SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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) July 29, 2003
URSTADT BIDDLE PROPERTIES INC.
(Exact name registrant as specified in charter)
Maryland 1-12803 04-2458042
(State or jurisdiction (Commission file (IRS Employer
or incorporation) number) Identification No.)
321 Railroad Avenue Greenwich, Connecticut 06830
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code (203) 863-8200
1
ITEM 5 - OTHER EVENTS
As previously announced, on June 19, 2003, UB Somers, Inc. a wholly owned
subsidiary of Urstadt Biddle Properties Inc. (the "Company") acquired seven
building units in the Somers Commons Shopping Center in Somers, New York
("Somers Commons") totaling 134,854 square feet of leasable space. Somers
Commons is a retail shopping center consisting of nine building units containing
an aggregate of 218,854 square feet of leasable space. The Center is organized
as a declared condominium. The building units were purchased from Columbia
Somers, LLC ("Seller"). The purchase price for the seven building units (the
"Property") was $21,650,000 (excluding closing costs, fees and other expenses of
approximately $150,000). The purchase price was funded with available cash. The
remaining two building units are owned by an unrelated third party.
The seven building units were acquired pursuant to a Purchase and Sale Agreement
by and between Columbia Somers, LLC and the Company. There is no relationship
between any Director or Officer of the Company and Seller.
The acquisition of the building units in Somers Commons does not itself
constitute an acquisition of a "significant amount of assets" for purposes
of Regulation S-X of the Securities and Exchange Commission and the
reporting requirements of Form 8-K. However, the Somers Commons acquisition
together with the prior acquisitions the Company has recently made, in the
aggregate involve a significant amount of assets for purposes of Rule 3-14 of
Regulation S-X. Accordingly, the Company is filing audited financial
statements of Somers Commons and pro forma financial statements pursuant to
Rule 3-14 of Regulation S-X.
Tenants:
The Property's largest tenants are as follows:
Square Percentage of
Tenant Feet leased Property leased
Home Goods Inc. 30,000 sf 22.0%
Futurama Home Furniture 28,547 sf 21.0%
Goodwill Industries Inc. 14,000 sf 10.4%
No other tenant leases more than 10% of the Property's gross leasable area.
The Seller has entered into a master lease agreement with the Company for 14,100
square feet of presently unleased and/or unoccupied space at the Property. The
lease has a term for a period of seven years.
2
The following is a schedule of lease expirations of the Property by year:
Number of Total Square
Tenants Footage Minimum % of
Whose Leases Expiring Each Annual Base Annual Base
Expire Year Rentals Rentals(1)
------ ---- ------- ----------
Year
2003 - - - -
2004 - - - -
2005 - - - -
2006 - - - -
2007 5 11,120 $212,076 9.68%
2008 3 4,663 96,360 4.40%
2009 - - - -
2010 1 4,010 72,180 3.29%
2011 - - - -
2012 12 97,579 1,505,796 68.71%
Thereafter 5 15,408 304,992 13.92%
- ------ ------- ------
26 132,780 $2,191,404 100.00%
== ======= ========== =======
(1) Based on 2003 annualized base rents.
Building and Capital Improvements:
The estimated federal tax basis of the Property (including land) is
approximately $21,800,000. For federal income tax purposes, the Property will be
depreciated over its estimated useful life (39 years) on a straight line basis.
Property Taxes:
The annual real estate taxes of the Property are approximately $ 135,000 for the
2003 tax year.
Property Management:
The Company has entered into a management agreement to manage the Property
directly.
After reasonable inquiry, the Company is not aware of any other material factors
relating to the Property that would cause the reported financial information not
to be necessarily indicative of future operating results.
3
ITEM 7 FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS
(a) Financial Statements
(b) Pro Forma Financial Information
(c) Exhibits
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.
URSTADT BIDDLE PROPERTIES INC.
(Registrant)
Date: July 29, 2003 By: /s/ James R. Moore
---------------------
James R. Moore
Executive Vice President and
Chief Financial Officer
4
URSTADT BIDDLE PROPERTIES INC.
