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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] Annual report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
[Fee Required]
For the fiscal year ended December 31, 1995
or
[ ] Transition report pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
[No Fee Required]
For the transition period from to
Commission file number 0-14463
Wells Real Estate Fund I
(Exact name of registrant as specified in its
charter)
Georgia 58-1565512
(State or other jurisdiction of (I.R.S.
Employer Identification Number)
incorporation or organization)
3885 Holcomb Bridge Road
Norcross, Georgia 30092
(Address of principal executive offices) (Zip
Code)
Registrant's telephone number, including area code (770)
449-7800
Securities registered pursuant to Section 12 (b) of the Act:
Title of each class Name of exchange on which
registered NONE NONE
Securities registered pursuant to Section 12 (g) of the Act:
CLASS A UNITS
(Title of Class)
CLASS B UNITS
(Title of Class)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
Aggregate market value of the voting stock held by non-
affiliates: Not Applicable
PART I
ITEM 1. BUSINESS
General
Wells Real Estate Fund I (the "Partnership") is a Georgia public
limited partnership having Leo F. Wells, III and Wells Capital,
Inc., a Georgia corporation, as General Partners. The
Partnership was formed on April 26, 1984, for the purpose of
acquiring, developing, constructing, owning, operating,
improving, leasing and otherwise managing for investment purposes
income-producing commercial or industrial properties.
On September 6, 1984, the Partnership commenced a public offering
of its limited partnership units pursuant to a Registration
Statement filed on Form S-11 under the Securities Act of 1933.
The Partnership terminated its offering on September 5, 1986, and
received gross proceeds of $35,321,000 representing subscriptions
from 4,895 Limited Partners, composed of two classes of limited
partnership interests, Class A and Class B limited partnership
units.
As of December 31, 1995, the Partnership owned directly or
through its ownership in joint ventures, interests in the
following properties: (i) The Howell Mill Road Property, a
medical office building located in Atlanta, Georgia, (ii) The
Crowe's Crossing Property, a shopping center located in DeKalb
County, Georgia, (iii) The Black Oak Property, a shopping center
located in Knoxville, Tennessee, (iv) The Peachtree Place
Property, two commercial office buildings located in Atlanta,
Georgia, (v) The Tucker Property, a retail shopping and
commercial office complex located in Tucker, Georgia, and (vi)
The Cherokee Property, a shopping center located in Cherokee
County, Georgia. All of the foregoing properties were acquired
on all cash basis and are described in more detail in Item 2 .
Employees
The Partnership has no direct employees. The employees of Wells
Capital, Inc., a General Partner of the Partnership perform a
full range of real estate services including leasing and property
management, accounting, asset management and investor relations
for the Partnership. See Item 11 - Compensation of General
Partners and Affiliates for a summary of the fees paid to the
General Partners and their affiliates during the fiscal year
ended December 31, 1995.
Insurance
Wells Management Company, Inc., an affiliate of the General
Partners, carries comprehensive liability and extended coverage
with respect to all the properties owned directly or indirectly
by the Partnership. In the opinion of management, the properties
are adequately insured.
Competition
The Partnership will experience competition for tenants from
owners and managers of competing projects which may include the
General Partners and their affiliates. As a result, the
Partnership may be required to provide free rent, reduced charges
for tenant improvements and other inducements, all of which may
have an adverse impact on results of operations. At the time the
Partnership elects to dispose of its properties, the Partnership
will also be in competition with sellers of similar properties to
locate suitable purchasers for its properties.
ITEM 2. PROPERTIES.
The Partnership owns six properties directly or through its
ownership in joint ventures of which two are office buildings,
three are retail buildings, and one is a combined office and
retail project. The Partnership does not have control over the
operations of the joint ventures; however, it does exercise
significant influence. Accordingly, investment in joint ventures
is recorded on the equity method. As of December 31, 1995, these
properties were 87.20% occupied, down from 91.38% at December 31,
1994, 90.33% at December 31, 1993, 88.77% at December 31, 1992,
and 87.92% at December 31, 1991.
The following table shows lease expirations during each of the
next ten years as of December 31, 1995, assuming no exercise of
renewal options or termination rights:
Partnership
Share
Year of Number of Square Annualized of Annualized
Percentage of Percentage of
Lease Leases Feet Gross Base Gross Base Total
Square Total Annualized
Expiration Expiring Expiring Rent (1) Rent (1) Feet
Expiring Gross Base Rent
1996 23 42,827$527,487 $362,471 26.77% 26.80%
1997 22 38,309452,877 278,833 23.94% 23.00%
1998 13 26,316335,432 266,715 16.45% 17.01%
1999 13 27,455319,998 243,095 17.16% 16.26%
2000 6 17,986217,828 169,559 11.24%
11.07%
2001(2)1 0 31,020 31,020 0%
1.58%
2002 1 3,531 50,821 27,997 2.20% 2.58%
2003 1 3,580 33,115 33,115 2.24% 1.68%
2004 0 0 0 0 0.00% 0.00%
2005 0 0 0 0
0.00% 0.00%
80 160,004$1,968,578 $1,412,805 100.00%
100.00%
(1) Average monthly gross rent over the life of the lease,
annualized.
(2) Lease expiring is ground lease only with McDonald's.
The following describes the properties in which the Partnership
owns an interest as of December 31, 1995:
The Howell Mill Property
On December 27, 1985, the Partnership acquired a three-story
medical office building on 1.65 acres of land located on Howell
Mill Road in metropolitan Atlanta, Fulton County, Georgia,
directly across from the West Paces Ferry Hospital (the "Howell
Mill Road Property") for a purchase price of $3,443,203. The
Howell Mill Road Property contains approximately 32,339 of net
rentable square feet, and the entire building is currently
leased to HCA Realty, Inc. and Hospital Corporation of America
(collectively, "HCA"). HCA is a medical support staff group
which supplies health care workers to West Paces Ferry Hospital.
HCA is currently leasing the premises on a month-to-month basis,
and the Partnership is in the process of attempting to negotiate
a new lease with HCA. There is no assurance, however, that the
Partnership will be able to sign a new lease with HCA.
