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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
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER 1-9876
WEINGARTEN REALTY INVESTORS
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
TEXAS 74-1464203
(State or other jurisdiction of incorporation or organization) (IRS Employer
Identification No.)
2600 Citadel Plaza Drive
P.O. Box 924133
Houston, Texas 77292-4133
(Address of principal executive offices) (Zip Code)
(713) 866-6000
(Registrant's telephone number)
Securities registered pursuant to Section 12(b) of the Act.
Title of Each Class Name of each exchange on which registered
- ----------------------------------------------------------------- -----------------------------------------
Common Shares of Beneficial Interest, $0.03 par value New York Stock Exchange
Series A Cumulative Redeemable Preferred Shares, $0.03 par value New York Stock Exchange
Series C Cumulative Redeemable Preferred Shares, $0.03 par value New York Stock Exchange
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT: NONE
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 [ ].
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]
The aggregate market value of the common shares held by non-affiliates
(based upon the closing sale price on the New York Stock Exchange) on February
22, 2000 was approximately $952,676,135. As of February 22, 2000 there were
26,694,953 common shares of beneficial interest, $.03 par value, outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's Proxy Statement in connection with its Annual
Meeting of Shareholders to be held April 24, 2000 are incorporated by reference
in Part III.
Exhibit Index beginning on Page 40
TABLE OF CONTENTS
ITEM NO. PAGE NO.
- -------- --------
PART I
1. Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Properties. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . 13
4. Submission of Matters to a Vote of Shareholders . . . . . . . . . 13
Executive Officers of the Registrant. . . . . . . . . . . . . . . 14
PART II
5. Market for Registrant's Common Shares of Beneficial
Interest and Related Shareholder Matters. . . . . . . . . . . . . 15
6. Selected Financial Data . . . . . . . . . . . . . . . . . . . . . 16
7. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . . 17
7A. Quantitative and Qualitative Disclosure about Market Risk . . . . 20
8. Financial Statements and Supplementary Data . . . . . . . . . . . 21
9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure . . . . . . . . . . . . . . . 39
PART III
10. Trust Managers and Executive Officers of the Registrant . . . . . 39
11. Executive Compensation. . . . . . . . . . . . . . . . . . . . . . 39
12. Security Ownership of Certain Beneficial Owners and
Management. . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
13. Certain Relationships and Related Transactions. . . . . . . . . . 39
PART IV
14. Exhibits, Financial Statement Schedules and Reports on Form 8-K . 39
PART I
ITEM 1. BUSINESS
General. Weingarten Realty Investors, an unincorporated trust organized
under the Texas Real Estate Investment Trust Act, and its predecessor entity
began the ownership and development of shopping centers and other commercial
real estate in 1948. WRI is self-advised and self-managed. As of December 31,
1999, we owned or operated under long-term leases interests in 239 developed
income-producing real estate projects. We owned 187 shopping centers located in
the Houston metropolitan area and in other parts of Texas and in Louisiana,
Arizona, Nevada, Arkansas, New Mexico, Oklahoma, Tennessee, Kansas, Colorado,
Missouri, Illinois, Florida and Maine. We also owned 50 industrial projects
located in Tennessee, Nevada and Houston, Austin and Dallas, Texas.
Additionally, we owned one multi-family residential project and one office
building, which serves, in part, as WRI's headquarters. Our interests in these
projects aggregated approximately 27.8 million square feet of building area and
104.1 million square feet of land area. We also owned interests in 31 parcels
of unimproved land under development or held for future development which
aggregated approximately 8.2 million square feet.
WRI currently employs 203 persons and its principal executive offices are
located at 2600 Citadel Plaza Drive, Houston, Texas 77008, and its phone number
is (713) 866-6000.
Location of Properties. Historically, WRI has emphasized investments in
properties located primarily in the Houston area. Since 1987, we actively
acquired properties outside of Houston. Of our 270 properties which were owned
or operated under long-term leases as of December 31, 1999, 100 of our 239
developed properties and 14 of our 31 parcels of unimproved land were located in
the Houston metropolitan area. In addition to these properties, we owned 79
developed properties and eight parcels of unimproved land located in other parts
of Texas. Because of our investments in the Houston area, as well as in other
parts of Texas, the Houston and Texas economies affect, to some degree, the
business and operations of WRI.
In 1999, the economies of Houston and Texas continued to grow, albeit at a
slower pace than 1998, but still exceeding the national average; the economy of
the entire southwestern United States, where WRI has its primary operations,
also remained strong relative to the national average. The Houston economy,
because of its strengths in energy and engineering and construction, has become
much more integrated into the international economy and is somewhat affected by
the international climate. Thus, while Houston's expansion slowed in 1999, it
is expected to continue to expand in 2000 and beyond. A deterioration in the
Houston or Texas economies could adversely affect WRI. However, WRI's centers
are generally anchored by grocery and drug stores under long-term leases, and
these types of stores, which deal in basic necessity-type items, tend to be less
affected by economic change.
Competition. There are other developers and owner-operators engaged in the
development, acquisition and operation of shopping centers and commercial
property who compete with us in our trade areas. This results in competition
for both acquisitions of existing income-producing properties and also for prime
development sites. There is also competition for tenants to occupy the space
that WRI and its competitors develop, acquire and manage.
We believe that the principal competitive factors in attracting tenants in
our market areas are location, price, anchor tenants and maintenance of
properties. We also believe that our competitive advantages include the
favorable locations of our properties, our ability to provide a retailer with
multiple locations with anchor tenants in the Houston area and the practice of
continuous maintenance and renovation of our properties.
Financial Information. Additional financial information concerning WRI is
included in the Consolidated Financial Statements located on pages 22 through 38
herein.
ITEM 2. PROPERTIES
At December 31, 1999, WRI's real estate properties consisted of 270
locations in fourteen states. A complete listing of these properties, including
the name, location, building area and land area (in square feet), as applicable,
is set forth below:
SHOPPING CENTERS
Building
Name and Location Area Land Area
- --------------------------------------------------------- --------- ---------
HOUSTON AND HARRIS COUNTY, TOTAL. . . . . . . . . . . . . . . 7,647,000 29,720,000
Alabama-Shepherd, S. Shepherd at W. Alabama . . . . . . . . . 28,000 * 88,000 *
Almeda Road, Almeda at Southmore. . . . . . . . . . . . . . . 17,000 37,000
Bayshore Plaza, Spencer Hwy. at Burke Rd. . . . . . . . . . . 36,000 196,000
Bellaire Boulevard, Bellaire at S. Rice . . . . . . . . . . . 35,000 137,000
Bellfort, Bellfort at Southbank . . . . . . . . . . . . . . . 48,000 167,000
Bellfort Southwest, Bellfort at Gessner . . . . . . . . . . . 30,000 89,000
Bellwood, Bellaire at Kirkwood. . . . . . . . . . . . . . . . 136,000 655,000
Bingle Square, U.S. Hwy. 290 at Bingle. . . . . . . . . . . . 46,000 168,000
Braeswood Square, N. Braeswood at Chimney Rock. . . . . . . . 103,000 422,000
Centre at Post Oak, Westheimer at Post Oak Blvd.. . . . . . . 184,000 505,000
Champions Village, F.M. 1960 at Champions Forest Dr.. . . . . 408,000 1,391,000
Copperfield Village, Hwy. 6 at F.M. 529 . . . . . . . . . . . 157,000 712,000
Crestview, Bissonnet at Wilcrest. . . . . . . . . . . . . . . 9,000 35,000
Crosby, F.M. 2100 at Kenning Road (61%) . . . . . . . . . . . 36,000 * 124,000 *
Cullen Place, Cullen at Reed. . . . . . . . . . . . . . . . . 7,000 30,000
Cullen Plaza, Cullen at Wilmington. . . . . . . . . . . . . . 81,000 318,000
Cypress Pointe, F.M. 1960 at Cypress Station. . . . . . . . . 191,000 737,000
Cypress Village, Louetta at Grant Road. . . . . . . . . . . . 25,000 134,000
Del Sol Market Place, Telephone at Monroe . . . . . . . . . . 21,000 87,000
Eastpark, Mesa Rd. at Tidwell . . . . . . . . . . . . . . . . 140,000 665,000
Edgebrook, Edgebrook at Gulf Fwy. . . . . . . . . . . . . . . 78,000 360,000
Fiesta Village, Quitman at Fulton . . . . . . . . . . . . . . 30,000 80,000
Fondren Southwest Village, Fondren at W. Bellfort . . . . . . 323,000 1,362,000
Fondren/West Airport, Fondren at W. Airport . . . . . . . . . 62,000 223,000
45/York Plaza, I-45 at W. Little York . . . . . . . . . . . . 218,000 840,000
Glenbrook Square, Telephone Road. . . . . . . . . . . . . . . 71,000 320,000
Griggs Road, Griggs at Cullen . . . . . . . . . . . . . . . . 85,000 422,000
Harrisburg Plaza, Harrisburg at Wayside . . . . . . . . . . . 95,000 334,000
Heights Plaza, 20th St. at Yale . . . . . . . . . . . . . . . 72,000 228,000
Humblewood Shopping Plaza, Eastex Fwy. at F.M. 1960 . . . . . 180,000 784,000
I-45/Telephone Rd. Center, I-45 at Maxwell Street . . . . . . 178,000 819,000
Inwood Village, W. Little York at N. Houston-Rosslyn. . . . . 68,000 305,000
Jacinto City, Market at Baca. . . . . . . . . . . . . . . . . 24,000 * 67,000 *
Kingwood, Kingwood Dr. at Chestnut Ridge. . . . . . . . . . . 155,000 648,000
Landmark, Gessner at Harwin . . . . . . . . . . . . . . . . . 56,000 228,000
Lawndale, Lawndale at 75th St.. . . . . . . . . . . . . . . . 53,000 177,000
Little York Plaza, Little York at E. Hardy. . . . . . . . . . 118,000 486,000
Long Point, Long Point at Wirt (77%). . . . . . . . . . . . . 58,000 * 257,000 *
Lyons Avenue, Lyons at Shotwell . . . . . . . . . . . . . . . 68,000 179,000
Market at Westchase, Westheimer at Wilcrest . . . . . . . . . 84,000 333,000
Miracle Corners, S. Shaver at Southmore . . . . . . . . . . . 87,000 386,000
Northbrook, Northwest Fwy. at W. 34th . . . . . . . . . . . . 204,000 656,000
North Main Square, Pecore at N. Main. . . . . . . . . . . . . 18,000 64,000
Table continued on next page
Building
Name and Location Area Land Area
- -------------------------------------------------------------- --------- ----------
North Oaks, F.M. 1960 at Veterans Memorial . . . . . . . . . . 322,000 1,246,000
North Triangle, I-45 at F.M. 1960. . . . . . . . . . . . . . . 16,000 113,000
Northway, Northwest Fwy. at 34th . . . . . . . . . . . . . . . 212,000 793,000
Northwest Crossing, N.W. Fwy. at Hollister (75%) . . . . . . . 135,000 * 671,000 *
Northwest Park Plaza, F.M. 149 at Champions Forest . . . . . . 32,000 268,000
Oak Forest, W. 43rd at Oak Forest. . . . . . . . . . . . . . . 164,000 541,000
Orchard Green, Gulfton at Renwick. . . . . . . . . . . . . . . 74,000 273,000
Randall's/Cypress Station, F.M. 1960 at I-45 . . . . . . . . . 141,000 618,000
Randall's/El Dorado, El Dorado at Hwy. 3 . . . . . . . . . . . 119,000 429,000
Randall's/Kings Crossing, Kingwood Dr. at Lake Houston Pkwy. . 128,000 624,000
Randall's/Norchester, Grant at Jones . . . . . . . . . . . . . 109,000 475,000
Richmond Square, Richmond Ave. at W. Loop 610. . . . . . . . . 33,000 136,000
River Oaks, East, W. Gray at Woodhead. . . . . . . . . . . . . 71,000 206,000
River Oaks, West, W. Gray at S. Shepherd . . . . . . . . . . . 235,000 609,000
Sheldon Forest, North, I-10 at Sheldon . . . . . . . . . . . . 22,000 131,000
Sheldon Forest, South, I-10 at Sheldon . . . . . . . . . . . . 38,000 * 164,000 *
Shops at Three Corners, S. Main at Old Spanish Trail (70%) . . 183,000 * 803,000 *
Southgate, W. Fuqua at Hiram Clark . . . . . . . . . . . . . . 115,000 533,000
Spring Plaza, Hammerly at Campbell . . . . . . . . . . . . . . 56,000 202,000
Steeplechase, Jones Rd. at F.M. 1960 . . . . . . . . . . . . . 193,000 849,000
Stella Link, North, Stella Link at S. Braeswood (77%). . . . . 40,000 * 156,000 *
Stella Link, South, Stella Link at S. Braeswood. . . . . . . . 15,000 56,000
Studemont, Studewood at E. 14th St . . . . . . . . . . . . . . 28,000 91,000
Ten Blalock Square, I-10 at Blalock. . . . . . . . . . . . . . 97,000 321,000
10/Federal, I-10 at Federal. . . . . . . . . . . . . . . . . . 132,000 474,000
University Plaza, Bay Area at Space Center . . . . . . . . . . 96,000 424,000
The Village Arcade, University at Kirby. . . . . . . . . . . . 191,000 414,000
West Junction, Hwy. 6 at Keith Harrow Dr. . . . . . . . . . . 67,000 264,000
Westbury Triangle, Chimney Rock at W. Bellfort . . . . . . . . 67,000 257,000
Westchase, Westheimer at Wilcrest. . . . . . . . . . . . . . . 236,000 766,000
Westhill Village, Westheimer at Hillcroft. . . . . . . . . . . 131,000 480,000
Wilcrest Southwest, Wilcrest at Southwest Fwy. . . . . . . . . 26,000 78,000
TEXAS (EXCLUDING HOUSTON & HARRIS CO.), TOTAL. . . . . . . . . 6,246,000 26,820,000
McDermott Commons, McDermott at Custer Rd., Allen. . . . . . . 12,000 72,000
Bell Plaza, 45th Ave. at Bell St., Amarillo. . . . . . . . . . 144,000 682,000
Coronado, S.W. 34th St. at Wimberly Dr., Amarillo. . . . . . . 49,000 201,000
Grand Plaza, Interstate Hwy 40 at Grand Ave., Amarillo . . . . 157,000 637,000
Puckett Plaza, Bell Road, Amarillo . . . . . . . . . . . . . . 133,000 621,000
Spanish Crossroads, Bell St. at Atkinsen St., Amarillo . . . . 72,000 275,000
Wolflin Village, Wolflin Ave. at Georgia St., Amarillo . . . . 191,000 421,000
Brodie Oaks, South Lamar Blvd. at Loop 360, Austin . . . . . . 245,000 1,050,000
Southridge Plaza, William Cannon Dr. at S. 1st St., Austin . . 143,000 565,000
Baywood, State Hwy. 60 at Baywood Dr., Bay City. . . . . . . . 40,000 169,000
Calder, Calder at 24th St., Beaumont . . . . . . . . . . . . . 34,000 129,000
North Park Plaza, Eastex Fwy. at Dowlen, Beaumont. . . . . . . 70,000 * 318,000 *
Phelan West, Phelan at 23rd St., Beaumont (67%). . . . . . . . 16,000 * 59,000 *
Southgate, Calder Ave. at 6th St., Beaumont. . . . . . . . . . 34,000 118,000