TABLE OF CONTENTS
Item 7
Financial Statements, Pro Forma Financial Information and Exhibits Page
(a) Financial Statements
Report of Independent Auditors 6
Statements of Revenues and Certain Expenses of Somers Commons
for the Year Ended December 31, 2002 (Audited) and Six Months
Ended June 30, 2003 (Unaudited) 7
Notes to Statements of Revenues and Certain Expenses of
Somers Commons for the Year Ended December 31, 2002 (Audited)
And Six Months Ended June 30, 2003 (Unaudited) 8
(b) Pro Forma Financial Information (Unaudited)
Pro Forma Consolidated Balance Sheet as of April 30, 2003 11
Pro Forma Consolidated Statement of Income
For the Six Months Ended April 30, 2003 12
Pro Forma Consolidated Statement of Income
For the Year Ended October 31, 2002 13
Notes and Management's Assumptions to Pro Forma Consolidated
Financial Statements 14
(c) Exhibits
10.1 Purchase and Sale Agreement between the Registrant and Columbia
Somers, LLC
23.1 Consent of Independent Auditors
5
REPORT OF INDEPENDENT AUDITORS
To the Management of Urstadt Biddle Properties Inc.:
We have audited the accompanying Statement of Revenues and Certain Expenses of
Somers Commons, as described in Note 1, for the year ended December 31, 2002.
The financial statement is the responsibility of the management of Urstadt
Biddle Properties Inc. Our responsibility is to express an opinion on this
financial statement based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. 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 financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
The accompanying Statement of Revenues and Certain Expenses of Somers Commons
was prepared for the purpose of complying with Rule 3-14 of Regulation S-X of
the Securities and Exchange Commission for inclusion in Form 8-K and is not
intended to be a complete presentation of the revenues and expenses of the
property acquired.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the Revenues and Certain Expenses of Somers Commons, as
described in Note 1, for the year ended December 31, 2002, in conformity with
accounting principles generally accepted in the United States.
New York, New York Ernst & Young LLP
July 23, 2003
6
SOMERS COMMONS
STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 2002
AND SIX MONTHS ENDED JUNE 30, 2003 (UNAUDITED)
(in thousands)
Six Months
Year Ended Ended
December 31, June 30,
2002 2003
(Unaudited)
REVENUES:
Base rents $ 1,047 $ 862
Escalations 200 226
Percentage rent - 12
Other 11 4
----- -----
1,258 1,104
----- -----
CERTAIN OPERATING EXPENSES:
Operating 254 214
Real estate taxes 87 68
Maintenance 8 6
General and administrative 46 68
--- ---
395 356
--- ---
EXCESS OF REVENUES OVER CERTAIN OPERATING EXPENSES $ 863 $ 748
===== =====
The accompanying notes are an integral part of this financial statement.
7
SOMERS COMMONS
NOTES TO STATEMENTS OF REVENUES AND CERTAIN EXPENSES
FOR THE YEAR ENDED DECEMBER 31, 2002 (AUDITED) AND
SIX MONTHS ENDED JUNE 30, 2003 (UNAUDITED)
1. BUSINESS AND ORGANIZATION
Somers Commons (the "Center") is a neighborhood/community shopping center which
consists of nine building units and 28 acres of land located in Somers, New
York. The Center contains an aggregate gross leasable area of approximately
212,854 square feet. Ownership of the Center is structured as a declared
condominium. Columbia Somers LLC is the owner of seven building units containing
134,854 square feet of leasable space and 23 acres of land. The remaining two
building units containing 78,000 square feet of leasable space are owned by an
unrelated third party. The Center was developed in 2000 and commenced leasing of
retail space in 2002.
On June 19, 2003, Columbia Somers, LLC ("the Seller") sold the seven building
units of Somers Commons to UB Somers, Inc, a newly formed wholly-owned
subsidiary of Urstadt Biddle Properties Inc for $21.65 million.
