-----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, LzJPjW0vnUyF2vnzKc7SMQZlALWaHkS1Yhg3B75XrnT52F2e4y335Q0FTR46OD55 FtdLWWPfPNWuqpIHcJQC/A== 0000889812-98-000106.txt : 19980123 0000889812-98-000106.hdr.sgml : 19980123 ACCESSION NUMBER: 0000889812-98-000106 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970115 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980122 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: KIMCO REALTY CORP CENTRAL INDEX KEY: 0000879101 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 132744380 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-10899 FILM NUMBER: 98510699 BUSINESS ADDRESS: STREET 1: 3333 NEW HYDE PARK RD STREET 2: PO BOX 5020 CITY: NEW HYDE PARK STATE: NY ZIP: 11042 BUSINESS PHONE: 5168699000 8-K 1 CURRENT REPORT 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 January 15, 1997 Date of Report (Date of earliest event reported) Kimco Realty Corporation (Exact name of registrant as specified in its charter) Maryland 1-10899 13-2744380 - ---------------------------- ------------------------ ------------------- (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 3333 New Hyde Park Road New Hyde Park, New York 11042-0020 - ---------------------------- ------------------- (Address of principal (zip code) executive offices) 516/869-9000 ---------------------------- Registrant's telephone, including area code Not Applicable - ------------------------------------------------------------------------------- (former name or former address, if changed since last report.) 1 of 17 KIMCO REALTY CORPORATION AND SUBSIDIARIES CURRENT REPORT ON FORM 8-K Item 5. Other Events Shopping Center Acquisitions - Certain subsidiaries of Kimco Realty Corporation (the "Company") acquired 14 neighborhood and community shopping center properties (the "Shopping Center Acquisitions") comprising approximately 2.0 million square feet of gross leasable area ("GLA") in 8 states. These shopping center properties, acquired in separate transactions throughout 1997, for an aggregate purchase price of approximately $141.7 million including the assumption of approximately $14.0 million of mortgage debt include: o Target Shopping Center, Lafayette, Indiana o Carrollwood Commons, Tampa, Florida o Shady Oaks Shopping Center, Ocala, Florida o Woodforest Shopping Center, Houston, Texas o Hammond Aire Plaza, Baton Rouge, Louisiana o Crossroads Center, Florence, South Carolina o Maplewood Plaza, Coral Springs, Florida o Mountainside Plaza, Phoenix, Arizona o Acadiana Square Shopping Center, Lafeyette, Louisiana o The Festival at Manassas, Manassas, Virginia o The Gallery Shopping Center, Greenville, South Carolina o Tri-Cities Square Shopping Center, Mount Dora, Florida o Greenridge Shopping Center, Staten Island, New York o North Rivers Market, North Charleston, South Carolina Although none of the above Shopping Center Acquisitions, individually represent a "significant acquisition" pursuant to the rules governing the reporting of transactions under this Current Report on Form 8-K, the Company considers these acquisitions in the aggregate to be material in relation to its overall financial position and results of operations. Consequently, this report has been filed for the purpose of providing certain historical financial information for certain acquired properties and pro forma financial information for the Shopping Center Acquisitions. More specific information with respect to each of these properties acquired is as follows: In January 1997, the Company purchased the Target Shopping Center located on Sagamore Parkway North in Lafayette, IN. This 177,000 square foot center is anchored by Target Stores and was acquired for approximately $4.1 million. 2 In April 1997, the Company acquired the Carrollwood Commons shopping center located at Ehrlich Road and North Dale Mabry Highway, in Tampa, FL for approximately $14.1 million. This shopping center has 110,000 square feet of GLA and is anchored by Staples and Ross Stores. In June 1997, the Company purchased Shady Oaks Shopping Center, Woodforest Shopping Center and Hammond Aire Plaza located in Ocala, FL, Houston, TX and Baton Rouge, LA, respectively. These properties were acquired in separate transactions for an aggregate purchase price of approximately $34.6 million. Shady Oaks Shopping Center, located at the intersection of S.R. 200 and Shady Oaks Road comprises 251,000 square feet of GLA and is anchored by Kmart Corporation, Service Merchandise and Kash N' Karry. Woodforest Shopping Center, which comprises 113,000 square feet of GLA at the intersection of Wood Forest Boulevard and Uvalde Road, is anchored by HEB Pantry Food and Palais Royal. Tenants at Hammond Aire Plaza, which comprises 264,000 square feet of GLA at the intersection of Old Hammond Highway and Airline Highway, include Marshall's, Steinmart and Taylor Office Supply. In September 1997, the Company