The occupancy rate at the Howell Mill Road Property was 100% for
the years ending December 31, 1995, 1994, 1993, 1992, and 1991.
The average effective annual rental per square foot at the Howell
Mill Road Property was $16.86 for 1995, 1994, 1993, and 1992 and
$17.02 for 1991.
Crowe's Crossing Property
On December 31, 1986, the Partnership acquired a retail shopping
center know as "Crowe's Crossing Shopping Center" located in
metropolitan Atlanta, DeKalb County, Georgia (the "Crowe's
Crossing Property"). The Crowe's Crossing Property consists of
approximately 93,728 net rentable square feet. The Crowe's
Crossing Property is anchored by a 45,528 square foot lease with
Kroger Food/Drug which expires in 2011. The annual base rent
payable under the Kroger lease is $295,932. The remaining 48,200
square feet of the center is composed of 31 separate retail
spaces whose tenants operate retail businesses typical of multi-
tenant shopping centers.
The occupancy rate at the Crowe's Crossing Property was 88% in
1995 and 1994, 86% in 1993, 78% in 1992 and 97% in 1991.
The average annual rental per square foot at the Crowe's Crossing
Property was $7.60 for 1995, $7.49 for 1994, $7.56 for 1993,
$7.96 for 1992, and $7.61 for 1991.
As of December 31, 1995, the Partnership had contributed a total
of $8,317,176 for the acquisition of the Crowe's Crossing
Property.
Black Oak Plaza Property
On December 31, 1986, the Partnership acquired a retail shopping
center known as "Black Oak Plaza" located in Metropolitan
Knoxville, Knox County, Tennessee. Black Oak Plaza was initially
developed in 1981. Although Black Oak Plaza contained a total of
approximately 175,000 square feet of space including a K-Mart
department store and a Kroger Food/Drug, the Partnership acquired
only the space located in the shopping center other than the
space occupied by K-Mart and Kroger. The portion of the shopping
center owned and operated by the Partnership contains
approximately 69,046 net rentable square feet. As of December
31, 1995, Black Oak Plaza was approximately 77% leased to 22
tenants. There are no tenants whose leases are for 10% or more
of the total square footage of the center. The occupancy rate at
Black Oak Plaza was 77% in 1995, 84% in 1994, 76% in 1993, 55% in
1992, and 72% in 1991. The average annual rental per square foot
at Black Oak Plaza was $6.14 for 1995, $6.37 for 1994, $5.31 for
1993, $5.04 for 1992, and $5.40 for 1991.
As of December 31, 1995, the Partnership had contributed a total
of $4,564,521 for the acquisition of Black Oak Plaza.
Peachtree Place Property
In 1985, the Partnership acquired an interest in two commercial
office buildings located at 3875 and 3867 Holcomb Bridge Road,
Norcross, Gwinnett County, Georgia (the "Peachtree Place
Property"). The Peachtree Place Property, which contains
approximately 17,245 net rentable square feet, is owned through a
joint venture between the Partnership and Wells & Associates,
Inc., a Georgia corporation affiliated with the General Partners.
The land upon which the Peachtree Place Property was developed
was originally purchased by Wells & Associates, Inc. for a
purchase price of $187,087, and, upon the formation of the joint
venture with the Partnership, Wells & Associates, Inc.
contributed the land to the joint venture as its capital
contribution. As of December 31, 1995, the Partnership had made
total capital contributions of $1,552,367 to the joint venture.
The Partnership holds a 89.95% equity interest in the joint
venture, and Wells & Associates, Inc. holds a 10.05% equity
interest in the joint venture. As of December 31, 1995, the
buildings at the Peachtree Place Property were 100% leased to 7
tenants.
The occupancy rate at the Peachtree Place Property was 100% in
1995 and 1994, 94% in 1993 and 1992 and 100% in 1991.
The average effective annual rental per square foot at the
Peachtree Place Property was $13.62 for 1995, $14.31 for 1994,
$13.18 for 1993, $14.38 for 1992 and $12.78 for 1991.
Three tenants occupy ten percent or more of the rentable square
footage --REMAX, a realtor; Dr. Keith Broome, a dentist; and Dr.
Christian Loetscher, an oral surgeon. The other tenants in the
office park provide typical commercial office services.
REMAX is not currently under a lease. They are occupying 4,483
rentable square feet on a month-to-month basis. The monthly base
rent is $6,164.13. The Partnership is in the process of
negotiating a new lease with REMAX. There is no assurance,
however, that the Partnership will be able to sign a new lease
with REMAX.
Dr. Loetscher's original lease represented 2,067 rentable square
feet. In 1995, he expanded and increased his rentable space an
additional 2,333 square feet for a total of 4,400 rentable square
feet. Dr. Loetscher's lease calls for an annual base rent of
$45,515 in 1995, $73,258 in 1996, $71,591 in 1997 and $29,333 in
1998. The lease expires May 31, 1998.
Dr. Keith Broome's lease represents 2,016 rentable square feet.
The annual base rent under the lease is $34,272 for 1995 and
1996, $35,196 for 1997 and $2,940 for 1998. The lease expires
January 31, 1998.
Tucker Property
The Tucker Property consists of a retail shopping center and a
commercial office building complex located in Tucker, DeKalb
County, Georgia (the "Tucker Property"). The retail shopping
center at the Tucker Property contains approximately 29,858 net
rentable square feet. The commercial office space at the Tucker
Property, which is divided into seven separate buildings,
contains approximately 67,465 net rentable square feet.