Westmont, Dowlen at Phelan, Beaumont . . . . . . . . . . . . . 95,000 507,000
Bryan Village, Texas at Pease, Bryan . . . . . . . . . . . . . 29,000 98,000
Parkway Square, Southwest Pkwy at Texas Ave., College Station. 158,000 685,000
Table continued on next page
Building
Name and Location Area Land Area
- -------------------------------------------------------------------- --------- ---------
Montgomery Plaza, Loop 336 West at I-45, Conroe. . . . . . . . . . . 315,000 1,156,000
River Pointe, I-45 at Loop 336, Conroe . . . . . . . . . . . . . . . 42,000 329,000
Moore Plaza, S. Padre Island Dr. at Staples, Corpus Christi. . . . . 360,000 1,492,000
Portairs, Ayers St. at Horne Rd., Corpus Christi . . . . . . . . . . 121,000 416,000
Dickinson, I-45 at F.M. 517, Dickinson (72%) . . . . . . . . . . . . 55,000 * 225,000 *
Coronado Hills, Mesa at Balboa, El Paso. . . . . . . . . . . . . . . 127,000 575,000
Southcliff, I-20 at Grandbury Rd., Ft. Worth . . . . . . . . . . . . 116,000 568,000
Broadway, Broadway at 59th St., Galveston (77%). . . . . . . . . . . 58,000 * 167,000 *
Galveston Place, Central City Blvd. at 61st St., Galveston . . . . . 206,000 828,000
Food King Place, 25th St. at Avenue P, Galveston . . . . . . . . . . 28,000 78,000
Fiesta, Belt Line Rd. at Marshall Dr., Grand Prairie . . . . . . . . 32,000 236,000
Cedar Bayou, Bayou Rd., La Marque. . . . . . . . . . . . . . . . . . 15,000 51,000
Corum South, I-45 at F.M. 518, League City . . . . . . . . . . . . . 112,000 680,000
Caprock Center, 50th at Boston Ave., Lubbock . . . . . . . . . . . . 375,000 1,255,000
Central Plaza, Loop 289 at Slide Rd., Lubbock. . . . . . . . . . . . 152,000 529,000
Town & Country, 4th St. at University, Lubbock . . . . . . . . . . . 134,000 339,000
Angelina Village, Hwy. 59 at Loop 287, Lufkin. . . . . . . . . . . . 254,000 1,835,000
Independence Plaza, Town East Blvd., Mesquite. . . . . . . . . . . . 179,000 787,000
McKinney Centre, US Hwy 380 at U.S.Hwy 75, McKinney . . . . . . . . 27,000 145,000
Murphy Crossing, F.M. 544 at Murphy Rd., Murphy. . . . . . . . . . . 8,000 71,000
University Park Plaza, University Dr. at E. Austin St., Nacogdoches. 78,000 283,000
Mid-County, Twin Cities Hwy. at Nederland Ave., Nederland. . . . . . 107,000 611,000
Gillham Circle, Gillham Circle at Thomas, Port Arthur. . . . . . . . 33,000 94,000
Village, 9th Ave. at 25th St., Port Arthur (77%) . . . . . . . . . . 39,000 * 185,000 *
Porterwood, Eastex Fwy. at F.M. 1314, Porter . . . . . . . . . . . . 99,000 487,000
Plaza, Ave. H at U.S. Hwy. 90A, Rosenberg. . . . . . . . . . . . . . 41,000 * 135,000 *
Rose-Rich, U.S. Hwy. 90A at Lane Dr., Rosenberg. . . . . . . . . . . 104,000 386,000
Bandera Village, Bandera at Hillcrest, San Antonio . . . . . . . . . 57,000 607,000
Oak Park Village, Nacogdoches at New Braunfels, San Antonio. . . . . 65,000 221,000
Parliament Square, W. Ave. at Blanco, San Antonio. . . . . . . . . . 65,000 260,000
San Pedro Court, San Pedro at Hwy. 281N., San Antonio. . . . . . . . 2,000 18,000
Valley View, West Ave. at Blanco Rd., San Antonio. . . . . . . . . . 89,000 341,000
Market at Town Center, Town Center Blvd., Sugar Land . . . . . . . . 392,000 1,732,000
Williams Trace, Hwy. 6 at Williams Trace, Sugar Land . . . . . . . . 263,000 1,187,000
New Boston Road, New Boston at Summerhill, Texarkana . . . . . . . . 97,000 335,000
Island Market Place, 6th St. at 9th Ave., Texas City . . . . . . . . 27,000 90,000
Mainland, Hwy. 1765 at Hwy. 3, Texas City. . . . . . . . . . . . . . 69,000 279,000
Palmer Plaza, F.M. 1764 at 34th St., Texas City. . . . . . . . . . . 97,000 367,000
Broadway, S. Broadway at W. 9th St., Tyler (77%) . . . . . . . . . . 46,000 * 197,000 *
Crossroads, I-10 at N. Main, Vidor . . . . . . . . . . . . . . . . . 116,000 516,000
Watauga Towne Center, Hwy. 377 at Bursey Rd., Watauga. . . . . . . . 22,000 120,000
LOUISIANA, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . 1,343,000 5,504,000
Park Terrace, U.S. Hwy. 171 at Parish, DeRidder. . . . . . . . . . . 137,000 520,000
Town & Country Plaza, U.S. Hwy. 190 West, Hammond. . . . . . . . . . 215,000 915,000
Westwood Village, W. Congress at Bertrand, Lafayette . . . . . . . . 141,000 942,000
East Town, 3rd Ave. at 1st St., Lake Charles . . . . . . . . . . . . 33,000 * 117,000 *
14/Park Plaza, Hwy. 14 at General Doolittle, Lake Charles. . . . . . 207,000 654,000
Kmart Plaza, Ryan St., Lake Charles. . . . . . . . . . . . . . . . . 105,000 * 406,000 *
Southgate, Ryan at Eddy, Lake Charles. . . . . . . . . . . . . . . . 171,000 628,000
Danville Plaza, Louisville at 19th, Monroe . . . . . . . . . . . . . 143,000 539,000
Table continued on next page
Building
Name and Location Area Land Area
- -------------------------------------------------------------------- --------- ----------
LOUISIANA, (CONT'D.)
Orleans Station, Paris, Robert E. Lee at Chatham, New Orleans. . . . 5,000 31,000
Southgate, 70th at Mansfield, Shreveport . . . . . . . . . . . . . . 73,000 359,000
Westwood, Jewella at Greenwood, Shreveport . . . . . . . . . . . . . 113,000 393,000
NEVADA, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,091,000 4,397,000
Francisco Centre, E. Desert Inn Rd. at S. Eastern Ave., Las Vegas. . 116,000 639,000
Mission Center, Flamingo Rd. at Maryland Pkwy, Las Vegas . . . . . . 152,000 570,000
Paradise Marketplace, Flamingo Rd. at Sandhill, Las Vegas. . . . . . 149,000 536,000
Rainbow Plaza, Rainbow Blvd. at Charleston Blvd., Las Vegas. . . . . 280,000 1,062,000
Rancho Towne & Country, Rancho Dr. at Charleston Blvd., Las Vegas. . 87,000 350,000
Tropicana Marketplace, Tropicana at Jones Blvd., Las Vegas . . . . . 143,000 519,000
College Park, E. Lake Mead Blvd. at Civic Ctr. Dr., North Las Vegas. 164,000 721,000
ARIZONA, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,058,000 4,733,000
Palmilla Center, Dysart Rd. at McDowell Rd., Avondale. . . . . . . . 6,000 31,000
University Plaza, Plaza Way at Milton Rd., Flagstaff . . . . . . . . 166,000 918,000
Arrowhead Festival, 75th Ave. at W. Bell Rd., Glendale . . . . . . . 26,000 157,000
Camelback Village Square, Camelback at 7th Avenue, Phoenix . . . . . 135,000 543,000
Squaw Peak Plaza, 16th Street at Glendale Ave., Phoenix. . . . . . . 61,000 220,000
Rancho Encanto, 35th Avenue at Greenway Rd., Phoenix . . . . . . . . 71,000 259,000
Fountain Plaza, 77th St. at McDowell, Scottsdale . . . . . . . . . . 112,000 460,000
Broadway Marketplace, Broadway at Rural, Tempe . . . . . . . . . . . 86,000 347,000
Fry's Valley Plaza, S. McClintock at E. Southern, Tempe. . . . . . . 145,000 570,000
Pueblo Anozira, McClintock Dr. at Guadalupe Rd., Tempe . . . . . . . 152,000 769,000
Desert Square Shopping Center, Golf Links at Kolb, Tucson. . . . . . 98,000 459,000
NEW MEXICO, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . 893,000 3,787,000
Eastdale, Candelaria Rd. at Eubank Blvd., Albuquerque. . . . . . . . 111,000 601,000
North Towne Plaza, Academy Rd. at Wyoming Blvd., Albuquerque . . . . 103,000 607,000
Valle del Sol, Isleta Blvd. at Rio Bravo, Albuquerque. . . . . . . . 106,000 475,000
Wyoming Mall, Academy Rd. at Northeastern, Albuquerque . . . . . . . 326,000 1,309,000
DeVargas, N. Guadalupe at Paseo de Peralta, Santa Fe . . . . . . . . 247,000 795,000
OKLAHOMA, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . 702,000 3,173,000
Bryant Square, Bryant Ave. at 2nd St., Edmond. . . . . . . . . . . . 282,000 1,259,000
Market Boulevard, E. Reno Ave. at N. Douglas Ave., Midwest City. . . 36,000 142,000
Town & Country, Reno Ave at North Air Depot, Midwest City. . . . . . 138,000 540,000
Windsor Hills Center, Meridian at Windsor Place, Oklahoma City . . . 246,000 1,232,000
ARKANSAS, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . 596,000 2,322,000
Evelyn Hills, College Ave. at Abshier, Fayetteville. . . . . . . . . 154,000 750,000
Broadway Plaza, Broadway at W. Roosevelt, Little Rock. . . . . . . . 43,000 148,000
Geyer Springs, Geyer Springs at Baseline, Little Rock. . . . . . . . 153,000 414,000
Markham Square, W. Markham at John Barrow, Little Rock . . . . . . . 134,000 535,000
Markham West, 11400 W. Markham, Little Rock (35%). . . . . . . . . . 62,000 * 269,000 *
Westgate, Cantrell at Bryant, Little Rock. . . . . . . . . . . . . . 50,000 206,000
Table continued on next page
Building
Name and Location Area Land Area
- ---------------------------------------------------------------- --------- ----------
KANSAS, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . 466,000 2,231,000
West State Plaza, State Ave. at 78th St., Kansas City. . . . . . 94,000 401,000
Westbrooke Village, Quivira Road at 75th St., Shawnee. . . . . . 237,000 1,269,000
Shawnee Village, Shawnee Mission Pkwy. at Quivera Rd., Shawnee . 135,000 561,000
MISSOURI, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . 338,000 1,101,000
Ballwin Plaza, Manchester Rd. at Vlasis Dr., Ballwin . . . . . . 203,000 653,000
PineTree Plaza, U.S. Hwy. 50 at Hwy. 291, Lee's Summit . . . . . 135,000 448,000
FLORIDA, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . 316,000 1,394,000
Pembroke Commons, University at Pines Blvd., Pembroke Pines. . . 316,000 1,394,000
COLORADO, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . 217,000 902,000
Carefree, Academy Blvd. at N. Carefree Circle, Colorado Springs. 127,000 460,000
Academy Place, Academy Blvd. at Union Blvd., Colorado Springs. . 84,000 407,000
Gold Creek Center, Hwy. 86 at Elizabeth St., Elizabeth . . . . . 6,000 * 35,000 *
MAINE, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . 124,000 482,000
The Promenade, Essex at Summit, Lewiston . . . . . . . . . . . . 124,000 * 482,000 *
ILLINOIS, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . 93,000 464,000
Lincoln Place Centre, Hwy. 59, Fairview Heights (99%). . . . . . 93,000 * 464,000 *
TENNESSEE, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . 20,000 84,000
Highland Square, Summer at Highland, Memphis . . . . . . . . . . 20,000 84,000
Building
INDUSTRIAL Area Land Area
- ---------------------------------------------------------------- --------- ----------
HOUSTON AND HARRIS COUNTY, TOTAL . . . . . . . . . . . . . . . . 3,330,000 9,537,000
Beltway 8 Business Park, Beltway 8 at Petersham Dr.. . . . . . . 52,000 166,000
Blankenship Building, Kempwood Drive . . . . . . . . . . . . . . 59,000 175,000
Brookhollow Business Center, Dacoma at Directors Row . . . . . . 133,000 405,000
Cannon/So. Loop Business Park, Cannon Street (20%) . . . . . . . 59,000 * 96,000 *
Central Park North, W. Hardy Rd. at Kendrick Dr. . . . . . . . . 155,000 466,000
Central Park Northwest VI, Central Pkwy. at Dacoma . . . . . . . 175,000 518,000
Central Park Northwest VII, Central Pkwy. at Dacoma. . . . . . . 103,000 283,000
Claywood Industrial Park, Clay at Hollister. . . . . . . . . . . 330,000 1,761,000
Crosspoint Warehouse, Crosspoint . . . . . . . . . . . . . . . . 73,000 179,000
Jester Plaza, West T.C. Jester . . . . . . . . . . . . . . . . . 101,000 244,000
Kempwood Industrial, Kempwood Dr. at Blankenship Dr. . . . . . . 113,000 327,000
Kempwood Industrial, Kempwood Dr. at Blankenship Dr. (20%) . . . 42,000 * 106,000 *
Lathrop Warehouse, Lathrop St. at Larimer St. (20%). . . . . . . 51,000 * 87,000 *
Levitz Furniture Warehouse, Loop 610 South . . . . . . . . . . . 184,000 450,000
Little York Mini-Storage, West Little York . . . . . . . . . . . 32,000 * 124,000 *
Navigation Business Park, Navigation at N. York (20%). . . . . . 47,000 * 111,000 *
Northway Park II, Loop 610 East at Homestead (20%) . . . . . . . 61,000 * 149,000 *
Park Southwest, Stancliff at Brooklet. . . . . . . . . . . . . . 52,000 160,000
Table continued on next page
Building
Name and Location Area Land Area
- -------------------------------------------------------------------- --------- -----------
HOUSTON AND HARRIS COUNTY, (CONT'D)
Railwood Industrial Park, Mesa at U.S. 90. . . . . . . . . . . . . . 616,000 1,651,000
Railwood Industrial Park, Mesa at U.S. 90 (20%). . . . . . . . . . . 99,000 * 213,000 *
South Loop Business Park, S. Loop at Long Dr.. . . . . . . . . . . . 46,000 * 103,000 *
Southport Business Park 5, South Loop 610. . . . . . . . . . . . . . 157,000 358,000
Southwest Park II, Rockley Road. . . . . . . . . . . . . . . . . . . 68,000 216,000
Stonecrest Business Center, Wilcrest at Fallstone. . . . . . . . . . 111,000 308,000
West-10 Business Center, Wirt Rd. at I-10. . . . . . . . . . . . . . 141,000 331,000
West-10 Business Center II, Wirt Rd. at I-10 . . . . . . . . . . . . 83,000 149,000
West Loop Commerce Center, W. Loop N. at I-10. . . . . . . . . . . . 34,000 91,000
610 and 11th St. Warehouse, Loop 610 at 11th St. . . . . . . . . . . 105,000 202,000
610 and 11th St. Warehouse, Loop 610 at 11th St. (20%) . . . . . . . 48,000 * 108,000 *
TEXAS (EXCLUDING HOUSTON & HARRIS CO.), TOTAL. . . . . . . . . . . . 2,197,000 5,085,000
Randol Mill Place, Randol Mill Road, Arlington . . . . . . . . . . . 55,000 178,000
Corporate Center I & II, Putnam Dr. at Research Blvd., Austin. . . . 117,000 326,000
Southpoint Service Center, Burleson at Promontory Point Dr., Austin. 54,000 234,000
Walnut Creek Office Park, Cameron Rd., Austin. . . . . . . . . . . . 34,000 122,000
Wells Branch Corporate Center, Wells Branch Pkwy., Austin. . . . . . 60,000 183,000
Midway Business Center, Midway at Boyington, Carrollton. . . . . . . 142,000 309,000
River Pointe Mini-Storage, I-45 at Hwy. 336, Conroe. . . . . . . . . 32,000 * 97,000 *
Manana Office Center, I-35 at Manana, Dallas . . . . . . . . . . . . 223,000 473,000
Newkirk Service Center, Newkirk near N.W. Hwy., Dallas . . . . . . . 106,000 223,000
Northaven Business Center, Northaven Rd., Dallas . . . . . . . . . . 151,000 178,000
Northeast Crossing Off/Svc Ctr., East N.W. Hwy. at Shiloh, Dallas. . 79,000 199,000
Northwest Crossing Off/Svc Ctr., N.W. Hwy. at Walton Walker, Dallas. 127,000 290,000
Redbird Distribution Center, Joseph Hardin Drive, Dallas . . . . . . 111,000 234,000
Regal Distribution Center, Leston Avenue, Dallas . . . . . . . . . . 203,000 318,000
Space Center Industrial Park, Pulaski St. at Irving Blvd., Dallas. . 265,000 426,000
Walnut Trails Business Park, Walnut Hill Lane, Dallas. . . . . . . . 103,000 311,000
DFW-Port America, Port America Place, Grapevine. . . . . . . . . . . 45,000 110,000
Jupiter Service Center, Jupiter near Plano Pkwy., Plano. . . . . . . 78,000 234,000
Sherman Plaza Business Park, Sherman at Phillips, Richardson . . . . 100,000 312,000
Nasa One Business Center, Nasa Road One at Hwy. 3, Webster . . . . . 112,000 328,000
TENNESSEE, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . 679,000 1,470,000
