. Mennel was with the accounting firm of Peat, Marwick, Mitchell & Co. and the property development firm of Melvin Simon & Associates before joining the Partnership in 1978. MICHAEL L. MYRVOLD Age 41, Vice President, Retail Group - Mr. Myrvold joined the Partnership in 1995 and is responsible for retail activities of the Partnership. Prior to joining the Partnership, Mr. Myrvold was Vice President of Real Estate of the Melville Realty Co., Inc. JOHN M. NEMECEK Age 41, President of Asset / Property Management - Mr. Nemecek joined the Partnership in 1994. Prior to joining the Partnership, Mr. Nemecek was the Senior Vice President/Florida Division of Compass Real Estate. DENNIS D. OKLAK Age 43, Vice President and Treasurer - Mr. Oklak joined the Partnership in 1986 and has served as Tax Manager and Controller of Development. Prior to joining the Partnership, Mr. Oklak was a Senior Manager with the public accounting firm of Deloitte Haskins + Sells. JEFFREY G. TULLOCH Age 52, Vice President and General Manager, Cincinnati Group - Mr. Tulloch joined the Partnership in 1995 and is responsible for all Cincinnati activities of the Partnership. Mr. Tulloch was Senior Vice President of the Galbreath Company before joining the Partnership. -24- Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the officers and directors of the General Partner, and persons who own more than 10% of the Limited Partner Units, to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Such officers, directors and greater than 10% Limited Partner Unitholders are required by Securities and Exchange Commission regulations to furnish the Partnership with copies of all Section 16(a) forms they file. To date, there have been no delinquencies in filing such reports. ITEM 11. EXECUTIVE COMPENSATION The information required by Item 11 with respect to officers and directors of the General Partner will be contained in a definitive proxy statement for Duke Realty Investments, Inc. which the Registrant anticipates will be filed no later than March 24, 1997, which proxy statement is incorporated herein by reference, and thus this part has been omitted in accordance with General Instruction G(3) to Form 10-K. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The Partnership had 3,309,758 Limited Partner Units which were outstanding as of the close of business on March 7, 1997. The following table shows, as of March 7, 1997, the number and percentage of Limited Partner Units held by each person known to the Company who beneficially owned more than five percent of outstanding Limited Partner Units. Except as otherwise noted, all Limited Partner Units are held with sole power to vote and sole power of disposition.
Amount and Nature Percentage of Beneficial Owner of Beneficial Ownership Limited Partner Units ------------------ ----------------------- --------------------- Thomas L. Hefner 1,350,811 (1) 40.81% Darell E. Zink, Jr. 1,341,815 (1) 40.54% Daniel C. Staton 1,260,547 (1) 38.09% John W. Wynne 1,166,401 (1) 35.24% David R. Mennel 1,139,319 (2) 34.42% Gary A. Burk 1,138,947 (3) 34.41% Ross C. Farro 170,784 5.16% DMI Partnership 1,061,058 32.06%
(1) Includes 1,061,058 Limited Partner Units owned by DMI Partnership, a partnership in which each of these individuals owns a 20.71% beneficial interest. (2) Includes 1,061,058 Limited Partner Units owned by DMI Partnership, a partnership in which Mr. Mennel owns a 7.50% beneficial interest. (3) Includes 1,061,058 Limited Partner Units owned by DMI Partnership, a partnership in which Mr. Burk owns a 7.51% beneficial interest. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The information required by Item 13 with respect to officers and directors of the General Partner will be contained in a definitive proxy statement for Duke Realty Investments, Inc. which the Registrant anticipates will be filed no later than March 24, 1997, which proxy statement is incorporated herein by reference, and thus this part has been omitted in accordance with General Instruction G(3) to Form 10-K. -25- PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K (A) DOCUMENTS FILED AS PART OF THIS REPORT. 1. CONSOLIDATED FINANCIAL STATEMENTS: Index ----- Independent Auditors' Report Consolidated Balance Sheets, December 31, 1996 and 1995 Consolidated Statements of Operations, Years Ended December 31, 1996, 1995 and 1994 Consolidated Statements of Cash Flows, Years Ended December 31, 1996, 1995 and 1994 Consolidated Statements of Partners' Equity, Years Ended December 31, 1996, 1995 and 1994 Notes to Consolidated Financial Statements 2. CONSOLIDATED FINANCIAL STATEMENT SCHEDULES Index ----- Schedule III - Real Estate and Accumulated Depreciation EDGAR Financial Data Schedule ----------------------------- Exhibit 27 - Financial Data Schedule for year ended December 31, 1996 (EDGAR filing only) Other schedules are omitted for the reasons that they are not required, are not applicable, or the required information is set forth in the financial statements or notes thereto. -26- INDEPENDENT AUDITORS' REPORT To the Partners of Duke Realty Limited Partnership: We have audited the consolidated financial statements of Duke Realty Limited Partnership and Subsidiaries as listed in the accompanying index. In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedule as listed in the accompanying index. These consolidated financial statements and the financial statement schedule are the responsibility of the Partnership's management. Our responsibility is to express an opinion on the consolidated financial statements and the financial statement schedule based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Duke Realty Limited Partnership and Subsidiaries as of December 31, 1996 and 1995, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 1996, in conformity with generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein. KPMG PEAT MARWICK LLP Indianapolis, Indiana January 29, 1997 -27- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
December 31, ----------------------------- 1996 1995 ------------- ------------- ASSETS ------ Real estate investments: Land and improvements $ 140,391 $ 91,550 Buildings and tenant improvements 1,041,040 712,614 Construction in progress 44,060 96,698 Land held for development 65,185 62,637 --------- --------- 1,290,676 963,499 Accumulated depreciation (82,207) (56,335) --------- -------- Net real estate investments 1,208,469 907,164 Cash 5,346 5,682 Accounts receivable, net of allowance of $709 and $624 5,255 5,184 Accrued straight-line rents, net of allowance of $841 10,956 8,101 Receivables on construction contracts 12,859 9,462 Investments in unconsolidated companies 79,362 67,771 Deferred financing costs, net of accumulated amortization of $3,529 and $2,072 8,127 8,141 Deferred leasing and other costs, net of accumulated amortization of $8,239 and $4,959 24,293 20,609 Escrow deposits and other assets 7,732 14,418 --------- --------- $1,362,399 $1,046,532 ========= ========= LIABILITIES AND PARTNERS' EQUITY -------------------------------- Indebtedness: Secured debt $ 261,815 $ 259,820 Unsecured notes 240,000 150,000 Unsecured line of credit 24,000 45,000 --------- --------- 525,815 454,820 Construction payables and amounts due subcontractors 23,167 21,410 Accounts payable 1,585 1,132 Accrued real estate taxes 14,888 10,374 Accrued interest 4,437 3,461 Other accrued expenses 6,935 5,454 Other liabilities 8,312 5,490 Tenant security deposits and prepaid rents 7,611 3,872 --------- --------- Total liabilities 592,750 506,013 --------- --------- Minority interest 380 298 --------- --------- Partners' equity: General partner Common equity 683,710 535,783 Preferred equity 72,856 - --------- --------- 756,566 535,783 Limited partners' common equity 12,703 4,438 --------- --------- Total partners' equity 769,269 540,221 --------- --------- $1,362,399 $1,046,532 ========= =========
See accompanying Notes to Consolidated Financial Statements. - 28 - DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER UNIT AMOUNTS)
Year ended December 31, --------------------------------------- 1996 1995 1994 ------- ------ -------- RENTAL OPERATIONS: Revenues: Rental income $156,392 $112,931 $88,243 Equity in earnings of unconsolidated companies 5,768 710 1,056 ------- ------- ------- 162,160 113,641 89,299 ------- ------- ------- Operating expenses: Rental expenses 29,843 20,953 17,158 Real estate taxes 14,244 9,683 8,256 Interest expense 31,344 21,462 18,920 Depreciation and amortization 32,571 24,337 18,036 ------- ------- ------- 108,002 76,435 62,370 ------- ------- ------ Earnings from rental operations 54,158 37,206 26,929 ------- ------- ------ SERVICE OPERATIONS: Revenues: Property management, maintenance and leasing fees 11,496 11,138 11,084 Construction management and development fees 6,895 5,582 6,107 Other income 1,538 1,057 1,282 ------ ------ ------ 19,929 17,777 18,473 ------ ------ ------ Operating expenses: Payroll 9,176 7,611 8,141 Maintenance 1,526 1,344 1,069 Office and other 2,791 2,258 2,188 ------- ------ ------ 13,493 11,213 11,398 ------- ------ ------ Earnings from service operations 6,436 6,564 7,075 ------- ------ ------ General and administrative expenses (4,053) (3,244) (3,261) ------- ------- ------ Operating income 56,541 40,526 30,743 OTHER INCOME (EXPENSE): Interest income 1,185 1,702 1,115 Earnings from property sales 4,532 283 2,198 Minority interest in earnings of subsidiaries (986) (911) (1,088) ------- ------- ------- Net income 61,272 41,600 32,968 Dividends on preferred units (2,559) - - ------- ------- ------- Net income available to common units $ 58,713 $41,600 $32,968 ======= ====== ====== Net income per common unit $ 1.84 $ 1.55 $ 1.54 ======= ====== ====== Weighted average number of common units outstanding 31,980 26,791 21,467 ======= ====== ======
See accompanying Notes to Consolidated Financial Statements. -29- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS)
Year ended December 31, ---------------------------------- 1996 1995 1994 ------- ------- -------- Cash flows from operating activities: Net income $ 61,272 $41,600 $ 32,968 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation of buildings and tenant improvements 27,568 20,416 15,068 Amortization of deferred financing costs 1,208 1,218 1,251 Amortization of deferred leasing and other costs 3,795 2,703 1,717 Minority interest in earnings 986 911 1,088 Straight-line rent adjustment (3,536) (3,198) (2,307) Allowance for straight-line rent receivable - - 748 Earnings from property sales (4,532) (283) (2,198) Construction contracts, net (1,640) 8,722 2,405 Other accrued revenues and expenses, net 12,298 6,737 1,335 Equity in earnings in excess of distributions received from unconsolidated companies (1,949) (189) (219) ------- ------ ------ NET CASH PROVIDED BY OPERATING ACTIVITIES 95,470 78,637 51,856 ------- ------ ------ Cash flows from investing activities: Rental property development costs (130,300) (128,879) (55,819) Acquisition of rental properties (182,024) (57,427) (44,201) Acquisition of businesses - (25,620) - Acquisition of undeveloped land and infrastructure costs (16,122) (38,361) (6,924) Recurring tenant improvements (6,048) (4,312) (3,056) Recurring leasing costs (3,032) (3,519) (2,407) Recurring building improvements (780) (757) (474) Other deferred costs and other assets (500) (16,225) (6,960) Proceeds from property sales, net 50,844 5,281 3,337 Distributions received from unconsolidated companies 12,423 - - Net investment in and advances to unconsolidated companies (1,470) (19,750) 277 ------- ------- ------- NET CASH USED BY INVESTING ACTIVITIES (277,009) (289,569) (116,227) ------- ------- ------- Cash flows from financing activities: Contributions from general partner 203,087 96,302 92,145 Proceeds from indebtedness 142,200 150,051 61,504 Payments on indebtedness including principal amortization (84,677) (60,030) (16,149) Borrowings (repayments) on lines of credit, net (11,000) 45,000 - Distributions to partners (65,986) (50,807) (39,514) Distributions to minority interest (904) (1,032) (1,191) Deferred financing costs (1,517) (3,297) (2,062) ------- ------- ------- NET CASH PROVIDED BY FINANCING ACTIVITIES 181,203 176,187 94,733 ------- ------- ------- NET INCREASE (DECREASE) IN CASH (336) (34,745) 30,362 Cash at beginning of year 5,682 40,427 10,065 ------- ------- ------- Cash at end of year $ 5,346 $ 5,682 $ 40,427 ======= ======= =======
See accompanying Notes to Consolidated Financial Statements. -30- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY (IN THOUSANDS, EXCEPT FOR PER UNIT AMOUNTS)