On September 4, 1986, the Partnership acquired an 11.17 acre
tract of land located at Hugh Howell Road and Tucker Industrial
Boulevard, Tucker, DeKalb County, Georgia. In January 1987, the
Partnership transferred and contributed this tract of land to a
joint venture (the "Tucker Joint Venture"), which was formed in
1987 between the Partnership and Wells Real Estate Fund II
("Wells Fund II"). Wells Fund II is a Georgia public limited
partnership affiliated with the Partnership through common
general partners. The investment objectives of Wells Fund II are
substantially identical to those of the Partnership. On March 1,
1988, Wells Fund II formed a joint venture (the "Fund II-Fund II-
OW Joint Venture") with Wells Real Estate Fund II-OW ("Wells Fund
II-OW"). Wells Fund II-OW is a Georgia public limited
partnership affiliated with the Partnership through common
general partners. The investment objectives of Wells Fund II-OW
are substantially identical to those of the Partnership. Upon
the formation of the Fund II-Fund II-OW Joint Venture, Wells Fund
II contributed its joint venture interest in the Tucker Joint
Venture to the Fund II-Fund II-OW Joint Venture as part of its
capital contribution. On January 1, 1991, the Cherokee Joint
Venture, which is defined below, was merged into the Tucker Joint
Venture forming a new joint venture ("Tucker-Cherokee Joint
Venture"). As described below, the Cherokee Joint Venture was
also a joint venture between the Partnership and the Fund II-Fund
II-OW Joint Venture. Under the terms of the Amended and Restated
Joint Venture Agreement of Fund I and Fund II Tucker-Cherokee,
the Partnership's percentage interest in the Tucker Property
remained unchanged as a result of the merger of the Tucker Joint
Venture into the Tucker-Cherokee Joint Venture.
On August 1, 1995, the Partnership and the Fund II-II-OW Joint
Venture entered into another amendment to effect the contribution
of the Cherokee Project to the Fund I, II, II-OW, VI, VII Joint
Venture, as described below. As a result, the name of the joint
venture was changed back to "Fund I and Fund II Tucker". The
Partnership's percentage interest in the Tucker Property remained
unchanged as a result of the transaction.
Both the Partnership and the Fund II-Fund II-OW Joint Venture
have funded the cost of completing the Tucker Property through
capital contributions which were paid as progressive stages of
construction were completed. As of December 31, 1995, the
Partnership had contributed a total of $6,399,854, and the Fund
II-Fund II-OW Joint Venture had contributed a total of $4,833,346
to the Tucker Property. As of December 31, 1995, the Partnership
had an approximately 55% equity interest in the Tucker Property,
and the Fund II - Fund II-OW Joint Venture held approximately a
45% equity interest in the Tucker Property. As of December 31,
1995, the Tucker Property was 83% occupied by 34 tenants.
There are no tenants in the project occupying ten percent or more
of the rentable square footage. The principal businesses,
occupations, and professions carried on in the building are
typical retail shopping/commercial office services.
The occupancy rate at the Tucker Property was 83% in 1995, 96% in
1994, 89% in 1993, 80% in 1992 and 83% in 1991.
The average effective annual rental per square foot at the Tucker
Property was $12.61 for 1995, $12.63 for 1994, $11.37 for 1993,
$11.37 for 1992, and $9.77 for 1991.
Cherokee Property
The Cherokee Property consists of a retail shopping center known
as "Cherokee Commons Shopping Center" located in metropolitan
Atlanta, Cherokee County, Georgia (the "Cherokee Property"). The
Cherokee Property consists of approximately 103,755 net rentable
square feet.
On June 30, 1987, the Partnership acquired an interest in the
Cherokee Property through a joint venture (the "Cherokee Joint
Venture") between the Partnership and Wells Fund II-Fund II-OW
Joint Venture. On January 1, 1991, the Cherokee Joint Venture
merged with the Tucker Joint Venture to form the Tucker-Cherokee
Joint Venture. As described above, the Tucker Joint Venture was
also a joint venture between the Partnership and the Fund II-Fund
II-OW Joint Venture. Under the terms of the Amended and
Restated Joint Venture Agreement of Fund I and Fund II Tucker-
Cherokee, the Partnership's percentage interest in the Cherokee
Property remained unchanged as a result of the merger of the
Cherokee Joint Venture into the Tucker-Cherokee Joint Venture.
On August 1, 1995, the Partnership, Fund II - Fund II-OW Joint
Venture, Wells Real Estate Fund VI, L.P., a Georgia public
limited partnership having Leo F. Wells, III and Wells Partners,
L.P., a Georgia limited partnership, as general partners ("Wells
Fund VI"); and Wells Real Estate Fund VII, L.P., a Georgia public
limited partnership having Leo F. Wells, III and Wells Partners,
L.P., a Georgia limited partnership, as general partners ("Wells
Fund VII') entered into a joint venture agreement known as Fund
I, II, II-OW, VI, and VII Associates (the "Fund I, II, II-OW, VI,
VII Joint Venture"), which was formed to own and operate the
Cherokee Property. Wells Partners, L.P. is a private limited
partnership having Wells Capital, Inc., a General Partner of the
Partnership, as its sole general partner. The investment
objectives of Wells Fund II-Fund II-OW, Wells Fund VI and Wells
Fund VII are substantially identical to those of the partnership.
As of December 31, 1995, the Partnership had contributed property
with a book value of $2,139,900, the Fund II-Fund II-OW Joint
Venture had contributed property with a book value of $4,860,100,
Wells Fund VI had contributed cash in the amount of $953,798 and
Wells Fund VII had contributed cash in the amount of $953,798 to
the Cherokee Property. As of December 31, 1995, the equity
interests in the Cherokee Property were as follows: the
Partnership 23.0%, Fund II-Fund II-OW Joint Venture 55%, Wells
Fund VI 11% and Wells Fund VII 11%.
The Cherokee Property is anchored by a 67,115 square foot lease
with Kroger Food/Drug ("Kroger") which expires in 2011.
Kroger's original lease was for 45,528 square feet. In 1994,
Kroger expanded to the current 67,115 square feet which is
approximately 65% of the total rentable square feet in the
Property. As of December 31, 1995, the Cherokee Property was
approximately 94% occupied by 19 tenants, including Kroger.
Kroger is the only tenant occupying ten percent or more of the
rentable square footage. Kroger is a retail grocery chain. The
other tenants in the shopping center provide typical retail
shopping services.
The Kroger lease calls for an annual rent of $392,915 which
increase to $589,102 on August 16, 1995, due to the expansion
from 45,528 square feet to 67,115 square feet. The lease expires
March 31, 2011 with Kroger entitled to five successive renewals
each for a term of five years.
The occupancy rate at the Cherokee Property was 94% in 1995, 91%
in 1994, 89% in 1993, 88% in 1992 and 85% in 1991.
