-----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, WbatQrEY3XqcyYOUfb1CFEb0v40xqm+xWGB3+kCEYxz1n+OjRrT9MjPghUUSp1wj 4lzPfXLo+Ouft6QBMIxJug== 0001178862-03-000026.txt : 20031117 0001178862-03-000026.hdr.sgml : 20031117 20031117163756 ACCESSION NUMBER: 0001178862-03-000026 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20031114 ITEM INFORMATION: FILED AS OF DATE: 20031117 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BERKSHIRE INCOME REALTY INC CENTRAL INDEX KEY: 0001178862 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 320024337 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-31659 FILM NUMBER: 031008351 BUSINESS ADDRESS: STREET 1: ONE BEACON ST STREET 2: SUITE 1500 CITY: BOSTON STATE: MA ZIP: 02108 MAIL ADDRESS: STREET 1: ONE BEACON ST STREET 2: SUITE 1500 CITY: BOSTON STATE: MA ZIP: 02108 8-K 1 bir8kq3epr.txt BERKSHIRE INCOME REALTY, INC. - 8K - Q3 EARNINGS SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): November 14, 2003 Berkshire Income Realty, Inc. (Exact Name of Registrant as Specified in its Charter) Maryland 001-31659 32-0024337 (State or other jurisdiction (Commission (I.R.S. Employer of incorporation or organization File Number) Identification No.) One Beacon Street, Boston, Massachusetts 02108 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (617) 523-7722 Not applicable (Former Name or Former Address, if Changed Since Last Report) Item 12. Results of Operations and Financial Condition On November 14, 2003, the Registrant issued a press release announcing its financial results for the third quarter of 2003. The text of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein. The information in this Current Report is being furnished pursuant to Item 12, Results of Operations and Financial Condition. This information, including the exhibits attached hereto, shall not be deemed "filed" for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that Section. The information in this Current Report on Form 8-K shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation language in such filing. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Company has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. Berkshire Income Realty, Inc. /s/ David C. Quade ________________________ Date: November 17, 2003 Name: David C. Quade Title: President and Chief Financial Officer EX-99 2 birex99-18kq3epr.txt EXHIBIT 99.1, BIR Q3 EARNINGS PRESS RELEASE BERKSHIRE INCOME REALTY ANNOUNCES THIRD QUARTER FFO OF $4,384,000 AND TEXAS ACQUISITION BOSTON, MASSACHUSETTS - - November 14, 2003 - - Berkshire Income, Realty, Inc. (AMEX: "BIR_pa", "BIRPRA", "BIR.PR.A") ("Berkshire" or the "Company") today reported its results for the quarter ended September 30, 2003. Financial highlights for the quarter ended September 30, 2003 include: o The Company's funds from operations for the quarter ended September 30, 2003 were $4,384,000. o For the quarter ended September 30, 2003, Berkshire reported net income of $2,114,000. For the comparable period in 2002, the Berkshire Income Realty Predecessor Group reported a net loss of $215,000. Because the Company did not have any operations until the quarter ended June 30, 2003, the discussion in this press release of operations or activities prior to April 1, 2003 refers to the operations and activities of the Berkshire Income Realty Predecessor Group, the Company's predecessor entities for accounting purposes. As described below, the Berkshire Income Realty Predecessor Group contributed to the Company the initial properties that make up the Company's current operations. o On October 30, 2003, Berkshire Income Realty - OP, L.P. (the "O.P."), the operating partnership subsidiary of the Company, through its newly formed and wholly owned subsidiary, St. Marin/Karrington Limited Partnership, purchased the St. Marin Apartments, a 350-unit multi-family apartment community and the Karrington Apartments, a 250-unit multi-family apartment community, which are contiguous properties located in Coppell, Texas from WHCO Real Estate Limited Partnership and WHCO II Real Estate Limited Partnership, respectively. Both of the sellers are third parties. The purchase and sale agreements, as amended, provide for purchase prices of $26,125,000 and $20,000,000 for St. Marin and Karrington, respectively, which was paid in cash. The