General Partner Limited --------------------- Partners' Common Preferred Common Equity Equity Equity Total -------- --------- ------- -------- BALANCE AT DECEMBER 31, 1993 $348,038 $ - $ 1,657 $349,695 Net income 26,216 - 6,752 32,968 Capital contribution from Duke Realty Investments, Inc. 92,171 - - 92,171 Acquisition of partnership interest for Common Stock of Duke Realty Investments, Inc. 11,523 - - 11,523 Acquisition of property in exchange for Limited Partner Units - - 455 455 Distributions to partners ($1.84 per Common Unit) (31,565) - (7,949) (39,514) ------- ----- ------ ------- BALANCE AT DECEMBER 31, 1994 $446,383 $ - $ 915 $447,298 Net income 35,070 - 6,530 41,600 Capital contribution from Duke Realty Investments, Inc. 96,433 - - 96,433 Acquisition of partnership interest for Common Stock of Duke Realty Investments, Inc. 796 - - 796 Acquisition of property in exchange for Limited Partner Units - - 4,901 4,901 Distributions to partners ($1.92 per Common Unit) (42,899) - (7,908) (50,807) ------- ----- ------ ------- BALANCE AT DECEMBER 31, 1995 $535,783 $ - $ 4,438 $540,221 Net income 51,529 2,559 7,184 61,272 Capital contribution from Duke Realty Investments, Inc. 130,951 72,288 - 203,239 Acquisition of partnership interest for Common Stock of Duke Realty Investments, Inc. 21,627 - - 21,627 Acquisition of property in exchange for Limited Partner Units - - 8,896 8,896 Distributions to preferred unitholders - (1,991) - (1,991) Distributions to partners ($2.00 per Common Unit) (56,180) - (7,815) (63,995) ------- ------ ------ ------- BALANCE AT DECEMBER 31, 1996 $683,710 $72,856 $12,703 $769,269 ======= ====== ====== ======= COMMON UNITS OUTSTANDING AT DECEMBER 31, 1996 29,486 3,696 33,182 ======= ====== ======= Common Units outstanding at December 31, 1995 24,152 4,151 28,303 ======= ====== ======= Common Units outstanding at December 31, 1994 20,391 3,993 24,384 ======= ====== =======
See accompanying Notes to Consolidated Financial Statements. -31- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements (1) THE PARTNERSHIP --------------- Duke Realty Limited Partnership (the "Partnership") was formed on October 4, 1993, when Duke Realty Investments, Inc. (the "Predecessor Company" or the "General Partner") contributed all of its properties and related assets and liabilities along with the net proceeds of $309.2 million from the issuance of an additional 14,000,833 shares through an offering (the "1993 Offering") to the Partnership. Simultaneously, the Partnership completed the acquisition of Duke Associates, a full-service commercial real estate firm operating in the Midwest. The General Partner was formed in 1985 and qualifies as a real estate investment trust under provisions of the Internal Revenue Code. In connection with the 1993 Offering, the formation of the Partnership and the acquisition of Duke Associates, the General Partner effected a 1 for 4.2 reverse stock split of its existing common shares. The General Partner is the sole general partner of the Partnership and received 16,046,144 units of partnership interest ("General Partner Units") in exchange for its original contribution which represented a 78.36% interest in the Partnership. As part of the acquisition, Duke Associates received 4,432,109 units of limited partnership interest ("Limited Partner Units") (together with the General Partner Units, the ("Common Units")) which represented a 21.64% interest in the Partnership. The Limited Partner Units are exchangeable for shares of the General Partner's common stock on a one-for-one basis subject generally to a one-year holding period. The Partnership owns and operates a portfolio of industrial, office and retail properties in the Midwest and provides real estate services to third-party property owners. The Partnership's primary markets are Indianapolis, Indiana; Cincinnati, Cleveland and Columbus, Ohio; St. Louis, Missouri and Nashville, Tennessee. The service operations are conducted through Duke Realty Services Limited Partnership and Duke Construction Limited Partnership, in which the Partnership has an 89% profits interest (after certain preferred returns on partners' capital accounts) and effective control of their operations. (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ------------------------------------------ PRINCIPLES OF CONSOLIDATION --------------------------- The equity interests in these majority-owned or controlled subsidiaries not owned by the Partnership are reflected as minority interests in the consolidated financial statements. All significant intercompany balances and transactions have been eliminated in the consolidated financial statements. RECLASSIFICATIONS ----------------- Certain 1995 and 1994 balances have been reclassified to conform with the 1996 presentation. -32- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements SEGMENT OPERATIONS ------------------ The Partnership is engaged in two business segments, the ownership and rental of real estate investments ("Rental Operations") and the providing of various real estate services such as property management, maintenance, leasing and construction management to third-party property owners ("Service Operations"). There are no material intersegment sales or transfers between Rental Operations and Service Operations. The identifiable assets of the Service Operations consisting of cash, accounts receivable, construction receivables and other assets as of December 31, 1996 and 1995 were $20.7 million and $15.8 million, respectively. Capital expenditures related to Service Operations were $2.0 million, $1.5 million and $761,000 for the years ended December 31, 1996, 1995, and 1994, respectively. All remaining assets, capital expenditures, depreciation, amortization and investments in and advances to unconsolidated companies relate to Rental Operations. The operations of each segment are reflected separately on the Statement of Operations. REAL ESTATE INVESTMENTS ----------------------- Real estate investments are stated at the lower of cost less accumulated depreciation or fair value if impairment is identified. Buildings and land improvements are depreciated on the straight-line method over 40 years, and tenant improvement costs are depreciated on the straight-line method over the term of the related lease. All direct and indirect costs, including interest and real estate taxes clearly associated with the acquisition, development, construction or expansion of real estate investments, are capitalized as a cost of the property and depreciated over the estimated useful life of the related asset. The Partnership evaluates its real estate investments upon occurrence of significant changes in the operations, but not less than annually, to assess whether any impairment indications are present, including recurring operating losses and significant adverse changes in legal factors or business climate that affect the recovery of the recorded value. If any real estate investment is considered impaired, a loss is provided to reduce the carrying value of the property to its estimated fair value. DEFERRED COSTS -------------- Costs incurred in connection with financing or leasing are amortized on the straight-line method over the term of the related loan. All direct and indirect costs associated with the rental of real estate projects owned by the Partnership are amortized over the term of the related lease. Unamortized costs are charged to expense upon the early termination of the lease or upon early payment of the financing. Prepaid interest is amortized to interest expense using the effective interest method over the terms of the related loans. -33- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements REVENUES -------- Rental Operations ----------------- Rental income from leases with scheduled rental increases during their terms is recognized for financial reporting purposes on a straight-line basis. Service Operations ------------------ Management fees are based on a percentage of rental receipts of properties managed and are recognized as the rental receipts are collected. Maintenance fees are based upon established hourly rates and are recognized as the services are performed. Leasing fees are based on a percentage of the total rental due under completed leases and are generally recognized upon lease execution. Construction management and development fees are generally based on a percentage of costs and are recognized as the project costs are incurred. Other income consists primarily of payroll reimbursements for on-site property management services. NET INCOME PER COMMON UNIT -------------------------- Net income per common unit is calculated using the weighted average number of common units outstanding during the year. Common unit equivalents dilute net income per common unit by less than 3% and are not considered in computing weighted average common units outstanding. FEDERAL INCOME TAXES -------------------- As a partnership, the allocated share of income or loss for the year is included in the income tax returns of the partners; accordingly, no accounting for income taxes is required in the accompanying consolidated financial statements. FAIR VALUE OF FINANCIAL INSTRUMENTS ----------------------------------- The fair values of the Partnership's financial instruments, including accounts receivable, accounts payable, accrued expenses, mortgage debt, unsecured notes payable, line of credit and other financial instruments, generally determined using the present value of estimated future cash flows using a discount rate commensurate with the risks involved, approximate their carrying or contract values. USE OF ESTIMATES ---------------- The preparation of the consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. -34- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements (3) RELATED PARTY TRANSACTIONS -------------------------- The Partnership provides management, leasing, construction and other tenant related services to partnerships in which certain executive officers of the General Partner have continuing ownership interests. The Partnership was paid fees totaling $3.2 million, $2.8 million and $3.0 million for such services in 1996, 1995 and 1994, respectively. Management believes the terms for such services are equivalent to those available in the market. The Partnership has an option to purchase the executive officers' interest in each of these properties which expires October 2003. The option price of each property was established at the date the option was granted. (4) INVESTMENTS IN UNCONSOLIDATED COMPANIES --------------------------------------- The Partnership has equity interests in unconsolidated partnerships and joint ventures which own and operate rental properties and hold land for development in the Midwest. The equity method of accounting is used for these investments in which the Partnership has the ability to exercise significant influence over operating and financial policies. Any difference between the carrying amount of these investments and the underlying equity in net assets is amortized to equity in earnings of unconsolidated companies over 40 years. The cost method of accounting is used for non-majority owned joint ventures over which the Partnership does not have the ability to exercise significant influence. The difference between the cost method and the equity method for such ventures does not significantly affect the financial position or results of operations of the Partnership. In 1995, the Partnership acquired its unaffiliated partner's 50% interest in a joint venture which owned two suburban office rental properties (one of which was under construction as of December 31, 1995) and 40.3 acres of land held for development. The Partnership accounted for the acquisition of the 50% interest using the purchase method with its recorded investment in the properties equal to the sum of the balance of its investment in and advances to the joint venture at the date of acquisition, the net liabilities assumed and cash paid to the joint venture partner amounting to $24.4 million. In 1994, the Partnership acquired its unaffiliated partner's 55% interest in a partnership which owned a suburban office rental property. The Partnership accounted for the acquisition of the 55% interest using the purchase method with its recorded investment in the property equal to the sum of its investment in the partnership at the date of acquisition, the cash payment to the unaffiliated partner, cash repayment of a portion of the partnership's mortgage loan and net liabilities assumed, including the remaining balance on the partnership's mortgage loan of $4.5 million. The fair value of the property exceeds the Partnership's recorded investment. Also in 1994, a partnership in which the Partnership owned a 50% interest was dissolved through the distribution of all assets and liabilities to the partners. At the date of dissolution, the Partnership had loans and advances to the partnership totaling $4.2 million. Under terms of the dissolution agreement, the Partnership received 71 acres of land held for development and the partnership was not required to repay the Partnership's loans and advances. The Partnership's recorded