The average effective annual rental per square foot at the
Cherokee Property was $7.50 for 1995, $5.33 for 1994, $6.47 for
1993, $6.46 for 1992 and $6.52 for 1991.
ITEM 3. LEGAL PROCEEDINGS
There were no material pending legal proceedings or proceedings
known to be contemplated by governmental authorities involving
the Partnership during 1995.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matters were submitted to a vote of the Limited Partners
during the fourth quarter of 1995.
PART II
ITEM 5. MARKET FOR PARTNERSHIP'S UNITS AND RELATED SECURITY
HOLDER MATTERS.
As of February 28, 1996, the Partnership had 98,716 outstanding
Class A Units held by a total of 3,809 Limited Partners and
42,568 outstanding Class B Units held by a total of 1,007 Limited
Partners. The capital contribution per unit was $250. There is
no established public trading market for the Partnership's
limited partnership units, and it is not anticipated that a
public trading market for the units will develop. Under the
Partnership Agreement, the General Partners have the right to
prohibit transfers of units.
Class A Unit holders are entitled to an annual 9% non-cumulative
distribution preference over Class B Unit holders as to
distributions from Net Cash From Operations, as defined in
Partnership Agreement to mean Cash Flow, less adequate cash
reserves for other obligations of the Partnership for which there
is no provision, but are initially allocated none of the
depreciation, amortization, cost recovery and interest expense.
These items are allocated to Class B Unit holders until their
capital account balances have been reduced to zero.
Net Cash From Operations to the Limited Partners is distributed
on a quarterly basis. To date, no cash distributions have been
made to Limited Partners holding Class B units. Cash
distributions made to the Limited Partners holding Class A units
during the two most recent fiscal years were as follows:
Per Class
Per Class A Unit B Unit
Distribution for Total Cash Investment Return of Return
of General
Quarter Ended Distributed Income Capital Capital
Partner
March 31, 1994$280,023 $2.84 $0.00 $0.00 $0.00
June 30, 1994$226,065 $2.29 $0.00 $0.00 $0.00
September 30, 1994$337,963$3.42 $0.00 $0.00 $0.00
December 31, 1994$450,649$4.57 $0.00 $0.00 $0.00
March 31, 1995$434,657 $4.40 $0.00 $0.00 $0.00
June 30, 1995$418,490 $4.24 $0.00 $0.00 $0.00
September 30, 1995$445,422$4.51 $0.00 $0.00 $0.00
December 31, 1995$403,581$4.09 $0.00 $0.00 $0.00
The fourth quarter distribution was accrued for accounting
purposes in 1995 and was not actually paid to the Limited
Partners holding Class A units until February 1996. The General
Partners anticipate that cash distributions to Limited Partners
holding Class A units will continue in 1996 to be paid from
investment income; however, there is no guarantee of this.
ITEM 6. SELECTED FINANCIAL DATA.
The following sets forth a summary of the selected financial data
for the fiscal years ended December 31, 1995, 1994, 1993, 1992,
and 1991.
1995 1994 1993 1992 1991
Total assets$26,086,260 $27,020,983$27,228,786$28,024,349$28,236,255
Total revenues2,169,532 2,084,942 1,973,392 2,111,371 2,051,917
Net income 746,262 808,112 650,841 761,308 738,105
Net income
allocated to Class A
Limited Partners1,657,3101,472,3061,387,751 1,491,433 1,461,407
Net loss allocated
to Class B Limited
Partners (911,048) (664,194) (736,910) (730,125) (723,302)
Net income per
Class A
Limited Partner Unit16.79 14.91 14.06 15.11 14.80
Net loss per
Class B
Limited Partner Unit(21.40)(15.60) (17.31) (17.15) (16.99)
Cash Distributions to
Investors:
Investment income
Class A Units 17.24 13.12 15.29 12.96 14.30
Return of Capital
Class A Units -- -- -- -- --
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITIONS AND RESULTS OF OPERATION.
The following discussion and analysis should be read in
conjunction with the selected financial data and the accompanying
financial statements of the Partnership and notes thereto. This
report contains forward-looking statements, within the meaning of
Section 27A of the Securities Act of 1933 and 21E of the
Securities Exchange Act of 1934, including discussion and
analysis of the financial condition of the Partnership,
anticipated capital expenditures required to complete certain
projects, amounts of cash distributions anticipated to be
distributed to Limited Partners in the future and certain other
matters. Readers of this Report should be aware that there are
various factors that could cause actual results to differ
materially from any forward-looking statement made in this
Report, which include construction costs which may exceed
estimates, construction delays, lease-up risks, inability to
obtain new tenants upon the expiration of existing leases, and
the potential need to fund tenant improvements or other capital
expenditures out of operating cash flow.
Results of Operations and Changes in Financial Conditions
General
Gross revenues of the Partnership were $2,169,532 for the fiscal
year ended December 31, 1995, as compared to $2,084,942 for the
fiscal year ended December 31, 1994 and $1,973,392 for the fiscal
year ended December 31, 1993. The increase for 1995 over 1994
was due primarily to increased revenues at the Cherokee Property.
The increase in revenue is due to a full year of rents on the
Kroger expansion. The increase for 1994 over 1993 was due to
increased earnings from joint ventures also due to increased
revenues from increased occupancy.
Expenses of the Partnership were $1,423,270 for the fiscal year
ended December 31, 1995, as compared to $1,276,830 for the fiscal
year ended December 31, 1994, and $1,322,551 for the fiscal year
ended December 31, 1993. The increase for 1995 over 1994 was due
primarily to the increase in depreciation expense. Depreciation
increased from 1994 to 1995 due to a change in the estimated
useful lives of buildings and improvements from 40 years to 25
years. For further discussion of depreciation expense, please
refer to the notes to the accompanying financial statements. The
decrease for 1994 compared to 1993 was the net result of overall
changes in various expenses.
Net income of the Partnership was $746,262 for the fiscal year
ended December 31, 1995, as compared to $808,112 for the fiscal
year ended December 31, 1994, and $650,841 for the fiscal year
ended December 31, 1993. The decrease in net income for 1995
over 1994 is due primarily to increased depreciation expense.
The increase in net income for 1994 over 1993 was due to
increased revenues and decreased expenses as discussed above.
