-----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, Rm4zbcd0GDEcTqc1xUVCnVo5Bm1dZLPUHALShkQkb6wXvQu4SV0PXy0CRJ8QcIeH d4PptO5nE0F7IL84KO23nQ== 0000908737-98-000318.txt : 19980325 0000908737-98-000318.hdr.sgml : 19980325 ACCESSION NUMBER: 0000908737-98-000318 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980319 ITEM INFORMATION: FILED AS OF DATE: 19980324 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HEALTH & RETIREMENT PROPERTIES TRUST CENTRAL INDEX KEY: 0000803649 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 046558834 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-09317 FILM NUMBER: 98572007 BUSINESS ADDRESS: STREET 1: 400 CENTRE ST CITY: NEWTON STATE: MA ZIP: 02158 BUSINESS PHONE: 6173323990 MAIL ADDRESS: STREET 1: 400 CENTRE STREET CITY: NEWTON STATE: MA ZIP: 02158 FORMER COMPANY: FORMER CONFORMED NAME: HEALTH & REHABILITATION PROPERTIES TRUST DATE OF NAME CHANGE: 19920703 8-K 1 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): March 19, 1998 HEALTH AND RETIREMENT PROPERTIES TRUST (Exact name of registrant as specified in charter) Maryland 1-9317 04-6558834 (State or other (Commission file (IRS employer jurisdiction of number) identification no.) incorporation) 400 Centre Street, Newton, Massachusetts 02158 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: 617-332-3990 THIS CURRENT REPORT CONTAINS FORWARD-LOOKING STATEMENTS. SUCH STATEMENTS ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES WHICH COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE ANTICIPATED OR PROJECTED. INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS WHICH SPEAK ONLY AS OF THE DATE HEREOF. THE REGISTRANT UNDERTAKES NO OBLIGATION TO PUBLISH REVISED FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES AFTER THE DATE HEREOF OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. (b) Unaudited Pro Forma Consolidated Financial Statements (set forth beginning on page P-1). (c) Exhibits. 23 Consent of Arthur Andersen LLP. -2- HEALTH AND RETIREMENT PROPERTIES TRUST Unaudited Pro Forma Consolidated Financial Statements The following unaudited pro forma consolidated balance sheet as of December 31, 1997 and the consolidated statement of income for the year ended December 31, 1997, present the consolidated financial position and the results of operations of Health and Retirement Properties Trust and consolidated subsidiaries (the "Company") as if the transactions described in the notes to unaudited financial statements were consummated on January 1, 1997. Additional information with respect to such transactions is provided in the Company's Annual Report on Form 10-K for its fiscal year ended December 31, 1997 (and in materials incorporated by reference therein), which is incorporated by reference into this Current Report. These unaudited pro forma consolidated financial statements should be read in connection with, and are qualified in their entirety by reference to, the separate consolidated financial statements of the Company for the year ended December 31, 1997, included in the Company's Current Report on Form 8-K dated February 27, 1998, which is incorporated by reference into this Current Report. These unaudited pro forma consolidated financial statements are not necessarily indicative of the financial position and the expected results of operations of the Company for any future period. Differences could result from, among other considerations, future changes in the Company's portfolio of investments, changes in interest rates, changes in the capital structure of the Company, delays in the acquisition of certain properties and changes in property level operating expenses. P-1
Health and Retirement Properties Trust Pro Forma Consolidated Balance Sheets December 31, 1997 (dollars in thousands) (unaudited) Recent Historical Acquisitions (A) Pro Forma ------------ ----------------- --------- ASSETS Real estate properties, at cost: $1,969,023 $ 152,651 $2,121,674 Less accumulated depreciation 111,669 -- 111,669 ---------- ---------- ---------- 1,857,354 152,651 2,010,005 Real estate mortgages, net 104,288 -- 104,288 Investment in Hospitality Properties Trust 111,134 -- 111,134 Other assets 63,187 (52,651) 10,536 ---------- ---------- ---------- $2,135,963 100,000 2,235,963 ========== ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Bank notes payable $ 200,000 $ 100,000 $ 300,000 Senior notes and bonds payable, net 349,900 -- 349,900 Mortgage notes payable 26,329 -- 26,329 Convertible subordinated debentures 211,650 -- 211,650 Other liabilities 81,824 81,824 Shareholders' equity 1,266,260 1,266,260 ---------- ---------- ---------- $2,135,963 $ 100,000 $2,235,963 ========== ========== ==========