investment in the property received is equal to the sum of its investment in and loans and advances to the partnership at the date of dissolution. The fair value of the property exceeds the Partnership's recorded investment. -35- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements On December 28, 1995, the Partnership formed a joint venture (Dugan Realty L.L.C.) with an institutional real estate investor and purchased 25 industrial buildings totaling approximately 2.3 million square feet. Upon formation of the venture, the Partnership contributed approximately 1.4 million square feet of recently developed and acquired industrial properties, 113 acres of recently acquired land held for future development, at an agreed value of $50.8 million, and approximately $16.7 million of cash for a 50.1% interest in the joint venture. The Partnership's recorded investment at December 31, 1995 in the joint venture of $59.4 million is the sum of the carrying value of the properties, land, and cash contributed. The Partnership's joint venture partner contributed cash of $67.5 million which was equal to the agreed value of the Partnership's contribution. The total cash contributed by the Partnership and the joint venture partner was used to purchase the 25 industrial buildings noted above. The recently acquired industrial properties and the undeveloped land which were contributed were acquired as part of the acquisition of Park Fletcher, Inc., an Indianapolis, Indiana based real estate development and management company. The acquisition was accounted for under the purchase method. The recorded carrying value of the acquired properties and land was equal to the net liabilities assumed plus cash paid plus mortgage indebtedness assumed of $17.4 million. The fair value of the property exceeds the Partnership's recorded investment. The operating results of the acquired properties and land have been included in the consolidated operating results subsequent to the date of acquisition. The Partnership completed the development of 1.1 million square feet of property in 1996 and contributed these properties to the joint venture at an agreed value of $24.9 million. The Partnership recorded its investment in the joint venture related to the additional contribution at its carrying value of $20.5 million. The joint venture partner contributed cash to the venture equal to 49.9% of the agreed value of the properties contributed, $12.4 million, and this cash was distributed to the Partnership and reduced its recorded investment in the venture. The Partnership accounts for its investment in this joint venture on the equity method because the joint venture partner's approval is required for all major decisions and the joint venture partner has equal control regarding the primary day-to-day operations of the venture. -36- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements Combined summarized financial information of the companies which are accounted for by the equity method as of December 31, 1996 and December 31, 1995 and for the years ended December 31, 1996, 1995 and 1994 are as follows (in thousands):
1996 1995 --------- --------- Land, buildings and tenant improvements, net $181,337 $155,628 Land held for development 7,975 8,515 Other assets 7,874 4,742 ------- ------- $197,186 $168,885 ======= ======= Property indebtedness $ 25,285 $ 28,185 Other liabilities 6,457 3,736 ------- ------- 31,742 31,921 Owners' equity 165,444 136,964 ------- ------- $197,186 $168,885 ======= =======
1996 1995 1994 ------- -------- -------- Rental income $21,880 $3,398 $3,419 ====== ===== ===== Net income $ 9,761 $ 363 $ 224 ====== ===== =====
Investments in unconsolidated companies include $6.1 million and $6.0 million at December 31, 1996 and 1995, respectively, related to joint ventures accounted for on the cost method. Included in equity in earnings of unconsolidated companies are distributions from a joint venture accounted for on the cost method totaling $735,000, $521,000 and $837,000 in 1996, 1995 and 1994, respectively. -37- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements (5) INDEBTEDNESS ------------ Indebtedness at December 31 consists of the following (in thousands):
1996 1995 -------- -------- Mortgage note with monthly payments of $668 including principal and interest at 8.50% due in 2003 $ 77,381 $ 78,832 Mortgage note with monthly payments of interest of $436 through August 1997. Thereafter, monthly payments of $471 including principal and interest at 8.72% due in 2001 60,000 60,000 Mortgage note with monthly payments at 30-day LIBOR + .75% with monthly principal payments ranging from $63 to $165 due in 1999 32,700 - Mortgage note with monthly payments of interest at 7.25% due in 1998 25,500 25,500 Mortgage note with monthly payments of $165 including principal and interest at 8.19% due in 2017 19,500 - Three mortgage notes with monthly payments of interest at rates ranging from 5.29% to 5.44% due in 1996 - 59,619 Mortgage note with monthly payments of $104 including principal and interest at 6.80% due in 1998 15,423 15,619 Mortgage notes with monthly payments in varying amounts including interest at rates ranging from 5.55% to 10.25% due in varying amounts through 2014 21,311 20,250 Demand secured line of credit with monthly payments of interest at 30-day LIBOR + .75% 10,000 - ------- ------- Total Secured Debt 261,815 259,820 Unsecured notes with semi-annual payments of interest at 7.28% due in 2000 40,000 - Unsecured notes with semi-annual payments of interest at 7.25% (effective rate of 7.328%) due in 2002 50,000 50,000 Unsecured notes with semi-annual payments of interest at 7.14% due in 2004 50,000 - Unsecured notes with semi-annual payments of interest at 7.375% (effective rate of 7.519%) due in 2005 100,000 100,000 Unsecured line of credit with monthly payments of interest at 30-day LIBOR + 1.25% due in 1998 24,000 45,000 ------- ------- Total Indebtedness $525,815 $454,820 ======= =======
As of December 31, 1996, the $261.8 million of mortgage notes are collateralized by rental properties with a net carrying value of $523.2 million. -38- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements In April 1995, the Partnership obtained an unsecured line of credit in the aggregate amount of $100.0 million. The unsecured line of credit matures in April 1998. Borrowings under this line of credit required interest at 30-day LIBOR plus 2.00% as of December 31, 1995 (effective rate of 7.69%). In 1996, the Partnership increased its amount available under the unsecured line of credit to $150.0 million and reduced the borrowing rate to LIBOR plus 1.25% as of December 31, 1996 (effective rate of 6.75%). The Partnership has an interest rate swap agreement (the "Agreement") on $33.0 million of the Partnership's outstanding mortgage debt to effectively fix the interest rate on a portion of its floating rate debt. Under the Agreement, the Partnership pays or receives the difference between a fixed rate of 5.1875% and a floating rate of 30- day LIBOR plus .75% based on the notional principal amount of $33.0 million. The amount paid or received under the Agreement is included in interest expense on a monthly basis. The Agreement matures along with the related mortgage loan in December 1999. The Agreement will stay in place until maturity unless the 30-day LIBOR rate on the date of monthly repricing exceeds 6.25% which will cause a termination of the Agreement. The 30-day LIBOR rate at December 31, 1996 was 5.50%. The estimated fair value of the Agreement at December 31, 1996 was $312,000. The fair value was estimated by discounting the expected cash flows to be received under the Agreement using rates currently available for interest rate swaps of similar terms and maturities. At December 31, 1996, scheduled amortization and maturities of all indebtedness for the next five years and thereafter are as follows (in thousands):
Year Amount ---- --------- 1997 $ 13,388 1998 75,000 1999 33,616 2000 48,080 2001 62,884 Thereafter 292,847 ------- $525,815 =======
Cash paid for interest in 1996, 1995, and 1994 was $35.5 million, $22.1 million, and $20.3 million, respectively. Total interest capitalized in 1996, 1995 and 1994 was $5.5 million, $4.2 million and $1.7 million, respectively. (6) LEASING ACTIVITY ---------------- Future minimum rents due to the Partnership under non-cancelable operating leases at December 31, 1996 are scheduled as follows (in thousands):
Year Amount ------ --------- 1997 $ 155,206 1998 143,331 1999 125,743 2000 103,998 2001 84,363 Thereafter 406,453 --------- $1,019,094 =========
-39- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements In addition to minimum rents, certain leases require reimbursements of specified operating expenses which amounted to $19.7 million, $12.7 million, and $10.0 million for the years ended December 31, 1996, 1995 and 1994, respectively. (7) EMPLOYEE BENEFIT PLANS ---------------------- The Partnership maintains a profit sharing and salary deferral plan for the benefit of its full-time employees. The Partnership matches the employees' contributions up to two percent of the employees' salary and may also make annual discretionary contributions. Total expense recognized by the Partnership was $328,000, $245,000 and $370,000 for the years ended 1996, 1995 and 1994, respectively. The Partnership makes contributions to a contributory health and welfare plan as necessary to fund claims not covered by employee contributions. Total expense recognized by the Partnership related to this plan was $1,193,000, $882,000 and $766,000 for 1996, 1995 and 1994, respectively. Included in total expense is an estimate based on historical experience of the effect of claims incurred but not reported as of year-end. (8) PARTNERS' EQUITY ---------------- The General Partner periodically accesses the public equity markets and contributes the net proceeds to the Partnership to fund the development and acquisition of additional rental properties. The proceeds of these offerings are contributed to the Partnership in exchange for additional Common Units, or in the case of the 1996 Preferred Stock Offering, Preferred Units. A summary of the public equity issuances by the General Partner during the three-year period ended December 31, 1996 is as follows (in thousands, except per share price):
Offering Price Shares Issued Per Share Net Proceeds ------------- -------------- ------------ Common Stock ------------ 1994 Offering 3,887 $ 25.250 $ 92,171 1995 Offering 3,728 27.375 96,273 1996 Offering 4,400 30.125 125,251 Preferred Stock --------------- 1996 9.10% Dividend Rate 300 $250.00 $72,288
During the three years ended December 31, 1996, the General Partner acquired a portion of the minority interest in the Partnership through the issuance of shares of common stock for a like number of common units. The acquisition of the minority interest was accounted for under the purchase method with assets acquired recorded at the fair market value of the General Partner's common stock on the date of acquisition. -40- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements The following acquisition amounts were allocated to rental property, undeveloped land and investments in unconsolidated companies based on their estimated fair values (in thousands):
Common Shares Minority Issued Interest Acquired ------ ----------------- 1994 456 $11,524 1995 28 796 1996 753 21,627
In August 1996, the General Partner issued 300,000 shares of 9.10% Series A Cumulative Redeemable Preferred Shares receiving net proceeds of approximately $72.3 million which were contributed to the Partnership in exchange for a like number of Preferred Units. On or after August 31, 2001, the Series A Preferred Units may be redeemed for cash at the option of the General Partner, in whole or in part at a redemption price of $250.00 per unit plus accrued and unpaid distributions, if any, to the redemption date. The redemption price of the Series A Preferred Units (other than any portion thereof consisting of accrued and unpaid distributions) may only be paid from the proceeds of other capital units of the Partnership, which may include other classes or series of preferred units. The Series A Preferred Units have no stated maturity, are not subject to sinking fund or mandatory redemption provisions and are not convertible into any other securities of the General Partner or the Partnership. Distributions on the Series A Preferred Units are cumulative from the date of original issue and are payable quarterly on or about the last day of February, May, August and November of each year, commencing on December 2, 1996, at the rate of 9.10% of the liquidation preference per annum (equivalent to $22.75 per annum per unit). (9) STOCK BASED COMPENSATION ------------------------ The General Partner and the Partnership have four stock-based compensation plans, which are described below. The Partnership applies APB Opinion No. 25 and related Interpretations in accounting for its plans. Accordingly, no compensation cost has been recognized for its fixed stock option plans. The Partnership does charge compensation costs against its income for its two performance based stock plans. If compensation cost for the Partnership's four stock-based compensation plans had been determined consistent with FASB Statement No. 123, the Partnership's net income and earnings per unit would have been reduced to the pro forma amounts indicated below:
1996 1995 ------- ------- Net income As reported $58,713 $41,600 Pro forma $58,564 $41,544 Primary earnings As reported $ 1.84 $ 1.55 per Common Unit Pro forma $ 1.83 $ 1.55
The effects of applying FASB Statement No. 123 in this pro forma disclosure are not indicative of future amounts. The Statement does not apply to awards prior to 1995, and additional awards in future years are anticipated. -41- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements Fixed Stock Option Plans ------------------------ The Partnership has two fixed stock option plans, the Duke Realty Services 1993 Stock Option Plan (the "1993 Plan") and the 1995 Key Employees' Stock Option Plan of Duke Realty Investments, Inc. (the "1995 Plan"). Under the 1995 Plan, the General Partner and the Partnership are authorized to grant options to its employees for up to 558,400 shares of common stock, as well as up to an additional 400,000 shares to the extent grants under the 1993 Plan lapse, are forfeited or are otherwise terminated. The 1995 Plan was adopted in 1995, subject to shareholder approval, which approval was received in 1996. Under the 1993 Plan, the General Partner and the Partnership were authorized to grant options to its employees for up to 1,315,000 shares of common stock, of which 751,180 are outstanding as of December 31, 1996. Upon the approval of the 1995 Plan, no further grants are permitted under the 1993 Plan. Under both plans, the exercise price of each option equals the market price of the General Partner's stock on the date of grant, and each option's maximum term is ten years. Options granted under the 1993 Plan vest at 20% per year. Options granted under the 1995 Plan vest 50% at the end of the third year following the grant date, and 25% per year for each of the two succeeding years, or, if earlier, upon the death, retirement or disability of the optionee or a change in control of the General Partner. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions used for grants in 1995 and 1996: Dividend yield of 6.0%; expected volatility of 19%; weighted average risk- free interest rates of 6.8% and 5.6% for 1995 and 1996 grants, respectively; and weighted average expected lives of 7.8 years and 7.9 years for 1995 and 1996 grants, respectively. A summary of the status of the General Partner and the Partnership's two fixed stock option plans as of December 31, 1994, 1995 and 1996, and changes during the years ended on those dates is as follows:
1996 1995 1994 ------------------- ------------------ ------------------ Weighted Weighted Weighted Average Average Average Exercise Exercise Exercise Shares Price Shares Price Shares Price ------ -------- ------ -------- ------ -------- Outstanding, beginning of year 866,069 $24.958 681,500 $23.750 681,500 $23.75 Granted 123,457 $32.125 225,469 $28.413 - $ - Exercised (100) $25.875 (1,000) $23.750 - $ - Forfeited (15,605) $30.671 (39,900) $23.872 - $ - ------- ------- ------- Outstanding, end of year 973,821 $25.775 866,069 $24.958 681,500 $23.75 ======= ======= ======= Options exercisable, end of year 411,540 262,200 136,300 ======= ======= ======= Weighted-average fair value of options granted during the year $ 3.925 $ 4.123 ====== ======
-42- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements The following table summarizes information about fixed stock options outstanding at December, 31, 1996:
Options Outstanding Options Exercisable ----------------------------------- ------------------------ Range Number Weighted Avg. Weighted Number Weighted of Outstanding Remaining Avg. Exercisable Avg. Exercise at Contractual Exercise at Exercise Prices 12/31/96 Life Price 12/31/96 Price --------- ----------- ------------- -------- ----------- ---------- $23 - $24 642,900 6.76 $23.750 389,100 $23.750 $25 - $31 214,620 8.46 $28.401 22,440 $26.298 $32 - $33 116,301 9.08 $32.125 - - ------- ------- $23 - $33 973,821 7.41 $25.775 411,540 $23.889 ======= =======
Performance Based Stock Plans ----------------------------- The Partnership has two performance based equity compensation plans. Under the 1995 Dividend Increase Unit Plan (the "DIU Plan"), Dividend Increase Units ("DIUs") are granted to key employees. The value of DIUs exercised by employees is payable in company stock. A maximum of 100,000 shares of the General Partner's stock may be issued under the DIU Plan. The maximum term of all DIUs granted is ten years. The value of each DIU when exercised is equal to the increase in the General Partner's annualized dividend per share from the date of grant to the date of exercise, divided by the "dividend yield". Dividend yield is the annualized dividend per share of the General Partner divided by the market price per share of the General Partner's common stock at the date of grant. DIUs are subject to the same vesting schedule as stock options issued under the 1995 Plan. The compensation cost that has been charged against income for the DIU Plan was $152,000 and $39,000 for 1996 and 1995, respectively. A summary of the status of DIUs granted by the Partnership is as follows:
1996 1995 ------- ------- DIUs outstanding, beginning of year 110,469 - Granted 123,457 110,469 Exercised - - Forfeited (11,285) - ------- ------- DIUs outstanding, end of year 222,641 110,469 ======= ======= DIUs exercisable, end of year - - ======= =======
Under the 1995 Shareholder Value Plan (the "SV Plan"), the Partnership may grant awards in specified dollar amounts to key employees. The award is payable to the employee on the third anniversary of the date of grant. One-half of the award is payable in common stock of the General Partner, and one-half is payable in cash. A maximum of 100,000 shares of the General Partner's common stock may be issued under the SV Plan. The initial dollar amount of each award granted under the SV Plan is adjusted upward or downward based on a comparison of the General Partner's cumulative total shareholder return for the three year period as compared to the cumulative total return of the S&P 500 and the NAREIT Equity REIT Total Return indices. The award is not payable upon the employee's termination of employment for any reason other than retirement, death, disability or a change in control of the General Partner. -43- DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES Notes to Consolidated Financial Statements The following table summarizes information about the initial amount of SV Plan awards granted in 1995 and 1996:
1996 1995 ------ ------ Amount of SVP initial awards, beginning of year $456,080 $ - Granted 521,165 456,080 Awards paid - - Forfeited (51,666) - ------- ------- Amount of SVP initial awards, end of year $925,579 $456,080 ======= =======
The Partnership believes that it is not possible to reasonably estimate the fair value of the General Partner's common stock to be issued under the DIU and SV Plans and, therefore, computes compensation cost for the Plans based on the intrinsic value of the awards as if they were exercised at the end of each applicable reporting period. The compensation cost that has been charged against income for the SV Plan was $361,000 and $152,000 for 1996 and 1995, respectively. -44- 3. Exhibits Exhibit Number Description -------- -------------- 4.1 Amended and Restated Agreement of Limited Partnership of Duke Realty Limited Partnership ("DRLP") is incorporated herein by reference to Exhibit 10.1 to the registration statement of Duke Realty Investments, Inc. on Form S-2, as amended, filed on June 8, 1993, as File No. 33-64038 (the "1993 Registration Statement"). 4.2 First and Second Amendments to Amended and Restated Agreement of Limited Partnership of DRLP are incorporated herein by reference to Exhibit 10.2 of the Annual Report on Form 10-K of Duke Realty Investments, Inc. for the year ended December 31, 1995 (File No. 1-9044)("DRE 10-K"), and the Third Amendment to Amended and Restated Agreement of DRLP is incorporated herein by reference to Exhibit 10 to the Report of Duke Realty Investments, Inc. on Form 8-K filed August 15, 1996. 4.3 Indenture between DRLP and The First National Bank of Chicago, Trustee, and the First Supplement thereto, are incorporated by reference to Exhibits 4.1 and 4.2 to the report of Duke Realty Investments, Inc. on Form 8-K filed September 19, 1995 and the Second Supplement thereto, is incorporated herein by reference to Exhibit 4 to the report of Duke Realty Investments, Inc. on Form 8-K filed July 12, 1996. 10.1 Second Amended and Restated Agreement of Limited Partnership of Duke Realty Services Limited Partnership (the "Services Partnership") is incorporated herein by reference to Exhibit 10.3 of the DRE 10-K. 10.2 Promissory Note of the Services Partnership is incorporated herein by reference to Exhibit 10.3 to the 1993 Registration Statement. 10.3 Duke Realty Services Partnership 1993 Stock Option Plan is incorporated herein by reference to Exhibit 10.4 to the 1993 Registration Statement. 10.4 Acquisition Option Agreement relating to certain properties not contributed to DRLP by Duke Associates (the "Excluded Properties") is incorporated herein by reference to Exhibit 10.5 to the 1993 Registration Statement. 10.5 Management Agreement relating to the Excluded Properties is incorporated herein by reference to Exhibit 10.6 to the 1993 Registration Statement. 10.6 Contribution Agreement for certain properties and land contributed by Duke Associates and Registrant to DRLP is incorporated herein by reference to Exhibit 10.7 to the 1993 Registration Statement. 10.7 Contribution Agreement for certain assets and contracts contributed by Duke Associates to the Service Partnership is incorporated herein by reference to Exhibit 10.8 to the 1993 Registration Statement. -45- 10.8 Contribution Agreement for certain contracts contributed by Duke Associates to DRLP is incorporated herein by reference to Exhibit 10.9 to the 1993 Registration Statement. 10.9 Stock Purchase Agreement is incorporated herein by reference to Exhibit 10.10 to the 1993 Registration Statement. 10.10 Indemnification Agreement is incorporated herein by reference to Exhibit 10.11 to the 1993 Registration Statement. 10.11 1995 Key Employee Stock Option Plan is incorporated herein by reference to Exhibit 10.13 of the DRE 10-K. 10.12 1995 Dividend Increase Unit Plan is incorporated herein by reference to Exhibit 10.14 of the DRE 10-K. 10.13 1995 Shareholder Value Plan is incorporated herein by reference to Exhibit 10.15 of the DRE 10-K. 21. List of Subsidiaries of Registrant. 23. Consent of KPMG Peat Marwick LLP. 24. Executed powers of attorney of certain directors. 27. Financial Data Schedule 99.1 Selected Quarterly Financial Information -46- The Partnership will furnish to any security holder, upon written request, copies of any exhibit incorporated by reference, for a fee of 15 cents per page, to cover the costs of furnishing the exhibits. Written request should include a representation that the person making the request was the beneficial owner of securities. (b) Reports on Form 8-K None -47- DUKE REALTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1996