The Partnership's cash distributions to the Limited Partners
holding Class A units were $17.24 per unit for the fiscal year
ended December 31, 1995, $13.12 for 1994, and $15.29 for 1993.
No cash distributions were made to the Limited Partners holding
Class B units or to the General Partners for the fiscal year
ended December 31, 1995, 1994, and 1993. Distributions accrued
for the fourth quarter of 1995 were paid in February, 1996.
In March 1995, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards ("SFAS") No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to Be Disposed of", which is effective for fiscal
years beginning after December 15, 1995. SFAS No. 121
establishes standards for determining when impairment losses on
long-lived assets have occurred and how impairment losses should
be measured. The joint ventures adopted SFAS No. 121, effective
January 1, 1995. The impact of adopting SFAS No. 121 was not
material to the financial statements of the joint ventures.
Property Operations
As of December 31, 1995, the Partnership owned interests in the
following properties:
Howell Mill Road Property
For the Year Ended December 31
1995 1994 1993
Revenues:
Rental income $545,149 $545,149 $545,149
Expenses:
Depreciation 152,651 121,749 121,749
Management and
leasing expenses 32,709 32,709 32,709
Other operating expenses 4,792 4,651 4,327
190,152 159,109 158,785
Net income $354,997 $386,040 $386,364
Occupied % 100% 100% 100%
Partnership Ownership % 100% 100% 100%
Cash generated to
the Partnership $540,357 $540,499 $540,822
Net income allocated
to the Partnership $354,997 $386,040 $386,364
Rental income, all expenses (with the exception of depreciation),
and cash generated to the Partnership remained stable for the
years ending December 31, 1995, 1994, and 1993. The increase in
depreciation expense from 1994 to 1995 was due to the change in
the estimated useful lives of buildings and improvements as
previously discussed under the "General" section of "Results of
Operations and Changes in Financial Conditions". Net income was
lower in 1995 as compared to 1994 and 1993 due to an increase in
depreciation expense. HCA is currently leasing the premises on a
month-to-month basis, and the Partnership is in the process of
negotiating a new lease.
Real estate taxes are paid by HCA directly.
For comments on the general competitive conditions to which the
property may be subject, see Item 1, Business, page 2. For
additional information on the property, tenants, etc., see Item
2, Properties, page 3.
Crowe's Crossing Shopping Center
For the Year Ended December 31
1995 1994 1993
Revenues:
Rental income $712,634 $701,678 $708,995
Expenses:
Depreciation 245,967 196,594 195,900
Management and
leasing expenses 40,175 36,385 37,752
Other operating expenses197,414 181,839 149,618
483,556 414,818 383,270
Net income $229,078 $286,860 $325,725
Occupied % 88% 88% 86%
Partnership Ownership % 100% 100% 100%
Cash generated to the
Partnership $529,574 $442,763 $574,479
Net income allocated
to the Partnership $229,078 $286,860 $325,725
Rental income increased to $712,634 for 1995 as compared to
$701,678 for 1994 even though occupancy levels remain unchanged
due to rental rate increases for existing tenants. Rental income
decreased for 1994 over 1993 even though occupancy levels
increased due to lower rental rates charged to new tenants.
Depreciation increased for 1995 as compared to 1994 due to the
change in the estimated useful lives of buildings and
improvements as previously discussed under "General" section of
"Results of Operations and Change in Financial Conditions".
Depreciation expense was relatively stable for 1994 and 1993.
Management and leasing expenses increased in 1995 over 1994 due
to increased rental collections in 1995. The small decrease in
management and leasing fees in 1994 over 1993 is primarily due to
the lower rentals being paid. Other operating expenses increased
approximately $15,000 in 1995 as compared to 1994 due mainly to
additional security expense which was also the reason for the
increased operating expenses in 1994 compared to 1993. Net
income of the property decreased to $286,860 in 1994 from
$325,725 in 1993 for reasons stated above, and decreased to
$229,078 in 1995 compared to $286,860 in 1994 primarily due to
the increased depreciation as discussed.
Real estate taxes were $83,860 for 1995, $83,997 for 1994 and
$87,784 for 1993.
For comments on the general competitive conditions to which the
property may be subject, see Item 1, Business, page 2. For
additional information on the property, tenants, etc., see Item
2, Properties, page 3.
Black Oak Plaza
For the Year Ended December 31
1995 1994 1993
Revenues:
Rental income $424,258 $439,703 $366,551
Expenses:
Depreciation 165,247 128,878 119,773
Management and
leasing expenses 35,863 26,385 24,447
Other operating expenses184,738 210,069 196,749
385,848 365,332 340,969
Net income $38,410 $74,371 $25,582
Occupied % 77% 84% 76%
Partnership Ownership % 100% 100% 100%
Cash generated to the
Partnership $197,499 $0 $91,603
Net income generated
to the Partnership $38,410 $74,371 $25,582
Rental income decreased to $424,258 for 1995 as compared to
$439,703 in 1994 due to decreased occupancy at the project.
Rental income increased for 1994 over 1993 due mainly to a higher
average level of occupancy for 1994. Depreciation increased for
1995 as compared to 1994 due to the change in the estimated
useful lives of buildings and improvements as previously
discussed under "General" section of "Results of Operations and
Changes in Financial Conditions". Depreciation expense increased
in 1994 over 1993 due to capital improvements to the property of
approximately $351,000. Management and leasing expenses
increased for 1995 compared to 1994 due primarily to an increase
of approximately $50,356 in actual rents received in 1995
compared to 1994 and a write off of accounts receivable in 1994
of approximately $23,900.
An increase in common area maintenance ("CAM") reimbursements in
July of 1994 of $.35 per square foot, and the application of
management and leasing fees to cam reimbursement fees paid by
Kroger in 1995 account for the remainder of the increase in
management and leasing fees in 1995 compared to 1994. Management
and leasing expenses increased in 1994 as compared to 1993
primarily due to increased occupancy at the property. Other
operating expenses decreased for 1995 compared to 1994 due
primarily to a decrease of approximately $22,500 in repairs and
maintenance. The increase in other operating expenses in 1994
over 1993 was primarily due to write-off of tenant bad debt. Net
income of the property increased to $74,371 in 1994 as compared
to $25,582 in 1993 due to increased occupancy as discussed and
decreased to $38,410 in 1995 as compared to $74,371 in 1994 due
to increased depreciation expense as discussed.