Columbia Somers, LLC entered into a master lease agreement with UB Somers Inc.
to lease 14,100 square feet of currently unleased and/or unoccupied space at the
Property. The agreement is for a term of seven years, which term expires in
2009. The agreement provides for the Seller to pay annual base rent of
approximately $263,500 plus additional rent. However, the Seller may be released
from all or a portion of its obligations under the agreement, at any time,
provided that, among other things, a new tenant is located for the vacant space
and certain leasing criteria are met.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements include the accounts of the seven building
units of Somers Commons ("the Property"). The accompanying financial statement
is presented in conformity with Rule 3-14 of Securities and Exchange Commission
Regulation S-X. Accordingly, the financial statement is not representative of
the actual operations for the periods presented, as certain expenses, which may
not be comparable to the expenses expected to be incurred in the future
operations of the acquired property, have been excluded. Expenses excluded
consist of depreciation and amortization, leasing expenses, interest expense,
and certain other expenses not directly related to the future operations of the
Property.
The statement of revenues and certain operating expenses for the six months
ended June 30, 2003 is unaudited. However, in the opinion of management, all
adjustments (consisting solely of normal recurring adjustments) necessary for
the fair presentation of this statement of revenues and certain operating
expenses for the interim period on the basis described above have been included.
The results for such interim period are not necessarily indicative of the
results for an entire year.
Real Estate
Significant improvements to real estate which enhance the value are capitalized
as additions to the property's cost basis in the period in which the
expenditures are incurred. Repairs and maintenance costs are expensed as
incurred. Tenant allowances and improvements are capitalized as additions to the
property's cost basis.
Rental Operations
The property earns rental income from tenants under leasing arrangements which
generally provide for minimum rents, escalations and charges to tenants for
their pro rata shares of real estate taxes and operating expenses. All leases
have been accounted for as operating leases. Base rental income is recorded on a
straight-line basis over the terms of the related agreements. Escalation rents
based on payments for real estate taxes and operating expenses are estimated and
accrued. Percentage rent is recognized when a specific tenant's sales breakpoint
is achieved.
Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts and disclosures during the
reporting period. Actual results could differ from those estimates.
8
3. RELATED PARTY TRANSACTION
Somers Commons entered into an arrangement with Columbia Management Group an
affiliate of Columbia Somers LLC to provide management services to the property
on a year-to-year basis. For its services, Columbia Management receives an
annual fixed fee of $90,000. For the year ended December 31, 2002 and the six
months ended June 30, 2003, Columbia Management received fees of $90,000 and
$45,000 respectively. The seven building units of Somers Commons share of the
management services fees totaled $56,378 and $28,134 for the year ended December
31, 2002 and six months ended June 30, 2003, respectively. Such amounts are
included in operating expenses in the accompanying statements of revenues and
certain operating expenses.
4. LEASES
Minimum future rentals on noncancelable leases which extend for more than one
year at December 31, 2002 are as follows:
Year Ending
December 31,
2003 $1,973,000
2004 2,001,000
2005 2,003,000
2006 2,005,000
2007 1,963,000
Thereafter 10,850,000
----------
$20,795,000
Minimum rentals above do not include recoveries of operating expenses, real
estate taxes, or percentage rents. Such amounts are reflected in the statement
of revenues and certain operating expenses as escalations and percentage rent
revenues.
The three largest tenants of the Property comprise approximately 57% and 53% of
the Property's base rental revenue for the year ended December 31, 2002 and the
six months ended June 30, 2003, respectively.
9
ITEM 7 (B) PRO FORMA FINANCIAL INFORMATION (UNAUDITED)
The following pro forma information reflects the acquisition of seven building
units in the Somers Commons Shopping Center on June 19, 2003, the acquisition of
Westchester Pavilion on December 23, 2002, the acquisition of the Ridgeway
Shopping Center on June 7, 2002, the issuance of 8,050,000 shares of Class A
Common stock in August 2002 and the issuance of 400,000 shares of Series C
Senior Cumulative Preferred Stock in May 2003 by Urstadt Biddle Properties Inc.
(the "Company").