(IN THOUSANDS) SCHEDULE III LOCATION / BUILDING DEVELOPMENT BUILDING TYPE ENCUMBRANCES ---------------------- -------- -------- ------------ INDIANAPOLIS, INDIANA --------------------- PARK 100 BUSINESS PARK BUILDING #32 RETAIL $ 586 PARK 100 BUSINESS PARK BUILDING #34 OFFICE 1,022 PARK 100 BUSINESS PARK BUILDING #38 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #79 INDUSTRIAL 1,037 PARK 100 BUSINESS PARK BUILDING #80 INDUSTRIAL 1,329 PARK 100 BUSINESS PARK BUILDING #83 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #84 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #95 INDUSTRIAL 3,326 PARK 100 BUSINESS PARK BUILDING #96 INDUSTRIAL 6,330 PARK 100 BUSINESS PARK BUILDING #97 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #98 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #100 INDUSTRIAL 1,662 PARK 100 BUSINESS PARK BUILDING #107 INDUSTRIAL 1,560 PARK 100 BUSINESS PARK BUILDING #109 INDUSTRIAL 1,135 PARK 100 BUSINESS PARK BUILDING #116 OFFICE 1,931 PARK 100 BUSINESS PARK BUILDING #118 OFFICE 1,220 PARK 100 BUSINESS PARK BUILDING #119 OFFICE - PARK 100 BUSINESS PARK BUILDING #121 RETAIL - PARK 100 BUSINESS PARK BUILDING #122 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #125 INDUSTRIAL 3,789 PARK 100 BUSINESS PARK BUILDING #126 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #127 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #128 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #129 INDUSTRIAL - PARK 100 BUSINESS PARK BUILDING #130 INDUSTRIAL - GEORGETOWN ROAD BUILDING 1 INDUSTRIAL - GEORGETOWN ROAD BUILDING 2 INDUSTRIAL - GEORGETOWN ROAD BUILDING 3 INDUSTRIAL - PARK 100 BUSINESS PARK NORGATE LAND LAND LEASE - LEASE PARK 100 BUSINESS PARK SCHAHET HOTELS LAND LEASE - LAND LEASE PARK 100 BUSINESS PARK KENNY ROGERS LAND LAND LEASE - LEASE PARK 100 BUSINESS PARK NORCO LAND LEASE LAND LEASE - PARK 100 BUSINESS PARK ZOLLMAN LAND LAND LEASE - LEASE SHADELAND STATION 7351 SHADELAND OFFICE - SHADELAND STATION BUILDING INDUSTRIAL 1,800 #204/205 SHADELAND STATION 7240 SHADELAND OFFICE (2) 2,644 SHADELAND STATION 7330 SHADELAND OFFICE 2,338 SHADELAND STATION 7369 SHADELAND OFFICE - SHADELAND STATION 7340 SHADELAND OFFICE 322 SHADELAND STATION 7400 SHADELAND OFFICE 450 CASTLETON CORNER CUB PLAZA RETAIL 3,179 CASTLETON MICHAEL'S PLAZA RETAIL 2,405 SHOPPING CENTER SOUTH PARK, INDIANA BUILDING #1 OFFICE 347 SOUTH PARK, INDIANA BUILDING #2 INDUSTRIAL 490 SOUTH PARK, INDIANA BUILDING #3 OFFICE - SOUTH PARK, INDIANA BRYLANE PARKING OFFICE - LOT LEASE SOUTH PARK, INDIANA LEE'S INN LAND LAND LEASE - LEASE GREENWOOD CORNER GREENWOOD CORNER RETAIL - GREENWOOD CORNER 1st INDIANA BANK RETAIL 255 BRANCH CARMEL MEDICAL I CARMEL MEDICAL I MEDICAL 1,884 ST. FRANCIS ST. FRANCIS MEDICAL - COMMUNITY MOB COMMUNITY MOB MEDICAL - CARMEL MEDICAL II CARMEL MEDICAL II MEDICAL 2,432 HILLSDALE TECHNECENTER BUILDING #4 INDUSTRIAL 2,524 HILLSDALE TECHNECENTER BUILDING #5 INDUSTRIAL 1,705 HILLSDALE TECHNECENTER BUILDING #6 INDUSTRIAL 2,108 KEYSTONE AT THE 8465 KEYSTONE OFFICE - CROSSING WOODFIELD AT THE WOODFIELD II OFFICE 6,052 CROSSING WOODFIELD AT THE WOODFIELD III OFFICE - CROSSING KEYSTONE AT THE 3520 COMMERCE OFFICE - CROSSING CROSSING ONE PARKWOOD ONE PARKWOOD OFFICE - TWO PARKWOOD TWO PARKWOOD OFFICE - PALOMAR PALOMAR INDUSTRIAL - FRANKLIN ROAD FRANKLIN ROAD INDUSTRIAL - BUSINESS CTR. BUSINESS CTR. NAMPAC BUILDING NAMPAC BUILDING INDUSTRIAL - HAMILTON CROSSING BUILDING #1 INDUSTRIAL - KEYSTONE AT THE F.C. TUCKER OFFICE - CROSSING BUILDING PARK FLETCHER BUILDING #14 INDUSTRIAL - 6060 GUION ROAD 6060 GUION ROAD INDUSTRIAL - (VANSTAR) (VANSTAR) 4750 KENTUCKY AVE. 4750 KENTUCKY AVE.INDUSTRIAL - 4316 WEST MINNESOTA 4316 W. MINNESOTA INDUSTRIAL - FORT WAYNE, INDIANA ------------------- COLDWATER CROSSING COLDWATER SHOPPES RETAIL 11,249 LEBANON, INNDIANA ----------------- AMERICAN AIR FILTER AMERICAN AIR INDUSTRIAL - FILTER NASHVILLE, TENNESSEE -------------------- KEEBLER BUILDING KEEBLER BUILDING INDUSTRIAL - HAYWOOD OAKS TECHNECENTER BUILDING #2 INDUSTRIAL 1,057 HAYWOOD OAKS TECHNECENTER BUILDING #3 INDUSTRIAL 1,017 HAYWOOD OAKS TECHNECENTER BUILDING #4 INDUSTRIAL 1,138 HAYWOOD OAKS TECHNECENTER BUILDING #5 INDUSTRIAL 1,788 HAYWOOD OAKS TECHNECENTER BUILDING #6 INDUSTRIAL - HAYWOOD OAKS TECHNECENTER BUILDING #7 INDUSTRIAL - GREENBRIAR BUSINESS PARK GREENBRIAR INDUSTRIAL - HEBRON, KENTUCKY ---------------- SOUTHPARK, KENTUCKY CR SERVICES INDUSTRIAL 3,053 SOUTHPARK, KENTUCKY BUILDING #1 INDUSTRIAL - SOUTHPARK, KENTUCKY BUILDING #3 INDUSTRIAL - SOUTHPARK, KENTUCKY REDKEN INDUSTRIAL 2,368 FLORENCE, KENTUCKY ------------------ EMPIRE COMMERCE EMPIRE COMMERCE INDUSTRIAL - CINCINNATI, OHIO ---------------- PARK 50 TECHNECENTER BUILDING #17 OFFICE 3,503 PARK 50 TECHNECENTER BUILDING #20 INDUSTRIAL 4,200 PARK 50 TECHNECENTER BUILDING #24 RETAIL - PARK 50 TECHNECENTER BUILDING #25 INDUSTRIAL - PARK 50 TECHNECENTER SDRC BUILDING OFFICE - FIDELITY DRIVE DUN & BRADSTREET OFFICE 1,768 WORLD PARK BUILDING #5 INDUSTRIAL 2,246 WORLD PARK BUILDING #6 INDUSTRIAL 2,307 WORLD PARK BUILDING #7 INDUSTRIAL 2,764 WORLD PARK BUILDING #8 INDUSTRIAL 2,836 WORLD PARK BUILDING #9 INDUSTRIAL 1,663 WORLD PARK BUILDING #11 INDUSTRIAL 2,558 WORLD PARK BUILDING #14 INDUSTRIAL 1,943 WORLD PARK BUILDING #15 INDUSTRIAL - WORLD PARK BUILDING #16 INDUSTRIAL 1,577 EASTGATE PLAZA EASTGATE PLAZA RETAIL - FAIRFIELD BUILDING D INDUSTRIAL - BUSINESS CENTER FAIRFIELD BUILDING E INDUSTRIAL - BUSINESS CENTER UNIVERSITY MOVING UNIVERSITY MOVING INDUSTRIAL - TRI-COUNTY OFFICE PARK BUILDINGS #1 - #4 OFFICE (3) - GOVERNOR'S PLAZA GOVERNOR'S PLAZA RETAIL - GOVERNOR'S PLAZA KING'S MALL II RETAIL - GOVERNOR'S PLAZA KOHLS RETAIL - SOFA EXPRESS SOFA EXPRESS RETAIL - OFFICE MAX OFFICE MAX RETAIL - 312 ELM BUILDING 312 ELM OFFICE 32,700 311 ELM STREET ZUSSMAN OFFICE - ENTERPRISE BUILDING 1 INDUSTRIAL 4,155 BUSINESS PARK ENTERPRISE BUILDING 2 INDUSTRIAL 3,101 BUSINESS PARK ENTERPRISE BUILDING A INDUSTRIAL 494 BUSINESS PARK ENTERPRISE BUILDING B INDUSTRIAL 760 BUSINESS PARK ENTERPRISE BUILDING D INDUSTRIAL 1,271 BUSINESS PARK 312 PLUM STREET S & L DATA OFFICE - TRIANGLE OFFICE PARK BUILDINGS #1-#38 OFFICE 6,025 GOVERNOR'S HILL 8790 GOVERNOR'S OFFICE - HILL GOVERNOR'S HILL 8700 GOVERNOR'S OFFICE - HILL GOVERNOR'S HILL 8800 GOVERNOR'S OFFICE 1,667 HILL GOVERNOR'S HILL 8600 GOVERNOR'S OFFICE 15,423 HILL GOVERNOR'S POINTE 4770 GOVERNOR'S OFFICE 4,747 POINTE GOVERNOR'S POINTE 4700 BUILDING INDUSTRIAL 3,516 GOVERNOR'S POINTE 4900 BUILDING INDUSTRIAL 2,955 GOVERNOR'S POINTE 4705 GOVERNOR'S OFFICE - POINTE GOVERNOR'S POINTE 4800 GOVERNOR'S OFFICE - POINTE BIGG'S SUPERCENTER BIGG'S RETAIL - SUPERCENTER GOVERNOR'S POINTE 4605 GOVERNOR'S OFFICE 10,685 POINTE MONTGOMERY CROSSING STEINBERG'S RETAIL 696 MONTGOMERY CROSSING II SPORTS UNLIMITED RETAIL 2,728 GOVERNOR'S PLAZA KING'S AUTO RETAIL 3,256 MALL I MOSTELLER DIST. CENTER MOSTELLER DIST. INDUSTRIAL - CENTER FRANCISCAN HEALTH FRANCISCAN HEALTH MEDICAL - PERIMETER PARK BUILDING A INDUST - PERIMETER PARK BUILDING B INDUST - CREEK ROAD BUILDING 1 INDUST - CREEK ROAD BUILDING 2 INDUST - WEST LAKE CENTER WEST LAKE CENTER OFFICE - EXECUTIVE PLAZA I EXECUTIVE PLAZA I OFFICE - EXECUTIVE PLAZA II EXECUTIVE PLAZA II OFFICE - LAKE FOREST PLACE LAKE FOREST PLACE OFFICE - HUNTINGTON BANK HUNTINGTON BANK OFFICE - OHIO NATIONAL OHIO NATIONAL OFFICE 19,500 CORNELL COMMERCE CORNELL COMMERCE INDUSTRIAL - CLEVELAND, OHIO --------------- ROCK RUN - NORTH ROCK RUN - NORTH OFFICE 723 ROCK RUN - CENTER ROCK RUN - CENTER OFFICE 895 ROCK RUN - SOUTH ROCK RUN - SOUTH OFFICE 757 FREEDOM SQUARE I FREEDOM SQUARE I OFFICE - FREEDOM SQUARE II FREEDOM SQUARE II OFFICE 1,498 CORPORATE PLAZA I CORPORATE PLAZA I OFFICE 1,841 CORPORATE PLAZA II CORPORATE PLAZA OFFICE 1,575 II ONE CORPORATE ONE CORPORATE OFFICE 1,103 EXCHANGE EXCHANGE CORPORATE PLACE CORPORATE PLACE OFFICE - CORPORATE CIRCLE CORPORATE CIRCLE OFFICE - CORPORATE CENTER I CORPORATE CENTER OFFICE - I CORPORATE CENTER II CORPORATE CENTER OFFICE - II COLUMBUS, OHIO -------------- CORP. PARK AT LITEL OFFICE - TUTTLE CRSG CORP. PARK AT STERLING 1 OFFICE - TUTTLE CRSG CORP. PARK AT INDIANA OFFICE - TUTTLE CRSG INSURANCE CORP. PARK AT STERLING 2 OFFICE - TUTTLE CRSG CORP. PARK AT CARDINAL HEALTH OFFICE - TUTTLE CRSG CORP. PARK AT STERLING 3 OFFICE - TUTTLE CRSG CORP. PARK AT NATIONWIDE OFFICE - UTTLE CRSG CORP. PARK AT LAZARUS GROUND RETAIL - TUTTLE CRSG LEASE CORP. PARK AT XEROX OFFICE 4,500 TUTTLE CRSG SOUTH POINTE BUILDING A INDUSTRIAL - SOUTH POINTE BUILDING B INDUSTRIAL - PET FOODS BUILD- PET FOODS INDUSTRIAL 3,607 TO-SUIT DISTRIBUTION GALYAN'S GALYAN'S RETAIL 3,135 TUTTLE RETAIL CENTER TUTTLE RETAIL RETAIL - CENTER MBM BUILDING MBM BUILDING INDUSTRIAL - METROCENTER III METROCENTER III OFFICE - SCIOTO CORPORATE CENTER SCIOTO CORPORATE OFFICE - CENTER V.A. HOSPITAL V.A. HOSPITAL MEDICAL 6,082 DAYTON, OHIO ------------ SUGARCREEK PLAZA SUGARCREEK PLAZA RETAIL 3,995 LIVONIA, MICHIGAN ----------------- LIVONIA BUILDING A OFFICE - LIVONIA BUILDING B OFFICE - DECATUR, ILLINOIS ----------------- PARK 101 BUILDING #3 INDUSTRIAL 1,927 PARK 101 BUILDING #8 INDUSTRIAL 1,001 PARK 101 ILL POWER LAND INDUSTRIAL - LEASE BLOOMINGTON, ILLINOIS --------------------- LAKEWOOD PLAZA LAKEWOOD PLAZA RETAIL 5,100 CHAMPAIGN, ILLINOIS ------------------- MARKET VIEW MARKET VIEW RETAIL 4,104 SHOPPING CTR CENTER ST. LOUIS, MISSOURI ------------------- LAUMEIER I LAUMEIER I OFFICE - LAUMEIER II LAUMEIER II OFFICE - WESTVIEW PLACE WESTVIEW PLACE OFFICE - WESTMARK WESTMARK OFFICE - ALFA - LAVAL ALFA - LAVAL INDUST - I-70 CENTER I-70 CENTER INDUST - 1920 BELTWAY 1920 BELTWAY INDUST 1,396 INTERAMERICAN INTERAMERICAN INDUST - VARIOUS LOCATIONS ----------------- LAND IMP. - N/A N/A - UNDEVELOPED LAND ELIMINATIONS - ------- TOTALS $261,815 =======
-48- DUKE REALTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1996
INITIAL COST TO PARTNERSHIP COSTS (1) ------------------- CAPITALIZED BUILDINGS/ SUBSEQUENT TO LOCATION/DEVELOPMENT BUILDING LAND IMPROVEMENTS ACQUISITION -------------------- -------- ---- ------------ ------------- INDIANAPOLIS, INDIANA --------------------- PARK 100 BUSINESS PARK BUILDING #32 64 740 230 PARK 100 BUSINESS PARK BUILDING #34 131 1,455 217 PARK 100 BUSINESS PARK BUILDING #38 25 241 26 PARK 100 BUSINESS PARK BUILDING #79 184 1,764 269 PARK 100 BUSINESS PARK BUILDING #80 251 2,412 179 PARK 100 BUSINESS PARK BUILDING #83 247 2,572 147 PARK 100 BUSINESS PARK BUILDING #84 347 2,604 169 PARK 100 BUSINESS PARK BUILDING #95 642 4,756 207 PARK 100 BUSINESS PARK BUILDING #96 1,414 8,734 452 PARK 100 BUSINESS PARK BUILDING #97 676 4,294 1,230 PARK 100 BUSINESS PARK BUILDING #98 473 6,022 1,656 PARK 100 BUSINESS PARK BUILDING #100 103 2,179 652 PARK 100 BUSINESS PARK BUILDING #107 99 1,575 138 PARK 100 BUSINESS PARK BUILDING #109 240 1,865 (101) PARK 100 BUSINESS PARK BUILDING #116 341 3,144 (75) PARK 100 BUSINESS PARK BUILDING #118 226 2,229 155 PARK 100 BUSINESS PARK BUILDING #119 388 3,386 291 PARK 100 BUSINESS PARK BUILDING #121 592 960 115 PARK 100 BUSINESS PARK BUILDING #122 284 3,359 316 PARK 100 BUSINESS PARK BUILDING #125 674 5,712 - PARK 100 BUSINESS PARK BUILDING #126 165 1,362 136 PARK 100 BUSINESS PARK BUILDING #127 96 1,726 371 PARK 100 BUSINESS PARK BUILDING #128 904 8,429 - PARK 100 BUSINESS PARK BUILDING #129 865 5,468 - PARK 100 BUSINESS PARK BUILDING #130 513 3,611 - GEORGETOWN ROAD BUILDING 1 362 2,341 - GEORGETOWN ROAD BUILDING 2 374 2,492 - GEORGETOWN ROAD BUILDING 3 421 1,873 - PARK 100 BUSINESS PARK NORGATE LAND 51 - - LEASE PARK 100 BUSINESS PARK SCHAHET HOTELS 131 - (131) LAND LEASE PARK 100 BUSINESS PARK KENNY ROGERS 56 - 9 LAND LEASE PARK 100 BUSINESS PARK NORCO LAND LEASE - 38 (1) PARK 100 BUSINESS PARK ZOLLMAN LAND LEASE 115 - - SHADELAND STATION 7351 SHADELAND 101 1,359 146 SHADELAND STATION BUILDING #204/205 260 2,595 319 SHADELAND STATION 7240 SHADELAND 152 3,113 797 SHADELAND STATION 7330 SHADELAND 255 4,045 (172) SHADELAND STATION 7369 SHADELAND 100 1,129 79 SHADELAND STATION 7340 SHADELAND 165 2,458 159 SHADELAND STATION 7400 SHADELAND 570 2,959 363 CASTLETON CORNER CUB PLAZA 540 4,850 222 CASTLETON MICHAEL'S PLAZA SHOPPING CENTER 749 3,400 309 SOUTH PARK, INDIANA BUILDING #1 287 2,328 382 SOUTH PARK, INDIANA BUILDING #2 334 3,081 821 SOUTH PARK, INDIANA BUILDING #3 208 2,150 420 SOUTH PARK, INDIANA BRYLANE PARKING - 54 3 LOT LEASE SOUTH PARK, INDIANA LEE'S INN LAND - 5 28 LEASE GREENWOOD CORNER GREENWOOD CORNER 390 3,435 (75) GREENWOOD CORNER 1st INDIANA BANK BRANCH 46 245 16 CARMEL MEDICAL I CARMEL MEDICAL I - 3,710 (383) ST. FRANCIS ST. FRANCIS - 5,839 230 COMMUNITY MOB COMMUNITY MOB 350 1,925 800 CARMEL MEDICAL II CARMEL MEDICAL II - 4,000 294 HILLSDALE TECHNECENTER BUILDING #4 366 4,711 322 HILLSDALE TECHNECENTER BUILDING #5 251 3,235 161 HILLSDALE TECHNECENTER BUILDING #6 315 4,054 141 KEYSTONE AT THE 8465 KEYSTONE 89 1,302 24 CROSSING WOODFIELD AT THE WOODFIELD II 719 9,106 859 CROSSING WOODFIELD AT THE WOODFIELD III 3,767 19,817 2,218 CROSSING KEYSTONE AT THE 3520 COMMERCE 19 560 59 CROSSING CRSG ONE PARKWOOD ONE PARKWOOD 1,018 9,578 419 TWO PARKWOOD TWO PARKWOOD 861 5,134 2,112 PALOMAR PALOMAR 158 1,148 361 FRANKLIN ROAD FRANKLIN ROAD 594 3,986 1,629 BUSINESS CTR. BUSINESS CTR. NAMPAC BUILDING NAMPAC BUILDING 274 1,622 106 HAMILTON CROSSING BUILDING #1 526 2,424 334 KEYSTONE AT THE F.C. TUCKER CROSSING BUILDING - 264 13 PARK FLETCHER BUILDING #14 76 722 98 6060 GUION ROAD 6060 GUION ROAD (VANSTAR) (VANSTAR) 511 2,656 - 4750 KENTUCKY AVENUE 4750 KENTUCKY 246 2,260 112 AVENUE 4316 WEST MINNESOTA 4316 WEST 287 2,178 170 MINNESOTA FORT WAYNE, INDIANA ------------------- COLDWATER CROSSING COLDWATER 2,310 15,827 821 SHOPPES LEBANON, INDIANA ---------------- AMERICAN AIR AMERICAN AIR 177 3,053 - FILTER FILTER NASHVILLE, TENNESSEE -------------------- KEEBLER BUILDING KEEBLER BUILDING 307 1,183 46 HAYWOOD OAKS BUILDING #2 395 1,767 100 TECHNECENTER HAYWOOD OAKS BUILDING #3 346 1,575 254 TECHNECENTER HAYWOOD OAKS BUILDING #4 435 1,948 52 TECHNECENTER HAYWOOD OAKS BUILDING #5 629 2,816 380 TECHNECENTER HAYWOOD OAKS BUILDING #6 924 5,730 475 TECHNECENTER HAYWOOD OAKS BUILDING #7 456 1,642 593 TECHNECENTER GREENBRIAR GREENBRIAR 1,445 4,490 562 BUSINESS PARK