Real estate taxes were $41,655 for 1995, $38,360 for 1994 and
1993.
For comments on the general competitive conditions to which the
property maybe subject, see Item 1, Business, page 2. For
additional information on the property, tenants, etc., see Item
2, Properties, page 3.
Peachtree Place
For the Year Ended December 31
1995 1994 1993
Revenues:
Rental income $234,903 $246,724 $227,203
Interest income 665 983 734
235,568 247,707 227,937
Expenses:
Depreciation 51,680 42,411 42,414
Management and
leasing expenses 20,782 21,961 23,053
Other operating expenses156,396 131,274 125,689
228,858 195,646 191,156
Net income $ 6,710 $ 52,061 $ 36,781
Occupied % 100% 100% 94%
Partnership Ownership %89.95% 89.76% 89.76%
Cash distribution to the
Partnership $47,488 $104,258 $88,515
Net income allocated
to the Partnership $5,994 $46,730 $33,015
Rental income, net income and cash distributions increased for
the year ended December 31, 1994, as compared to the same period
for 1993, due chiefly to an increase in tenant occupancy for
1994. Operating expenses and management and leasing expenses
were relatively stable for 1993 and 1994. Rental income
decreased for the year ended December 31, 1995 as compared to the
same period for 1994 due to decreased occupancy for a period
during the year. In 1995, the increase in depreciation expense
was due to the change in the estimated useful lives of buildings
and improvements as previously discussed under the "General"
section of "Results of Operations and Changes in Financial
Conditions". The increase in operating expenses in 1995 as
compared to 1994 was due primarily to bad debt expense. Net
income and cash distributions were down in 1995 as compared to
1994 due to the decreased revenues and increased expenses. The
property was 100% leased as of December 31, 1995 and 1994 as
compared to 94% as of December 31, 1993.
Real estate taxes were $16,831 for 1995 and 1994, and $15,991 for
1993.
For comments on the general competitive conditions to which the
property may be subject, see Item 1, Business, page 2. For
additional information on the property, tenants, etc., see Item
2, Properties, page 3.
Tucker Property
For the Year Ended December 31
1995 1994
1993
Revenues:
Rental income $1,227,116 $1,228,960 $1,106,676
Interest income 2,599 3,269 3,151
1,229,715 1,232,229 1,109,827
Expenses:
Depreciation 277,862 238,238 236,288
Management and
leasing expenses135,517 133,650 126,853
Other operating expenses563,049 500,494 617,726
976,428 872,382 980,867
Net income $253,287 $359,847 $128,960
Occupied % 83% 96% 89%
Partnership Ownership %55.09% 55.09% 55.09%
Cash distribution to the
Partnership $367,070 $309,179 $206,364
Net income allocated
to the Partnership $139,535 $198,239 $71,143
Rental income remained relatively stable from 1994 to 1995 and
increased from $1,106,676 in 1993 to $1,228,960 in 1994 due
primarily to increased tenant occupancy. Operating expenses
increased in 1995 over 1994 due to an increase in property taxes,
utilities, and other repairs and maintenance. Operating expenses
decreased in 1994 as compared to 1993 due chiefly to a decrease
in retirement of tenant improvements of $88,000 and a decrease of
$20,000 for general and administrative expenses. The increase in
depreciation expense for 1995 as compared to 1994 and 1993 is a
result of the change in the estimated useful lives of buildings
and improvements as previously discussed under the "General"
section of "Results of Operations and Changes in Financial
Conditions". Net income of the property decreased to $253,286 in
1995 from $359,847 in 1994 due to increased depreciation and
operating expenses as discussed above and increased in 1994 to
$359,847 from $128,960 in 1993 due to increased tenant occupancy
and a decrease in operating expenses as discussed above.
The property was 83% leased as of December 31, 1995, as compared
to 96% as of December 31, 1994, and 89% as of December 31, 1993.
Rental income for 1995 decreased only slightly over the 1994
level due to the decrease in occupancy occurring near the end of
1995.
Real estate taxes were $127,484 for 1995, $105,042 for 1994 and
$132,780 for 1993.
For comments on the general competitive conditions to which the
property may be subject, see Item 1, Business, Page 2. For
additional information on the property, tenants, etc., see Item
2, Properties, page 3.
Cherokee Commons Shopping Center
For the Year Ended December
31
1995 1994 1993
Revenues:
Rental income $778,204 $ 552,823 $585,195
Interest income 180 50 343
778,384 552,873 585,538
Expenses:
Depreciation 277,099 172,583 178,269
Management and
leasing expenses 36,303 22,410 20,453
Other operating expenses115,885 569,830 605,465
429,287 764,823 804,187
Net income $349,097 $(211,950) $(218,649)
Occupied % 94% 91% 89%
Partnership Ownership %23.0% 30.6% 32.3%
Cash distribution to the
Partnership $126,697 $104,234 $89,478
Net income/(loss) allocated
to the Partnership $95,490 ($63,123) ($70,668)
Rental income increased in 1995 over 1994 due to the Kroger
expansion which was completed in November, 1994. Rental income
for the year ended December 31, 1994 decreased approximately
$32,000 from the rental income for the year ended December 31,
1993. This decrease is due to concessions given to existing
tenants and to a decrease in occupancy for nine months of the
year. Concessions were given to new tenants because the market
in the area called for free rent in order to meet competition.
The decrease in occupancy was due to the vacancy created by the
Kroger expansion while under construction. Operating expenses of
the property decreased to $115,886 in 1995 from $569,830 in 1994,
and $605,465 in 1993. The decrease is due primarily to the
retirement of tenant improvements that occurred in 1994 and 1993
due to the Kroger expansion which elevated the expenses for those
two years. The increase in depreciation expense for 1995 as
compared to 1994 and 1993 is a result of the change in the
estimated useful lives of buildings and improvements as
previously discussed under the "General" section of "Results of
Operations and Changes in Financial Conditions". Net income of
the property increased to $349,097 in 1995 from a loss of
($211,950) in 1994 and ($218,649) in 1993 due to the increase in
revenue and the decrease in operating expenses as discussed
above.