Southwide Warehouse # 2, Federal Compress Ind. Pk., Memphis. . . . . 124,000 302,000
Southwide Warehouse # 3, Federal Compress Ind. Pk., Memphis. . . . . 112,000 209,000
Southwide Warehouse # 4, Federal Compress Ind. Pk., Memphis. . . . . 120,000 220,000
Thomas Street Warehouse, N. Thomas Street, Memphis . . . . . . . . . 164,000 423,000
Crowfarn Drive Warehouse, Crowfarn Dr. at Getwell Rd., Memphis . . . 159,000 316,000
NEVADA, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,000 162,000
East Sahara Off/Svc Ctr., E. Sahara Blvd., Las Vegas . . . . . . . . 66,000 162,000
Table continued on next page
Building
Name and Location Area Land Area
- -------------------------------------------------------------------- --------- ----------
OFFICE BUILDING
HOUSTON & HARRIS COUNTY, TOTAL . . . . . . . . . . . . . . . . . . . 121,000 171,000
Citadel Plaza, N. Loop 610 at Citadel Plaza Dr.. . . . . . . . . . . 121,000 171,000
MULTI-FAMILY RESIDENTIAL
TEXAS (EXCLUDING HOUSTON & HARRIS CO.), TOTAL. . . . . . . . . . . . 236,000 595,000
River Pointe Drive at I-45, Conroe . . . . . . . . . . . . . . . . . 236,000 595,000
UNIMPROVED LAND
HOUSTON & HARRIS COUNTY, TOTAL . . . . . . . . . . . . . . . . . . . 3,875,000
Beltway 8 at W. Belfort. . . . . . . . . . . . . . . . . . . . . . . 333,000
Bissonnet at Wilcrest. . . . . . . . . . . . . . . . . . . . . . . . 773,000
Citadel Plaza at 610 N. Loop . . . . . . . . . . . . . . . . . . . . 137,000
East Orem. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122,000
Kirkwood at Dashwood Dr. . . . . . . . . . . . . . . . . . . . . . . 322,000
Lockwood at Navigation . . . . . . . . . . . . . . . . . . . . . . . 163,000
Mesa Rd. at Tidwell. . . . . . . . . . . . . . . . . . . . . . . . . 901,000
Mowery at Cullen . . . . . . . . . . . . . . . . . . . . . . . . . . 118,000
Northwest Fwy. at Gessner. . . . . . . . . . . . . . . . . . . . . . 484,000
Redman at W. Denham. . . . . . . . . . . . . . . . . . . . . . . . . 17,000
Sheldon at I-10. . . . . . . . . . . . . . . . . . . . . . . . . . . 19,000
W. Little York at I-45 . . . . . . . . . . . . . . . . . . . . . . . 322,000
W. Little York at N. Houston-Rosslyn . . . . . . . . . . . . . . . . 19,000
W. Loop N. at I-10 . . . . . . . . . . . . . . . . . . . . . . . . . 145,000
TEXAS (EXCLUDING HOUSTON & HARRIS CO.), TOTAL. . . . . . . . . . . . 1,657,000
McDermott Drive at Custer Rd., Allen . . . . . . . . . . . . . . . . 297,000
Phelan Blvd., Beaumont . . . . . . . . . . . . . . . . . . . . . . . 63,000
US Hwy 380 (University Drive) and US Hwy 75, McKinney. . . . . . . . 189,000
F.M. 544 at Murphy Rd., Murphy . . . . . . . . . . . . . . . . . . . 293,000
River Pointe Dr. at I-45, Conroe . . . . . . . . . . . . . . . . . . 186,000
Hillcrest, Sunshine at Quill, San Antonio. . . . . . . . . . . . . . 171,000
Hwy. 3 at Hwy. 1765, Texas City. . . . . . . . . . . . . . . . . . . 184,000
Hwy 377 at Bursey Road, Watauga. . . . . . . . . . . . . . . . . . . 274,000
LOUISIANA, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . 1,480,000
U.S. Hwy. 171 at Parish, DeRidder. . . . . . . . . . . . . . . . . . 462,000
Ambassador Caffery Pkwy. at Congress St., Lafayette. . . . . . . . . 196,000
Woodland Hwy., Plaquemines Parish (5%) . . . . . . . . . . . . . . . 822,000 *
Table continued on next page
Building
Name and Location Area Land Area
- -------------------------------------------------------------------- --------- ----------
UNIMPROVED LAND (CONT'D.)
ARIZONA, TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . 606,000
Dysart Rd. at McDowell Rd., Avondale . . . . . . . . . . . . . . . . 240,000
Warner Rd. at Val Vista, Gilbert . . . . . . . . . . . . . . . . . . 366,000
COLORADO, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . 507,000
Jordan Rd. at Lincoln Ave., Parker (38%) . . . . . . . . . . . . . . 326,000 *
Smokey Hill Rd. at S. Picadilly St. , Aurora . . . . . . . . . . . . 136,000 *
Hwy. 86 at Elizabeth St., Elizabeth. . . . . . . . . . . . . . . . . 45,000 *
ILLINOIS, TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . 34,000
Lincoln Place Centre, SBI Rt. 159 at Matilda , Fairview Heights (99%) 34,000 *
Table continued on next page
Building
Name and Location Area Land Area
- -------------------------------------------------------------------- ---------- -----------
ALL PROPERTIES-BY LOCATION
GRAND TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,779,000 112,293,000
Houston & Harris County. . . . . . . . . . . . . . . . . . . . . . . 11,098,000 43,303,000
Texas (excluding Houston & Harris County). . . . . . . . . . . . . . 8,679,000 34,157,000
Louisiana. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,343,000 6,984,000
Nevada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,157,000 4,559,000
Arizona. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,058,000 5,339,000
New Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 893,000 3,787,000
Oklahoma . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 702,000 3,173,000
Tennessee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 699,000 1,554,000
Arkansas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 596,000 2,322,000
Kansas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 466,000 2,231,000
Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338,000 1,101,000
Florida. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 316,000 1,394,000
Colorado . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217,000 1,409,000
Maine. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124,000 482,000
Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93,000 498,000
ALL PROPERTIES-BY CLASSIFICATION
GRAND TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,779,000 112,293,000
Shopping Centers . . . . . . . . . . . . . . . . . . . . . . . . . . 21,150,000 87,114,000
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,272,000 16,254,000
Multi-Family Residential . . . . . . . . . . . . . . . . . . . . . . 236,000 595,000
Office Building. . . . . . . . . . . . . . . . . . . . . . . . . . . 121,000 171,000
Unimproved Land. . . . . . . . . . . . . . . . . . . . . . . . . . . 8,159,000
Note: Total square footage includes 8,041,000 square feet of land leased and
450,000 square feet of building leased from others.
* Denotes partial ownership. WRI's interest is 50% except where noted.
The square feet figures represent WRI's proportionate ownership of
the entire property.
General. In 1999, no single property accounted for more than 2.9% of WRI's
total assets or 2.6% of gross revenues. Four properties, in the aggregate,
represented approximately 9.27% of our gross revenues for the year ended
December 31, 1999; otherwise, none of the remaining properties accounted for
more than 1.9% of our gross revenues during the same period. The weighted
average occupancy rate for all of our improved properties as of December 31,
1999 was 91.3%.
Substantially all of our properties are owned directly by WRI (subject in
some cases to mortgages), although our interests in some properties are held
indirectly through interests in joint ventures or under long-term leases. In
our opinion, our properties are well maintained and in good repair, suitable for
their intended uses, and adequately covered by insurance.
Shopping Centers. As of December 31, 1999, WRI owned or operated under
long-term leases, either directly or through its interests in joint ventures,
187 shopping centers with approximately 21.1 million square feet of building
area. The shopping centers were located predominantly in Texas with other
locations in Louisiana, Arizona, Nevada, Arkansas, New Mexico, Oklahoma,
Tennessee, Kansas, Colorado, Missouri, Illinois, Florida and Maine.
WRI's shopping centers are primarily community shopping centers which range
in size from 100,000 to 400,000 square feet, as distinguished from small strip
centers which generally contain 5,000 to 25,000 square feet and from large
regional enclosed malls which generally contain over 500,000 square feet. Most
of the centers do not have climatized common areas but are designed to allow
retail customers to park their automobiles in close proximity to any retailer in
the center. Our centers are customarily constructed of masonry, steel and glass
and all have lighted, paved parking areas which are typically landscaped with
berms, trees and shrubs. They are generally located at major intersections in
close proximity to neighborhoods which have existing populations sufficient to
support retail activities of the types conducted in our centers.
We have approximately 4,200 separate leases with 3,300 different tenants,
including national and regional supermarket chains, drug stores, discount
department stores, junior department stores, other nationally or regionally
known stores and a great variety of other regional and local retailers. The
large number of locations offered by WRI and the types of traditional anchor
tenants help attract prospective new tenants. Some of the national and regional
supermarket chains which are tenants in our centers include Albertson's, Fiesta,
Smith's, H.E.B., Kroger Company, Randall's Food Markets, Fry's Food Stores and
Safeway. In addition to these supermarket chains, WRI's nationally and
regionally known retail store tenants include Eckerd, Walgreen and Osco
drugstores; Kmart discount stores; Bealls, Palais Royal and Weiner's junior
department stores; Marshall's, Office Depot, Office Max, Babies 'R' Us, Ross,
Stein Mart and T.J. Maxx off-price specialty stores; Luby's, Piccadilly and
Furr's cafeterias; Academy sporting goods; FAO Schwarz toy store; Cost Plus
Imports; Linens 'N Things; Barnes & Noble bookstore; Home Depot; CompUSA; and
the following restaurant chains: Arby's, Burger King, Champ's, Church's Fried
Chicken, Dairy Queen, Domino's, Jack-in-the-Box, CiCi Pizza, Long John Silver's,
McDonald's, Olive Garden, Outback Steakhouse, Pizza Hut, Shoney's, Steak & Ale,
Taco Bell and Whataburger. We also lease space in 3,000 to 10,000 square foot
areas to national chains such as the Limited Store, The Gap, One Price Stores,
Eddie Bauer and Radio Shack.
WRI's shopping center leases have lease terms generally ranging from three
to five years for tenant space under 5,000 square feet and from 10 to 35 years
for tenant space over 10,000 square feet. Leases with primary lease terms in
excess of 10 years, generally for anchor and out-parcels, frequently contain
renewal options which allow the tenant to extend the term of the lease for one
or more additional periods, with each of these periods generally being of a
shorter duration than the primary lease term. The rental rates paid during a
renewal period are generally based upon the rental rate for the primary term,
sometimes adjusted for inflation or for the amount of the tenant's sales during
the primary term.
Most of our leases provide for the monthly payment in advance of fixed
minimum rentals, the tenants' pro rata share of ad valorem taxes, insurance
(including fire and extended coverage, rent insurance and liability insurance)
and common area maintenance for the center (based on estimates of the costs for
these items). They also provide for the payment of additional rentals based on
a percentage of the tenants' sales. Utilities are generally paid directly
by tenants except where common metering exists with respect to a center. In
this case, WRI makes the payments for the utilities and is reimbursed
by the tenants on a monthly basis. Generally, our leases prohibit the
tenant from assigning or subletting its space. They also require the tenant
to use its space for the purpose designated in its lease agreement and to
operate its business on a continuous basis. Some of the lease agreements with
major tenants contain modifications of these basic provisions in view of the
financial condition, stability or desirability of those tenants. Where a tenant
is granted the right to assign its space, the lease agreement generally provides
that the original lessee will remain liable for the payment of the lease
obligations under that lease agreement.
During 1999, we added approximately 2.8 million square feet to our
portfolio of properties through acquisitions and another .4 million square feet
of space through development. Regarding the retail portfolio, we purchased
three anchored shopping centers in Texas, a supermarket-anchored retail center
in Florida and a building adjacent to one of our shopping centers in Houston,
Texas. We also purchased our joint venture partner's 77% interest in a shopping
center in Santa Fe, New Mexico and executed a lease on a retail center in
Ballwin, Missouri, a suburb of St. Louis. These transactions increased our
retail portfolio by 1.4 million square feet of building area and represent an
investment of $107.3 million.
With respect to new development, construction was completed on .1 million
square feet of retail space. WRI currently has seven retail centers under
development and has investments in three additional retail centers in joint
ventures with our Denver-based development partner.
Industrial Properties. At December 31, 1999, WRI owned a total of 50
industrial projects. During 1999, we purchased twelve facilities, including
seven facilities in the Dallas/Fort Worth metroplex and our first industrial
project in Las Vegas, Nevada. We also acquired three buildings in Austin, Texas,
and one facility in Houston, Texas. These projects added 1.4 million square
feet to the industrial portfolio and represent an investment of $43.2 million.
During 1999, WRI completed the development of one 52,500 square foot
building of a three-building office/service facility in Houston, Texas. The
remaining two buildings are currently under development.
In December 1999, WRI sold seven industrial properties totaling 2.0 million
square feet of building area to a joint venture in which we retained a 20%
ownership interest, with the other 80% purchased by American National Insurance
Company.
Office Building. We own a seven-story, 121,000 square foot masonry office
building with a detached, covered, three-level parking garage situated on
171,000 square feet of land fronting on North Loop 610 West in Houston. The
building serves as our headquarters. Other than WRI, the major tenant of the
building is Bank of America, which currently occupies 9% of the office space.
Multi-family Residential Properties. WRI completed development of a
260-unit luxury apartment complex within a multi-use master-planned project we
developed in a suburb north of Houston. An unrelated Houston-based multi-family
operator manages the property on our behalf.
