-----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, KNQqeP92yGX/QiicLUXRwWDmgyTiD1rCn5WF+oSqL0evGdJGGwGSnWrxRFbKm5K8 C7B9cS4GAeE1/JKZyj4Y2A== 0000921112-98-000008.txt : 19980313 0000921112-98-000008.hdr.sgml : 19980313 ACCESSION NUMBER: 0000921112-98-000008 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980312 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980312 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LIBERTY PROPERTY TRUST CENTRAL INDEX KEY: 0000921112 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 237768996 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-13130 FILM NUMBER: 98564541 BUSINESS ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: STE 100 CITY: MALVERN STATE: PA ZIP: 19355 BUSINESS PHONE: 6106481700 MAIL ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: SUITE 100 CITY: MALVERN STATE: PA ZIP: 19355 FORMER COMPANY: FORMER CONFORMED NAME: ROUSE & ASSOCIATES PROPERTY TRUST DATE OF NAME CHANGE: 19940421 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LIBERTY PROPERTY LIMITED PARTNERSHIP CENTRAL INDEX KEY: 0000921113 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 232766549 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-13132 FILM NUMBER: 98564542 BUSINESS ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: STE 100 CITY: MALVERN STATE: PA ZIP: 19355 BUSINESS PHONE: 6106481700 MAIL ADDRESS: STREET 1: 65 VALLEY STREAM PKWY STREET 2: SUITE 100 CITY: MALVERN STATE: PA ZIP: 19355 FORMER COMPANY: FORMER CONFORMED NAME: ROUSE & ASSOCIATES LTD PART DATE OF NAME CHANGE: 19940331 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 12, 1998 LIBERTY PROPERTY TRUST LIBERTY PROPERTY LIMITED PARTNERSHIP ------------------------------------ (Exact names of registrants as specified in their governing respective documents) MARYLAND 1-13130 23-7768996 PENNSYLVANIA 1-13132 23-2766549 - --------------------------- ------------- ------------------- State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) 65 VALLEY STREAM PARKWAY, SUITE 100 MALVERN, PENNSYLVANIA 19355 - --------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrants' telephone number, including area code: (610) 648-1700 ITEM 5: OTHER EVENTS - --------------------- Liberty Property Limited Partnership is a Pennsylvania limited partnership (the "Operating Partnership"). Liberty Property Trust, a Maryland real estate investment trust (the "Trust"), owns an approximate 91.86% interest in the Operating Partnership (as of December 31, 1997) (the Trust and the Operating Partnership are collectively referred to as the "Company"). On January 6, 1998, the Company acquired title to two office properties, comprising 281,505 leaseable square feet, located in Troy, Michigan, (the "Liberty Center Properties"). The Company's Total Investment (as defined below) in these properties is anticipated to be approximately $43.4 million. The "Total Investment" for a property is defined as the property's purchase price plus closing costs and management's estimate, as determined at the time of acquisition, of the cost of necessary building improvements in the case of acquisitions, or land costs and land and building improvement costs in the case of development projects, and where appropriate, other development costs and carrying costs required to reach rent commencement. On February 9, 1998, the Company acquired title to 11 industrial properties, comprising 623,718 leaseable square feet, located in Ft. Lauderdale and Pompano Beach, Florida, (the "Pompano/Cypress Parks Properties"). The Company's Total Investment in these properties is anticipated to be approximately $26.8 million. On February 17, 1998, the Company acquired title to one office property, comprising 39,804 leaseable square feet, located in Virginia Beach, Virginia, ("Oceana Center One"). The Company's Total Investment in this property is anticipated to be approximately $4.6 million. On February 27, 1998, the Company acquired title to two industrial properties comprising 140,340 leaseable square feet, located in Ashland, Virginia, ("Northridge I & II"). The Company's Total Investment of these properties is anticipated to be