EX-99.1 10 rw38rpt.txt EVALUATION OF VALUE OF VININGS' SHARE PRICE Exhibit (c)(1) RONALD WHITMAN WEISS 737 PARK AVENUE NEW YORK, NEW YORK 10021 (212) 535-2077 March 8, 2001 Board of Directors Vinings Investment Properties Trust 2839 Paces Ferry Road Atlanta, GA 30339-5704 Gentlemen: We have been asked to up-date our evaluations of the value of Vinings' share price, as of the year ending December 31, 2000. The best measure of share market value for any public company, is the currently traded price per share on the open market. Even when the trading market is thin, as in this instance, it is still indicative of the value that these shares would command if liquidation took place. The market price of Vinings' stock had shown wide fluctuations during the past twelve-month period, and during the latter part of December, VIPIS shares traded at their lowest point, below $2.00 per share. Therefore, we concluded that a fair market price valuation would be in a range between $2.00 and $2.25 per share. Although, Book Value or Net Asset Value, is not always a good measure for a public company, it is more appropriate for a real estate investment trust, than most other publicly owned companies. In this instance, after an allowance for accumulated depreciation, the net share value can still be approximated at $3.25. Earnings per share and price earnings ratios, are not viable methods for estimating a share value for a real estate owning company, for the reasons stated. Cash flow and/or Adjusted Funds from Operations, is a much truer approximation. An analysis of comparable AFFO multiples, from other real estate investment trusts in Vinings' peer group, indicates that an appropriate fair market value based upon AFFO Multiples, would still be in a range between $2.90 and $3.25 per share. Finally, an estimate based upon net value of the underlying real estate owned by Vinings, is another excellent indication for the fair per share market value for the Vinings stock. In lieu of appraisals for each of the individual properties, we previously used a capitalized net operating income model, based upon the gross income for the latest verified twelve month period, which we had prior to year end December 31, 2000. The actual year end rent and expense numbers, reported to us at this time by the company, showed that gross possible rents and net operating income, had both been over-stated in our original evaluation, and reduced by the year end. Therefore, as indicated in the attached valuation, including the joint venture equity, a capitalization of the actual year-end net operating income would indicate a lower revised approximate per share value of $2.66. All of these factors indicate that we should revise our estimate of per share value to a lower range than our original December 15, 2000, opinion of $3.25, to a range between $2.66 and $3.25 per share. This produces an average per share value of approximately $3.00 per share, as of the year-end, December 31, 2000. We hereby consent to the inclusion of the fairness opinion and its description and the report to the Board of Trustees in all required filings with the Securities and Exchange Commission, including without limitation a Proxy Statement and Schedule 13E-3 relating to the transaction. Very truly yours, /s/ Ronald Whitman Weiss ------------------------ Ronald Whitman Weiss VININGS INVESTMENT PROPERTIES TRUST VALUATION ANALYSIS REVISED AS OF DECEMBER 31, 2000 ---------------------------------- (EXCLUDING PBC) ACTUALS DECEMBER 31, 2000 -------------- GROSS POSSIBLE 11,610,408 VACANCY 784,061 CONCESSION 151,861 MODEL/OFFICE 8,458 WRITE OFFS 146,166 -------------- NET RENTAL INCOME 10,519,863 OTHER INCOME 551,837 -------------- TOTAL INCOME 11,071,700 SALARIES 1,053,166 LEASING/ADVERTISING 77,119 ADMINISTRATIVE 269,574 CORPORATE UNIT 51,228 UTILITIES 757,932 MAINTENANCE 754,522 MANAGEMENT FEES 388,736 R. E. TAX & PERS. PROP. TAXES 893,736 INSURANCE 94,386 -------------- TOTAL OPERATING EXPENSE 4,340,398 -------------- NET OPERATING INCOME 6,731,302 REPLACEMENT RESERVE 250 377,500 -------------- NOI AFTER CAPITAL 