acquired the Crossroads Center located on Frontage Road in Florence, SC for approximately $7.3 million. This 114,000 square foot shopping center is anchored by Staples and Hamricks. In October 1997, the Company purchased Mountainside Plaza and Maplewood Plaza located in Phoenix, AZ and Coral Springs, FL, respectively. These properties were acquired in separate transactions for an aggregate purchase price of approximately $20.5 million, including the assumption of approximately $8.1 million of mortgage debt encumbering the Mountainside Plaza property. Mountainside Plaza which comprises 124,000 square feet of GLA at the intersection of Chandler Boulevard and 40th Street, is anchored by Safeway and Walgreen's. Tenants at Maplewood Plaza, which comprises 86,000 square feet of GLA at the intersection of Ramblewood Drive and University Drive, include TJ Maxx and Blockbuster Video. In November 1997, the Company acquired The Festival at Manassas and Acadiana Square Shopping Center located in Manassas, VA and Lafeyette, LA, respectively, in separate transactions for an aggregate purchase price of approximately $19.5 million. The Festival at Manassas is a 118,000 square foot center located at the intersection of Sudley Road and Portsmouth Drive and is anchored by Super Fresh Food Markets and Blockbuster Video. Acadiana Square Shopping Center is a 148,000 square foot center located at the intersection of U.S. Highway 167 and Ambassador Caffery Parkway and is anchored by SteinMart, TJ Maxx and Office Max. In December 1997, the Company acquired The Gallery Shopping Center, Tri-Cities Square Shopping Center, Greenridge Shopping Center and North Rivers Market located in Greenville, SC, Mount Dora, FL, Staten Island, NY, and North Charleston, SC, respectively. These properties were acquired in separate transactions for an aggregate purchase price of approximately $41.6 million, including the assumption of approximately $5.9 million of mortgage debt encumbering the Greenridge Shopping 3 Center property. The Gallery Shopping Center which comprises 91,000 square feet of GLA on Haywood Road is anchored by Baby Superstore. Tri-Cities Square Shopping Center located on Eurora Road and US Highway 441 comprises 111,000 square feet of GLA and is anchored by Kmart. The Greenridge Shopping Center which comprises 101,000 square feet of GLA at the intersection of Arthurkill Road and Richmond Avenue is anchored by Waldbaums Supermarket and CVS Drug Stores. North Rivers Market which comprises 196,000 square feet of GLA at the intersection of Rivers Avenue and Northbrook Boulevard is anchored by TJ Maxx, Marshall's and Phar-Mor. Management believes that the current annualized net cash flow generated by these recently acquired properties provides an annualized yield of 10% or more on the Company's investment in such properties. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (a)(b) Financial Statements and Pro Forma Financial Information The financial statements and pro forma financial information filed herewith is as follows:
Page ---- Report of Independent Accountants 6 Combined Historical Summary of Revenue and Certain Operating Expenses for the Year Ended December 31, 1996 of Certain Acquired Properties 7 Notes to Combined Historical Summary of Revenue and Certain Operating Expenses of Certain Acquired Properties 8 Estimates of Net Income and Funds from Operations of Certain Acquired Properties 9 Notes to Estimates of Net Income and Funds from Operations of Certain Acquired Properties 10 Pro Forma Condensed Consolidated Balance Sheet as of September 30, 1997 12 Pro Forma Condensed Consolidated Statements of Income for the Year Ended December 31, 1996 and the Nine Months Ended September 30, 1997 13 Notes to Pro Forma Condensed Consolidated Statements of Income 15
(c) Exhibits: * 23.1 Consent of Coopers & Lybrand L.L.P. -------------- *Filed herewith. 4 KIMCO REALTY CORPORATION AND SUBSIDIARIES CERTAIN ACQUIRED PROPERTIES COMBINED HISTORICAL SUMMARY OF REVENUE AND CERTAIN OPERATING EXPENSES YEAR ENDED DECEMBER 31, 1996 5 REPORT OF INDEPENDENT ACCOUNTANTS To the Board of Directors and Stockholders of Kimco Realty Corporation: We have audited the accompanying Combined Historical Summary of Revenue and Certain Operating Expenses of Certain Acquired Properties, as defined in the accompanying Note 1, for the year ended December 31, 1996. This combined historical summary is the responsibility of the management of Kimco Realty Corporation. Our responsibility is to express an opinion on the combined historical summary based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the combined historical summary is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the combined historical summary. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the combined historical summary. We believe that our audit provides a reasonable basis for our opinion. The accompanying Combined Historical Summary of Revenue and Certain Operating Expenses of Certain Acquired Properties has been prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission as described in Note 2, and is not intended to be a complete presentation of the revenue and expenses of the Certain Acquired Properties. In our opinion, the combined historical summary referred to above presents fairly, in all material respects, the revenue and certain operating expenses of the Certain Acquired Properties described in Notes 2 and 3 for the year ended December 31, 1996, in conformity with generally accepted accounting principles. COOPERS & LYBRAND L.L.P. New York, New York January 20, 1998 6 KIMCO REALTY CORPORATION AND SUBSIDIARIES CERTAIN ACQUIRED PROPERTIES COMBINED HISTORICAL SUMMARY OF REVENUE AND CERTAIN OPERATING EXPENSES YEAR ENDED DECEMBER 31, 1996 Revenue: Base rentals $8,999,395 Operating reimbursements and other income 2,267,338 ---------- 11,266,733 ---------- Certain operating expenses: Real estate taxes 1,022,303 Repairs and maintenance 1,264,876 Other operating expenses 498,328 ---------- 2,785,507 ---------- Excess of revenue over certain operating expenses $8,481,226 ========== The accompanying notes are an integral part of this combined financial statement. 7 KIMCO REALTY CORPORATION AND SUBSIDIARIES CERTAIN ACQUIRED PROPERTIES NOTES TO COMBINED HISTORICAL SUMMARY OF REVENUE AND CERTAIN OPERATING EXPENSES 1. Certain Properties Acquired --------------------------- The Combined Historical Summary of Revenue and Certain Operating Expenses relates to the operations of the following certain acquired properties (the "Certain Acquired Properties"), while under ownership previous to Kimco Realty Corporation and Subsidiaries: Property Name Location - ------------- -------- Carrollwood Commons Tampa, FL Crossroads Center Florence, SC Maplewood Plaza Coral Springs, FL Mountainside Plaza Phoenix, AZ Acadiana Square Shopping Center Lafeyette, LA The Festival at Manassas Manassas, VA The Gallery Shopping Center Greenville, SC Tri-Cities Square Shopping Center Mount Dora, FL North Rivers Market North Charleston, SC 2. Basis of Presentation --------------------- The Combined Historical Summary has been prepared on the accrual method of accounting. Certain operating expenses include operating and maintenance costs, real estate taxes, and insurance expenses relating to the operation of the Certain Acquired Properties. In accordance with the regulations of the Securities and Exchange Commission, mortgage interest, depreciation and general and administrative expenses have been excluded from Certain operating expenses, as such costs are dependent upon a particular owner, purchase price or other financial agreement. 2. Revenue Recognition ------------------- Minimum revenues from rental property are recognized on a straight-line basis over the terms of the related leases. The future minimum revenues from rental property under the terms of all noncancellable tenant leases are approximately as follows: 1997 $9,326,000 1998 8,553,000 1999 7,753,000 2000 6,617,000 2001 5,976,000 Thereafter 22,654,000 8 KIMCO REALTY CORPORATION AND SUBSIDIARIES ESTIMATES OF NET INCOME AND FUNDS FROM OPERATIONS OF CERTAIN ACQUIRED PROPERTIES (Unaudited) The following represents an estimate of the net income and funds from operations expected to be generated from the operation of the Certain Acquired Properties based upon the Combined Historical Summary of Revenue and Certain Operating Expenses for the year ended December 31, 1996. These estimated results do not purport to represent results of operations for these properties in the future and were prepared on the basis described in the accompanying notes which should be read in conjunction herewith. Estimated Net Income Excess of revenues over certain operating expenses $8,481,226 Less: Estimated depreciation (Note 1) 1,818,859 ---------- Estimated net income $6,662,367 ========== Estimated Funds from Operations Estimated net income $6,662,367 Add: Estimated depreciation (Note 1) 1,818,859 ---------- Estimated funds from operations $8,481,226 ========== 9 KIMCO REALTY COPRORATION AND SUBSIDIARIES NOTES TO ESTIMATES OF NET INCOME AND FUNDS FROM OPERATIONS OF CERTAIN ACQUIRED PROPERTIES 1. Basis of Presentation Depreciation has been estimated based upon an allocation of the purchase prices for the Certain Acquired Properties to land (20%) and building (80%) and assuming a 39 year useful life applied on a straight-line method. No income taxes have been provided because the Company is organized and operates in such a manner so as to qualify as a Real Estate Investment Trust under the provisions of the Internal Revenue Code ("Code"). Accordingly, the Company generally will not pay Federal income tax provided that distributions to its stockholders equal at least the amount of its real estate investment trust taxable income as defined under the Code. 