HEBRON, KENTUCKY ---------------- SOUTHPARK, KENTUCKY CR SERVICES 1,085 4,460 - SOUTHPARK, KENTUCKY BUILDING #1 682 3,725 237 SOUTHPARK, KENTUCKY BUILDING #3 841 3,382 231 SOUTHPARK, KENTUCKY REDKEN 779 3,095 116 FLORENCE, KENTUCKY ------------------ EMPIRE COMMERCE EMPIRE COMMERCE 581 2,784 197 CINCINNATI, OHIO ---------------- PARK 50 TECHNECENTER BUILDING #17 500 6,200 (516) PARK 50 TECHNECENTER BUILDING #20 461 7,450 (497) PARK 50 TECHNECENTER BUILDING #24 151 809 93 PARK 50 TECHNECENTER BUILDING #25 1,161 3,758 266 PARK 50 TECHNECENTER SDRC BUILDING 911 19,004 1,004 FIDELITY DRIVE DUN & BRADSTREET 270 2,510 342 WORLD PARK BUILDING #5 270 3,260 435 WORLD PARK BUILDING #6 378 4,488 (793) WORLD PARK BUILDING #7 525 4,150 204 WORLD PARK BUILDING #8 561 5,309 195 WORLD PARK BUILDING #9 317 2,993 247 WORLD PARK BUILDING #11 460 4,701 310 WORLD PARK BUILDING #14 380 3,592 184 WORLD PARK BUILDING #15 373 2,274 301 WORLD PARK BUILDING #16 321 3,033 20 EASTGATE PLAZA EASTGATE PLAZA 2,030 4,079 778 FAIRFIELD BUILDING D 135 1,639 28 BUSINESS CENTER FAIRFIELD BUILDING E 398 2,461 84 BUSINESS CENTER UNIVERSITY MOVING UNIVERSITY 248 1,612 61 MOVING TRI-COUNTY OFFICE BUILDINGS #1 - 217 5,211 611 PARK #4 GOVERNOR'S PLAZA GOVERNOR'S PLAZA 2,012 8,452 534 GOVERNOR'S PLAZA KING'S MALL II 1,928 3,636 353 GOVERNOR'S PLAZA KOHLS 1,345 3,575 164 SOFA EXPRESS SOFA EXPRESS 145 771 10 OFFICE MAX OFFICE MAX 651 1,223 63 312 ELM BUILDING 312 ELM 4,750 43,823 5,151 311 ELM STREET ZUSSMAN 339 6,226 435 ENTERPRISE BUILDING 1 1,030 5,482 492 BUSINESS PARK ENTERPRISE BUILDING 2 733 3,443 1,050 BUSINESS PARK ENTERPRISE BUILDING A 119 685 35 BUSINESS PARK ENTERPRISE BUILDING B 119 1,117 56 BUSINESS PARK ENTERPRISE BUILDING D 243 1,802 318 BUSINESS PARK 312 PLUM STREET S & L DATA 2,539 24,312 1,443 TRIANGLE OFFICE BUILDINGS #1 - 1,000 10,440 1,647 PARK #38 GOVERNOR'S HILL 8790 GOVERNOR'S 400 4,581 382 HILL GOVERNOR'S HILL 8700 GOVERNOR'S 459 5,705 151 HILL GOVERNOR'S HILL 8800 GOVERNOR'S 225 2,305 413 HILL GOVERNOR'S HILL 8600 GOVERNOR'S 1,220 17,689 1,520 HILL GOVERNOR'S POINTE 4770 GOVERNOR'S 586 7,609 185 POINTE GOVERNOR'S POINTE 4700 BUILDING 584 5,465 159 GOVERNOR'S POINTE 4900 BUILDING 654 4,017 545 GOVERNOR'S POINTE 4705 GOVERNOR'S 719 6,910 1,825 POINTE GOVERNOR'S POINTE 4800 GOVERNOR'S 978 4,742 738 POINTE BIGG'S BIGG'S 2,107 4,545 1,828 SUPERCENTER SUPERCENTER GOVERNOR'S POINTE 4605 GOVERNOR'S 630 16,236 1,142 POINTE MONTGOMERY STEINBERG'S 260 852 117 CROSSING MONTGOMERY SPORTS UNLIMITED 778 3,687 133 CROSSING II GOVERNOR'S PLAZA KING'S AUTO 1,085 3,859 805 MALL I MOSTELLER DIST. MOSTELLER DIST. 1,220 4,209 1,560 CENTER CENTER FRANCISCAN HEALTH FRANCISCAN - 3,241 - HEALTH PERIMETER PARK BUILDING A 229 1,274 16 PERIMETER PARK BUILDING B 244 1,001 13 CREEK ROAD BUILDING 1 103 792 8 CREEK ROAD BUILDING 2 132 1,093 12 WEST LAKE CENTER WEST LAKE CENTER 2,459 15,972 204 EXECUTIVE PLAZA I EXECUTIVE PLAZA I 728 5,015 - - EXECUTIVE PLAZA II EXECUTIVE PLAZA II 728 5,220 - LAKE FOREST PLACE LAKE FOREST PLACE 1,953 19,164 - HUNTINGTON BANK HUNTINGTON BANK 175 220 - OHIO NATIONAL OHIO NATIONAL 2,463 24,408 - CORNELL COMMERCE CORNELL COMMERCE 495 4,501 118 CLEVELAND, OHIO --------------- ROCK RUN - NORTH ROCK RUN-NORTH 837 5,351 64 ROCK RUN - CENTER ROCK RUN-CENTER 1,046 6,686 - ROCK RUN - SOUTH ROCK RUN-SOUTH 877 5,604 59 FREEDOM SQUARE I FREEDOM SQUARE I 595 3,796 19 FREEDOM SQUARE II FREEDOM SQUARE II 1,746 11,141 56 CORPORATE PLAZA I CORPORATE PLAZA I 2,116 13,528 261 CORPORATE PLAZA II CORPORATE PLAZA II 1,841 11,768 - ONE CORPORATE ONE CORPORATE 1,287 8,226 17 EXCHANGE EXCHANGE CORPORATE PLACE CORPORATE PLACE 1,161 7,425 102 CORPORATE CIRCLE CORPORATE CIRCLE 1,696 10,846 155 CORPORATE CENTER I CORPORATE CENTER I 1,048 6,695 87 CORPORATE CENTER II CORPORATE CENTER 1,048 6,712 - II COLUMBUS, OHIO -------------- CORP. PARK AT LITEL 2,618 17,428 1,147 TUTTLE CRSG CORP. PARK AT STERLING 1 1,494 11,856 664 TUTTLE CRSG CORP. PARK AT INDIANA 717 2,081 941 TUTTLE CRSG INSURANCE CORP. PARK AT STERLING 2 605 5,300 595 TUTTLE CRSG CORP. PARK AT JOHN ALDEN LIFE 1,066 6,856 198 TUTTLE CRSG INSURANCE CORP. PARK AT CARDINAL HEALTH 1,600 9,556 754 TUTTLE CRSG CORP. PARK AT STERLING 3 1,601 8,207 - TUTTLE CRSG CORP. PARK AT NATIONWIDE 4,815 18,554 - TUTTLE CRSG CORP. PARK AT LAZARUS GROUND 852 - - TUTTLE CRSG LEASE CORP. PARK AT XEROX 1,580 8,630 321 TUTTLE CRSG SOUTH POINTE BUILDING A 594 4,355 1,185 SOUTH POINTE BUILDING B 556 4,985 318 PET FOODS BUILD- PET FOODS 268 4,932 1,167 TO-SUIT DISTRIBUTION GALYAN'S GALYAN'S 1,925 3,146 213 TUTTLE RETAIL TUTTLE RETAIL 2,625 6,598 - CENTER CENTER MBM BUILDING MBM BUILDING 170 1,916 72 METROCENTER III METROCENTER III 887 2,727 667 SCIOTO CORPORATE SCIOTO CORPORATE 1,137 3,147 43 CENTER CENTER V.A. HOSPITAL V.A. HOSPITAL 703 9,239 308 DAYTON, OHIO ------------ SUGARCREEK PLAZA SUGARCREEK PLAZA 898 6,492 (337) LIVONIA, MICHIGAN ----------------- LIVONIA BUILDING A - 9,474 883 LIVONIA BUILDING B - 11,930 1,135 DECATUR, ILLINOIS ----------------- PARK 101 BUILDING #3 275 2,405 722 PARK 101 BUILDING #8 80 1,660 27 PARK 101 ILL POWER LAND 212 - - LEASE BLOOMINGTON, ILLINOIS --------------------- LAKEWOOD PLAZA LAKEWOOD PLAZA 766 7,199 1,039 CHAMPAIGN, ILLINOIS ------------------- MARKET VIEW MARKET VIEW SHOPPING CTR CENTER 740 6,830 (324) ST. LOUIS, MISSOURI ------------------- LAUMEIER I LAUMEIER I 1,220 9,091 576 LAUMEIER II LAUMEIER II 1,258 9,054 792 WESTVIEW PLACE WESTVIEW PLACE 673 8,389 442 WESTMARK WESTMARK 1,200 9,759 408 ALFA - LAVAL ALFA - LAVAL 1,158 4,944 161 I-70 CENTER I-70 CENTER 950 3,915 93 1920 BELTWAY 1920 BELTWAY 605 1,462 36 INTERAMERICAN INTERAMERICAN 1,416 7,661 7 VARIOUS LOCATIONS ----------------- LAND IMP. - N/A - - - UNDEVELOPED LAND ELIMINATIONS - 117 - ------- ------- ------ TOTALS 138,622 977,363 66,674 ======= ======= ======
-49- DUKE REALTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31,1996
(IN THOUSANDS) GROSS BOOK VALUE AT DECEMBER 31, 1996 --------------------------- LOCATION/ LAND & BUILDINGS/ DEVELOPMENT BUILDING IMPROVEMENTS IMPROVEMENTS TOTAL - -------------------- ------------- ------------- ------------- ------ INDIANAPOLIS, INDIANA - ---------------------- PARK 100 BUSINESS PARK BUILDING #32 65 969 1,034 PARK 100 BUSINESS PARK BUILDING #34 133 1,671 1,803 PARK 100 BUSINESS PARK BUILDING #38 26 266 292 PARK 100 BUSINESS PARK BUILDING #79 187 2,030 2,217 PARK 100 BUSINESS PARK BUILDING #80 256 2,586 2,842 PARK 100 BUSINESS PARK BUILDING #83 252 2,714 2,966 PARK 100 BUSINESS PARK BUILDING #84 354 2,767 3,120 PARK 100 BUSINESS PARK BUILDING #95 642 4,963 5,605 PARK 100 BUSINESS PARK BUILDING #96 1,436 9,164 10,600 PARK 100 BUSINESS PARK BUILDING #97 676 5,524 6,200 PARK 100 BUSINESS PARK BUILDING #98 273 7,878 8,151 PARK 100 BUSINESS PARK BUILDING #100 103 2,831 2,934 PARK 100 BUSINESS PARK BUILDING #107 99 1,713 1,812 PARK 100 BUSINESS PARK BUILDING #109 246 1,758 2,004 PARK 100 BUSINESS PARK BUILDING #116 348 3,062 3,410 PARK 100 BUSINESS PARK BUILDING #118 230 2,379 2,610 PARK 100 BUSINESS PARK BUILDING #119 395 3,670 4,065 PARK 100 BUSINESS PARK BUILDING #121 604 1,063 1,667 PARK 100 BUSINESS PARK BUILDING #122 290 3,670 3,959 PARK 100 BUSINESS PARK BUILDING #125 674 5,712 6,386 PARK 100 BUSINESS PARK BUILDING #126 165 1,498 1,663 PARK 100 BUSINESS PARK BUILDING #127 96 2,096 2,192 PARK 100 BUSINESS PARK BUILDING #128 904 8,429 9,333 PARK 100 BUSINESS PARK BUILDING #129 865 5,468 6,332 PARK 100 BUSINESS PARK BUILDING #130 513 3,611 4,124 GEORGETOWN ROAD BUILDING 1 362 2,341 2,703 GEORGETOWN ROAD BUILDING 2 374 2,492 2,866 GEORGETOWN ROAD BUILDING 3 421 1,873 2,294 PARK 100 BUSINESS PARK NORGATE LAND LEASE 51 - 51 PARK 100 BUSINESS PARK SCHAHET HOTELS - - - LAND LEASE PARK 100 BUSINESS PARK KENNY ROGERS LAND 56 9 65 LEASE PARK 100 BUSINESS PARK NORCO LAND LEASE - 37 37 PARK 100 BUSINESS PARK ZOLLMAN LAND LEASE 115 - 115 SHADELAND STATION 7351 SHADELAND 103 1,504 1,606 SHADELAND STATION BUILDING #204/205 266 2,909 3,174 SHADELAND STATION 7240 SHADELAND 152 3,910 4,062 SHADELAND STATION 7330 SHADELAND 260 3,868 4,128 SHADELAND STATION 7369 SHADELAND 102 1,206 1,308 SHADELAND STATION 7340 SHADELAND 169 2,613 2,782 SHADELAND STATION 7400 SHADELAND 581 3,311 3,892 CASTLETON CORNER CUB PLAZA 550 5,062 5,612 CASTLETON SHOPPING CENTER MICHAEL'S PLAZA 764 3,694 4,458 SOUTH PARK, INDIANA BUILDING #1 292 2,704 2,997 SOUTH PARK, INDIANA BUILDING #2 341 3,895 4,236 SOUTH PARK, INDIANA BUILDING #3 212 2,566 2,778 SOUTH PARK, INDIANA BRYLANE PARKING - 57 57 LOT LEASE SOUTH PARK, INDIANA LEE'S INN LAND LEASE - 33 33 GREENWOOD CORNER GREENWOOD CORNER 400 3,350 3,750 GREENWOOD CORNER 1st INDIANA BANK 47 260 307 BRANCH CARMEL MEDICAL I CARMEL MEDICAL I - 3,327 3,327 ST. FRANCIS ST. FRANCIS - 6,069 6,069 COMMUNITY MOB COMMUNITY MOB 350 2,724 3,075 CARMEL MEDICAL II CARMEL MEDICAL II - 4,294 4,294 HILLSDALE TECHNECENTER BUILDING #4 366 5,033 5,399 HILLSDALE TECHNECENTER BUILDING #5 251 3,396 3,647 HILLSDALE TECHNECENTER BUILDING #6 315 4,195 4,510 KEYSTONE AT THE CROSSING 8465 KEYSTONE 89 1,326 1,415 WOODFIELD AT THE CROSSING WOODFIELD II 733 9,951 10,684 WOODFIELD AT THE CROSSING WOODFIELD III 3,843 21,959 25,802 KEYSTONE AT THE CROSSING 3520 COMMERCE CRSG. - 638 638 ONE PARKWOOD ONE PARKWOOD 1,018 9,997 11,015 TWO PARKWOOD TWO PARKWOOD 861 7,245 8,106 PALOMAR PALOMAR 158 1,509 1,667 FRANKLIN ROAD FRANKLIN ROAD 594 5,615 6,209 BUSINESS CTR. BUSINESS CTR. NAMPAC BUILDING NAMPAC BUILDING 274 1,728 2,002 HAMILTON CROSSING BUILDING #1 536 2,748 3,284 KEYSTONE AT THE CROSSING F.C. TUCKER BLDG. - 277 277 PARK FLETCHER BUILDING #14 76 821 896 6060 GUION ROAD 6060 GUION ROAD 511 2,656 3,167 (VANSTAR) (VANSTAR) 4750 KENTUCKY AVENUE 4750 KENTUCKY AVE. 246 2,372 2,618 4316 WEST MINNESOTA 4316 W. MINNESOTA 287 2,348 2,634 FORT WAYNE, IN - -------------- COLDWATER CROSSING COLDWATER SHOPPES 2,310 16,648 18,958 LEBANON, IN - ----------- AMERICAN AIR FILTER AMERICAN AIR 177 3,053 3,230 FILTER NASHVILLE, TENNESSEE - -------------------- KEEBLER BUILDING KEEBLER BUILDING 307 1,228 1,536 HAYWOOD OAKS TECHNECENTER BUILDING #2 395 1,867 2,262 HAYWOOD OAKS TECHNECENTER BUILDING #3 346 1,829 2,175 HAYWOOD OAKS TECHNECENTER BUILDING #4 435 1,999 2,435 HAYWOOD OAKS TECHNECENTER BUILDING #5 629 3,196 3,825 HAYWOOD OAKS TECHNECENTER BUILDING #6 946 6,183 7,129 HAYWOOD OAKS TECHNECENTER BUILDING #7 456 2,235 2,692 GREENBRIAR BUSINESS PARK GREENBRIAR 1,445 5,053 6,498 HEBRON, KENTUCKY - ---------------- SOUTHPARK, KENTUCKY CR SERVICES 1,085 4,060 5,145 SOUTHPARK, KENTUCKY BUILDING #1 696 3,947 4,644 SOUTHPARK, KENTUCKY BUILDING #3 858 3,596 4,454 SOUTHPARK, KENTUCKY REDKEN 779 3,211 3,990 FLORENCE, KENTUCKY - ------------------ EMPIRE COMMERCE EMPIRE COMMERCE 581 2,981 3,562 CINCINNATI, OHIO - ---------------- PARK 50 TECHNECENTER BUILDING #17 510 5,674 6,184 PARK 50 TECHNECENTER BUILDING #20 469 6,945 7,414 PARK 50 TECHNECENTER BUILDING #24 154 899 1,053 PARK 50 TECHNECENTER BUILDING #25 1,184 4,001 5,185 PARK 50 TECHNECENTER SDRC BUILDING 929 19,989 20,919 FIDELITY DRIVE DUN & BRADSTREET 277 2,845 3,122 WORLD PARK BUILDING #5 276 3,690 3,965 WORLD PARK BUILDING #6 385 3,688 4,073 WORLD PARK BUILDING #7 537 4,343 4,879 WORLD PARK BUILDING #8 561 5,504 6,065 WORLD PARK BUILDING #9 317 3,240 3,557 WORLD PARK BUILDING #11 460 5,011 5,471 WORLD PARK BUILDING #14 380 3,777 4,156 WORLD PARK BUILDING #15 381 2,567 2,948 WORLD PARK BUILDING #16 321 3,053 3,374 EASTGATE PLAZA EASTGATE PLAZA 2,030 4,857 6,887 FAIRFIELD BUSINESS CENTER BUILDING D 135 1,667 1,801 FAIRFIELD BUSINESS CENTER BUILDING E 398 2,545 2,943 UNIVERSITY MOVING UNIVERSITY MOVING 248 1,674 1,921 TRI-COUNTY OFFICE PARK BUILDINGS #1 - #4 221 5,818 6,039 GOVERNOR'S PLAZA GOVERNOR'S PLAZA 2,053 8,946 10,998 GOVERNOR'S PLAZA KING'S MALL II 1,952 3,965 5,917 GOVERNOR'S PLAZA KOHLS 1,345 3,740 5,085 SOFA EXPRESS SOFA EXPRESS 145 781 926 OFFICE MAX OFFICE MAX 651 1,286 1,937 312 ELM BUILDING 312 ELM 5,428 48,295 53,724 311 ELM STREET ZUSSMAN - 7,000 7,000 ENTERPRISE BUSINESS PARK BUILDING 1 1,051 5,954 7,004 ENTERPRISE BUSINESS PARK BUILDING 2 747 4,479 5,226 ENTERPRISE BUSINESS PARK BUILDING A 119 720 839 ENTERPRISE BUSINESS PARK BUILDING B 119 1,173 1,292 ENTERPRISE BUSINESS PARK BUILDING D 243 2,120 2,363 312 PLUM STREET S & L DATA 2,590 25,704 28,294 TRIANGLE OFFICE PARK BUILDINGS #1-#38 1,018 12,069 13,087 GOVERNOR'S HILL 8790 GOVERNOR'S 408 4,955 5,363 HILL GOVERNOR'S HILL 8700 GOVERNOR'S 468 5,847 6,315 HILL GOVERNOR'S HILL 8800 GOVERNOR'S 231 2,712 2,943 HILL GOVERNOR'S HILL 8600 GOVERNOR'S 1,245 19,184 20,429 HILL GOVERNOR'S POINTE 4770 GOVERNOR'S 596 7,784 8,380 POINTE GOVERNOR'S POINTE 4700 BUILDING 595 5,614 6,208 GOVERNOR'S POINTE 4900 BUILDING 673 4,543 5,216 GOVERNOR'S POINTE 4705 GOVERNOR'S 733 8,721 9,454 POINTE GOVERNOR'S POINTE 4800 GOVERNOR'S 998 5,460 6,458 POINTE BIGG'S SUPERCENTER BIGG'S SUPERCENTER 2,107 6,373 8,480 GOVERNOR'S POINTE 4605 GOVERNOR'S 643 17,365 18,008 