approximately $8.5 million. On March 11, 1998, the Company acquired title to seven industrial and office properties comprising 509,736 leaseable square feet, located in Minnesota and Wisconsin, (the "Heitman Properties"). The Company's Total Investment in these properties is anticipated to be approximately $31.7 million. On January 30, 1998, the Company entered into a contract to acquire title to one office property comprising 83,000 leaseable square feet, located in Plymouth Meeting, Pennsylvania, which the Company, as of this date, considers probable of closing, ("Hickory Pointe"). The Company's Total Investment in this property is anticipated to be approximately $10.4 million. On February 6, 1998, the Company entered into a contract to acquire title to one office property comprising 144,046 leaseable square feet, located in Charleston, South Carolina, which the Company, as of this date, considers probable of closing ("NationsBank Place"). The Company's Total Investment in this property is anticipated to be approximately $34.1 million. Collectively, the Liberty Center Properties, the Pompano/Cypress Parks Properties, Oceana Center One, Northridge I & II, the Heitman -2- Properties, Hickory Pointe, and NationsBank Place are known as the "Acquisition Properties". Pursuant to Rule 3-14 of Regulation S-X, audited historical financial information concerning the Acquisition Properties is provided in Item 7 of this Current Report on Form 8-K. Additionally, certain pro forma information is provided in Item 7. Factors considered by the Company in determining the price paid or to be paid, as the case may be, for the Acquisition Properties, included their historical and expected cash flow, the nature of tenants and terms of leases in place, occupancy rates, opportunities for alternative and new tenancies, current operating costs and real estate taxes on the properties and anticipated changes therein under Company ownership, physical condition and locations of the properties, the anticipated effect to the Company's financial results (particularly funds from operations), the ability to sustain and potentially increase its distributions to Company shareholders, and other factors. The Company took into consideration the capitalization rates at which it believed other comparable buildings were recently sold, but determined the price it was willing to pay primarily on factors discussed above relating to the properties themselves and their fit into the Company's operations. The Company, after investigation of the properties, is not aware of any material fact, other than those enumerated above, that would cause the financial information reported not to be necessarily indicative of future operating results. - ------------------------------- Statements contained in this report contain forward-looking statements with respect to estimates of Total Investment, pro forma financial information and their underlying assumptions. As such, these statements involve risks and uncertainties that could affect future results, and accordingly, such results may differ from those expressed herein. These risks and uncertainties include, but are not limited to, uncertainties affecting real estate businesses generally, risks relating to acquisition activities and risks relating to leasing and releasing activities and rates. -3- ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS - ------------------------------------------ PAGE ---- (a) Financial Statements of Real Estate Operations Acquired or to be Acquired Statement of Operating Revenues and Certain Operating Expenses for the Acquisition Properties Report of Independent Auditors........................ 5 Statement of Operating Revenues and Certain Operating Expenses for the Acquisition Properties for the year ended December 31, 1997...... 6 Notes to the Statement of Operating Revenues and Certain Operating Expenses for the Acquisition Properties for the year ended December 31, 1997...... 7 (b) Pro Forma Financial Information (unaudited) Liberty Property Trust...................................... 10 Pro Forma Condensed Consolidated Balance Sheet as of December 31, 1997.................................... 