2. Acquisition Considerations In assessing the properties acquired, the Company's management considered the existing tenancies, which are the primary revenue source, the occupancy rates, which averaged 97% on the dates of acquisition, the competitive nature of the markets and comparative rental rates. Furthermore, current and anticipated maintenance and repair costs, real estate taxes and capital improvement requirements were evaluated. Management is not aware of any material factors that would cause the reported financial information in the accompanying Combined Historical Summary of Revenue and Certain Operating Expenses and Estimates of Net Income and Funds from Operations of Certain Acquired Properties to be misleading or not necessarily indicative of future operating results. 10 KIMCO REALTY CORPORATION AND SUBSIDIARIES PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AND STATEMENTS OF INCOME The accompanying Pro Forma Condensed Consolidated Balance Sheet as of September 30, 1997 gives effect to the purchase of 8 shopping center properties acquired by the Company in October, November and December 1997 as if these properties had been acquired as of September 30, 1997. The accompanying Pro Forma Condensed Consolidated Statements of Income for the year ended December 31, 1996 and the nine months ended September 30, 1997 assume the Shopping Center Acquisitions had occurred as of January 1, 1996. The pro forma information is based on the historical statements of the Company after giving effect to the acquisition of these properties. The Pro Forma Condensed Consolidated Balance Sheet and the Statements of Income have been prepared by the management of the Company. These pro forma statements may not be indicative of the results that would have actually occurred if the Shopping Center Acquisitions had been in effect on the date indicated. Also, they may not be indicative of the results that may be achieved in the future. The Pro Forma Condensed Consolidated Balance Sheet and Statements of Income should be read in conjunction with Kimco Realty Corporation's audited financial statements as of December 31, 1996 and for the year then ended (which are contained in the Company's Form 10-K for the year ended December 31, 1996), and the unaudited condensed consolidated financial statements as of September 30, 1997 and for the nine months then ended (which are contained in the Company's Form 10-Q for the period ended September 30, 1997) and the accompanying notes thereto. 11 KIMCO REALTY CORPORATION AND SUBSIDIARIES PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET SEPTEMBER 30, 1997 ----------- (Unaudited)
PRO FORMA AS REPORTED ADJUSTMENTS PRO FORMA --------------- --------------- --------------- Assets: Real estate, net of accumulated depreciation $ 1,103,340,060 $ 81,596,242 $ 1,184,936,302 Investment in retail store leases 16,408,989 -- 16,408,989 Cash and cash equivalents 122,645,949 (67,604,210) 55,041,739 Accounts and notes receivable 16,090,574 -- 16,090,574 Other assets 76,027,470 -- 76,027,470 --------------- --------------- --------------- $ 1,334,513,042 $ 13,992,032 $ 1,348,505,074 =============== =============== =============== Liabilities: Notes payable $ 410,250,000 $ -- $ 410,250,000 Mortgages payable 108,129,377 13,992,032 122,121,409 Other liabilities, including minority interests -- in partnerships 72,450,843 -- 72,450,843 -- --------------- --------------- --------------- 590,830,220 13,992,032 604,822,252 --------------- --------------- --------------- Stockholders' Equity: Preferred stock, $1.00 par value, authorized 5,000,000 shares Class A Preferred Stock, $1.00 par value, authorized 345,000 shares Issued and outstanding 300,000 shares 300,000 -- 300,000 Aggregate liquidation preference $75,000,000 Class B Preferred Stock, $1.00 par value, authorized 230,000 shares Issued and outstanding 200,000 shares 200,000 -- 200,000 Aggregate liquidation preference $50,000,000 Class C Preferred Stock, $1.00 par value, authorized 460,000 shares Issued and outstanding 400,000 shares 400,000 -- 400,000 Aggregate liquidation preference $100,000,000 Common stock, $.01 par value, authorized 100,000,000 shares Issued and outstanding 40,390,889 shares 403,909 -- 403,909 Paid-in capital 857,568,979 -- 857,568,979 Cumulative distributions in excess of net income (115,190,066) -- (115,190,066) --------------- --------------- --------------- 743,682,822 -- 743,682,822 --------------- --------------- --------------- $ 1,334,513,042 $ 13,992,032 $ 1,348,505,074 =============== =============== ===============
12 KIMCO REALTY CORPORATION AND SUBSIDIARIES PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 1996 ------------------------------- (Unaudited)