A lease amendment has been executed with Kroger expanding its
existing store at the Cherokee Commons Shopping Center from
45,528 square feet to 66,918 square feet. In November, 1994,
construction was completed on the Kroger expansion and remodeling
of the center. The total cost for both the Kroger expansion and
remodeling of the Center was $2,807,367. The costs of this
expansion were funded in the following amounts: the Partnership
$94,679 and the Fund II-Fund II-OW Joint Venture $805,092 as of
December 31, 1994 and Wells Fund VI $953,798, and Wells Fund VII
$953,798 as of December 31, 1995. Due to these additional
investments, the Partnership's ownership percentage in the
Cherokee Commons Shopping Center decreased from 30.6% in 1994 to
23.0% as of December 31, 1995. The Statements are for a twelve
month period; however, Wells Fund VI and Wells Fund VII did not
contribute their portion until August, 1995.
Real estate taxes were $63,694 for 1995 and $56,080 for 1994 and
1993.
For comments on the general competitive conditions to which the
property may be subject, see Item 1, Business, Page 2. For
additional information on the property, tenants, etc. , see Item
2, Properties, page 3.
Liquidity and Capital Resources
During its offering, which terminated on September 5, 1986, the
Partnership raised a total of $35,321,000 through the sale of
141,284 units. No additional units will be sold by the
Partnership. From the original funds raised, the Partnership had
invested a total of $28,253,054 in properties, paid $2,225,992
in acquisition and advisory fees, $4,836,633 in selling
commissions and organization and offering expenses, and is
maintaining a working capital reserve of $5,321.
Since the Partnership is an investment partnership formed for the
purpose of acquiring, owning, and operating income-producing real
property and has invested all of its funds available for
investment, it is highly unlikely that the Partnership will
acquire interests in any additional properties, and the
Partnership's capital resources are anticipated to remain
relatively stable over the holding period of its investments.
The Partnership's net cash provided by operating activities
decreased to $82,044 for the year ended December 31, 1995 from
$497,138 for the year ended December 31, 1994 primarily due to an
increase in Partnership distributions paid. The increase in
equity in income of joint ventures was offset by an increase in
depreciation expense. Net cash provided by operating activities
increased to $497,138 for the year ended December 31, 1994 from
$214,141 for the year ended December 31, 1993 due primarily to a
decrease in Partnership distributions paid and an increase in net
income.
Net cash used in investing activities increased from $217,891 in
1993 to $560,189 in 1994 due to an increase in investment in real
estate. Net cash used in investing activities decreased from
$560,189 in 1994 to $153,423 in 1995 due to decrease in
investment in real estate. Cash and cash equivalents remained
relatively stable for the years ending December 31, 1995, 1994,
and 1993. The Partnership distributes cash available less
reserves, and as a result, the level of cash remains stable.
The Partnership's distributions paid and payable through the
fourth quarter of 1995 have been paid from Net Cash from
Operations and from distributions received from its equity
investment in joint ventures and the Partnership anticipates that
distributions will continue to be paid on a quarterly basis from
such sources. The Partnership expects to meet liquidity
requirements and budget demands through cash flow.
The Partnership is unaware of any known demands, commitments,
events, or capital expenditures other than that which is required
for the normal operations of its properties or the properties in
which it owns a joint venture interest that will result in the
Partnership's liquidity increasing or decreasing in any material
way.
Inflation
Real estate has not been affected significantly by inflation in
the past three years due to the relatively low inflation rate.
There are provisions in the majority of tenant leases executed
by the Partnership to protect the Partnership from the impact of
inflation. These leases contain common area maintenance charges
(CAM charges), real estate tax and insurance reimbursements on a
per square foot bases, or in some cases, annual reimbursement of
operating expenses above a certain per square foot allowance.
These provisions reduce the Partnership's exposure to increases
in costs and operating expenses resulting from inflation. In
addition, a number of the Partnership's leases are for terms of
less than five years which may permit the Partnership to replace
existing leases with new leases at higher base rental rates if
the existing leases are below market rate. There is no
assurance, however, that the Partnership would be able to replace
existing leases with new leases at higher base rentals.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The consolidated financial statements of the Registrant and
Supplementary data are detailed under Item 14 (a) and filed as
part of the report on the pages indicated.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
The Partnership's change in accountants during 1995 was
previously reported in the Partnership's Form 8-K dated
September 11, 1995. There were no disagreements with the
Partnership's accountants or other reportable events during
1995.
PART III
ITEM 10. GENERAL PARTNERS OF THE PARTNERSHIP.
Wells Capital, Inc. Wells Capital, Inc. ("Capital") is a
Georgia corporation formed in April 1984. The executive offices
of Capital are located at 3885 Holcomb Bridge Road, Norcross,
Georgia 30092. Leo F. Wells, III is the sole shareholder, sole
Director and the President of Capital.
Leo F. Wells, III. Mr. Wells is a resident of Atlanta,
Georgia, is 52 years of age and holds a Bachelor of Business
Administration Degree in Economics from the University of
Georgia. Mr. Wells is the President and sole Director of
Capital. Mr. Wells is the President of Wells & Associates,
Inc., a real estate brokerage and investment company formed in
1976 and incorporated in 1978, for which he serves as principal
broker. Mr. Wells is also currently the sole Director and
President of Wells Management Company, Inc., a property
management company he founded in 1983. In addition, Mr. Wells
is the President and Chairman of the Board of Wells Investment
Securities, Inc., Wells & Associates, Inc., and Wells Management
Company, Inc., which are affiliates of the General Partners.
From 1980 to February 1985, Mr. Wells served as Vice-President
of Hill-Johnson, Inc., a Georgia corporation engaged in the
construction business. From 1973 to 1976, he was associated
with Sax Gaskin Real Estate Company and from 1970 to 1973, he
was a real estate salesman and property manager for Roy D.
Warren & Company, an Atlanta real estate company.
ITEM 11. COMPENSATION OF GENERAL PARTNERS AND AFFILIATES.