11 Pro Forma Consolidated Statement of Operations for the year ended December 31, 1997..................... 12 Notes to Pro Forma Consolidated Financial Statements as of and for the year ended December 31, 1997....... 13 Liberty Property Limited Partnership......................... 14 Pro Forma Condensed Consolidated Balance Sheet as of December 31, 1997.................................... 15 Pro Forma Consolidated Statement of Operations for the year ended December 31, 1997..................... 16 Notes to Pro Forma Consolidated Financial Statements as of and for the year ended December 31, 1997....... 17 Signatures......................................................... 18 (c) Exhibits 23 Consent of Fegley & Associates...................... 19 -4- REPORT OF INDEPENDENT AUDITORS To The Board of Trustees and Shareholders Liberty Property Trust We have audited the accompanying Statement of Operating Revenues and Certain Operating Expenses of the Acquisition Properties, as defined in Note 1, for the year ended December 31, 1997. This financial statement is the responsibility of the management of the Acquisition Properties. Our responsibility is to express an opinion on this financial statement 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 financial statement is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement. An audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall presentation of the financial statement. We believe that our audit provides a reasonable basis for our opinion. The accompanying Statement of Operating Revenues and Certain Operating Expenses was prepared for the purpose of complying with the rules and regulations of the Securities and Exchange Commission (for inclusion in the Current Report on Form 8-K of Liberty Property Trust and Liberty Property Limited Partnership) and, as described in Note 1, is not intended to be a complete presentation of the Acquisition Properties' revenues and expenses. In our opinion, the Statement of Operating Revenues and Certain Operating Expenses referred to above presents fairly, in all material respects, the Operating Revenues and Certain Operating Expenses described in Note 1 for the year ended December 31, 1997, in conformity with generally accepted accounting principles. /s/ FEGLEY & ASSOCIATES Plymouth Meeting, Pennsylvania FEGLEY & ASSOCIATES February 27, 1998 -5- STATEMENT OF OPERATING REVENUES AND CERTAIN OPERATING EXPENSES FOR THE ACQUISITION PROPERTIES FOR THE YEAR ENDED DECEMBER 31, 1997 (IN THOUSANDS) YEAR ENDED DECEMBER 31, 1997 ------------ Operating revenues: Rental $ 14,066 Operating expense reimbursement 6,473 -------- Total operating revenues 20,539 -------- Certain operating expenses: Rental property expenses 4,051 Real estate taxes 2,346 -------- Total certain operating expenses 6,397 -------- Operating revenues in excess of certain operating expenses $ 14,142 ======== The accompanying notes are an integral part of this statement. -6- NOTES TO THE STATEMENT OF OPERATING REVENUES AND CERTAIN OPERATING EXPENSES FOR THE ACQUISITION PROPERTIES FOR THE YEAR ENDED DECEMBER 31, 1997 1. Summary of Significant Accounting Policies - ---------------------------------------------- The Statement of Operating Revenues and Certain Operating Expenses (see "Basis of Presentation" below) includes the operations of the Acquisition Properties. Liberty Property Trust (the "Company") owns an approximate 91.86% partners' interest in the Operating Partnership (as of December 31, 1997) (the Trust and the Operating Partnership are collectively referred to as the "Company"). PROPERTY NAME LOCATION DESCRIPTION - -------------------------- -------------------- -------------------- The Liberty Center Properties - ----------------------------- 50 West Big Bear Road Troy, Michigan Multi-story office building 142,290 square feet 100 West Big Bear Road Troy, Michigan Multi-story office building 139,215 square feet The Pompano/Cypress Parks Properties - ------------------------------------ 6500 NW 12th Avenue Ft. Lauderdale, FL Multi-story indus- trial building 66,000 square feet 6600 NW 12th Avenue Ft. Lauderdale, FL Multi-story