Unimproved Land. At December 31, 1999, WRI owned, directly or through its
interest in a joint venture, 31 parcels of unimproved land aggregating
approximately 8.2 million square feet of land area located in Texas, Louisiana,
Arizona, Colorado and Illinois. These properties include approximately 2.6
million square feet of land adjacent to certain of our existing developed
properties, which may be used for expansion of these developments, as well as
approximately 5.6 million square feet of land, which may be used for new
development. Almost all of these unimproved properties are served by roads and
utilities and are ready for development. Most of these parcels are suitable for
development as shopping centers or industrial projects, and WRI intends to
emphasize the development of these parcels for such purpose.
In December 1999, WRI and WRI Holdings, Inc., an affiliated company, sold
28.5 acres and 102.6 acres, respectively, of undeveloped land to American
National Insurance Company with WRI retaining the right to co-develop this land
with American National.
ITEM 3. LEGAL PROCEEDINGS
There are no material pending legal proceedings, other than ordinary
routine litigation incidental to its business or litigation we believe is
substantially covered by insurance, to which WRI is a party or to which any of
its properties are subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS
None.
EXECUTIVE OFFICERS OF THE REGISTRANT
The following table sets forth certain information with respect to the
executive officers of WRI as of February 22, 2000. All executive officers of
WRI are elected annually by our Board of Trust Managers and serve until the
successors are elected and qualified.
Name Age Position
Stanford Alexander. . . . . . . 71 Chairman/Chief Executive Officer
Martin Debrovner. . . . . . . . 63 Vice Chairman
Andrew M. Alexander . . . . . . 43 President
Joseph W. Robertson, Jr.. . . . 52 Executive Vice President/Chief Financial Officer
Stephen C. Richter. . . . . . . 45 Senior Vice President/Financial
Administration and Treasurer
Mr. S. Alexander is WRI's Chairman and its Chief Executive Officer. He has
been employed by WRI since 1955 and has served in his present capacity since
January 1, 1993. Prior to becoming Chairman, Mr. Alexander served as President
and Chief Executive Officer of WRI since 1962. Mr. Alexander is President,
Chief Executive Officer and a Trust Manager of Weingarten Properties Trust.
Mr. Debrovner became Vice Chairman of WRI on February 25, 1997. Prior to
assuming such position, Mr. Debrovner served as President and Chief Operating
Officer since January 1, 1993. Mr. Debrovner served as President of Weingarten
Realty Management Company since WRI's reorganization in December 1984. Prior to
such time, Mr. Debrovner was an employee of WRI for 17 years, holding the
positions of Senior Vice President from 1980 until March 1984 and Executive Vice
President until December 1984. As Executive Vice President, Mr. Debrovner was
generally responsible for WRI's operations. Mr. Debrovner is also a Trust
Manager of Weingarten Properties Trust.
Mr. A. Alexander became President of WRI on February 25, 1997. Prior to
his present position, Mr. Alexander was Executive Vice President/Asset
Management of WRI and President of Weingarten Realty Management Company. Prior
to such time, Mr. Alexander was Senior Vice President/Asset Management of the
Management Company. He also served as Vice President of the Management Company
and, prior to WRI's reorganization in December 1984, was Vice President and an
employee of WRI since 1978. Mr. Alexander has been primarily involved with
leasing operations at both WRI and the Management Company. Mr. Alexander is
also a Trust Manager of Weingarten Properties Trust and a Director of Academy
Sports and Outdoors, Inc.
Mr. Robertson became Executive Vice President of WRI and its Chief
Financial Officer on January 1, 1993. Prior to becoming Executive Vice
President, Mr. Robertson served as Senior Vice President and Chief Financial
Officer since 1980. He has been with WRI since 1971. Mr. Robertson is also a
Trust Manager of Weingarten Properties Trust.
Mr. Richter became Senior Vice President/Financial Administration and
Treasurer on January 1, 1997. Prior to his present position, Mr. Richter served
as Vice President/Financial Administration and Treasurer of WRI since January 1,
1993. For the five years prior to that time, he served as Vice
President/Financial Administration and Treasurer of the Management Company.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON SHARES OF BENEFICIAL INTEREST AND
RELATED SHAREHOLDER MATTERS
WRI's common shares are listed and traded on the New York Stock Exchange under
the symbol "WRI". The number of holders of record of our common shares as of
February 22, 2000 was 3,324. The high and low sale prices per share of our
common shares, as reported on the New York Stock Exchange composite tape, and
dividends per share paid for the fiscal quarters indicated were as follows:
HIGH LOW DIVIDENDS
--------- --------- ---------
1999:
Fourth. . . $ 39 3/8 $ 37 $ 0.71
Third . . . 42 7/16 37 1/4 0.71
Second. . . 43 7/16 38 1/4 0.71
First . . . 45 5/8 38 3/8 0.71
1998:
Fourth. . . $ 46 7/8 $ 39 3/4 $ 0.67
Third . . . 43 35 15/16 0.67
Second. . . 44 15/16 40 5/8 0.67
First . . . 45 5/8 43 7/8 0.67
ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth selected consolidated financial data with respect
to WRI and should be read in conjunction with "Item 7. Management's Discussion
and Analysis of Financial Condition and Results of Operations," the Consolidated
Financial Statements and accompanying Notes in "Item 8. Financial Statements and
Supplementary Data" and the financial schedules included elsewhere in this Form
10-K.
(Amounts in thousands, except per share amounts)
Years Ended December 31,
1999 1998 1997 1996 1995
----------- ----------- ----------- --------- ---------
Revenues (primarily real estate rentals). $ 230,469 $ 198,467 $ 174,512 $151,123 $134,197
----------- ----------- ----------- --------- ---------
Expenses:
Depreciation and amortization . . . . 49,612 41,946 37,976 33,769 30,060
Interest. . . . . . . . . . . . . . . 33,186 33,654 30,009 21,975 16,707
Other . . . . . . . . . . . . . . . . 71,947 61,995 54,888 47,004 42,614
----------- ----------- ----------- --------- ---------
Total. . . . . . . . . . . . . . 154,745 137,595 122,873 102,748 89,381
----------- ----------- ----------- --------- ---------
Income before gain (loss) on sales of
property and securities and
extraordinary charge. . . . . . . . . . 75,724 60,872 51,639 48,375 44,816
Gain (loss) on sales of property and
securities. . . . . . . . . . . . . . . 20,596 885 3,327 5,563 (14)
----------- ----------- ----------- --------- ---------
Income before extraordinary charge. . . . 96,320 61,757 54,966 53,938 44,802
Extraordinary charge (early retirement
of debt) . . . . . . . . . . . . . . . (190) (1,392)
----------- ----------- ----------- --------- ---------
Net income . . . . . . . . . . . . . . . $ 96,130 $ 60,365 $ 54,966 $ 53,938 $ 44,802
=========== =========== =========== ========= =========
Net income available to common
shareholders . . . . . . . . . . . . . $ 76,537 $ 54,484 $ 54,966 $ 53,938 $ 44,802
=========== =========== =========== ========= =========
Cash flows from operations . . . . . . . $ 118,476 $ 97,464 $ 89,902 $ 76,299 $ 72,498
=========== =========== =========== ========= =========
Per share data - basic:
Income before extraordinary charge . $ 2.88 $ 2.09 $ 2.06 $ 2.03 $ 1.69
Net income . . . . . . . . . . . . . $ 2.87 $ 2.04 $ 2.06 $ 2.03 $ 1.69
Weighted average number of shares. . 26,690 26,667 26,638 26,555 26,464
Per share data - diluted:
Income before extraordinary charge . $ 2.86 $ 2.08 $ 2.05 $ 2.03 $ 1.69
Net income . . . . . . . . . . . . . $ 2.85 $ 2.03 $ 2.05 $ 2.03 $ 1.69
Weighted average number of shares. . 26,890 26,869 26,771 26,598 26,493
Cash dividends per common share. . . . . $ 2.84 $ 2.68 $ 2.56 $ 2.48 $ 2.40
Property (at cost) . . . . . . . . . . . $1,514,139 $1,294,632 $1,118,758 $970,418 $849,894
Total assets . . . . . . . . . . . . . . $1,309,396 $1,107,043 $ 946,793 $831,097 $734,824
Debt . . . . . . . . . . . . . . . . . . $ 594,185 $ 516,366 $ 507,366 $389,225 $289,339
Other data:
Funds from operations (1)
Net income available to common
shareholders. . . . . . . . . . . $ 76,537 $ 54,484 $ 54,966 $ 53,938 $ 44,802
Depreciation and amortization. . . 49,256 41,580 37,544 33,414 29,813
(Gain) loss on sales of property
and securities. . . . . . . . . . (20,596) (885) (3,327) (5,563) 14
Extraordinary charge (early retirement
of debt) . . . . . . . . . . . . . . . 190 1,392
----------- ----------- ----------- --------- ---------
Total . . . . . . . . . . . . . $ 105,387 $ 96,571 $ 89,183 $ 81,789 $ 74,629
=========== =========== =========== ========= =========
(1) Funds from operations does not represent cash flows from operations as defined by generally
accepted accounting principles and should not be considered as an alternative to net income
as an indicator of WRI's operating performance or to cash flows as a measure of liquidity.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the consolidated
financial statements and notes thereto and the comparative summary of selected
financial data appearing elsewhere in this report. Historical results and
trends which might appear should not be taken as indicative of future
operations.
Weingarten Realty Investors owned or operated under long-term leases 187
shopping centers, 50 industrial properties, one multi-family residential project
and one office building at December 31, 1999. Of our 239 developed properties,
179 are located in Texas (including 100 in Houston and Harris County). Our
remaining properties are located in Louisiana (11), Arizona (11), Nevada (8),
Arkansas (6), New Mexico (5), Oklahoma (4), Tennessee (4), Kansas (3), Colorado
(3), Missouri (2), Illinois (1), Florida (1) and Maine (1). WRI has nearly
4,200 leases and 3,300 different tenants. Leases for our properties range from
less than a year for smaller spaces to over 25 years for larger tenants; leases
generally include minimum lease payments and contingent rentals for payment of
taxes, insurance and maintenance and for an amount based on a percentage of the
tenants' sales. The majority of our anchor tenants are supermarkets,
drugstores, value-oriented apparel and discount stores and other retailers,
which generally sell basic necessity-type items.
CAPITAL RESOURCES AND LIQUIDITY
WRI anticipates that cash flows from operating activities will continue to
provide adequate capital for all dividend payments in accordance with REIT
requirements. Cash on hand, internally-generated cash flow, borrowings under
our existing credit facilities, issuance of unsecured debt and the use of
project financing, as well as other debt and equity alternatives, will provide
the necessary capital to achieve growth. Cash flow from operating activities as
reported in the Statements of Consolidated Cash Flows increased to $118.5
million for 1999 from $97.5 million for 1998 and $89.9 million for 1997.
Common and preferred dividends increased to $95.4 million in 1999, compared to
$77.3 million in 1998 and $68.2 million in 1997. WRI satisfied its REIT
requirement of distributing at least 95% of ordinary taxable income for each of
the three years ended December 31, 1999, and, accordingly, federal income taxes
were not required to be paid in these years. Our dividend payout ratio on
common equity for 1999, 1998 and 1997 approximated 71.9%, 74.4% and 76.4%,
respectively, based on funds from operations for the applicable year.
WRI invested $150.5 million in acquisitions in 1999, adding 2.8 million square
feet to its portfolio of properties. Regarding the retail portfolio, we
purchased three anchored shopping centers in Texas, a supermarket-anchored
retail center in Florida and a building adjacent to one of our shopping centers
in Houston, Texas. We also purchased our joint venture partner's 77% interest
in a shopping center in Santa Fe, New Mexico and executed a lease on a retail
center in Ballwin, Missouri, a suburb of St. Louis. These transactions
increased our retail portfolio by 1.4 million square feet of building area and
represent an investment of $107.3 million.
WRI currently owns a total of 50 industrial projects. During 1999, we purchased
twelve properties, including seven facilities in the Dallas/Fort Worth metroplex
and our first industrial project in Las Vegas, Nevada. We also acquired three
buildings in Austin, Texas, and one facility in Houston, Texas. These projects
added 1.4 million square feet to the industrial portfolio and represent an
investment of $43.2 million. In December 1999, we sold seven industrial
properties totaling 2.0 million square feet to a joint venture in which we
retained 20% ownership, with the remainder owned by American National Insurance
Company. Additionally, American National purchased 131 acres of undeveloped
land in our Railwood Industrial Park. WRI retained the right to co-develop this
land with American National. WRI owned 28.5 acres of this land and WRI
Holdings, Inc., an affiliated entity, owned 102.6 acres. The proceeds of $8.1
million received by WRI Holdings were remitted to WRI in payment of mortgage
bonds and notes. Including the payment received from WRI Holdings, these
transactions provided WRI with $21 million of cash and a six-month $33 million
note receivable from American National. We have retained the leasing and
management of the properties and also contracted to lease and manage an
additional 1.4 million square feet of Houston industrial properties owned by
American National.
With respect to new development, construction was completed on retail and
industrial space totaling .2 million square feet. An additional .2 million
square feet was added with the completion of a 260-unit luxury apartment complex
within a multi-use master-planned project WRI developed in a suburb north of
Houston. WRI currently has several other facilities under development,
including seven retail centers, an industrial office/service center and three
additional retail centers in joint ventures with our Denver-based development
partner. The projects under construction or completed in 1999 represent an
estimated investment by WRI of approximately $77 million and will add .9
million square feet to our portfolio.
Additionally, WRI has an ongoing program for maintaining and renovating its
existing portfolio of properties. Capitalized expenditures for acquisitions,
new development and additions to the existing portfolio were, in millions,
$224.3, $176.5 and $152.6 during 1999, 1998 and 1997, respectively. All of the
acquisitions and new development during 1999 were either initially financed
under WRI's revolving credit facility, funded with excess cash balances or
funded with excess cash flow from our existing portfolio of properties.
In January 1999, we issued $115 million of 7.0% Series C cumulative redeemable
preferred shares with a liquidation preference of $50 per share and no stated
maturity. We can elect to redeem these shares anytime after March 15, 2004.
The Series C preferred shares are redeemable by the holder only upon their death
and are also redeemable in either cash or common shares at WRI's option. There
are limitations on the number of shares per shareholder and in the aggregate
that may be redeemed per year. The proceeds of this offering were used to pay
down all amounts outstanding under our revolving credit facilities and retire
$82 million of variable-rate, unsecured medium term notes, resulting in an
extraordinary loss of $.2 million. Any redemption of preferred shares initiated
by WRI must be funded with proceeds from an offering of additional common or
preferred shares.
In July 1999, WRI issued $20 million of ten-year 7.35% fixed-rate, unsecured
medium term notes. Including the effect of a loss of $1.2 million on the sale
of Treasury locks, which were designated as a hedge against future issuance of
fixed-rate notes, the effective interest rate is 8.0%.
In January 2000, WRI issued $10.5 million of ten-year 8.25% fixed-rate,
unsecured medium term notes. In connection with this debt issuance, we entered
into a ten-year interest rate swap agreement with a notional amount of $10.5
million to swap 8.25% fixed-rate interest for floating-rate interest.
WRI has a $200 million unsecured revolving credit facility which expires in
November of 2000. WRI has an annual option to request a one-year extension of
the commitment. Upon expiration, we have an option to convert amounts
outstanding under the facility to a term loan payable over a two-year period.
Additionally, WRI has an unsecured and uncommitted overnight credit facility
totaling $20 million to be used for cash management purposes. WRI will maintain
adequate funds available under the $200 million revolving credit facility at all
times to cover the outstanding balance under the $20 million facility. WRI has
three interest rate swap contracts with an aggregate notional amount of $40
million which fix interest rates on variable-rate debt at 8.1% and expire
through 2004.