POINTE MONTGOMERY CROSSING STEINBERG'S 260 969 1,229 MONTGOMERY CROSSING I SPORTS UNLIMITED 778 3,820 4,598 GOVERNOR'S PLAZA KING'S AUTO MALL I 1,124 4,625 5,749 MOSTELLER DIST. CENTER MOSTELLER DIST. 1,220 5,769 6,989 CENTER FRANCISCAN HEALTH FRANCISCAN HEALTH - 3,241 3,241 PERIMETER PARK BUILDING A 229 1,290 1,519 PERIMETER PARK BUILDING B 244 1,013 1,258 CREEK ROAD BUILDING 1 103 801 903 CREEK ROAD BUILDING 2 132 1,105 1,237 WEST LAKE CENTER WEST LAKE CENTER 2,459 16,176 18,635 EXECUTIVE PLAZA I EXECUTIVE PLAZA I 728 5,015 5,743 EXECUTIVE PLAZA II EXECUTIVE PLAZA II 728 5,220 5,947 LAKE FOREST PLACE LAKE FOREST PLACE 1,953 19,164 21,117 HUNTINGTON BANK HUNTINGTON BANK 175 220 395 OHIO NATIONAL OHIO NATIONAL 2,463 24,408 26,870 CORNELL COMMERCE CORNELL COMMERCE 495 4,619 5,114 CLEVELAND, OHIO - --------------- ROCK RUN - NORTH ROCK RUN-NORTH 837 5,414 6,251 ROCK RUN - CENTER ROCK RUN-CENTER 1,046 6,686 7,732 ROCK RUN - SOUTH ROCK RUN-SOUTH 877 5,663 6,540 FREEDOM SQUARE I FREEDOM SQUARE I 595 3,816 4,410 FREEDOM SQUARE II FREEDOM SQUARE II 1,746 11,197 12,943 CORPORATE PLAZA I CORPORATE PLAZA I 2,116 13,789 15,905 CORPORATE PLAZA II CORPORATE PLAZA II 1,841 11,768 13,608 ONE CORPORATE ONE CORPORATE 1,287 8,244 9,530 EXCHANGE EXCHANGE CORPORATE PLACE CORPORATE PLACE 1,163 7,525 8,688 CORPORATE CIRCLE CORPORATE CIRCLE 1,698 10,999 12,697 CORPORATE CENTER I CORPORATE CENTER I 1,040 6,791 7,831 CORPORATE CENTER II CORPORATE CENTER II 1,048 6,712 7,760 COLUMBUS, OHIO - -------------- CORP. PARK AT LITEL 2,670 18,523 21,193 TUTTLE CRSG CORP. PARK AT STERLING 1 1,524 12,490 14,014 TUTTLE CRSG CORP. PARK AT INDIANA INSURANCE 717 3,022 3,739 TUTTLE CRSG CORP. PARK AT STERLING 2 605 5,895 6,500 TUTTLE CRSG CORP. PARK AT JOHN ALDEN LIFE 1,066 7,054 8,120 TUTTLE CRSG INSURANCE CORP. PARK AT CARDINAL HEALTH 1,600 10,310 11,910 TUTTLE CRSG CORP. PARK AT STERLING 3 1,601 8,207 9,807 TUTTLE CRSG CORP. PARK AT NATIONWIDE 4,815 18,554 23,369 TUTTLE CRSG CORP. PARK AT LAZARUS GROUND 852 - 852 TUTTLE CRSG LEASE CORP. PARK AT XEROX 1,580 8,951 10,531 TUTTLE CRSG SOUTH POINTE BUILDING A 594 5,540 6,134 SOUTH POINTE BUILDING B 556 5,303 5,859 PET FOODS BUILD-TO-SUIT PET FOODS 1,031 5,336 6,368 DISTRIBUTION GALYAN'S GALYAN'S 1,925 3,359 5,284 TUTTLE RETAIL CENTER TUTTLE RETAIL 2,625 6,598 9,224 CENTER MBM BUILDING MBM BUILDING 170 1,988 2,158 METROCENTER III METROCENTER III 887 3,395 4,281 SCIOTO CORPORATE CENTER SCIOTO CORPORATE 1,137 3,190 4 327 CENTER V.A. HOSPITAL V.A. HOSPITAL 703 9,547 10,250 DAYTON, OHIO - ------------ SUGARCREEK PLAZA SUGARCREEK PLAZA 924 6,129 7,053 LIVONIA, MICHIGAN - ----------------- LIVONIA BUILDING A - 10,357 10,357 LIVONIA BUILDING B - 13,065 13,065 DECATUR, ILLINOIS - ----------------- PARK 101 BUILDING #3 280 3,122 3,402 PARK 101 BUILDING #8 184 1,583 1,767 PARK 101 ILL POWER LAND 212 - 212 LEASE BLOOMINGTON, ILLINOIS - --------------------- LAKEWOOD PLAZA LAKEWOOD PLAZA 786 8,218 9,004 CHAMPAIGN, ILLINOIS - ------------------- MARKET VIEW MARKET VIEW 755 6,491 7,246 SHOPPING CTR CENTER ST. LOUIS, MISSOURI - ------------------- LAUMEIER I LAUMEIER I 1,220 9,668 10,888 LAUMEIER II LAUMEIER II 1,258 9,846 11,104 WESTVIEW PLACE WESTVIEW PLACE 673 8,831 9,504 WESTMARK WESTMARK 1,200 10,167 11,367 ALFA - LAVAL ALFA - LAVAL 1,158 5,105 6,263 I-70 CENTER I-70 CENTER 950 4,008 4,958 1920 BELTWAY 1920 BELTWAY 605 1,498 2,103 INTERAMERICAN INTERAMERICAN 1,416 7,668 9,084 VARIOUS LOCATIONS - ----------------- LAND IMP. - N/A - - - UNDEVELOPED LAND ELIMINATIONS - (1,110) (1,110) ------- --------- --------- TOTALS 140,391 1,041,040 1,181,431 ======= ========= =========
-50- DUKE REALTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1996
(IN THOUSANDS) DEPRE- ACCUMULATED DATE OF DATE CIABLE LOCATION/DEVELOPMENT BUILDING DEPRECIATION CONSTRUCTION ACQUIRED LIFE - -------------------- -------- ------------ ------------ -------- ------ INDIANAPOLIS, INDIANA - --------------------- PARK 100 BUSINESS PARK BUILDING #32 259 1978 1986 (4) PARK 100 BUSINESS PARK BUILDING #34 473 1979 1986 (4) PARK 100 BUSINESS PARK BUILDING #38 23 1978 1993 (4) PARK 100 BUSINESS PARK BUILDING #79 213 1988 1993 (4) PARK 100 BUSINESS PARK BUILDING #80 221 1988 1993 (4) PARK 100 BUSINESS PARK BUILDING #83 216 1989 1993 (4) PARK 100 BUSINESS PARK BUILDING #84 219 1989 1993 (4) PARK 100 BUSINESS PARK BUILDING #95 361 1993 1994 (4) PARK 100 BUSINESS PARK BUILDING #96 446 1994 1994 (4) PARK 100 BUSINESS PARK BUILDING #97 542 1994 1994 (4) PARK 100 BUSINESS PARK BUILDING #98 696 1968 1994 (4) PARK 100 BUSINESS PARK BUILDING #100 171 1995 1995 (4) PARK 100 BUSINESS PARK BUILDING #107 105 1984 1995 (4) PARK 100 BUSINESS PARK BUILDING #109 511 1985 1986 (4) PARK 100 BUSINESS PARK BUILDING #116 632 1988 1988 (4) PARK 100 BUSINESS PARK BUILDING #118 199 1988 1993 (4) PARK 100 BUSINESS PARK BUILDING #119 327 1989 1993 (4) PARK 100 BUSINESS PARK BUILDING #121 85 1989 1993 (4) PARK 100 BUSINESS PARK BUILDING #122 338 1990 1993 (4) PARK 100 BUSINESS PARK BUILDING #125 209 1994 1994 (4) PARK 100 BUSINESS PARK BUILDING #126 113 1984 1994 (4) PARK 100 BUSINESS PARK BUILDING #127 90 1995 1995 (4) PARK 100 BUSINESS PARK BUILDING #128 311 1996 1996 (4) PARK 100 BUSINESS PARK BUILDING #129 - 1996 1996 (4) PARK 100 BUSINESS PARK BUILDING #130 2 1996 1996 (4) GEORGETOWN ROAD BUILDING 1 5 1987 1996 (4) GEORGETOWN ROAD BUILDING 2 5 1987 1996 (4) GEORGETOWN ROAD BUILDING 3 4 1987 1996 (4) PARK 100 BUSINESS PARK NORGATE LAND - N/A 1995 (4) LEASE PARK 100 BUSINESS PARK SCHAHET HOTELS - N/A 1995 (4) LAND LEASE PARK 100 BUSINESS PARK KENNY ROGERS 1 N/A 1995 (4) LAND LEASE PARK 100 BUSINESS PARK NORCO LAND LEASE 3 N/A 1995 (4) PARK 100 BUSINESS PARK ZOLLMAN LAND LEASE - N/A 1994 (4) SHADELAND STATION 7351 SHADELAND 138 1983 1993 (4) SHADELAND STATION BUILDING 804 1984 1986 (4) #204/205 SHADELAND STATION 7240 SHADELAND 1,044 1985 1993 (4) SHADELAND STATION 7330 SHADELAND 763 1988 1988 (4) SHADELAND STATION 7369 SHADELAND 98 1989 1993 (4) SHADELAND STATION 7340 SHADELAND 212 1989 1993 (4) SHADELAND STATION 7400 SHADELAND 338 1990 1993 (4) CASTLETON CORNER CUB PLAZA 1,365 1986 1986 (4) CASTLETON SHOPPING MICHAEL'S PLAZA 330 1984 1993 (4) CENTER SOUTH PARK, INDIANA BUILDING #1 363 1989 1993 (4) SOUTH PARK, INDIANA BUILDING #2 328 1990 1993 (4) SOUTH PARK, INDIANA BUILDING #3 344 1990 1993 (4) SOUTH PARK, INDIANA BRYLANE PARKING 14 N/A 1994 (4) LOT LEASE SOUTH PARK, INDIANA LEE'S INN LAND - N/A 1995 (4) LEASE GREENWOOD CORNER GREENWOOD CORNER 885 1986 1986 (4) GREENWOOD CORNER 1st INDIANA BANK 21 1988 1993 (4) BRANCH CARMEL MEDICAL I CARMEL MEDICAL I 885 1985 1986 (4) ST. FRANCIS ST. FRANCIS 434 1995 1995 (4) COMMUNITY MOB COMMUNITY MOB 128 1995 1995 (4) CARMEL MEDICAL II CARMEL MEDICAL II 640 1989 1990 (4) HILLSDALE TECHNECENTER BUILDING #4 421 1987 1993 (4) HILLSDALE TECHNECENTER BUILDING #5 315 1987 1993 (4) HILLSDALE TECHNECENTER BUILDING #6 334 1987 1993 (4) KEYSTONE AT THE 8465 KEYSTONE 52 1983 1995 (4) CROSSING WOODFIELD AT THE WOODFIELD II 926 1987 1993 (4) CROSSING WOODFIELD AT THE WOODFIELD III 1,979 1989 1993 (4) CROSSING KEYSTONE AT THE 3520 COMMERCE 158 1976 1993 (4) CROSSING CROSSING ONE PARKWOOD ONE PARKWOOD 266 1989 1995 (4) TWO PARKWOOD TWO PARKWOOD 307 1996 1996 (4) PALOMAR PALOMAR 74 1973 1995 (4) FRANKLIN ROAD FRANKLIN ROAD 258 1962 1995 (4) BUSINESS CTR. BUSINESS CTR. NAMPAC BUILDING NAMPAC BUILDING 71 1974 1995 (4) HAMILTON CROSSING BUILDING #1 254 1989 1993 (4) KEYSTONE AT THE F.C. TUCKER 22 1978 1993 (4) CROSSING BUILDING PARK FLETCHER BUILDING #14 68 1978 1995 (4) 6060 GUION ROAD 6060 GUION ROAD 33 1968 1996 (4) (VANDSTAR) (VANSTAR) 4750 KENTUCKY 4750 KENTUCKY 16 1974 1996 (4) AVENUE AVENUE 4316 W. MINNESOTA 4316 W. MINNESOTA 16 1970 1996 (4) FORT WAYNE, INDIANA - ------------------- COLDWATER CROSSING COLDWATER 1,058 1990 1994 (4) SHOPPES LEBANON, INDIANA - ---------------- AMERICAN AIR FILTER AMERICAN AIR 51 1996 1996 (4) FILTER NASHVILLE, TENNESSEE - -------------------- KEEBLER BUILDING KEEBLER BUILDING 55 1985 1995 (4) HAYWOOD OAKS BUILDING #2 160 1988 1993 (4) TECHNECENTER HAYWOOD OAKS BUILDING #3 242 1988 1993 (4) TECHNECENTER HAYWOOD OAKS BUILDING #4 161 1988 1993 (4) TECHNECENTER HAYWOOD OAKS BUILDING #5 343 1988 1993 (4) TECHNECENTER HAYWOOD OAKS BUILDING #6 537 1989 1993 (4) TECHNECENTER HAYWOOD OAKS BUILDING #7 117 1995 1995 (4) TECHNECENTER GREENBRIAR BUSINESS GREENBRIAR 340 1986 1993 (4) PARK HEBRON, KENTUCKY - ---------------- SOUTHPARK, KENTUCKY CR SERVICES 257 1994 1994 (4) SOUTHPARK, KENTUCKY BUILDING #1 322 1990 1993 (4) SOUTHPARK, KENTUCKY BUILDING #3 282 1991 1993 (4) SOUTHPARK, KENTUCKY REDKEN 203 1994 1994 (4) FLORENCE, KENTUCKY - ------------------ EMPIRE COMMERCE EMPIRE COMMERCE 35 1973 1996 (4) CINCINNATI, OHIO - ---------------- PARK 50 TECHNECENTER BUILDING #17 1,802 1985 1986 (4) TECHNECENTER PARK 50 TECHNECENTER BUILDING #20 1,451 1987 1988 (4) TECHNECENTER PARK 50 TECHNECENTER BUILDING #24 88 1989 1993 (4) TECHNECENTER PARK 50 TECHNECENTER BUILDING #25 320 1989 1993 (4) TECHNECENTER PARK 50 TECHNECENTER SDRC BUILDING 1,572 1991 1993 (4) TECHNECENTER FIDELITY DRIVE DUN & BRADSTREET 824 1972 1986 (4) WORLD PARK BUILDING #5 954 1987 1990 (4) WORLD PARK BUILDING #6 862 1987 1990 (4) WORLD PARK BUILDING #7 830 1987 1990 (4) WORLD PARK BUILDING #8 437 1989 1993 (4) WORLD PARK BUILDING #9 284 1989 1993 (4) WORLD PARK BUILDING #11 456 1989 1993 (4) WORLD PARK BUILDING #14 316 1989 1993 (4) WORLD PARK BUILDING #15 252 1990 1993 (4) WORLD PARK BUILDING #16 247 1989 1993 (4) EASTGATE PLAZA EASTGATE PLAZA 213 1990 1995 (4) FAIRFIELD BUSINESS BUILDING D 47 1990 1995 (4) CENTER FAIRFIELD BUSINESS BUILDING E 74 1990 1995 (4) CENTER UNIVERSITY MOVING UNIVERSITY MOVING 75 1991 1995 (4) TRI-COUNTY OFFICE PARK BUILDINGS #1-#4 558 1971 1993 (4) GOVERNOR'S PLAZA GOVERNOR'S PLAZA 707 1990 1993 (4) GOVERNOR'S PLAZA KING'S MALL II 308 1988 1989 (4) GOVERNOR'S PLAZA KOHLS 196 1994 1994 (4) SOFA EXPRESS SOFA EXPRESS 25 1995 1995 (4) OFFICE MAX OFFICE MAX 46 1995 1995 (4) 312 ELM BUILDING 312 ELM 4,066 1992 1993 (4) 311 ELM STREET ZUSSMAN 582 1902 1993 (4) ENTERPRISE BUSINESS BUILDING 1 504 1990 1993 (4) PARK ENTERPRISE BUSINESS BUILDING 2 561 1990 1993 (4) PARK ENTERPRISE BUSINESS BUILDING A 29 1987 1995 (4) PARK ENTERPRISE BUSINESS BUILDING B 46 1988 1995 (4) PARK ENTERPRISE BUSINESS BUILDING D 110 1989 1995 (4) PARK 312 PLUM STREET S & L DATA 2,148 1987 1993 (4) TRIANGLE OFFICE BUILDINGS #1- 4,237 1965 1986 (4) PARK #38 GOVERNOR'S HILL 8790 GOVERNOR'S 442 1985 1991 (4) HILL GOVERNOR'S HILL 8700 GOVERNOR'S 470 1985 1993 (4) HILL GOVERNOR'S HILL 8800 GOVERNOR'S 1,009 1985 1986 (4) HILL GOVERNOR'S HILL 8600 GOVERNOR'S 1,688 1986 1991 (4) HILL GOVERNOR'S POINTE 4770 GOVERNOR'S 1,650 1986 1988 (4) POINTE GOVERNOR'S POINTE 4700 BUILDING 1,260 1987 1988 (4) GOVERNOR'S POINTE 4900 BUILDING 1,130 1987 1989 (4) GOVERNOR'S POINTE 4705 GOVERNOR'S 736 1988 1993 (4) POINTE GOVERNOR'S POINTE 4800 GOVERNOR'S 612 1989 1993 (4) POINTE BIGG'S SUPERCENTER BIGG'S 75 1996 1996 (4) SUPERCENTER GOVERNOR'S POINTE 4605 GOVERNOR'S 1,451 1990 1993 (4) POINTE MONTGOMERY CROSSING STEINBERG'S 49 1993 1993 (4) MONTGOMERY CROSSING II SPORTS UNLIMITED 224 1994 1994 (4) GOVERNOR'S PLAZA KING'S AUTO 954 1990 1993 (4) MALL I MOSTELLER DIST. MOSTELLER DIST. 127 1950 1996 (4) CENTER CENTER FRANCISCAN HEALTH FRANCISCAN HEALTH 8 1996 1996 (4) PERIMETER PARK BUILDING A 5 1991 1996 (4) PERIMETER PARK BUILDING B 4 1991 1996 (4) CREEK ROAD BUILDING 1 4 1971 1996 (4) CREEK ROAD BUILDING 2 6 1971 1996 (4) WEST LAKE CENTER WEST LAKE CENTER 136 1981 1996 (4) EXECUTIVE PLAZA I EXECUTIVE PLAZA I 4 1980 1996 (4) EXECUTIVE PLAZA II EXECUTIVE PLAZA II 5 1981 1996 (4) LAKE FOREST PLACE LAKE FOREST PLACE 164 1985 1996 (4) HUNTINGTON BANK HUNTINGTON BANK 2 1986 1996 (4) OHIO NATIONAL OHIO NATIONAL 311 1996 1996 (4) CORNELL COMMERCE CORNELL COMMERCE 126 1989 1996 (4) CLEVELAND, OHIO - --------------- ROCK RUN - NORTH ROCK RUN-NORTH 133 1984 1996 (4) ROCK RUN - CENTER ROCK RUN-CENTER 153 1985 1996 (4) ROCK RUN - SOUTH ROCK RUN-SOUTH 136 1986 1996 (4) FREEDOM SQUARE I FREEDOM SQUARE I 88 1980 1996 (4) FREEDOM SQUARE II FREEDOM SQUARE II 260 1987 1996 (4) CORPORATE PLAZA I CORPORATE PLAZA I 319 1989 1996 (4) CORPORATE PLAZA II CORPORATE PLAZA 270 1991 1996 (4) II ONE CORPORATE ONE CORPORATE 190 1989 1996 (4) EXCHANGE EXCHANGE CORPORATE PLACE CORPORATE PLACE 19 1988 1996 (4) CORPORATE CIRCLE CORPORATE CIRCLE 28 1983 1996 (4) CORPORATE CENTER I CORPORATE CENTER I 80 1985 1996 (4) CORPORATE CENTER II CORPORATE CENTER 77 1987 1996 (4) II COLUMBUS, OHIO - -------------- CORP. PARK AT LITEL 1,447 1990 1993 (4) TUTTLE CRSG CORP. PARK AT STERLING 1 983 1990 1993 (4) TUTTLE CRSG CORP. PARK AT INDIANA 382 1994 1994 (4) TUTTLE CRSG INSURANCE CORP. PARK AT STERLING 2 239 1995 1995 (4) TUTTLE CRSG CORP. PARK AT JOHN ALDEN LIFE 303 1995 1995 (4) TUTTLE CRSG INSURANCE CORP. PARK AT CARDINAL HEALTH 650 1995 1995 (4) TUTTLE CRSG CORP. PARK AT STERLING 3 61 1995 1995 (4) TUTTLE CRSG CORP. PARK AT NATIONWIDE 360 1996 1996 (4) TUTTLE CRSG CORP. PARK AT LAZARUS GROUND - N/A 1996 (4) TUTTLE CRSG LEASE CORP. PARK AT XEROX 592 1992 1994 (4) TUTTLE CRSG SOUTH POINTE BUILDING A 249 1995 1995 (4) SOUTH POINTE BUILDING B 101 1996 1996 (4) PET FOODS BUILD- PET FOODS 299 1993 1993 (4) TO-SUIT DISTRIBUTION GALYAN'S GALYAN'S 180 1994 1994 (4) TUTTLE RETAIL TUTTLE RETAIL 126 1995 1995 (4) CENTER CENTER MBM BUILDING MBM BUILDING 97 1978 1994 (4) METROCENTER III METROCENTER III 81 1983 1996 (4) SCIOTO CORPORATE SCIOTO CORPORATE 12 1987 1996 (4) CENTER CENTER V.A. HOSPITAL V.A. HOSPITAL 530 1994 1994 (4) DAYTON, OHIO - ------------ SUGARCREEK PLAZA SUGARCREEK PLAZA 1,284 1988 1988 (4) LIVONIA, MICHIGAN - ----------------- LIVONIA BUILDING A 974 1988 1993 (4) LIVONIA BUILDING B 1,148 1989 1993 (4) DECATUR, ILLINOIS - ----------------- PARK 101 BUILDING #3 945 1979 1986 (4) PARK 101 BUILDING #8 423 1980 1986 (4) PARK 101 ILL POWER LAND - N/A 1994 (4) LEASE BLOOMINGTON, ILLINOIS - --------------------- LAKEWOOD PLAZA LAKEWOOD PLAZA 1,654 1987 1988 (4) CHAMPAIGN, ILLINOIS - ------------------- MARKET VIEW MARKET VIEW 1,729 1985 1986 (4) SHOPPING CTR CENTER ST. LOUIS, MISSOURI - ------------------- LAUMEIER I LAUMEIER I 391 1987 1995 (4) LAUMEIER II LAUMEIER II 424 1988 1995 (4) WESTVIEW PLACE WESTVIEW PLACE 377 1988 1995 (4) WESTMARK WESTMARK 292 1987 1995 (4) ALFA - LAVAL ALFA - LAVAL 21 1996 1996 (4) I-70 CENTER I-70 CENTER 42 1986 1996 (4) 1920 BELTWAY 1920 BELTWAY 16 1986 1996 (4) INTERAMERICAN INTERAMERICAN 64 1996 1996 (4) VARIOUS LOCATIONS - ----------------- LAND IMP. - N/A 457 UNDEVELOPED LAND ELIMINATIONS - ------ TOTALS 82,207 ======