indus- trial building 66,025 square feet 1500 SW 5th Court Pompano Beach, FL Single story indus- trial building 120,544 square feet 1651 SW 5th Court Pompano Beach, FL Single-story indus- trial building 25,200 square feet 1601 SW 5th Court Pompano Beach, FL Single-story indus- trial building 25,200 square feet 1501 SW 5th Court Pompano Beach, FL Single-story indus- trial building 25,200 square feet 1400 SW 6th Court Pompano Beach, FL Single-story indus- trial building 143,459 square feet 1405 SW 6th Court Pompano Beach, FL Single-story flex building 48,620 square feet -7- PROPERTY NAME LOCATION DESCRIPTION - -------------------------- -------------------- -------------------- 595 SW 13th Terrace Pompano Beach, FL Single-story indus- trial building 44,627 square feet 601 SW 13th Terrace Pompano Beach, FL Single-story indus- trial building 20,385 square feet 605 SW 16th Terrace Pompano Beach, FL Single-story indus- trial building 38,458 square feet Oceana Center One - ----------------- 484 Viking Drive Virginia Beach, VA Multi-story office building 39,804 square feet Northridge I & II - ----------------- Northridge I Ashland, VA Single-story flex building 71,230 square feet Northridge II Ashland, VA Single-story flex building 69,200 square feet The Heitman Properties - ---------------------- 5400-5500 Feltl Road Minnetonka, MN Three, single-story flex buildings 135,089 square feet 10300 Bren Road Minnetonka, MN Single-story flex building 50,156 square feet 14630-14650 28th Ave. Plymouth, MN Single-story indus- North trial building 56,100 square feet 245 Executive Drive Brookfield, WI Multi-story office building 60,003 square feet 8301 West Parkland Crt. Milwaukee, WI Single-story indus- trial building 114,040 square feet 4701 West Schroeder Dr. Brown Deer, WI Single-story flex building 40,370 square feet 4555 West Schroeder Dr. Brown Deer, WI Single-story flex building 53,978 square feet -8- PROPERTY NAME LOCATION DESCRIPTION - -------------------------- -------------------- -------------------- Hickory Pointe - -------------- 2250 Hickory Road Plymouth Meeting, PA Multi-story office building 83,000 square feet NationsBank Place - ----------------- 200 Meeting Street Charleston, SC Multi-story office building 144,046 square feet USE OF ESTIMATES - ---------------- Generally accepted accounting principles required management to make estimates and assumptions in preparing financial statements. Those estimates and assumptions affect the reported revenues and expenses. BASIS OF PRESENTATION - --------------------- The Statement of Operating Revenues and Certain Operating Expenses is presented in conformity with Rule 3-14 of the Securities and Exchange Commission. Accordingly, depreciation, interest and income taxes are not presented. The Company is not aware of any factors relating to the Acquisition Properties that would cause the reported financial information not to be indicative of future operating results. General company overhead has not been allocated to the Acquisition Properties. The Acquisition Properties consist of commercial industrial, flex and office space leased to tenants under leases with varying terms. Tenant renewal options are available. REVENUE RECOGNITION - ------------------- Base rental income attributable to leases is recorded on a straight-line basis over the applicable lease term. The leases also typically provide for tenant reimbursement of common area maintenance and other operating expenses which are included in the accompanying Statement of Operating Revenue and Certain Operating Expenses as operating expense reimbursements. 