6,353,802 -------------- Portfolio Value 9.50% 66,882,122 Plus estimated PBC Value 3,000,000 -------------- 69,882,122 Cost of Sale 1% 698,821 Mortgage Debt 56,742,209 -------------- REMAINING EQUITY 12,441,092 Joint Venture Equity (443,575) -------------- Subtotal 11,997,516 Less Preferred Payoff 8,867,529 -------------- Total Remaining Equity 3,129,987 ============== Outstanding Common Shares/Units (excludes options) 1,343,034 ============== Value per Share 2.33 ============== Value per Share (Without negative JV Equity) 2.66 ============== TRADE LINE GRAPH for VIPIS US Equity -------------------------- Range: 9/8/00 - 12/28/00 Period: DAILY Base Currency: USD -------------------------------- Comp/Close/Trade/USD -------------------------------- Last 1.9375 High 09/11/00 2.6250 Ave 2.2679 Low 12/27/00 1.9375 -------------------------------- Reflects the daily trading price for VIPIS for the period 9/8/00 through 12/28/00. Graph obtained from Bloomberg Professional on-line services. The graph was not accompanied by a tabular representation of the data. Copyright 2000 BLOOMBERG L.P. PRICE TABLE VININGS INVESTMENT PROPERTIES TRUST (VIPIS US) USD 12/28/00 TO 10/30/00 -------------------------------------------------------------------------------- DATE PRICE DATE PRICE DATE PRICE -------------------------------------------------------------------------------- F F 12/8 F 11/17 T 12/28 1 15/16 T 12/7 T 11/16 W 12/27 1 15/16 W 12/6 W 11/15 T 12/26 T 12/5 2 1/16 T 11/14 M 12/25 M 12/4 M 11/13 F 12/22 F 12/1 F 11/10 T 12/21 T 11/30 T 11/9 W 12/20 W 11/29 W 11/8 T 12/19 T 11/28 T 11/7 M 12/18 M 11/27 M 11/6 2 3/16 F 12/15 F 11/24 F 11/3 T 12/14 T 11/23 T 11/2 W 12/13 W 11/22 W 11/1 T 12/12 2 T 11/21 T 10/31 M 12/11 2 M 11/20 M 10/30 Copyright 2000 BLOOMBERG L.P. HISTORICAL PRICE TRADED CURRENCY VININGS INVESTMENT PROPERTIES TRUST (VIPIS US) Range: 9/8/00 to 12/28/00 Market: Trade Period: Daily
DATE PRICE CURRENCY DATE PRICE CURRENCY DATE PRICE CURRENCY --------------------------------------------------------------------------------------------------------- 12/28/00 1 15/16 USD 12/1/00 11/6/00 2 3/16 USD 12/27/00 1 15/16 USD 11/30/00 11/3/00 12/26/00 11/29/00 11/2/00 12/25/00 11/28/00 11/1/00 12/22/00 11/27/00 10/31/00 12/21/00 11/24/00 10/30/00 12/20/00 11/23/00 10/27/00 2 3/8 USD 12/19/00 11/22/00 10/26/00 12/18/00 11/21/00 10/25/00 12/15/00 11/20/00 10/24/00 12/14/00 11/17/00 10/23/00 2 3/8 USD 12/13/00 11/16/00 10/20/00 12/12/00 2 USD 11/15/00 10/19/00 12/11/00 2 USD 11/14/00 10/18/00 2 3/8 USD 12/8/00 11/13/00 10/17/00 12/7/00 11/10/00 10/16/00 12/6/00 11/9/00 10/13/00 12/5/00 2 1/16 USD 11/8/00 10/12/00 2 1/2 USD 12/4/00 11/7/00 10/11/00 ---------------------------------------------------------------------------------------------------------
Copyright 2000 BLOOMBERG L.P. CORPORATE ACTION PRICE GRAPH for VIPIS US --------------------------------------- Range: 9/13/00 - 12/28/00 Period: DAILY Line Chart USD E -------------------------------- Comp/Trade/USD -------------------------------- Last 1.9375 on 12/28/00 High 2.5 on 10/12/00 Ave 2.224 Low 1.9375 on 12/28/00 -------------------------------- Reflects the market's reaction to corporate actions and how they may impact the price of the company's stock for the period 9/13/00 through 12/28/00. Graph obtained from Bloomberg Professional on-line services. The graph was not accompanied by a tabular representation of the data. Copyright 2000 BLOOMBERG L.P. COMPARATIVE RETURNS ------------------- Range: 1/3/00 - 12/28/00 Period: DAILY 360 Day Period Securites Currency Prc Appr Total Return Difference Annual Eq -------------------------------------------------------------------------------- VIPIS US Equity USD -51.56% -51.56% -13.59% -52.05% CCMP Index USD -38.09% -37.98% -38.39% (* = No dividends or coupons) Compares the daily returns of VIPIS to the daily returns of the NASDAQ Composite Index for the period 1/3/00 through 12/28/00. Graph obtained from Bloomberg Professional on-line services. The graph was not accompanied by a tabular representation of the data. Copyright 2000 BLOOMBERG L.P.