See accompanying notes to unaudited pro forma financial statements P-2
Health and Retirement Properties Trust Pro Forma Consolidated Statements of Income Year Ended December 31, 1997 (amounts in thousands, except per share data) (unaudited) Second Third Quarter Quarter West Acquisitions Acquisitions 34th Historical GPI(B) CSMC(C) (D) (D) Street (E) ----------- ---------- ---------- ----------- ------------- ----------- Revenues: Rental Income $188,000 $ 11,959 $ 6,831 $ 2,948 $ 3,179 $ 10,771 Interest Income 20,863 (366) -- -- -- -- -------- -------- -------- -------- -------- -------- Total revenues 208,863 11,593 6,831 2,948 3,179 10,771 -------- -------- -------- -------- -------- -------- Expenses: Operating 26,765 2,053 1,910 -- 954 3,641 Interest 36,766 (1,216) 3,232 1,087 1,463 2,876 Depreciation and amortization 39,330 4,156 1,119 627 501 1,869 General and administrative 11,670 2,105 249 139 111 415 -------- -------- -------- -------- -------- -------- Total expenses 114,531 7,098 6,510 1,853 3,029 8,801 -------- -------- -------- -------- -------- -------- Income before equity in earnings of Hospitality Properties Trust and before extraordinary item 94,332 4,495 321 1,095 150 1,970 Equity in earnings of Hospitality Properties Trust 8,590 Gain on equity transaction of Hospitality Properties Trust 9,282 - - -------- -------- -------- -------- -------- -------- Net income before extraordinary item $112,204 $ 4,495 $ 321 $ 1,095 $ 150 $ 1,970 -------- -------- -------- -------- -------- -------- Average shares outstanding 92,168 Basic and diluted earnings per commonshare: Net income before extraordinary item $ 1.22 Fourth Quarter Franklin Bridgepoint Acquisitions Recent Plaza (F) Square (G) (D) Acquisitions (H) Pro Forma ---------- -------------- ------------- ---------------- ------------ Revenues: Rental Income $ 9,614 $ 5,599 $ 8,461 $ 19,505 $266,867 Interest Income -- -- -- -- 20,497 -------- -------- -------- -------- -------- Total revenues 9,614 5,599 8,461 19,505 287,364 -------- -------- -------- -------- -------- Expenses: Operating 4,904 2,162 2,634 4,240 49,263 Interest 2,486 3,216 4,338 6,500 60,748 Depreciation and amortization 1,334 1,175 1,269 3,435 54,815 General and administrative 296 262 283 764 16,294 -------- -------- -------- -------- -------- Total expenses 9,020 6,815 8,524 14,939 181,120 -------- -------- -------- -------- -------- Income before equity in earnings of Hospitality Properties Trust and before extraordinary item 594 (1,216) (63) 4,566 106,244 Equity in earnings of Hospitality Properties Trust - 8,590 Gain on equity transaction of Hospitality Properties Trust - - - 9,282 -------- -------- -------- -------- -------- Net income before extraordinary ite$ $ 594 $ (1,216) $ (63) $ 4,566 $124,116 -------- -------- -------- -------- -------- Average shares outstanding 98,838 Basic and diluted earnings per common share Net income before extraordinary item $ 1.26
See accompanying notes to unaudited pro forma financial statements P-3 Notes to Unaudited Pro Forma Consolidated Financial Statements Pro Forma Balance Sheet Adjustments at December 31, 1997. A. Represents the Company's acquisitions, during January 1998, February 1998 and March 1998 of two medical office properties and three commercial office properties located in Pennsylvania, four commercial office properties located in Texas, a medical office property located in Massachusetts, a commercial office property located in Maryland, one medical office property and two commercial office properties located in Minnesota and three medical office properties and a commercial office property located in Florida (collectively, "Recent Acquisitions"). The Recent Acquisitions were funded with available cash and by drawings under the Company's existing revolving line of