2. MINIMUM FUTURE RENTALS - --------------------------- Future minimum rental payments due from tenants of the Acquisition Properties under non-cancellable operating leases as of December 31, 1997 are as follows (in thousands): 1998 $ 13,321 1999 11,802 2000 9,787 2001 7,703 2002 3,870 Thereafter 8,366 -------- Total $ 54,849 ======== -9- LIBERTY PROPERTY TRUST PRO FORMA FINANCIAL INFORMATION (UNAUDITED) The unaudited, pro forma condensed consolidated balance sheet as of December 31, 1997 reflects the incremental effect of the Acquisition Properties described in Item 5 as if the acquisitions had occurred on December 31, 1997. The accompanying unaudited, pro forma consolidated statement of operations for the year ended December 31, 1997 reflect the incremental effect of the Acquisition Properties, as if such acquisitions had occurred on January 1, 1997. These statements should be read in conjunction with respective consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 1997. In the opinion of management, the unaudited, pro forma consolidated financial information provides for all adjustments necessary to reflect the effects of the Acquisition Properties. These pro forma statements may not necessarily be indicative of the results that would have actually occurred if the acquisition of the Acquisition Properties had been in effect on the dates indicated, nor does it purport to represent the financial position, results of operations or cash flows for future periods. -10- LIBERTY PROPERTY TRUST PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1997 (UNAUDITED, IN THOUSANDS)
LIBERTY THE PROPERTY HISTORICAL ACQUISITION TRUST PROPERTIES CONSOLIDATED ---------- ------------- ------------ ASSETS: Investment in real estate, net $1,947,026 $ 159,521 $2,106,547 Cash and cash equivalents 55,079 - 55,079 Deferred financing and leasing costs, net 32,536 - 32,536 Other assets 59,696 - 59,696 ---------- ----------- ----------- Total assets $2,094,337 $ 159,521 $2,253,858 ========== =========== =========== LIABILITIES: Mortgage loans $ 363,591 $ - $ 363,591 Unsecured notes 350,000 - 350,000 Credit facility 135,000 159,521 294,521 Convertible debentures 111,543 - 111,543 Other liabilities 93,930 - 93,930 ---------- ----------- ----------- Total liabilities 1,054,064 159,521 1,213,585 ---------- ----------- ----------- MINORITY INTEREST 84,678 - 84,678 SHAREHOLDERS' EQUITY: Series A preferred shares 120,814 - 120,814 Common shares 53 - 53 Additional paid-in capital 846,949 - 846,949 Unearned compensation (985) - (985) Dividends in excess of net income (11,236) - (11,236) ---------- ----------- ----------- Total shareholders' equity 955,595 - 955,595 ---------- ----------- ----------- Total liabilities and shareholders' equity $2,094,337 $ 159,521 $2,253,858 ========== =========== ===========
The accompanying notes are an integral part of this unaudited, pro forma condensed consolidated financial statement. -11- LIBERTY PROPERTY TRUST PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1997 (UNAUDITED AND IN THOUSANDS, EXCEPT PER SHARE AMOUNT)
THE LIBERTY ACQUISITION PRO PROPERTY HISTORICAL PROPERTIES FORMA TRUST ADJUSTMENTS CONSOLIDATED ---------- ------------- ------------ ------------ REVENUE Rental $ 169,859 $ 14,066 $183,925 Operating expense reim- bursement 55,502 6,473 61,975 Management fees 673 - 673 Interest and other 6,483 - 6,483 ---------- --------- ----------- Total revenue 232,517 20,539 253,056 ---------- --------- ----------- OPERATING EXPENSES Rental property expenses 43,118 4,051 47,169 Real estate taxes 17,961 2,346 20,307 General and administrative 10,650 - 10,650 Depreciation and amorti- zation 40,752 - $ 3,988 44,740 ---------- --------- --------- ----------- Total operating expenses 112,481 6,397 3,988 122,866 ---------- --------- --------- ----------- Operating income 120,036 14,142 (3,988) 130,190 Premium on debenture conversion 98 - - 98 Interest expense 53,888 - 11,310 65,198 ---------- --------- --------- ----------- Income (loss) before minority interest 66,050 14,142 (15,298) 64,894 Minority interest 5,606 1,283 (1,388) 5,501 ---------- --------- --------- ----------- Net income (loss) 60,444 12,859 (13,910) 59,393 Preferred dividend 4,247 - - 4,247 ---------- --------- --------- ----------- Income available to common shareholders $ 56,197 $ 12,859 $(13,910) $ 55,146 ========== ========= ========== =========== Income per common share - basic $ 1.39 $ 1.36 ========== =========== Income per common share - diluted $ 1.38 $ 1.35 ========== ========== Weighted average number of common shares out- standing - basic 40,493 40,493 ========== =========== Weighted average number of common shares out- standing - diluted 40,806 40,806 ========== ===========