No cash compensation or fees were paid to the General Partners or
their affiliates during the year ended December 31, 1995 from the
Partnership or with respect to the Partnership's interests in
joint ventures owning and operating properties. Due to the fact
that Wells Management Company, Inc. has elected to defer the
receipt of property management and leasing fees from the
Partnership and with respect to the Partnership's interests in
properties owned through joint ventures, as of December 31, 1995,
deferred cash compensation of approximately $1,710,611 of which
$1,267,152 was accrued at the Partnership level and the remainder
at the joint venture level, was due to the General Partners and
their affiliates, of which $217,562 was accrued for fiscal year
ended 1995.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
No Limited Partner is known by the Partnership to own
beneficially more than 5% of the outstanding units of the
Partnership.
Set forth below is the security ownership of management as
of February 29, 1996.
(1) (2) (3) (4)
Title of Class Name and Address of Amount and
Nature Percent of Class
Beneficial Owner of Beneficial
Ownership
Class A Units Leo F. Wells, III108 units (IRA, less than
1%
401 (k) and Profit
Sharing)
Class B Units Leo F. Wells, III 80 units
(401(k)) less than 1%
Class A Units Leo F. Wells, III 151 units
(outright) less than 1%
No arrangements exist which would, upon implementation, result in
a change in control of the Partnership.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The compensation and fees paid or to be paid by the Partnership
to the General Partners and their affiliates in connection with
the operation of the Partnership are as follows:
Interest in Partnership Cash Flow and Net Sale
Proceeds. The General Partners will receive a
subordinated participation in net cash flow from
operations equal to 10% of net cash flow after the
Limited Partners have received preferential
distributions equal to 9% of their adjusted capital
accounts in each fiscal year. In addition, after the
Limited Partners receive their distributions equal to
9% of their capital contributions and the General
Partners receive their distributions equal to 10% of
the total distributions for such year, the General
Partners will receive a participation of 10% of the
additional distributions from cash available for
distribution, 9% of which shall be paid to the General
Partners as a Partnership Management Fee. The General
Partners will also receive a participation in net sale
proceeds and net financing proceeds equal to 15% of the
residual proceeds available for distribution after the
Limited Partners have received a return of their
adjusted capital contributions plus a 15% cumulative
return on their adjusted capital contributions. The
General Partners received no partnership cash flow or
net sale proceeds during 1995.
Property Management and Leasing Fees. Wells
Management Company, Inc., an affiliate of the General
Partners, will receive compensation for supervising the
management of the Partnership properties equal to 6%(3%
management and 3% leasing) of rental income. In no
event will such fees exceed the sum of (i) 6% of the
gross receipts of each property, plus (ii) a separate
one-time fee for initial rent-up or leasing-up of
development properties in an amount not to exceed the
fee customarily charged in arm's-length transactions by
others rendering similar services in the same
geographic area for similar properties. With respect
to properties leased on a net basis for a period of ten
years or longer, property management fees will not
exceed 1% of gross revenues from such leases, plus a
one-time initial leasing fee of 3% of the gross
revenues which are payable over the first five years of
the term of such net leases. Management and leasing
fees as well as initial lease-up fees of the
Partnership and with respect to the Partnership's
interest in joint ventures owning properties are
currently being expensed but not paid to Wells
Management Company, Inc. As set forth above, as of
December 31, 1995, deferred property management and
leasing fees totaling $1,710,611 were due to Wells
Management Company, Inc., of which $217,562 was accrued
for fiscal year ended 1995.
Real Estate Commissions. In connection with the
sale of Partnership properties, the General Partners or
their affiliates may receive commissions not exceeding
the lesser of (A) 50% of the commissions customarily
charged by other brokers in arm's-length transactions
involving comparable properties in the same geographic
area or (B) 3% of the gross sales price of the
property, and provided that payments of such
commissions will be made only after Limited Partners
have received prior distributions totaling 100% of
their capital contributions plus a 6% cumulative return
on their adjusted capital contributions. During 1995,
no real estate commissions were paid to the General
Partners or their affiliates.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K.
(a) 1. Financial Statements
Information with respect to this item is contained on Pages
F-2 to F-24 of this Annual
Report on Form 10-K. See Index to Financial Statements on
Page F-1.
(a) 2. Financial Statement Schedule III
Information with respect to this item begins on Page S-1 of
this Annual Report on
Form 10-K. See Index to Financial Statements on Page F-1.
(a)3. The Exhibits filed in response to Item 601 of
Regulation S-K are listed on the Exhibit
Index attached hereto.
(b) No reports on Form 8-K were filed with the Commission during
the fourth quarter of
1994.
(c) The Exhibits filed in response to Item 601 of Regulation S-K
are listed on the Exhibit
Index attached hereto.
(d) See (a) 2 above.
SIGNATURES
Pursuant to the requirements of Sections 13 or 15(d) 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 this 27th day of March, 1996
Wells Real Estate Fund I
(Registrant)
By: /s/ Leo F. Wells, III
Leo F.
Wells, III
Leo F. Wells, III
Individual General
Partner and as President of Wells Capital,
Inc., the
Corporate General Partner
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
person on behalf of the registrant and in the capacity as and on
the date indicated.
Signature Title
/s/ Leo F. Wells, III Individual
General Partner, March 27, 1996
Leo F. Wells, III President and
Sole Director
of
Wells Capital, Inc., the
Corporate General Partner
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED
PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRARS WHICH HAVE NOT
BEEN REGISTERED PURSUANT TO SECTION 12 OF THE ACT.
No annual report or proxy material relating to an annual or
other meeting of security holders has been sent to security
holders.
INDEX TO FINANCIAL STATEMENTS
Financial Statements Page
Independent Auditors' Reports F2
Consolidated Balance Sheets as of December 31, 1995 and 1994 F4
Consolidated Statements of Income for the Years Ended
December 31, 1995, 1994, and 1993 F5
Consolidated Statements of Partners' Capital for the Years Ended
December 31, 1995, 1994, and 1993 F6
Consolidated Statements of Cash Flows for the Years Ended
December 31, 1995, 1994, and 1993 F7
Notes to Consolidated Financial Statements for December 31, 1995,
1994, and 1993 F8