The Pro Forma Consolidated Balance Sheet as of April 30, 2003 and the Pro Forma
Consolidated Statements of Income for the six months ended April 30, 2003 and
for the year ended October 31, 2002 have been prepared to reflect the
acquisition transactions, the Class A Common Stock offering, the Preferred Stock
offering, and the adjustments described in the accompanying notes. The
historical financial statements of the seven building units in the Somers
Commons Shopping Center are for the year ended December 31, 2002 and the six
months ended June 30, 2003. The historical financial statements of the
Westchester Pavilion are for the year ended December 31, 2002 and the period
November 1, 2002 to December 22, 2002 and the historical financial statements of
Ridgeway Shopping Center are for the period November 1, 2001 to June 6, 2002.
The pro forma financial information is based on the historical financial
statements of the Company and should be read in conjunction with the notes and
management's assumptions thereto. The pro forma consolidated balance sheet was
prepared as if the acquisition of the seven building units in the Somers Commons
Shopping Center occurred on April 30, 2003. The pro forma consolidated
statements of income for the six months ended April 30, 2003 and for the year
ended October 31, 2002 were prepared assuming the transactions occurred on
November 1, 2002 and 2001, respectively. The pro forma financial information is
unaudited and not necessarily indicative of the actual financial position of the
Company as of April 30, 2003 or what the actual results would have been assuming
the acquisition transactions had been consummated at the beginning of the
periods presented, nor does it purport to represent the future financial
position and results of operations for future periods.
10
URSTADT BIDDLE PROPERTIES INC.
PRO FORMA CONSOLIDATED BALANCE SHEET
AS OF APRIL 30, 2003
(UNAUDITED)
(in thousands)
Company
Company Pro Forma
Historical (a) Adjustments Pro Forma
Real Estate Investments:
Core properties - at cost, net of accumulated depreciation $311,819 $21,800 (b) $333,619
Non-core properties- at cost, net of accumulated depreciation 11,544 11,544
Mortgage notes receivable and other receivables 3,386 3,386
------- ------ -------
326,749 21,800 348,549
Cash and cash equivalents 11,700 16,650 (c)(d) 28,350
Restricted cash 514 514
Tenant receivables 6,138 6,138
Deferred charges, net of accumulated amortization 3,398 3,398
Prepaid expenses and other assets 5,267 5,267
-------- ------- --------
Total Assets $353,766 $38,450 $392,216
======== ======= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes payable $105,525 $105,525
Accounts payable and accrued expenses 2,074 2,074
Deferred officers' compensation 365 365
Other liabilities 4,768 4,768
------- -------
Total Liabilities 112,732 112,732
------- -------
Minority Interests 7,320 7,320
----- -----
Preferred Stock 14,341 $38,450 (d) 52,791
------ ------
Stockholders' Equity:
Common Stock 67 67
Class A Common Stock 185 185
Additional paid in capital 257,388 257,388
Cumulative distributions in excess of net income (32,436) (32,436)
Unamortized restricted stock compensation and officer
notes receivable (5,831) (5,831)
------- -------
Total Stockholders' Equity 219,373 219,373
------- -------
Total Liabilities and Stockholders'
Equity $353,766 $38,450 $392,216
======== ======= ========
The accompanying notes and management's assumptions are an integral part of this
pro forma consolidated balance sheet.
11
URSTADT BIDDLE PROPERTIES INC.