The accompanying notes are an integral part of this unaudited, proforma consolidated financial statement. -12- LIBERTY PROPERTY TRUST NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1997 (UNAUDITED, DOLLARS IN THOUSANDS) Reflects historical financial information of the Company as of December 31, 1997 and for the year ended December 31, 1997. Reflects the Total Investment in the Acquisition Properties. Reflects the use of $159,521 from the credit facility to finance the Total Investment in the Acquisition Properties. Reflects incremental addition of revenues and certain expenses of the Acquisition Properties in order to reflect a full year of operations for these acquisitions. Reflects incremental depreciation of the Acquisition Properties based on asset lives of 40 years. Reflects an incremental increase in interest expense from the assumed borrowings of $159,521 on the credit facility to fund the purchase of the Acquisition Properties. Reflects the allocation of the pro forma adjustment to minority interest based upon pro forma minority interest in the Operating Partnership of approximately 9.07%. The Company's pro forma taxable income for the year ended December 31, 1997 is approximately $46,124 which has been calculated as pro forma income from operations of approximately $59,393 plus GAAP depreciation and amortization of $44,740 less tax basis depreciation and amortization and other tax differences of approximately $58,009. -13- LIBERTY PROPERTY LIMITED PARTNERSHIP PRO FORMA FINANCIAL INFORMATION (UNAUDITED) The unaudited, pro forma condensed consolidated balance sheet as of December 31, 1997 reflects the incremental effect of the Acquisition Properties described in Item 5 as if the acquisitions had occurred on December 31, 1997. The accompanying unaudited, pro forma consolidated statement of operations for the year ended December 31, 1997 reflects the incremental effect of the Acquisition Properties, as if such acquisitions had occurred on January 1, 1997. These statements should be read in conjunction with respective consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 1997. In the opinion of management, the unaudited, pro forma consolidated financial information provides for all adjustments necessary to reflect the effects of the Acquisition Properties. These pro forma statements may not necessarily be indicative of the results that would have actually occurred if the acquisition of the Acquisition Properties had been in effect on the dates indicated, nor does it purport to represent the financial position, results of operations or cash flows for future periods. -14- LIBERTY PROPERTY LIMITED PARTNERSHIP PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1997 (UNAUDITED, IN THOUSANDS)
LIBERTY PROPERTY THE LIMITED HISTORICAL ACQUISITION PARTNERSHIP PROPERTIES CONSOLIDATED ---------- ------------- ------------ ASSETS: Investment in real estate, net $1,947,026 $ 159,521 $2,106,547 Cash and cash equivalents 55,079 - 55,079 Deferred financing and leasing costs, net 32,536 - 32,536 Other assets 59,696 - 59,696 ---------- ----------- ----------- Total assets $2,094,337 $ 159,521 $2,253,858 ========== =========== =========== LIABILITIES: Mortgage loans $ 363,591 $ - $ 363,591 Unsecured notes 350,000 - 350,000 Credit facility 135,000 159,521 294,521 Convertible debentures 111,543 - 111,543 Other liabilities 93,930 - 93,930 ---------- ----------- ----------- Total liabilities 1,054,064 159,521 1,213,585 ---------- ----------- ----------- OWNERS' EQUITY: General partner's equity 955,595 - 955,595 Limited partners' equity 84,678 - 84,678 ---------- ----------- ----------- Total owners' equity 1,040,273 - 1,040,273 ---------- ----------- ----------- Total liabilities and owners' equity $2,094,337 $ 159,521 $2,253,858 ========== =========== ===========
-15- LIBERTY PROPERTY LIMITED PARTNERSHIP PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1997 (UNAUDITED AND IN THOUSANDS)