Subsequent to year-end, WRI finalized an additional $100 million revolving
credit agreement with a major bank. This one-year facility became effective on
March 1, 2000 and is renewable at our option for an additional two-year period.
We also filed a new $400 million shelf registration statement in August of this
year, all of which was available at year-end.
Total debt outstanding increased to $594.2 million at December 31, 1999 from
$516.4 million at December 31, 1998, primarily to fund acquisitions and new
development. WRI will continue to closely monitor both the debt and equity
markets and carefully consider its available alternatives, including both public
and private placements.
FUNDS FROM OPERATIONS
Industry analysts generally consider funds from operations to be an appropriate
measure of the performance of an equity REIT since such measure does not
recognize depreciation and amortization of real estate assets as operating
expenses. Management believes that reductions for these charges are not
meaningful in evaluating income-producing real estate, which historically has
not depreciated. The National Association of Real Estate Investment Trusts
defines funds from operations as net income plus depreciation and amortization
of real estate assets, less gains and losses on sales of properties. Funds from
operations does not represent cash flows from operations as defined by generally
accepted accounting principles and should not be considered as an alternative to
net income as an indicator of WRI's operating performance or to cash flows as a
measure of liquidity.
Funds from operations increased to $105.4 million in 1999, as compared to $96.6
million in 1998 and $89.2 million in 1997. These increases relate primarily to
the impact of WRI's acquisitions, new developments and activity at its existing
properties. For further information on changes between years, see "Results of
Operations" below.
RESULTS OF OPERATIONS
Rental revenues increased 15.7%, or $30.6 million, from $194.6 million in 1998
to $225.2 million in 1999 and by 15.1%, or $25.6 million, from $169.0 million in
1997. Of these increases, property acquisitions and new development contributed
$24.8 million in 1999 and $18.4 million in 1998. The remaining portion of these
increases is due to activity at our existing properties. Occupancy of our
shopping centers, industrial properties and total portfolio decreased to 91% at
December 31, 1999 from 93% at the end of 1998. This is primarily the result of
the loss of certain large tenants in the latter half of the year. Among the
larger losses were Builders Square, which occupied a 105,000 square foot space
in Corpus Christi, Texas, a 91,500 square foot Kmart in Houston, Texas, a 63,000
square foot Service Merchandise in Lake Charles, Louisiana and a 60,000 square
foot Pay & Save in Lubbock, Texas. In 1999, we completed 894 renewals or new
leases comprising 4.8 million square feet at an average rental rate increase of
9.5%. Net of the amortized portion of capital costs for tenant improvements,
the increase averaged 5.9%. Occupancy of our total portfolio increased to 93% at
December 31, 1998 from 92% at the end of 1997. In 1998, we completed 830
renewals or new leases comprising 3.4 million square feet at an average rental
rate increase of 5.8%. Net of the amortized portion of capital costs for tenant
improvements, the increase averaged 3.2%.
Interest income totaled $3.1 million in 1999, $2.1 million in 1998 and $2.5
million in 1997. The increase in income in 1999 is due to the funding of loans
to our joint venture partners. The decrease from 1997 to 1998 was due to the
sale of $12.2 million of marketable debt securities during the first quarter of
1998.
Equity in earnings of real estate joint ventures and partnerships totaled $.2
million in 1999, $.3 million in 1998 and $1.0 million in 1997. The decrease in
1999 and 1998 is due to the purchase at December 31, 1997 of our joint venture
partner's 85% interest in four shopping centers and the purchase of our joint
venture partner's 77% interest in a shopping center in July 1999.
Direct costs and expenses of operating our properties (i.e., operating and ad
valorem tax expenses) increased to $64.4 million in 1999 from $54.8 million in
1998 and $49.2 million in 1997. These increases are primarily due to property
acquired and developed during these periods. Overall, direct operating costs
and expenses as a percentage of rental revenues were 29% in 1999, 28% in 1998
and 29% in 1997. Depreciation and amortization have increased to $49.6 million
in 1999 from $41.9 million in 1998 and $38.0 million in 1997, also as a result
of the properties acquired and developed during these periods. General and
administrative expense has increased to $7.5 million in 1999 from $7.1 million
in 1998 and $5.6 million in 1997. The increase in 1998 results primarily from
the adoption of a new Emerging Issues Task Force consensus decision which
required that internal costs of identifying and acquiring operating property
incurred subsequent to March 19, 1998 be expensed. WRI realized an increase in
expense of $1.1 million in 1998 due to the adoption of this standard. The
remainder of the increase in 1998 and the majority of the increase in 1999 are
due to normal compensation increases as well as slight increases in staffing.
Gross interest costs, before capitalization of interest to development projects,
increased from $35.0 million in 1998 to $35.9 million in 1999. This increase in
interest cost was due mainly to an increase in the average debt outstanding from
$492.2 million for 1998 to $501.6 million for 1999. The weighted-average
interest rate increased from 7.11% in 1998 to 7.15% in 1999. Interest expense,
net of amounts capitalized, decreased $.5 million from 1998. The amount of
interest capitalized increased to $2.7 million in 1999 from $1.4 million in 1998
due to an increase in the amount of development activity during the year.
Comparing 1998 to 1997, gross interest costs increased from $30.8 million in
1997 to $35.0 million in 1998. This was due to an increase in the average debt
outstanding from $422.9 million in 1997 to $492.2 million in 1998. The
weighted-average interest rate decreased between the two periods from 7.27% in
1997 to 7.11% in 1998. Interest expense, net of amounts capitalized, increased
$3.6 million from 1997. The amount of interest capitalized increased by $.6
million in 1998 due to an increase in the amount of development activity during
the year. Included in interest expense during 1997 was $.7 million related to
repurchase agreements collateralized by our investment in marketable debt
securities which were sold during the first quarter of 1998.
The gain on sale of $20.6 million in 1999 was due primarily to the sale of 28.5
acres of undeveloped land and an 80% interest in certain industrial properties
to American National Insurance Company.
EFFECTS OF INFLATION
The rate of inflation was relatively unchanged in 1999. WRI has structured its
leases, however, in such a way as to remain largely unaffected should
significant inflation occur. Most of the leases contain percentage rent
provisions whereby WRI receives rentals based on the tenants' gross sales. Many
leases provide for increasing minimum rentals during the terms of the leases
through escalation provisions. In addition, many of WRI's leases are for terms
of less than ten years, which allows WRI to adjust rental rates to changing
market conditions when the leases expire. Most of WRI's leases require the
tenants to pay their proportionate share of operating expenses and ad valorem
taxes. As a result of these lease provisions, increases due to inflation, as
well as ad valorem tax rate increases, generally do not have a significant
adverse effect upon WRI's operating results.
NEW ACCOUNTING PRONOUNCEMENTS
In June 1998, Statement of Financial Accounting Standards No. 133, "Accounting
for Derivative Instruments and Hedging Activities" was issued. This statement
requires that an entity recognize all derivatives as either assets or
liabilities and measure the instruments at fair value. The accounting for
changes in fair value of a derivative depends upon its intended use. WRI will
adopt the provisions of this statement in the first quarter of fiscal year 2001.
WRI is still evaluating the effects of adopting this statement, however, we do
not expect the impact to be material to our operating results or our financial
position.
In December 1999, the SEC Staff Accounting Bulletin No. 101, "Revenue
Recognition in Financial Statements" was issued. This bulletin requires that
revenue based on a percentage of tenants' sales be recognized only after the
tenant exceeds their sales breakpoint. Implementation of this bulletin is
expected to reduce revenue by $.6 million in 2000.
YEAR 2000
Based on a review of our mission critical and non-mission critical software and
hardware, we concluded that our company's systems were Year 2000 compliant. No
significant problems related to the Year 2000 were experienced or are expected
in the future. Our major tenants, financial institutions and utility companies
represented to us that they also were Year 2000 compliant. While we have not
been affected by any Year 2000 issues experienced by these third parties, we
have no guarantee that these third-party systems will continue to operate as
represented.
FORWARD-LOOKING STATEMENTS
This Annual Report includes certain forward-looking statements reflecting WRI's
expectations in the near term that involve a number of risks and uncertainties;
however, many factors may materially affect the actual results, including demand
for our properties, changes in rental and occupancy rates, changes in property
operating costs, interest rate fluctuations, and changes in local and general
economic conditions. Accordingly, there is no assurance that WRI's expectations
will be realized.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
WRI uses fixed and floating-rate debt to finance its capital requirements.
These transactions expose WRI to market risk related to changes in interest
rates. Derivative financial instruments are used to manage a portion of this
risk. We do not engage in the trading of derivative financial instruments in
the normal course of business. During 1998, we entered into and settled three
forward Treasury lock agreements with a total notional amount of $85 million as
a hedge against potential changes in interest rates of prospective issuances of
fixed-rate debt. Amounts paid or received upon settlement of these contracts
are deferred and amortized as an adjustment to interest expense over the life of
the fixed-rate debt. At December 31, 1999, WRI had fixed-rate debt of $499.9
million and variable-rate debt of $94.3 million, after adjusting for the effect
of interest rate swaps. We also had variable-rate notes receivable totaling
$44.8 million at year-end. In the event that interest rates were to increase
100 basis points, the fair value of fixed-rate debt would decrease by $21.8
million and net income, funds from operations and future cash flows would
decrease $.5 million based upon the variable-rate debt and notes receivable
outstanding at December 31, 1999.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEPENDENT AUDITORS' REPORT
To the Board of Trust Managers and Shareholders of
Weingarten Realty Investors:
We have audited the accompanying consolidated balance sheets of Weingarten
Realty Investors (the "Company") as of December 31, 1999 and 1998, and the
related statements of consolidated income, shareholders' equity, and cash flows
for each of the three years in the period ended December 31, 1999. Our audits
also included the financial statement schedules listed in the Index at Item 14.
These financial statements and financial statement schedules are the
responsibility of the Company's management. Our responsibility is to express an
opinion on the financial statements and financial statement schedules based on
our audits.
We conducted our audits 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 statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. 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 audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Weingarten Realty Investors at
December 31, 1999 and 1998, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 1999 in conformity
with generally accepted accounting principles. Also, in our opinion, such
financial statement schedules, when considered in relation to the basic
consolidated financial statements taken as a whole, present fairly in all
material respects the information set forth therein.
DELOITTE & TOUCHE LLP
Houston, Texas
February 22, 2000
STATEMENTS OF CONSOLIDATED INCOME
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Years Ended December 31,
-------------------------------
1999 1998 1997
--------- --------- ---------
Revenues:
Rentals . . . . . . . . . . . . . . . . . . . . . $225,244 $194,624 $169,041
Interest:
Affiliates. . . . . . . . . . . . . . . . . . . 2,403 1,578 1,434
Securities and Other. . . . . . . . . . . . . . 721 511 1,053
Equity in earnings of real estate joint ventures
and partnerships. . . . . . . . . . . . . . . . 213 342 1,003
Other . . . . . . . . . . . . . . . . . . . . . . 1,888 1,412 1,981
--------- --------- ---------
Total . . . . . . . . . . . . . . . . . . . 230,469 198,467 174,512
--------- --------- ---------
Expenses:
Depreciation and amortization . . . . . . . . . . 49,612 41,946 37,976
Operating . . . . . . . . . . . . . . . . . . . . 36,112 30,413 27,131
Interest. . . . . . . . . . . . . . . . . . . . . 33,186 33,654 30,009
Ad valorem taxes. . . . . . . . . . . . . . . . . 28,323 24,436 22,110
General and administrative. . . . . . . . . . . . 7,512 7,146 5,647
--------- --------- ---------
Total . . . . . . . . . . . . . . . . . . . 154,745 137,595 122,873
--------- --------- ---------
Income Before Gain on Sales of Property
and Extraordinary Charge. . . . . . . . . . . . . 75,724 60,872 51,639
Gain on Sales of Property . . . . . . . . . . . . . 20,596 885 3,327
--------- --------- ---------
Income Before Extraordinary Charge. . . . . . . . . 96,320 61,757 54,966
Extraordinary Charge (early retirement of debt) . . (190) (1,392)
--------- --------- ---------
Net Income. . . . . . . . . . . . . . . . . . . . . $ 96,130 $ 60,365 $ 54,966
========= ========= =========
Net Income Available to Common Shareholders . . . . $ 76,537 $ 54,484 $ 54,966
========= ========= =========
Net Income Per Common Share - Basic:
Income Before Extraordinary Charge. . . . . . . $ 2.88 $ 2.09 $ 2.06
Extraordinary Charge. . . . . . . . . . . . . . (.01) (.05)
--------- --------- ---------
Net Income. . . . . . . . . . . . . . . . . . . $ 2.87 $ 2.04 $ 2.06
========= ========= =========
Net Income Per Common Share - Diluted:
Income Before Extraordinary Charge. . . . . . . $ 2.86 $ 2.08 $ 2.05
Extraordinary Charge. . . . . . . . . . . . . . (.01) (.05)
--------- --------- ---------
Net Income. . . . . . . . . . . . . . . . . . . $ 2.85 $ 2.03 $ 2.05
========= ========= =========
See Notes to Consolidated Financial Statements.
CONSOLIDATED BALANCE SHEETS
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
December 31,
------------------------
1999 1998
----------- -----------
ASSETS
Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,514,139 $1,294,632
Accumulated Depreciation. . . . . . . . . . . . . . . . . . . . . . . (328,645) (296,989)
----------- -----------
Property - net. . . . . . . . . . . . . . . . . . . . . . . . . . 1,185,494 997,643
Investment in Real Estate Joint Ventures and Partnerships . . . . . . 2,006 2,741
----------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,187,500 1,000,384
Mortgage Bonds and Notes Receivable from:
Real Estate Joint Ventures and Partnerships . . . . . . . . . . . . 52,824 23,388
Affiliate (net of deferred gain of $3,050 in 1999 and $4,487 in 1998) 3,907 13,444
Marketable Debt Securities. . . . . . . . . . . . . . . . . . . . . . 14,951
Unamortized Debt and Lease Costs. . . . . . . . . . . . . . . . . . . 29,986 25,612
Accrued Rent and Accounts Receivable (net of allowance for doubtful
accounts of $908 in 1999 and $888 in 1998). . . . . . . . . . . . . 16,874 15,197
Cash and Cash Equivalents . . . . . . . . . . . . . . . . . . . . . . 5,842 1,672
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,463 12,395
----------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $1,309,396 $1,107,043
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 594,185 $ 516,366
Accounts Payable and Accrued Expenses . . . . . . . . . . . . . . . . 57,518 49,269
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,791 8,229
----------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 663,494 573,864
----------- -----------
Commitments and Contingencies
Shareholders' Equity:
Preferred Shares of Beneficial Interest - par value, $.03 per share;
shares authorized: 10,000
7.44% Series A cumulative redeemable preferred shares of
beneficial interest; 3,000 shares issued and outstanding;
liquidation preference $25 per share. . . . . . . . . . . . . 90 90
7.125% Series B cumulative redeemable preferred shares of
beneficial interest; 3,600 shares issued and outstanding;
liquidation preference $25 per share. . . . . . . . . . . . . 108 108
7.0% Series C cumulative redeemable preferred shares of
beneficial interest; 2,300 shares issued and 2,297 shares
outstanding; liquidation preference $50 per share. . . . . . 69
Common Shares of Beneficial Interest - par value, $.03 per share;
shares authorized: 150,000; shares issued and outstanding:
26,695 in 1999 and 26,673 in 1998 . . . . . . . . . . . . . . . . 801 800
Capital Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . 753,030 641,180
Accumulated Dividends in Excess of Net Income . . . . . . . . . . . (108,193) (108,926)
Deferred Compensation Obligation. . . . . . . . . . . . . . . . . . (3) (73)
----------- -----------
Shareholders' Equity. . . . . . . . . . . . . . . . . . . . . . 645,902 533,179
----------- -----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . $1,309,396 $1,107,043
=========== ===========
See Notes to Consolidated Financial Statements.