-51- DUKE REALTY LIMITED PARTNERSHIP REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1996 (IN THOUSANDS) (1) Costs capitalized subsequent to acquisition include decreases for purchase price reduction payments received and land sales or takedowns. (2) The Partnership owns a 66.67% interest in th partnership owning this building. The Partnership shares in the cash flow of this building in accordance with the Partnership's ownership interests. (3) The four buildings comprising Tri-County Office Park were constructed in 1971, 1973 and 1982. (4) Depreciation of real estate is computed using the straight-line method over 40 years for building and shorter periods based on lease terms (generally 3 to 10 years) for tenant improvements.
Real Estate Assets Accumulated Depreciation ---------------------------- -------------------------- 1996 1995 1994 1996 1995 1994 ---- ---- ---- ---- ---- ---- Balance at beginning of year $ 804,164 $653,552 $540,376 $56,335 $38,058 $23,725 Additions during year: Acquisitions 213,979 114,705 57,218 - - - Construction costs and tenant improvements 173,186 84,790 41,125 - - - Depreciation expense - - - 27,568 20,416 15,068 Acquisition of minority interest and joint venture interest 21,627 796 15,742 - - - --------- ------- ------- ------ ------ ------ 1,212,956 853,843 654,461 83,903 58,474 38,793 Deductions during year: Cost of real estate sold (11,347) (4,393) (909) (586) (1,259) - Contribution to Joint Venture (19,175) (44,725) - (108) (319) - Other (1,003) (561) - (1,003) (561) (735) --------- ------- ------- ------ ------ ------ $1,181,431 $804,164 $653,552 $82,207 $56,335 $38,058 ========= ======= ======= ====== ====== ======
-52- SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. DUKE REALTY LIMITED PARTNERSHIP By: Duke Realty Investments, Inc. Its General Partner March 14, 1997 By: /s/ Thomas L. Hefner ----------------- ------------------------------ Thomas L. Hefner President and Chief Executive Officer By: /s/ Darell E. Zink, Jr. ------------------------------ Darell E. Zink, Jr. Executive Vice President and Chief Financial Officer By: /s/ Dennis D. Oklak ------------------------------ Dennis D. Oklak Vice President and Treasurer (Chief Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Date Title --------- ---- ----- /s/ John W. Wynne * 3/14/97 Chairman of the Board ---------------------- John W. Wynne /s/ Thomas L. Hefner * 3/14/97 President and Chief Executive ---------------------- Officer and Director Thomas L. Hefner /s/ Daniel C. Staton * 3/14/97 Executive Vice President and ---------------------- Chief Operating Officer and Daniel C. Staton Director /s/ Darell E. Zink, Jr.* 3/14/97 Executive Vice President and ----------------------- Chief Financial Officer and Darell E. Zink, Jr. Director -53- /s/ Geoffrey Button * 3/14/97 Director ---------------------- Geoffrey Button /s/ John D. Peterson * 3/14/97 Director ---------------------- John D. Peterson /s/ Ngaire E. Cuneo * 3/14/97 Director ---------------------- Ngaire E. Cuneo /s/ L. Ben Lytle * 3/14/97 Director ---------------------- L. Ben Lytle /s/ Jay J. Strauss * 3/14/97 Director ---------------------- Jay J. Strauss /s/ Howard L. Feinsand * 3/14/97 Director ---------------------- Howard L. Feinsand /s/ James E. Rogers * 3/14/97 Director ---------------------- James E. Rogers * By Dennis D. Oklak, Attorney-in-Fact /s/ Dennis D. Oklak --------------------- -54- EX-21 2 EXHIBIT 21 SUBSIDIARIES OF DUKE REALTY LIMITED PARTNERSHIP State of Names Under Which Incorporation Subsidiary Does Subsidiary or Organization Business --------------------- ----------------- --------------------- Duke Realty Services Indiana Duke Realty Services Limited Partnership Limited Partnership Duke Realty Construction, Indiana Duke Realty Inc. Construction, Inc. Duke Construction Limited Indiana Duke Construction Partnership Limited Partnership B/D Limited Partnership Indiana B/D Limited Partnership Lamida Partners Limited Ohio Lamida Partners Partnership Limited Partnership Duna Developers Ohio Duna Developers Kenwood Office Associates Ohio Kenwood Office Associates Park Creek Venture Indiana Park Creek Venture Parkrite Limited Indiana Parkrite Limited Partnership Partnership Post Road Limited Indiana Post Road Limited Partnership Partnership Shadeland Station Office Indiana Shadeland Station Associates II Limited Office Associates Partnership II Limited Partnership SCRED Ohio Limited Ohio SCRED Ohio Limited Partnership Partnership Dugan Realty L.L.C. Indiana Dugan Realty L.L.C. Duke/Tees Joint Venture Indiana Duke/Tees J.V. Park Fletcher Limited Indiana Park Fletcher Partnership 2728 Limited Partnership 2728 Cincinnati Development Ohio Cincinnati Group L.L.C. Development Group L.L.C. EX-23 3 Exhibit 23 The Partners DUKE REALTY LIMITED PARTNERSHIP: We consent to incorporation by reference in the registration statements (No. 33-61361 and No. 333-04695) on Form S-3 of Duke Realty Investments, Inc. and Duke Realty Limited Partnership of our report dated January 29, 1997, relating to the consolidated balance sheets of Duke Realty Limited Partnership and Subsidiaries as of December 31, 1996 and 1995, and the related consolidated statements of operations, partners' equity, and cash flows for each of the years in the three-year period ended December 31, 1996, and the related schedule, which report appears in the December 31, 1996 annual report on Form 10-K of Duke Realty Limited Partnership. /s/ KPMG Peat Marwick, LLP Indianapolis, Indiana March 12, 1997 EX-24 4 Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Geoffrey Button --------------------- Geoffrey Button Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Ngaire E. Cuneo --------------------- Ngaire E. Cuneo Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Howard L. Feinsand ------------------------ Howard L. Feinsand Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ John D. Peterson ---------------------- John D. Peterson Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ James E. Rogers --------------------- James E. Rogers Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ L. Ben Lytle ------------------ L. Ben Lytle Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Daniel C. Staton ---------------------- Daniel C. Staton Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Jay J. Strauss ------------------- Jay J. Strauss Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneysin-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ John W. Wynne ------------------- John W. Wynne Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Darell E. Zink, Jr., John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneys-in-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Thomas L. Hefner --------------------- Thomas L. Hefner Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, John Gaskin and Dennis D. Oklak, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneys-in-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Darell E. Zink, Jr. ------------------------- Darell E. Zink, Jr. Exhibit 24 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that the person whose signature appears below hereby constitutes and appoints Thomas L. Hefner, Darell E. Zink, Jr., and John Gaskin, and each of them, his attorneys-in-fact and agents, with full power of substitution and resubstitution for him in any all capacities, to sign the annual report on Form 10-K of Duke Realty Limited Partnership for the year ended December 31, 1996, and any amendment thereof, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each of such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary in connection with such matters and hereby ratifying and confirming all that each of such attorneys-in-fact and agents or his substitute or substitutes may do or cause to be done by virtue hereof. Dated: January 30, 1997 /s/ Dennis D. Oklak -------------------- Dennis D. Oklak EX-27 5
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM DUKE REALTY LIMITED PARTNERSHIP AND SUBSIDIARIES' DECEMBER 31, 1996 CONSOLIDATED FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 12-MOS DEC-31-1996 JAN-01-1996 DEC-31-1996 5,346 0 30,620 (1,550) 0 31,192 1,290,676 (82,207) 1,362,399 66,935 525,815 0 0 0 769,269 1,362,399 0 187,806 94,204 0 3,545 0 31,344 58,713 0 58,713 0 0 0 58,713 $1.84 0
EX-99 6 EXHIBIT 99.1 SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED) Selected quarterly information for the years ended December 31, 1996 and 1995 is as follows (in thousands, except per Unit amounts): Quarter Ended ------------------------------------------------------ 1996 December 31 September 30 June 30 March 31 ------------------- ------------ -------------- ------------ -------- [S] [C] [C] [C] [C] Revenues from Rental Operations $ 46,451 $ 41,448 $ 37,724 $36,537 Revenues from Service Operations $ 5,404 $ 5,042 $ 5,137 $ 4,346 Net income available for common units $ 17,415 $ 15,571 $ 14,150 $11,577 Net income per common unit $ 0.53 $ 0.47 $ 0.43 $ 0.40 Weighted average common units 33,147 33,053 33,011 28,686 Funds From Operations (1) $ 23,803 $ 23,071 $ 21,768 $18,792 Cash flow provided by (used by): Operating activities $ 26,426 $ 29,908 $ 24,831 $14,305 Investing activities (74,606) (108,819) (13,719) (79,865) Financing activities 41,622 90,541 (22,719) 71,759 1995 ---------------------- Revenues from Rental Operations $ 32,298 $ 29,098 $ 26,694 $25,551 Revenues from Service Operations $ 4,496 $ 5,126 $ 4,320 $ 3,835 Net income available for common units $ 11,399 $ 11,172 $ 10,155 $ 8,874 Net income per common unit $ 0.40 $ 0.39 $ 0.39 $ 0.36 Weighted average common units 28,303 28,300 26,113 24,388 Funds From Operations (1) $ 17,910 $ 17,245 $ 15,531 $14,160 Cash flow provided by (used by): Operating activities $ 16,630 $ 21,453 $ 24,656 $15,898 Investing activities (100,325) (74,823) (79,445) (34,976) Financing activities 29,775 91,871 68,085 (13,544) (1)Funds From Operations is defined by the National Association of Real Estate Investment Trusts as net income or loss excluding gains or losses from debt restructuring and sales of property plus depreciation and amortization, and after adjustments for minority interest, unconsolidated partnerships and joint ventures (adjustments for minority interest, unconsolidated partnerships and joint ventures are calculated to reflect Funds From Operations on same basis). Funds From Operations does not represent cash flow from operations as defined by generally accepted accounting principles, should not be considered as an alternative to net income as an indicator of the Partnership's operating performance, and is not indicative of cash available to fund all cash flow needs. In March 1995, NAREIT issued a clarification of its definition of FFO effective for years beginning after December 31,1995. The clarification provides that amortization of deferred financing costs and depreciation of non-rental real estate assets are no longer to be added back to net income in arriving at FFO. The Partnership adopted these changes effective January 1, 1996, and the calculations of FFO for the quarterly periods during the year ended December 31, 1995 have been revised accordingly. -----END PRIVACY-ENHANCED MESSAGE-----