LIBERTY THE PROPERTY ACQUISITION PRO LIMITED HISTORICAL PROPERTIES FORMA PARTNERSHIP ADJUSTMENTS CONSOLIDATED ---------- ------------ ------------ ------------ REVENUE Rental $ 169,859 $ 14,066 $ 183,925 Operating expense reim- bursement 55,502 6,473 61,975 Management fees 673 - 673 Interest and other 6,483 - 6,483 ---------- --------- ------------ Total revenue 232,517 20,539 253,056 ---------- --------- ------------ OPERATING EXPENSES Rental property expenses 43,118 4,051 47,169 Real estate taxes 17,961 2,346 20,307 General and administrative 10,650 - 10,650 Depreciation and amorti- zation 40,752 - $ 3,988 44,740 ---------- --------- ---------- ------------ Total operating expenses 112,481 6,397 3,988 122,866 ---------- --------- ---------- ------------ Operating income 120,036 14,142 (3,988) 130,190 Premium on debenture conversion 98 - - 98 Interest expense 53,888 - 11,310 65,198 ---------- --------- ---------- ------------ Net income (loss) $ 66,050 $ 14,142 $ (15,298) $ 64,894 ========== ========= ========== ============ Net income (loss) allocated to general partner $ 60,444 $ 12,859 $ (13,910) $ 59,393 Net income (loss) allocated to limited partners 5,606 1,283 (1,388) 5,501 ========== ========= ========== ============
The accompanying notes are an integral part of this unaudited, proforma consolidated financial statement. -16- LIBERTY PROPERTY LIMITED PARTNERSHIP NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED DECEMBER 31, 1997 (UNAUDITED, DOLLARS IN THOUSANDS) Reflects historical financial information of the Company as of December 31, 1997 and for the year ended December 31, 1997. Reflects the Total Investment in the Acquisition Properties. Reflects the use of $159,521 from the credit facility to finance the Total Investment in the Acquisition Properties. Reflects the incremental addition of revenues and certain expenses of the Acquisition Properties in order to reflect a full year of operations for these acquisitions. Reflects incremental depreciation of the Acquisition Properties based on asset lives of 40 years. Reflects an incremental increase in interest expense from the assumed borrowings of $159,521 on the credit facility to fund the purchase of the Acquisition Properties. Reflects the allocation of the pro forma adjustment to the net income allocated to the limited partners based upon pro forma ownership in the Operating Partnership of approximately 9.07%. -17- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. LIBERTY PROPERTY TRUST Dated: March 12, 1998 BY: /s/ WILLARD G. ROUSE III ---------------------------------------- NAME: Willard G. Rouse III TITLE: Chief Executive Officer LIBERTY PROPERTY LIMITED PARTNERSHIP BY: LIBERTY PROPERTY TRUST, SOLE GENERAL PARTNER Dated: March 12, 1998 BY: /s/ WILLARD G. ROUSE III ---------------------------------------- NAME: Willard G. Rouse III TITLE: Chief Executive Officer -18- EXHIBIT 23 CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the incorporation by reference in the Registration Statement (Form S- 3 No. 333-43267) and related Prospectus of Liberty Property Trust and Liberty Property Limited Partnership, to the incorporation by reference in the Registration Statement (Form S-3 No. 33-94782) and related Prospectus of Liberty Property Trust and Liberty Property Limited Partnership, to the incorporation by reference in the Registration Statement (Form S-3 No. 333-14139) and related Prospectus of Liberty Property Trust, to the incorporation by reference in the Registration Statement (Form S-3 No. 333-22211) and related Prospectus of Liberty Property Trust and Liberty Property Limited Partnership, to the incorporation by reference in the Registration Statement (Form S-8 No. 33-94036) and related Prospectus of Liberty Property Trust, to the incorporation by reference in the Registration Statement (Form S-8 No. 333-44149) and related Prospectus of Liberty Property Trust of our report dated February 27, 1998, with respect to the Statement of Operating Revenues and Certain Operating Expenses for the Acquisition Properties, included in the Current Report on Form 8-K of Liberty Property Trust and Liberty Property Limited Partnership dated March 12, 1998, filed with the Securities and Exchange Commission. /s/ FEGLEY & ASSOCIATES Fegley & Associates Plymouth Meeting, PA March 12, 1998 -19- -----END PRIVACY-ENHANCED MESSAGE-----