STATEMENTS OF CONSOLIDATED CASH FLOWS
(AMOUNTS IN THOUSANDS)
Years Ended December 31,
---------------------------------
1999 1998 1997
---------- ---------- ----------
Cash Flows from Operating Activities:
Net income. . . . . . . . . . . . . . . . . . . . . . . $ 96,130 $ 60,365 $ 54,966
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization . . . . . . . . . . . . 49,612 41,946 37,976
Equity in earnings of real estate joint ventures and
partnerships . . . . . . . . . . . . . . . . . . . . (213) (342) (1,003)
Gain on sales of property . . . . . . . . . . . . . . (20,596) (885) (3,327)
Extraordinary charge (early retirement of debt) . . . 190 1,392
Changes in accrued rent and accounts receivable . . . (1,532) (621) (2,462)
Changes in other assets . . . . . . . . . . . . . . . (12,616) (12,662) (6,105)
Changes in accounts payable and accrued expenses. . . 6,924 7,614 9,113
Other, net. . . . . . . . . . . . . . . . . . . . . . 577 657 744
---------- ---------- ----------
Net cash provided by operating activities . . . . 118,476 97,464 89,902
---------- ---------- ----------
Cash Flows from Investing Activities:
Investment in properties. . . . . . . . . . . . . . . . (198,741) (172,470) (136,632)
Mortgage bonds and notes receivable:
Advances. . . . . . . . . . . . . . . . . . . . . . . (8,187) (12,598) (1,501)
Collections . . . . . . . . . . . . . . . . . . . . . 9,719 3,745 2,090
Proceeds from sales and disposition of property . . . . 15,010 1,109 11,741
Purchase of marketable debt securities. . . . . . . . . (14,951)
Proceeds from sales of marketable debt securities . . . 15,000 12,229
Real estate joint ventures and partnerships:
Investments . . . . . . . . . . . . . . . . . . . . . (1,643) (453) (59)
Distributions . . . . . . . . . . . . . . . . . . . . 216 345 808
Other, net. . . . . . . . . . . . . . . . . . . . . . . (4) 241 2,517
---------- ---------- ----------
Net cash used in investing activities . . . . . . (168,630) (182,803) (121,036)
---------- ---------- ----------
Cash Flows from Financing Activities:
Proceeds from issuance of:
Debt. . . . . . . . . . . . . . . . . . . . . . . . . 124,100 136,575 104,526
Common shares of beneficial interest. . . . . . . . . 546 301 1,325
Preferred shares of beneficial interest . . . . . . . 111,263 159,552
Principal payments of debt. . . . . . . . . . . . . . . (85,532) (134,443) (3,644)
Common and preferred dividends paid . . . . . . . . . . (95,397) (77,347) (68,200)
Other, net. . . . . . . . . . . . . . . . . . . . . . . (656) (381) (288)
---------- ---------- ----------
Net cash provided by financing activities . . . . 54,324 84,257 33,719
---------- ---------- ----------
Net increase (decrease) in cash and cash equivalents. . . 4,170 (1,082) 2,585
Cash and cash equivalents at January 1. . . . . . . . . . 1,672 2,754 169
---------- ---------- ----------
Cash and cash equivalents at December 31. . . . . . . . . $ 5,842 $ 1,672 $ 2,754
========== ========== ==========
See Notes to Consolidated Financial Statements.
STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY
(AMOUNTS IN THOUSANDS)
Years Ended December 31, 1999, 1998 and 1997
Preferred Common Accumulated
Shares of Shares of Dividends in Deferred
Beneficial Beneficial Capital Excess of Compensation
Interest Interest Surplus Net Income Obligation
----------- ----------- --------- -------------- --------------
Balance, January 1, 1997 . . . . . . . . . . . . $ 797 $478,911 $ (78,710)
Net income . . . . . . . . . . . . . . . . . . 54,966
Shares exchanged for property. . . . . . . . . 1 275
Shares issued under benefit plans. . . . . . . 2 1,733
Dividends declared - common shares . . . . . . (68,200)
Other. . . . . . . . . . . . . . . . . . . . . 211
----------- ----------- --------- -------------- --------------
Balance, December 31, 1997 . . . . . . . . . . . 800 481,130 (91,944)
Net income . . . . . . . . . . . . . . . . . . 60,365
Issuance of Series A preferred shares. . . . .$ 90 72,422
Issuance of Series B preferred shares. . . . . 108 86,932
Shares issued under benefit plans. . . . . . . 696
Dividends declared - common shares . . . . . . (71,466)
Dividends declared - preferred shares. . . . . (5,881)
Adjustment for cumulative effect of adopting
accounting for deferred compensation plan:
Common shares held in plan . . . . . . . . $ (3,531)
Deferred compensation obligation . . . . . 3,458
----------- ----------- --------- -------------- --------------
Balance, December 31, 1998 . . . . . . . . . . . 198 800 641,180 (108,926) (73)
Net income . . . . . . . . . . . . . . . . . . 96,130
Issuance of Series C preferred shares. . . . . 69 111,119
Shares issued under benefit plans. . . . . . . 1 883
Dividends declared - common shares . . . . . . (75,804)
Dividends declared - preferred shares. . . . . (19,593)
Redemption of Series C preferred shares. . . . (152)
Deferred compensation obligation . . . . . . . 70
----------- ----------- --------- -------------- --------------
Balance, December 31, 1999 . . . . . . . . . . .$ 267 $ 801 $753,030 $ (108,193) $ (3)
=========== =========== ========= ============== ==============
See Notes to Consolidated Financial Statements.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business
Weingarten Realty Investors, a Texas real estate investment trust, is engaged in
the acquisition, development and management of real estate, primarily anchored
neighborhood and community shopping centers and, to a lesser extent, industrial
properties. Over 74% of WRI's properties are located in Texas, with the
remainder located primarily throughout the southwestern part of the United
States. WRI's major tenants include supermarkets, drugstores and other
retailers who generally sell basic necessity-type commodities. WRI currently
operates and intends to operate in the future as a real estate investment trust.
Basis of Presentation
The consolidated financial statements include the accounts of WRI, its
subsidiaries and its interest in joint ventures and partnerships over which WRI
exercises control. All significant intercompany balances and transactions have
been eliminated. Investments in less than 50%-owned joint ventures and
partnerships where WRI does not exercise control are accounted for using the
equity method.
Revenue Recognition
Rental revenue is generally recognized on a straight-line basis over the life of
the lease. Revenue from tenant reimbursements of taxes, maintenance expenses
and insurance is recognized in the period the related expense is recorded.
Revenue based on a percentage of tenants' sales is estimated and accrued ratably
over the year. Beginning January 1, 2000, such revenue will be recognized only
after the tenant exceeds their sales breakpoint, in accordance with the SEC
Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial
Statements." Implementation of this bulletin is expected to reduce revenue by
$.6 million in 2000.
Property
Real estate assets are stated at cost less accumulated depreciation, which, in
the opinion of management, is not in excess of the individual property's
estimated undiscounted future cash flows, including estimated proceeds from
disposition. Depreciation is computed using the straight-line method, generally
over estimated useful lives of 18-50 years for buildings and 10-20 years for
parking lot surfacing and equipment. Major replacements are capitalized and the
replaced asset and corresponding accumulated depreciation are removed from the
accounts. All other maintenance and repair items are charged to expense as
incurred.
Capitalization
Carrying charges, principally interest and ad valorem taxes, on land under
development and buildings under construction are capitalized as part of land
under development and buildings and improvements.
WRI had also capitalized the direct internal costs of identifying and acquiring
operating property. In March 1998, the Emerging Issues Task Force of the
Financial Accounting Standards Board reached a consensus decision on Issue No.
97-11, "Accounting for Internal Costs Relating to Real Estate Property
Acquisitions." This consensus requires that internal costs of identifying and
acquiring operating property incurred subsequent to March 19, 1998 be expensed.
Such amounts capitalized totaled $.2 million and $1.1 million in 1998 and 1997,
respectively.
Deferred Charges
Debt and lease costs are amortized primarily on a straight-line basis over the
terms of the debt and over the lives of leases, respectively.
Marketable Debt Securities
WRI's investment in marketable securities is classified as "available for sale."
The securities are carried at market with any unrealized gains or losses
included as a component of shareholders' equity.
Use of Estimates
The preparation of financial statements requires management to make use of
estimates and assumptions that affect amounts reported in the financial
statements as well as certain disclosures. Actual results could differ from
those estimates.
Per Share Data
Net income per common share - basic is computed using net income available to
common shareholders and the weighted average shares outstanding. Net income per
common share - diluted includes the effect of potentially dilutive securities
for the periods indicated, as follows (in thousands):
1999 1998 1997
------- ------- -------
Numerator:
Net income available to common shareholders - basic. . . . . . $76,537 $54,484 $54,966
Income attributable to operating partnership units . . . . . . 141 37
------- ------- -------
Net income available to common shareholders - diluted. . . . . $76,678 $54,521 $54,966
======= ======= =======
Denominator:
Weighted average shares outstanding - basic. . . . . . . . . . 26,690 26,667 26,638
Effect of dilutive securities:
Share options and awards . . . . . . . . . . . . . . . . . 58 132 132
Operating partnership units. . . . . . . . . . . . . . . . 142 70 1
------- ------- -------
Weighted average shares outstanding - diluted. . . . . . . . . 26,890 26,869 26,771
======= ======= =======
Options to purchase 550,200, 13,200 and 800 common shares in 1999, 1998 and
1997, respectively, were not included in the calculation of net income per
common share - diluted as the exercise prices were greater than the average
market price for the year.
Statements of Cash Flows
WRI considers all highly liquid investments with original maturities of three
months or less as cash equivalents. WRI issued .1 million common shares of
beneficial interest in 1997 valued at $.2 million in connection with purchases
of property. We assumed debt and/or capital lease obligations totaling $39.1
million, $6.7 million and $17.3 million in connection with purchases of property
during 1999, 1998 and 1997, respectively. We issued limited partnership
interests in exchange for property valued at $4.0 million and $1.7 million in
1998 and 1997, respectively. In connection with the sale of improved properties
in 1999, we received notes receivable totaling $33.1 million.
Comprehensive Income
WRI adopted Statement of Financial Accounting Standards No. 130, "Reporting
Comprehensive Income" in 1998. Net income differs from comprehensive income by
less than $50,000 in each year presented.
Reclassifications
Certain reclassifications of prior years' amounts have been made to conform with
the current year presentation, including the classification of "accumulated
dividends in excess of net income" as a separate caption on the Consolidated
Balance Sheets.
NOTE 2. DEBT
WRI's debt consists of the following (in thousands):
DECEMBER 31,
---------------------
1999 1998
---------- ---------
Fixed-rate debt payable to 2015 at 6.0% to 10.5% . . . . . . . $ 423,906 $ 404,061
Variable-rate unsecured notes payable. . . . . . . . . . . . . 82,000
Unsecured notes payable under revolving credit agreements. . . 114,000 10,250
Obligations under capital leases . . . . . . . . . . . . . . . 48,467 12,467
Industrial revenue bonds payable to 2015 at 5.6% to 6.4% . . . 6,141 6,262
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,671 1,326
--------- ---------
Total. . . . . . . . . . . . . . . . . . . . . . . . $ 594,185 $ 516,366
========= =========
WRI has an unsecured $200 million revolving credit agreement with a syndicate of
banks. The agreement expires in November 2000, but WRI has an annual option to
request a one-year extension of the agreement. All members of the bank
syndicate must agree to the requested extension or the agreement expires on the
scheduled date, at which time WRI has the option to convert all amounts
outstanding under the credit agreement to a term loan payable over a two-year
period. We also have an agreement for an unsecured and uncommitted overnight
credit facility totaling $20 million with a bank to be used for cash management
purposes. We will maintain adequate funds available under our revolving credit
facilities at all times to cover the outstanding balance under the $20 million
facility. WRI also has letters of credit totaling $16.0 million outstanding
under the $200 million revolving credit facility at December 31, 1999. The
revolving credit agreements are subject to normal banking terms and conditions
and do not adversely restrict our operations or liquidity. Subsequent to
year-end, we finalized an additional $100 million revolving credit agreement
with a bank which became effective March 1, 2000. This one-year facility is
renewable at our option for an additional two-year period.
At December 31, 1999, the variable interest rate for notes payable under the $20
million revolving credit agreement was 5.3%. During 1999, the maximum balance
and weighted average balance outstanding under both credit facilities were
$114.0 million and $53.2 million, respectively, at an average interest rate of
6.0%. WRI made cash payments for interest on debt, net of amounts capitalized,
of $32.3 million in 1999, $32.6 million in 1998 and $27.4 million in 1997.
Various leases and properties and current and future rentals from those leases
and properties collateralize certain debt. At December 31, 1999 and 1998, the
carrying value of such property aggregated $174 million and $177 million,
respectively.
WRI has three interest rate swap contracts with an aggregate notional amount of
$40 million. Such contracts, which expire through 2004, have been outstanding
since their purchase in 1992. We intend to hold such contracts through their
expiration date and to use them as a means of managing interest rate risk by
fixing the interest rate on a portion of our variable-rate debt. The interest
rate swaps have an effective interest rate of 8.1%. The difference between the
interest received and paid on the interest rate swaps is recognized as interest
expense as incurred. The interest rate swaps increased interest expense and
decreased net income by $1.0 million in 1999 and $.9 million in both 1998 and
1997. The interest rate swaps increased the average interest rate for our debt
by .2% for 1999, 1998 and 1997. WRI could be exposed to credit losses in the
event of non-performance by the counterparty; however, the likelihood of such
non-performance is remote.
In February 1999, WRI retired $82 million of variable-rate, unsecured medium
term notes resulting in an extra-ordinary charge to earnings of $.2 million. In
July 1999, we issued $20 million of ten-year 7.35% fixed-rate, unsecured medium
term notes. Including the effect of a loss of $1.2 million on the sale of
Treasury locks which were designated as a hedge against future issuance of
fixed-rate notes, the effective interest rate is 8.0%.
WRI's debt can be summarized as follows (in thousands):
DECEMBER 31,
--------------------
1999 1998
--------- ---------
As to interest rate (including the effects of
interest rate swaps):
Fixed-rate debt . . . . . . . . . . . . . . . . . $ 499,919 $ 444,060
Variable-rate debt. . . . . . . . . . . . . . . . 94,266 72,306
--------- ---------
Total . . . . . . . . . . . . . . . . . . . . $ 594,185 $ 516,366
========= =========
As to collateralization:
Unsecured debt. . . . . . . . . . . . . . . . . . $ 482,671 $ 440,433
Secured debt. . . . . . . . . . . . . . . . . . . 111,514 75,933
--------- ---------
Total . . . . . . . . . . . . . . . . . . . . $ 594,185 $ 516,366
========= =========
Scheduled principal payments on our debt (excluding $114.0 million potentially
due under our revolving credit agreements and $36 million of capital leases) are
due during the following years (in thousands):
2000. . . . . . . . . $ 32,480
2001. . . . . . . . . 30,152
2002. . . . . . . . . 33,636
2003. . . . . . . . . 27,709
2004. . . . . . . . . 51,921
2005 through 2009 . . 237,769
2010 through 2014 . . 29,345
Thereafter. . . . . . 936
In the event our $200 million revolving credit agreement expires in November
2000 and we elect to convert amounts outstanding under the revolver at that time
to a term loan, such amounts would be payable as follows; 50% in 2001 and 50% in
2002.