Company will operate the two properties as one under the name St. Marin/Karrington Apartments. o On October 31, 2003, the Company announced it that would pay its regular quarterly cash dividend of $.5625 on each share (aggregate quarterly dividend of $1,675,000) of its 9% Series A Cumulative Redeemable Preferred Stock ("Preferred Shares") on November 15, 2003 to shareholder of record on November 10, 2003. The regular cash dividend payable on the Series A Preferred Stock is payable on February 15, May 15, August 15 and November 15 of each year. Funds From Operations The Company has adopted the revised definition of Funds from Operations adopted by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT"). Management considers Funds from Operations ("FFO") to be an appropriate measure of performance of an equity REIT. We calculate FFO by adjusting net income (loss) (computed in accordance with GAAP, including non-recurring items), for gains (or losses) from sales of properties and real estate related depreciation and amortization. Management believes that in order to facilitate a clear understanding of the historical operating results of the Company, FFO should be considered in conjunction with net income as presented in the financial statements. Management considers FFO to be a useful measure for reviewing the comparative operating and financial performance of the Company, because, by excluding gains and losses related to sales of previously depreciated operating real estate assets and excluding real estate asset depreciation and amortization (which can vary among owners of identical assets in similar condition based on historical cost accounting and useful life estimates), FFO can help one compare the operating performance of a company's real estate between periods or as compared to different companies. The Company's calculation of FFO may not be directly comparable to FFO reported by other REITS or similar real estate companies that have not adopted the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently. FFO should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of our performance. FFO does not represent cash generated from operating activities determined in accordance with GAAP and is not a measure of liquidity or an indicator of our ability to make cash distributions. We believe that to further understand our performance, FFO should be compared with our reported net income and considered in addition to cash flows in accordance with GAAP, as presented in our financial statements. The calculation of FFO for the three month period ended September 30, 2003 is presented below (in thousands): Three Months Ended September 30, 2003 ------------------- Net Income $ 2,114 Add: Minority interest in Operating Partnership 488 Depreciation of real property 1,782 ------------------- Funds from Operations $ 4,384 =================== Further information regarding the results of Berkshire for the quarter ended September 30, 2003 can be found in Berkshire's Form 10-Q for the quarter ended September 30, 2003, which is being filed today with the Securities and Exchange Commission and will be available on the SEC's website at www.sec.gov. Looking Forward Statements With the exception of the historical information contained in the release, the matters described herein contain forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve a number of risks, uncertainties or other factors beyond the Company's control, which may cause material differences in actual results, performance or other expectations. These factors include, but are not limited to, changes in economic conditions generally and the real estate and bond markets specifically, legislative/regulatory changes (including changes to laws governing the taxation of real estate investment trusts ("REITS"), availability of capital, interest rates and interest rate spreads, changes in generally accepted accounting and policies and guidelines applicable to REITs, those set forth in Part I, Item 1A "Risk Factors" of the Company's Form 10-K and other risks and uncertainties as may be detailed from time to time in the Company's public announcements and SEC filings. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company assumes no obligation to update such information. BERKSHIRE INCOME REALTY, INC. (FORMERLY BERKSHIRE INCOME REALTY PREDECESSOR GROUP) BALANCE SHEETS (unaudited, in thousands, except share and per share amounts) December 31, September 30, 2002 2003 (Note 1) Consolidated Combined -------------- -------------- ASSETS Multi-family apartment communities, net of accumulated depreciation of $100,166 and $94,712, respectively $ 99,896 $ 94,343 Cash and cash equivalents 41,819 4,852 Cash restricted for tenant security deposits 855 850 Replacement reserve escrow 250 407 Prepaid expenses and other assets 3,601 3,733 Investment in Mortgage Funds 40,197 - Deferred expenses, net of accumulated amortization of $281 and $246, respectively 1,262 1,288 -------------- -------------- Total assets $ 187,880 $ 105,473 ============== ============== LIABILITIES AND STOCKHOLDERS' EQUITY/OWNERS' DEFICIT Liabilities: Mortgage notes payable $ 131,901 $ 119,162 Notes payable - 3,155 Due to affiliates 1,456 2,879 Dividend and distributions payable 1,338 - Accrued expenses and other liabilities 3,317 1,891 Tenant security deposits 940 912 -------------- ------------- Total liabilities 138,952 127,999 Minority interest - - Commitments and Contingencies - - Stockholders' equity / owners' deficit: Series A 9% Cumulative Redeemable Preferred Stock, no par value, $25 stated value, 5,000,000 shares authorized, 2,978,110 and 0 shares issued and outstanding at September 30, 2003 and December 31, 2002, 70,212 - respectively Class A common stock, $.01 par, 5,000,000 shares authorized; 0 shares issued and outstanding at September 30, 2003 and December 31, 2002, res2002, respectively - - Class B common stock, $.01 par, 5,000,000 shares authorized; 1,283,313 and 100 shares issued and outstanding at September 30, 2003 and December 31, 2002, respectively 12 - Excess stock, $.01 par value, 15,000,000 shares authorized, 0 shares issued and outstanding at September 30, 2003 and December 31, 2002, respectively - - Accumulated deficit (21,296) - Owners' deficit (22,526) - -------------- ------------- Total stockholders' equity / owners' deficit 48,928 22,526) Total liabilities and stockholders' equity / owners' deficit $ 187,880 $ 105,473 ============== ============= BERKSHIRE INCOME REALTY, INC. (FORMERLY BERKSHIRE INCOME REALTY PREDECESSOR GROUP) STATEMENTS OF OPERATIONS (unaudited, in thousands, except share and per share amounts) For the Three Months For the Nine Months Ended September 30, Ended September 30, --------------------- ---------------------- 2003 2002 2003 2002 Consolidated Combined Consolidated Combined --------------------- ---------------------- Revenue: Rental $ 6,909 $ 6,738 $ 20,598 $ 19,739 Interest 11 86 78 158 Utility reimbursement 133 133 340 448 Other 372 276 925 737 --------------------- ---------------------- Total revenue 7,425 7,233 21,941 21,082 Expenses: Operating 1,909 1,524 5,184 4,469 Maintenance 715 577 1,784 1,551 Real estate taxes 644 553 1,819 1,633 General and administrative 476 343 1,149 694 Organizational costs - - 213 - Management fees 465 451 1,573 1,351 Depreciation 1,819 1,482 5,454 4,386 Interest 1,830 2,189 5,580 4,509 Loss on extinguishment of debt 87 285 339 1,168 Participation interest - 44 - 132 --------------------- ---------------------- Total expenses 7,945 7,448 23,095 19,893 --------------------- ---------------------- Income (loss) before minority interest in properties, equity in income of Mortgage Funds and minority common interest in Operating Partnership (520) (215) (1,154) 1,189 Minority interest in properties (31) - (125) (1,436) Equity in income of Mortgage Funds 3,153 - 4,883 - --------------------- ---------------------- Income (loss) before minority common interest in Operating Partnership 2,602 (215) 3,604 (247) Minority common interest in Operating Partnership (488) - (488) - --------------------- ---------------------- Net income (loss) $ 2,114 $ (215) $ 3,116 (247) ===================== ===================== Preferred dividend (1,675) - (3,276) - --------------------- --------------------- Net income (loss) available to common shareholders $ 439 $ (215) $ (160)$ (247) ===================== ===================== Earnings per common share, basic $ 0.34 $ (0.19) ===================== ===================== Weighted average number of common shares outstanding 1,283,313 837,207 ===================== ===================== -----END PRIVACY-ENHANCED MESSAGE-----