credit. Pro Forma Statement of Income Adjustments for the Year Ended December 31, 1997. B. Represents the increase in rental income, operating expenses, depreciation and amortization and general and administrative expenses arising from the Company's acquisition of the government office properties ("Government Office Properties") from Government Property Investors, Inc. Also reflects the decrease in interest expense arising from the Company's issuance of its common shares of beneficial interest in a March 1997 offering, the proceeds of which were used in part to repay amounts then outstanding under the Company's revolving line of credit, net of an increase in interest expense related to the Company's assumption of certain debt in connection with the acquisition of the Government Office Properties. C. Represents the increase in rental income, operating expenses, depreciation and amortization and general and administrative expenses arising from the Company's acquisition of two medical office properties and two parking structures located in Los Angeles, California, as well as the increase in interest expense due to the use of the Company's revolving line of credit to fund this acquisition. D. Represents the increase in rental income, operating expenses, depreciation and amortization and general and administrative expenses arising from the Company's acquisition of a) a 200 unit retirement housing property located in Spokane, Washington and 20 medical office clinics and ancillary structures located in Massachusetts during the second quarter, b) three medical and two commercial office buildings located in Pennsylvania during the third quarter and c) a medical office property located in Colorado, a medical office property located in Maryland, a medical office property located in Rhode Island, three medical office properties located in California, and a medical office property located in Washington, D.C. during the fourth quarter, as well as the increase in interest expense due to the use of the Company's revolving line of credit to fund these acquisitions. E. Represents the increase in rental income, operating expenses, depreciation and amortization and general and administrative expenses arising from the Company's acquisition of West 34th Street in New York City, as well as the increase in interest due to the use of the Company's revolving line of credit to fund the acquisition. F. Represents the increase in rental income, operating expenses, depreciation and amortization and general and administrative expenses arising from the Company's acquisition of Franklin Plaza in Philadelphia, Pennsylvania, as well as the increase in interest expense due to the use of the Company's revolving line of credit to fund the acquisition. G. Represents the increase in rental income, operating expenses, depreciation and amortization and general and administrative expenses arising from the Company's acquisition of Bridgepoint Square, Austin, Texas. Bridgepoint Square consists of five properties, of which one property was under construction at September 30, 1997 and one property was completed in July 1997. Also represents the increase in interest expense due to the use of the Company's revolving line of credit to fund the acquisition. H. Represents the increase in rental income, operating expenses, depreciation and amortization and general and administrative expenses arising from the Company's Recent Acquisitions as well as the increase in interest due to the use of the Company's revolving line of credit to fund these acquisitions. P-4 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. HEALTH AND RETIREMENT PROPERTIES TRUST By: /s/ Ajay Saini Ajay Saini, Treasurer and Chief Financial Officer Date: March 24, 1998 EX-23 2 EXHIBIT 23 Consent of Independent Public Accountants As independent public accountants, we hereby consent to the incorporation of our report dated January 16, 1998 included in Health and Retirement Properties Trust's Form 8-K dated February 27, 1998 into the Health and Retirement Properties Trust's Form 10-K, and into the previously filed Registration Statements File Nos. 33-62135, 333-26887 and 333-34823. /s/ Arthur Andersen LLP Washington, D.C. March 19, 1998 -----END PRIVACY-ENHANCED MESSAGE-----