Various debt agreements contain restrictive covenants, the most restrictive of
which requires WRI to produce annual consolidated distributable cash flow, as
defined by the agreements, of not less than 250% of interest payments, to limit
total debt to no more than 60% of total assets (as defined) and to maintain
uncollateralized assets equal to at least 150% of unsecured debt. Management
believes that WRI is in compliance with all restrictive covenants.
In the third quarter of 1999, WRI filed a $400 million shelf registration
statement with the SEC which allows for the issuance of debt or equity
securities or warrants. The shelf registration was totally available at
December 31, 1999.
In January 2000, WRI issued $10.5 million of ten-year 8.25% fixed-rate,
unsecured medium term notes. In connection with this debt issuance, we entered
into a ten-year interest rate swap agreement with a notional amount of $10.5
million to swap 8.25% fixed-rate interest for floating-rate interest.
NOTE 3. PREFERRED SHARES
In February 1998, WRI issued $75 million of 7.44% Series A cumulative redeemable
preferred shares with a liquidation preference of $25 per share. The shares are
callable at WRI's option any time after March 31, 2003 and have no stated
maturity. In October 1998, WRI issued $90 million of 7.125% Series B cumulative
redeemable preferred shares with a liquidation preference of $25 per share and
no stated maturity. WRI can elect to redeem the shares anytime after October
20, 2003. The Series B shares are redeemable by the holder only upon their
death and are also redeemable in either cash or common shares at our option.
There are limitations on the number of shares per shareholder and in the
aggregate that may be redeemed per year.
In January 1999, WRI issued $115 million of 7.0% Series C cumulative redeemable
preferred shares with a liquidation preference of $50 per share and no stated
maturity. WRI can elect to redeem these shares anytime after March 15, 2004.
The redemption rights of the shareholders and the related restrictions are
effectively the same as for the Series B preferred shares.
The proceeds of these offerings were used to pay down amounts outstanding under
WRI's revolving credit facilities, to fund acquisition and new development
activity, to retire $35 million of 9.11% secured notes payable and to retire $82
million of variable-rate, medium term notes due in 2000. Any redemption of
preferred shares initiated by WRI must be funded with proceeds from an offering
of additional common or preferred shares.
NOTE 4. PROPERTY
WRI's property consists of the following (in thousands):
DECEMBER 31,
----------------------
1999 1998
---------- ----------
Land . . . . . . . . . . . . . . $ 279,871 $ 236,221
Land held for development. . . . 24,509 30,156
Land under development . . . . . 12,139 13,024
Buildings and improvements . . . 1,189,687 1,009,166
Construction in-progress . . . . 7,933 6,065
---------- ----------
Total. . . . . . . . . . . $1,514,139 $1,294,632
========== ==========
The following carrying charges were capitalized (in thousands):
DECEMBER 31,
----------------------
1999 1998 1997
------ ------ ------
Interest . . . . . . . . . . . . $2,722 $1,375 $ 812
Ad valorem taxes . . . . . . . . 333 50 33
------ ------ ------
Total. . . . . . . . . . . $3,055 $1,425 $ 845
====== ====== ======
During 1999, WRI purchased five shopping centers and twelve industrial
facilities. Additionally, we purchased a building adjacent to a WRI-owned
shopping center and purchased our joint venture partner's 77% interest in a
shopping center. These transactions added 2.8 million square feet to our
portfolio and represent an investment of $150.5 million. We also completed new
development totaling $35.4 million, which added .4 million square feet to the
portfolio.
In December 1999, WRI sold 28.5 acres of undeveloped land and an 80% interest in
2.0 million square feet of industrial properties for $46.4 million, resulting in
a gain of $20.6 million.
NOTE 5. MARKETABLE DEBT SECURITIES
WRI's investment in marketable debt securities at December 31, 1998 consisted of
short-term commercial paper that matured January 4, 1999. The proceeds were
used to pay down amounts outstanding under our $20 million credit facility.
NOTE 6. RELATED PARTY TRANSACTIONS
WRI has mortgage bonds and notes receivable from WRI Holdings, Inc. of $3.9
million and $13.4 million, net of deferred gain of $3.0 million and $4.5 million
at December 31, 1999 and 1998, respectively. WRI and WRI Holdings share certain
directors and are under common management. Unimproved land and an investment in
a joint venture which owns and manages a motor hotel collateralize these
receivables. The bonds and notes bear interest at rates of 16% and prime plus
1%, respectively. However, due to WRI Holdings' poor financial condition, WRI
has limited the recognition of interest income for financial statement purposes
to the amount of cash payments received. WRI did not receive any interest
payments in 1999 and does not anticipate receiving such payments in the near
term. Interest income recognized for financial reporting purposes was $.1
million in 1997.
In the second quarter of 1998, WRI purchased 13.7 acres of undeveloped land from
WRI Holdings to be used for the development of a luxury apartment complex in
Conroe, Texas. The purchase price was $2.2 million and was based upon an
independent third party appraisal. WRI Holdings used the proceeds to pay down
amounts outstanding under mortgage bonds and notes payable to WRI.
In December 1999, undeveloped land from WRI Holdings of 102.6 acres was sold and
the net proceeds of $8.1 million were used to pay down amounts outstanding under
mortgage bonds and notes payable to WRI.
Management of WRI believes that the fair market value of the security
collateralizing debt from WRI Holdings approximates the net investment in such
debt and that there would not be a charge to operations if WRI were to
foreclose on the debt. If foreclosure were required, the net investment in
such debt would become WRI's basis of the repossessed assets. WRI's management
believes that the net investment in the mortgage bonds and notes receivable from
WRI Holdings is not impaired.
WRI's unrecorded receivable for interest on the mortgage bonds and notes
receivable was $20.9 million and $31.1 million at December 31, 1999 and 1998,
respectively. Interest income not recognized by WRI for financial reporting
purposes aggregated, in millions, $4.2, $4.8 and $4.0 for 1999, 1998 and 1997,
respectively. WRI does not anticipate recovery of the unrecorded receivable in
the future.
WRI owns interests in several joint ventures and partnerships. Notes receivable
from these entities bear interest at 8% to 10.5% at December 31, 1999, are due
at various dates through 2028 and are generally secured by real estate assets.
WRI recognized interest income on these notes as follows, in millions: $2.3 in
1999; $1.5 in 1998 and $1.4 in 1997.
Chase Bank of Texas, National Association is a significant participant in and
the agent for the banks that provide WRI's $200 million revolving credit
agreement and is a counterparty in three interest rate swap agreements with WRI.
An executive officer of Chase serves on the WRI Board of Trustees.
NOTE 7. FEDERAL INCOME TAX CONSIDERATIONS
Federal income taxes are not provided because WRI believes it qualifies as a
REIT under the provisions of the Internal Revenue Code. Shareholders of WRI
include their proportionate taxable income in their individual tax returns. As
a REIT, we must distribute at least 95% of our ordinary taxable income to our
shareholders and meet certain income source and investment restriction
requirements.
Taxable income differs from net income for financial reporting purposes
principally because of differences in the timing of recognition of interest, ad
valorem taxes, depreciation, rental revenue, pension expense and installment
gains on sales of property. As a result of these differences, the book value of
our net assets exceeds the tax basis by $23.3 million at December 31, 1999.
For federal income tax purposes, the cash dividends distributed to common
shareholders are characterized as follows:
1999 1998 1997
------ ------ ------
Ordinary income . . . . . . . . . . . . . . . 84.2% 97.0% 95.9%
Return of capital (generally non-taxable) . . 4.0 2.1 2.9
Capital gain distributions. . . . . . . . . . 11.8 .9 1.2
------ ------ ------
Total . . . . . . . . . . . . . . 100.0% 100.0% 100.0%
====== ====== ======
NOTE 8. LEASING OPERATIONS
WRI's lease terms range from less than one year for smaller tenant spaces to
over twenty-five years for larger tenant spaces. In addition to minimum lease
payments, most of the leases provide for contingent rentals (payments for taxes,
maintenance and insurance by lessees and for an amount based on a percentage of
the tenants' sales). Future minimum rental income from non-cancelable tenant
leases at December 31, 1999, in millions, is: $172.4 in 2000; $151.5 in 2001;
$127.6 in 2002; $107.9 in 2003; $90.5 in 2004 and $627.5 thereafter. The future
minimum rental amounts do not include estimates for contingent rentals. Such
contingent rentals, in millions, aggregated $44.4 in 1999, $40.9 in 1998, and
$36.8 in 1997.
NOTE 9. COMMITMENTS AND CONTINGENCIES
WRI leases land and one shopping center from the owners and then subleases these
properties to other parties. Future minimum rental payments under these
operating leases, in millions, are: $1.8 in 2000; $1.7 in 2001; $1.7 in 2002;
$1.6 in 2003; $1.4 in 2004 and $11.7 thereafter. Future minimum rental
payments on these leases have not been reduced by future minimum sublease
rentals aggregating $22.1 million through 2036 that are due under various
non-cancelable subleases. Rental expense (including insignificant amounts for
contingent rentals) for operating leases aggregated, in millions: $4.9 in 1999,
$2.6 in 1998 and $2.0 in 1997. Sublease rental revenue (excluding amounts for
improvements constructed by WRI on the leased land) from these leased properties
was as follows, in millions: $2.9 in 1999 and 1998 and $2.4 in 1997.
Property under capital leases, consisting of five shopping centers, aggregated
$41.1 and $12.3 million, respectively, at December 31, 1999 and 1998 and is
included in buildings and improvements. Amortization of property under capital
leases is included in depreciation and amortization expense. Future minimum
lease payments under these capital leases total $89.6 million, with annual
payments due, in millions, of $3.2 in each of 2000 through 2002; $18.3 in 2003;
$1.9 in 2004; and $59.8 thereafter. The amount of these total payments
representing interest is $41.1 million. Accordingly, the present value of the
net minimum lease payments is $48.5 million at December 31, 1999.
In 1998 and 1997, WRI formed limited partnerships to acquire certain property.
WRI controls the partnerships and consolidates their operations in the
accompanying consolidated financial statements. The partnership agreements
allow for the outside limited partners to put their interests to the partnership
after the second anniversary of the agreement for the original consideration of
$4.0 million and $1.7 million in 1998 and 1997, respectively, payable in cash or
WRI common shares at the option of WRI. Subsequent to year-end, one limited
partner put its interest in a partnership to WRI. We expect to issue common
shares or remit cash to the limited partner in early 2000.
WRI is involved in various matters of litigation arising in the normal course of
business. While WRI is unable to predict with certainty the amounts involved,
WRI's management and counsel are of the opinion that, when such litigation is
resolved, WRI's resulting liability, if any, will not have a material effect on
WRI's consolidated financial statements.
NOTE 10. FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair value of WRI's financial instruments was determined using available
market information and appropriate valuation methodologies as of December 31,
1999. Unless otherwise described below, all other financial instruments are
carried at amounts which approximate their fair values.
Based on rates currently available to WRI for debt with similar terms and
average maturities, fixed-rate debt with carrying values of $499.9 million and
$444.1 million have fair values of approximately $485.6 million and $443.9
million at December 31, 1999 and 1998, respectively. The fair value of WRI's
variable-rate debt approximates its carrying values of $94.3 million and $72.3
million at year-end 1999 and 1998, respectively.
The fair value of the interest rate swap agreements is based on the estimated
amounts WRI would receive or pay to terminate the contracts. If WRI had
terminated these agreements at December 31, 1999 and 1998, WRI would have paid
$1.1 million and $3.8 million at each year-end, respectively.
The fair value of the mortgage bonds and notes receivable from WRI Holdings was
not determined because it is not practicable to reasonably assess the credit
adjustment that would be applied in the marketplace for such bonds and notes
receivable.
NOTE 11. SHARE OPTIONS AND AWARDS
WRI had an incentive share option plan which provided for the issuance of
options and share awards up to a maximum of 700,000 common shares that expired
in December 1997. Options granted under this plan become exercisable in equal
increments over a three-year period. WRI has an additional share option plan
which grants 100 share options to every employee of WRI, excluding officers,
upon completion of each five-year interval of service. This plan, which expires
in 2002, provides options for a maximum of 100,000 common shares. Options
granted under this plan are exercisable immediately. For both of these share
option plans, options are granted to employees of WRI at an exercise price equal
to the quoted fair market value of the common shares on the date the options are
granted and expire upon termination of employment or ten years from the date of
grant.
In 1999, WRI granted 16,000 share options under a compensatory incentive share
plan. This plan, which expires in 2002, provides for the issuance of up to
1,750,000 shares, either in the form of restricted shares or share options. The
restricted shares generally vest over a ten-year period, with potential
acceleration of vesting due to appreciation in the market value of our common
shares. The share options generally vest over a three-year period beginning one
year after the date of grant. Share options were granted at the quoted fair
market value on the date of grant. Restricted shares are issued at no cost to
the employee, and as such we recognized compensation expense relating to
restricted shares as follows, in millions: $.3 in 1999, 1998 and 1997.
WRI does not recognize compensation cost for share options when the option
exercise price equals or exceeds the quoted fair market value on the date of the
grant. Had we determined compensation cost for our share option and award plans
based on the fair value of the options granted at the grant dates, our proforma
net income available to common shareholders would have been as follows, in
millions: $75.9, $53.8 and $54.3 in 1999, 1998 and 1997, respectively. Proforma
net income per common share - basic would have been $2.84, $2.02 and $2.04 in
1999, 1998 and 1997, respectively.
The fair value of each option grant was estimated on the date of grant using the
Black-Scholes option-pricing method with the following weighted-average
assumptions in 1999, 1998 and 1997, respectively: dividend yield of 7.3%, 6.5%
and 6.0%; expected volatility of 18.1%, 18.1% and 18.0%; expected lives of 6.9,
6.9 and 6.9 and risk-free interest rates of 6.6%, 4.8% and 6.5%.
Following is a summary of the option activity for the three years ended December
31, 1999:
SHARES WEIGHTED
UNDER AVERAGE
OPTION EXERCISE PRICE
----------- --------------
Outstanding, January 1, 1997 . . . . . . . 687,735 $ 35.40
Granted. . . . . . . . . . . . . . . . . . 558,600 40.25
Canceled . . . . . . . . . . . . . . . . . (9,400) 37.60
Exercised. . . . . . . . . . . . . . . . . (61,910) 32.00
-----------
Outstanding, December 31, 1997 . . . . . . 1,175,025 37.85
Granted. . . . . . . . . . . . . . . . . . 14,900 42.99
Canceled . . . . . . . . . . . . . . . . . (7,802) 40.14
Exercised. . . . . . . . . . . . . . . . . (29,344) 34.01
-----------
Outstanding, December 31, 1998 . . . . . . 1,152,779 37.99
Granted. . . . . . . . . . . . . . . . . . 17,900 41.29
Canceled . . . . . . . . . . . . . . . . . (14,800) 40.23
Exercised. . . . . . . . . . . . . . . . . (39,089) 32.95
-----------
Outstanding, December 31, 1999 . . . . . . 1,116,790 $ 38.19
===========
The number of share options exercisable at December 31, 1999, 1998 and 1997 was
728,000, 432,000 and 296,000, respectively. Options exercisable at year-end
1999 had a weighted average exercise price of $37.74. The weighted average fair
value of share options granted during 1999, 1998 and 1997 was $4.25, $4.05 and
$5.35, respectively. Share options outstanding at December 31, 1999 had
exercise prices ranging from $25.00 to $45.81 and a weighted average remaining
contractual life of 5.7 years. Approximately 89% of the options outstanding at
year-end 1999 have exercise prices between $37.00 and $40.25 and a weighted
average contractual life of 6.0 years. There were 1,011,000 common shares
available for the future grant of options or awards at December 31, 1999.