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE SIX MONTHS ENDED APRIL 30, 2003
(UNAUDITED)
(in thousands, except per share data)
Company Westchester Somers Pro Forma Company
Historical(a) Pavilion(c) Commons(d) Adjustments Pro Forma
------------- ----------- ---------- ----------- ---------
Revenues:
Operating leases $28,176 $966 $1,104 $10 (j) $30,256
Interest and other 532 - - - 532
------ --- ----- -- ------
28,708 966 1,104 10 30,788
------ --- ----- -- ------
Operating Expenses:
Property expenses 8,564 472 356 (52) (i) 9,340
Interest 4,063 - - - 4,063
Depreciation and amortization 4,933 - - 340 (h) 5,273
General and administrative expenses 1,808 - - - 1,808
Directors' fees and expenses 90 - - - 90
------ --- --- --- ------
19,458 472 356 288 20,574
------ --- --- --- ------
Operating Income 9,250 494 748 (278) 10,214
Minority Interests in Results of
Consolidated Joint Ventures (183) - - - (183)
----- --- --- ---- -----
Net Income 9,067 494 748 (278) 10,031
Preferred Stock Dividends (674) - - (1,700) (f) (2,374)
----- ---- ---- ------- -------
Net Income Applicable to Common
and Class A Common Stockholders $8,393 $494 $748 $(1,978) $7,657
====== ==== ==== ======== ======
Basic Earnings Per Share:
Common $0.32 $0.29
===== =====
Class A Common $0.35 $0.32
===== =====
Weighted Average Number of Shares
Outstanding:
Common 6,246 6,246
===== =====
Class A Common 18,187 18,187
====== ======
Diluted Earnings Per Share:
Common $0.32 $0.29
===== =====
Class A Common $0.35 $0.32
===== =====
Weighted Average Number of Shares
Outstanding:
Common and Common Equivalent 6,533 6,533
===== =====
Class A Common and
Class A Common Equivalent 18,692 18,692
====== ======
The accompanying notes and management's assumptions are an integral part of this
pro forma consolidated statement of income.
12
URSTADT BIDDLE PROPERTIES INC.
PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR ENDED OCTOBER 31, 2002
(UNAUDITED)
(in thousands, except per share data)
Ridgeway
Company Shopping Westchester Somers Pro Forma Company
Historical(a) Center (b) Pavilion (c) Commons(d) Adjustments Pro Forma
------------- ---------- ------------ ---------- ----------- ---------
Revenues:
Operating leases $42,206 $5,668 $6,764 $1,258 $411 (j) $56,307
Lease termination income 765 - - - - 765
Interest and other 1,369 - - - - 1,369
------- ------ ------ ------ ---- --------
44,340 5,668 6,764 1,258 411 58,441
------- ------ ------ ------ ---- --------
Operating Expenses:
Property expenses 12,781 1,729 3,301 395 (342) (i) 17,864
Interest 5,584 - - - 2,523 (g) 8,107
Depreciation and amortization 8,064 - - - 2,666 (h) 10,730
General and administrative expense 2,836 - - - - 2,836
Directors' fees and expenses 173 - - - - 173
------- ----- ----- --- ----- ------
29,438 1,729 3,301 395 4,847 39,710
------- ----- ----- --- ----- ------
Operating Income 14,902 3,939 3,463 863 (4,436) 18,731
Minority Interests in Results of
Consolidated Joint Ventures (395) - - - - (395)
------ ----- ----- --- ------ ------
Net Income 14,507 3,939 3,463 863 (4,436) 18,336
Excess of Carrying Value over
Cost to Repurchase Preferred
Shares 3,071 - - - - 3,071
Preferred Stock Dividends (1,498) - - - (3,400) (f) (4,898)
------- ------ ------ ---- --------- ------
Net Income Applicable to Common and Class
A Common
Stockholders $16,080 $3,939 $3,463 $863 $(7,836) $16,509
======= ====== ====== ==== ======== =======
Basic Earnings per Share:
Common $0.80 $0.63
===== =====
Class A Common $0.89 $0.70
===== =====
Weighted Average Number of
Shares Outstanding
Common 6,089 6,089
===== =====
Class A Common 12,615 5,482 (e) 18,097
====== ===== ======
Diluted Earnings Per Share:
Common $0.78 $0.62
===== =====
Class A Common $0.87 $0.69
===== =====
Weighted Average Number of
Shares Outstanding:
Common and Common
Equivalent 6,432 6,432
===== =====
Class A Common and Class A
Common Equivalent 13,136 5,482 (e) 18,618
====== ===== ======
The accompanying notes and management's assumptions are an integral part of this
pro forma consolidated statement of income.
13
URSTADT BIDDLE PROPERTIES INC.
NOTES AND MANAGEMENT ASSUMPTIONS
TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
ADJUSTMENTS TO PRO FORMA CONSOLIDATED BALANCE SHEET:
(a) Derived from the Company's unaudited financial statements at April
30, 2003
(b) Reflects the pro forma acquisition of seven building units at Somers
Commons Shopping Center for $21,800,000 including estimated transaction
costs of approximately $150,000. The Company intends to account for the
acquisition of the property in accordance with SFAS 141 and 142.