Shopping Center As Reported Acquisitions Pro Forma ----------------- ----------------- ---------------- Revenues from rental property $ 168,144,419 $ 19,659,352 $ 187,803,771 ----------------- ----------------- ---------------- Rental property expenses- Rent 1,417,263 37,500 1,454,763 Real estate taxes 19,815,808 2,135,405 21,951,213 Interest 27,019,283 4,263,144 31,282,427 Operating and maintenance 21,659,620 3,014,152 24,673,772 Depreciation and amortization 27,066,709 2,917,771 29,984,480 ----------------- ----------------- ---------------- 96,978,683 12,367,972 109,346,655 ----------------- ----------------- ---------------- Income from rental property 71,165,736 7,291,380 78,457,116 Income from investment in retail store leases 3,631,845 - 3,631,845 ----------------- ----------------- ---------------- 74,797,581 7,291,380 82,088,961 Management fee income 3,447,577 - 3,447,577 General and administrative expenses (10,333,924) - (10,333,924) Other income (expenses), net 5,113,704 (1,530,000) 3,583,704 ----------------- ----------------- ---------------- Income before gain on sale of shopping center 73,024,938 5,761,380 78,786,318 Gain on sale of shopping center property 801,955 - 801,955 ----------------- ----------------- ---------------- Net income $73,826,893 $5,761,380 $79,588,273 ================= ================= ================ Net income applicable to common shares $57,692,418 $5,761,380 $63,453,798 ================= ================= ================ Net income per common share $1.61 $1.77 ===== =====
13 KIMCO REALTY CORPORATION AND SUBSIDIARIES PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 ------------------------------------------ (Unaudited)
Shopping Center As Reported Acquisitions Pro Forma ----------------- ------------------ ---------------- Revenues from rental property $ 141,294,177 $ 12,406,529 $ 153,700,706 ----------------- ------------------ ---------------- Rental property expenses- Rent 2,499,182 28,125 2,527,307 Real estate taxes 17,479,097 1,312,963 18,792,060 Interest 22,252,562 2,186,348 24,438,910 Operating and maintenance 16,687,602 1,938,028 18,625,630 Depreciation and amortization 21,737,600 1,784,133 23,521,733 ----------------- ------------------ ---------------- 80,656,043 7,249,597 87,905,640 ----------------- ------------------ ---------------- Income from rental property 60,638,134 5,156,932 65,795,066 Income from investment in retail store leases 2,704,761 - 2,704,761 ----------------- ------------------ ---------------- 63,342,895 5,156,932 68,499,827 Management fee income 2,754,842 - 2,754,842 General and administrative expenses (8,526,158) - (8,526,158) Other income (expenses), net 4,474,666 (725,000) 3,749,666 ----------------- ------------------ ---------------- Income before gain on sale of shopping center 62,046,245 4,431,932 66,478,177 Gain on sale of shopping center property 243,995 - 243,995 ----------------- ------------------ ---------------- Net income $62,290,240 $4,431,932 $66,722,172 ================= ================== ================ Net income applicable to common shares $48,461,965 $4,431,932 $52,893,897 ================= ================== ================ Net income per common share $1.33 $1.45 ===== =====
14 KIMCO REALTY CORPORATION AND SUBSIDIARIES NOTES TO PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME 1. Basis of Presentation As Reported amounts have been adjusted based upon the historical results of the Shopping Center Acquisitions for the year ended December 31, 1996. These adjustments to the Pro Forma Condensed Consolidated Statements of Income have the effect of presenting the results for the year ended December 31, 1996 and the nine months ended September 30, 1997 as if the Shopping Center Acquisitions had been completed as of January 1, 1996. 2. Pro Forma Adjustments The adjustment to interest expense relates to the assumed mortgages and additional borrowings related to the properties acquired. The adjustment to other income (expenses), net relates to the elimination of interest earned on funds assumed to have been expended as of January 1, 1996 for property acquisitions. The adjustment for depreciation was based upon an estimated useful life of 39 years using the straight-line method and purchase price allocations to land and building of 20% and 80%, respectively. 15 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Kimco Realty Corporation ------------------------ Registrant Date: January 21, 1998 By: /s/ Michael V. Pappagallo ---------------------------- Michael V. Pappagallo Chief Financial Officer 16 EX-23.1 2 CONSENT OF COOPERS & LYBRAND L.L.P. CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the registration statement of Kimco Realty Corporation on Form S-3, (File No. 333-37285) of our report dated January 20, 1998 on our audit of the Combined Historical Summary of Revenue and Certain Operating Expenses of Certain Acquired Properties as of December 31, 1996, which report is included in this Current Report on Form 8-K. COOPERS & LYBRAND L.L.P. New York, New York January 21, 1998 17 -----END PRIVACY-ENHANCED MESSAGE-----