Accordingly, the Company is currently in the process of analyzing the
fair value of in-place leases; and, consequently, no value has yet been
assigned to the leases. Accordingly, the purchase price allocation is
preliminary and may be subject to change.
(c) Reflects pro forma use of cash and cash equivalents for the
$21,800,000 purchase price of the seven building units.
(d) Reflects pro forma adjustment for the issuance of 400,000 shares of
Series C Senior Cumulative Preferred Stock for net proceeds of
$38,450,000 (including transaction costs of $1,550,000) as if the stock
offering had been completed on April 30, 2003.
ADJUSTMENTS TO PRO FORMA CONSOLIDATED STATEMENTS OF INCOME:
(a) Derived from the Company's unaudited financial statements for the six
months ended April 30, 2003 and the audited financial statements for the
year ended October 31, 2002.
(b) Reflects revenues and operating expenses of the Ridgeway Shopping
Center for the period November 1, 2001 to June 6, 2002.
(c) Reflects revenue and operating expenses of the Westchester Pavilion
for the period November 1, 2002 to December 22, 2002 and for the year
ended December 31, 2002.
(d) Reflects revenue and operating expenses of Somers Commons for the six
months ended June 30, 2003 and for the year ended December 31, 2002.
(e) Reflects pro forma adjustment for the issuance of a total of
8,050,000 shares of Class A Common Stock of the Company in June 2002
(7,000,000 shares) and August 2002 (1,050,000 shares) as if the stock
offering had been completed on November 1, 2001.
(f) Reflects pro forma dividends on 400,000 shares of Series C Cumulative
Preferred stock of $1,700,000 and $3,400,000 for the six months ended
April 30, 2003 and the year end October 31, 2002, respectively.
Ridgeway Shopping Center
(g) Reflects pro forma interest expense of $2,523,000 on a $57,369,000
mortgage loan for the period November 1, 2001 to June 6, 2002. Interest
at a rate of 7.54% per annum.
(h) Reflects depreciation expense of $1,400,000 for the period November
1, 2001 to June 6, 2002 for the Ridgeway Shopping Center based on a
30-year estimated useful life for the property's building and
improvements using a cost basis of $72,000,000 (the remaining purchase
price is assumed to be allocated to land) as if the property had been
owned for the entire period.
(i) Reflects pro forma adjustment to property expenses for the period
November 1, 2001 through June 6, 2002 to record consulting fees of
$73,000 to an affiliate and to reflect a reduction in management fees of
$194,000 from a change in the property manager.
(j) Reflects pro forma adjustment of $205,000 for the period November 1,
2001 to June 6, 2002 to record operating rents on a straight-line basis
14
Westchester Pavilion
(h) Reflects depreciation expense of $818,000 and $117,000 for the year
ended October 31, 2002 and the period November 1, 2002 to December 22,
2002, respectively, for the Westchester Pavilion based on a 39-year
estimated useful life for the property's building and improvements using
a cost basis of $31,920,000 (the remaining purchase price is assumed to
be allocated to land) as if the property had been owned for the entire
period.
(i) Reflects a reduction in management fees of $165,000 and $24,000 for
the year ended December 31, 2002 and the period November 1, 2002 to
December 22, 2002 from a change in the property manager.
(j) Reflects pro forma adjustments of $206,000 and $10,000 for the year
ended October 31, 2002 and the period November 1, 2002 to December 22,
2002 to record operating rents on a straight-line basis.
Somers Commons (Seven Building Units)
(h) Reflects depreciation expense of $448,000 and $223,000 for the year
ended October 31, 2002 and the six months ended April 30, 2003,
respectively for the seven building units of Somers Commons based on a
39-year estimated useful life for the property's building and
improvements using a cost basis of $17,440,000 (the remaining purchase
price is assumed to be allocated to land) as if the property had been
owned for the entire period.
(i) Reflects a reduction in management fees of $56,000 and $28,000 for
the year ended December 31, 2002 and the six months ended June 30, 2003,
respectively, from a change in property manager.
15