NOTE 12. EMPLOYEE BENEFIT PLANS
WRI has a Savings and Investment Plan to which eligible employees may elect to
contribute from 1% to 12% of their salaries. Employee contributions are matched
by WRI at the rate of $.50 per $1.00 for the first 6% of the employee's salary.
The employees vest in the employer contributions ratably over a six-year period.
Compensation expense related to the plan was $.3 million in 1999 and 1998 and
$.2 million in 1997.
Effective April 1, 1999, WRI adopted an Employee Share Purchase Plan under which
250,000 WRI common shares have been authorized. These shares, as well as common
shares purchased by WRI on the open market, are made available for sale to
employees at a discount of 15%. Shares purchased by the employee under the plan
are restricted from being sold for two years from the date of purchase or until
termination of employment with WRI. During 1999, a total of 8,028 shares were
purchased by employees at an average price of $33.01.
WRI has a defined benefit pension plan covering substantially all of its
employees. The benefits are based on years of service and the employee's
compensation during the last five years of service. Our funding policy is to
make annual contributions as required by applicable regulations, however, we
have not been required to make contributions for any of the past three years.
Reconciliations of the benefit obligation, plan assets at fair value and
the funded status of the plan are as follows (in thousands):
1999 1998
-------- --------
Benefit obligation at beginning of year . . . . . . . $10,485 $ 9,318
Service cost. . . . . . . . . . . . . . . . . . . . . 533 457
Interest cost . . . . . . . . . . . . . . . . . . . . 729 663
Actuarial (gain) loss . . . . . . . . . . . . . . . . (841) 245
Benefit payments. . . . . . . . . . . . . . . . . . . (203) (198)
-------- --------
Benefit obligation at end of year . . . . . . . . . . $10,703 $10,485
======== ========
Fair value of plan assets at beginning of year. . . . $10,676 $10,348
Actual return on plan assets. . . . . . . . . . . . . 1,584 526
Benefit payments. . . . . . . . . . . . . . . . . . . (203) (198)
-------- --------
Fair value of plan assets at end of year. . . . . . . $12,057 $10,676
======== ========
Plan assets at fair value less benefit obligation . . $ 1,354 $ 191
Unrecognized prior service cost . . . . . . . . . . . 8
Unrecognized gain . . . . . . . . . . . . . . . . . . (3,096) (1,681)
-------- --------
Pension liability . . . . . . . . . . . . . . . . . . $(1,742) $(1,482)
======== ========
The components of net periodic pension cost are as follows (in thousands):
1999 1998 1997
------ ------ ------
Service cost . . . . . . . . . . . . . . . . . . . $ 533 $ 457 $ 430
Interest cost. . . . . . . . . . . . . . . . . . . 729 663 587
Expected return on plan assets . . . . . . . . . . (950) (923) (703)
Amortization of transition asset . . . . . . . . . (54)
Prior service cost . . . . . . . . . . . . . . . . 8 47 47
Recognized gains . . . . . . . . . . . . . . . . . (59) (124) (44)
------ ------ ------
Total. . . . . . . . . . . . . . . . . . $ 261 $ 120 $ 263
====== ====== ======
Assumptions used to develop periodic expense and the actuarial present value of
the benefit obligations were:
1999 1998 1997
------ ------ ------
Weighted average discount rate . . . . . . . . . . 7.5% 6.7% 7.0%
Expected long-term rate of return on plan assets . 9.0% 9.0% 9.0%
Rate of increase in compensation levels. . . . . . 5.0% 5.0% 5.0%
WRI also has a non-qualified supplemental retirement plan for officers of WRI
which provides for benefits in excess of the statutory limits of its defined
benefit pension plan. The obligation is funded in a grantor trust with our
common shares. We recognized expense as follows, in millions: $.3 in 1999,
1998 and 1997.
NOTE 13. SEGMENT INFORMATION
The operating segments presented are the segments of WRI for which separate
financial information is available and operating performance is evaluated
regularly by senior management in deciding how to allocate resources and in
assessing performance. WRI evaluates the performance of its operating segments
based on net operating income that is defined as total revenues less operating
expenses and ad valorem taxes. Management does not consider the effect of gains
or losses from the sale of property in evaluating ongoing operating performance.
The shopping center segment is engaged in the acquisition, development and
management of real estate, primarily anchored neighborhood and community
shopping centers located in Texas, Louisiana, Arizona, Nevada, Arkansas, New
Mexico, Oklahoma, Tennessee, Kansas, Colorado, Missouri, Illinois, Florida and
Maine. The customer base includes supermarkets, drugstores and other retailers
who generally sell basic necessity-type commodities. The industrial segment is
engaged in the acquisition, development and management of bulk warehouses and
office/service centers. Its properties are located in Texas, Nevada and
Tennessee, and the customer base is diverse. Included in "Other" are
corporate-related items, insignificant operations and costs that are not
allocated to the reportable segments.
Information concerning WRI's reportable segments is as follows (in thousands):
SHOPPING
CENTER INDUSTRIAL OTHER TOTAL
--------- ----------- -------- ------------
1999:
Revenues . . . . . . . . . $ 197,084 $ 28,331 $ 5,054 $ 230,469
Net operating income . . . 140,191 20,127 5,716 166,034
Total assets . . . . . . . 1,025,090 173,502 110,804 1,309,396
Capital expenditures . . . 189,445 56,461 12,777 258,683
1998:
Revenues . . . . . . . . . $ 176,269 $ 18,574 $ 3,624 $ 198,467
Net operating income . . . 125,949 13,342 4,327 143,618
Total assets . . . . . . . 898,805 133,379 74,859 1,107,043
Capital expenditures . . . 118,746 54,790 6,051 179,587
1997:
Revenues . . . . . . . . . $ 154,979 $ 14,912 $ 4,621 $ 174,512
Net operating income . . . 109,776 10,855 4,640 125,271
Total assets . . . . . . . 816,852 88,091 41,850 946,793
Capital expenditures . . . 138,365 16,908 2,985 158,258
Net operating income reconciles to income before extraordinary charge as shown
on the Statements of Consolidated Income as follows (in thousands):
-------------------------------
1999 1998 1997
--------- --------- ---------
Total segment net operating income . . $166,034 $143,618 $125,271
Less:
Depreciation and amortization. . . 49,612 41,946 37,976
Interest . . . . . . . . . . . . . 33,186 33,654 30,009
General and administrative . . . . 7,512 7,146 5,647
Gain on sales of property. . . . . (20,596) (885) (3,327)
--------- --------- ---------
Income before extraordinary charge . . $ 96,320 $ 61,757 $ 54,966
========= ========= =========
Equity in earnings of real estate joint ventures and partnerships as shown on
the Statements of Consolidated Income and the corresponding investment balances
are included in net operating income of the shopping center segment.
NOTE 14. PRO FORMA FINANCIAL INFORMATION (UNAUDITED)
During the year ended December 31, 1999, WRI acquired five retail centers, a
building adjacent to a WRI-owned shopping center, a joint venture partner's 77%
interest in a retail center and twelve industrial projects for a total of $150.5
million. The pro forma financial information for the years ended December 31,
1999 and 1998 is based on the historical statements of WRI after giving effect
to the acquisitions as if such acquisitions took place on January 1, 1999 and
1998, respectively.
The pro forma financial information shown below is presented for informational
purposes only and may not be indicative of results that would have actually
occurred if the acquisitions had been in effect at the dates indicated, nor does
it purport to be indicative of the results that may be achieved in the future
(in thousands, except per share amounts).
DECEMBER 31,
------------------
1999 1998
-------- --------
Pro forma revenues . . . . . . . . . . . . . . . . . . . . . . $241,091 $219,827
======== ========
Pro forma net income available to common shareholders. . . . . $ 78,544 $ 57,977
======== ========
Pro forma net income per common share - basic. . . . . . . . . $ 2.94 $ 2.17
======== ========
Pro forma net income per common share - diluted. . . . . . . . $ 2.93 $ 2.16
======== ========
NOTE 15. QUARTERLY FINANCIAL DATA (UNAUDITED)
Summarized quarterly financial data is as follows (in thousands, except per
share amounts):
FIRST SECOND THIRD FOURTH
------- ------- ------- -------
1999:
Revenues . . . . . . . . . . . . . . . . . . . . . $54,764 $56,312 $58,387 $61,006
Net income available to common shareholders. . . . 13,524 14,174 14,562 34,277 (1)
Net income per common share - basic. . . . . . . . 0.51 0.53 0.55 1.28 (1)
Net income per common share - diluted. . . . . . . 0.50 0.53 0.54 1.28 (1)
1998:
Revenues . . . . . . . . . . . . . . . . . . . . . $46,962 $48,808 $49,955 $52,742
Net income available to common shareholders. . . . 12,329 13,682 14,304 14,169
Net income per common share - basic. . . . . . . . 0.46 0.51 0.54 0.53
Net income per common share - diluted. . . . . . . 0.46 0.51 0.53 0.53
(1) Increase is primarily the result of a gain on the sale of property
during the quarter.
NOTE 16. PRICE RANGE OF COMMON SHARES (UNAUDITED)
The high and low sale prices per share of WRI's common shares, as reported on
the New York Stock Exchange composite tape, and dividends per common share paid
for the fiscal quarters indicated were as follows:
HIGH LOW DIVIDENDS
--------- --------- ---------
1999:
Fourth. . . $ 39 3/8 $ 37 $ 0.71
Third . . . 42 7/16 37 1/4 0.71
Second. . . 43 7/16 38 1/4 0.71
First . . . 45 5/8 38 3/8 0.71
1998:
Fourth. . . $ 46 7/8 $ 39 3/4 $ 0.67
Third . . . 43 35 15/16 0.67
Second. . . 44 15/16 40 5/8 0.67
First . . . 45 5/8 43 7/8 0.67
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. TRUST MANAGERS AND EXECUTIVE OFFICERS OF THE REGISTRANT
(a) Information with respect to WRI's Trust Managers is incorporated
herein by reference to the "Election of Trust Managers" section of WRI's
definitive Proxy Statement for the Annual Meeting of Shareholders to be held
April 24, 2000.
ITEM 11. EXECUTIVE COMPENSATION
Incorporated herein by reference to the "Executive Compensation" and
"Pension Plan" sections of WRI's definitive Proxy Statement for the Annual
Meeting of Shareholders to be held April 24, 2000.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Incorporated herein by reference to the "Election of Trust Managers"
section of WRI's definitive Proxy Statement for the Annual Meeting of
Shareholders to be held April 24, 2000.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Incorporated herein by reference to the "Compensation Committee Interlocks
and Insider Participation" section of WRI's definitive Proxy Statement for the
Annual Meeting of Shareholders to be held April 24, 2000.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) Financial Statements and Financial Statement Schedules: PAGE
----
(1) (A) Independent Auditors' Report . . . . . . . . . . . . . . 21
(B) Financial Statements
(i) Statements of Consolidated Income for the years
ended December 31, 1999, 1998 and 1997. . . . . . 22
(ii) Consolidated Balance Sheets as of December 31,
1999 and 1998 . . . . . . . . . . . . . . . . . 23
(iii) Statements of Consolidated Cash Flows for the
years ended December 31, 1999, 1998 and 1997. . . 24
(iv) Statements of Consolidated Shareholders'
Equity for the years ended December 31, 1999,
1998 and 1997.. . . . . . . . . . . . . . . . . 25
(v) Notes to Consolidated Financial Statements. . . . . 26
(2) Financial Statement Schedules:
SCHEDULE PAGE
-------- ----
II Valuation and Qualifying Accounts . . . . . . . . . . 45
III Real Estate and Accumulated Depreciation. . . . . . 46
IV Mortgage Loans on Real Estate . . . . . . . . . . . 48
All other schedules are omitted since the required information is not present or
is not present in amounts sufficient to require submission of the schedule or
because the information required is included in the consolidated financial
statements and notes hereto.
(b) No reports on Form 8-K were filed during the last quarter of the
period covered by this annual report.
(c) Exhibits:
3.1 - Restated Declaration of Trust (filed as Exhibit 3.1 to WRI's Registration Statement on Form S-3
(No. 33-49206) and incorporated herein by reference).
3.2 - Amendment of the Restated Declaration of Trust (filed as Exhibit 3.2 to WRI's Registration
Statement on Form 8-A dated January 19, 1999 and incorporated herein by reference).
3.3 - Second Amendment of the Restated Declaration of Trust (filed as Exhibit 3.3 to WRI's
Registration Statement on Form 8-A dated January 19, 1999 and incorporated herein by
reference).
3.4 - Third Amendment of the Restated Declaration of Trust (filed as Exhibit 3.4 to WRI's
Registration Statement on Form 8-A dated January 19, 1999 and incorporated herein by
reference).
3.5 - Amended and Restated Bylaws of WRI (filed as Exhibit 3.2 to WRI's Registration Statement on
Form S-3 (No. 33-49206) and incorporated herein by reference).
4.1 - 16% Mortgage Bonds Due 2004 of WRI Holdings, Inc., dated December 28, 1984, payable to
WRI in the original principal amount of $16,682,000 (filed as Exhibit 10.10 to WRI's
Registration Statement on Form S-4 (No. 33-19730) and incorporated herein by reference).
4.2 - 16% Mortgage Bonds Due 1994 of WRI Holdings, Inc. dated December 28, 1984, payable to
WRI in the original principal amount of $3,150,000 (filed as Exhibit 10.8 to WRI's Registration
Statement on Form S-4 (No. 33-19730) and incorporated herein by reference).
4.2.1* - Sixth Bonds Renewal and Extension Agreement, effective December 28, 2000, for the 16%
Mortgage Bonds of WRI Holdings, Inc., payable to WRI in the original principal amount of
3,150,000.
4.3 - Trust Indenture, dated December 28, 1984, between WRI Holdings, Inc. and Chase Bank of
Texas, National Association (formerly, Texas Commerce Bank National Association), as
Trustee, relating to the 16% Mortgage Bonds Due 1994 of WRI Holdings, Inc. in the original
principal amount of $3,150,000 (filed as Exhibit 10.9 to WRI's Registration Statement on Form
S-4 (No. 33-19730) and incorporated herein by reference).
4.3.1 - Supplemental Indenture of Trust, dated February 22, 1995, between WRI Holdings, Inc. and
Chase Bank of Texas, National Association (formerly, Texas Commerce Bank National
Association) relating to the 16% Mortgage Bonds due December 28, 1994 of WRI Holdings,
Inc. in the original principal amount of $3,150,000 (filed as Exhibit 10.4.1 to WRI's Annual
Report on Form 10-K for the year ended December 31, 1994 and incorporated herein by
reference).
4.4* - Sixth Supplemental Indenture of Trust between WRI Holdings, Inc. and Chase Bank of Texas,
National Association (formerly, Texas Commerce Trust Company of New York), as Trustee,
amending Trust Indenture, dated December 28, 1984, between WRI Holdings, Inc. and Chase
Bank of Texas, National Association (formerly, Texas Commerce Bank National Association),
as Trustee, relating to the 16% Mortgage Bonds Due 1994 of WRI Holdings, Inc. in the original
principal amount of $3,150,000.
4.5 - Trust Indenture, dated December 28, 1984, between WRI Holdings, Inc. and Chase Bank of
Texas, National Association (formerly, Texas Commerce Bank National Association), as
Trustee, relating to the 16% Mortgage Bonds Due 2004 of WRI Holdings, Inc. in the original
principal amount of $16,682,000 (filed as Exhibit 10.11 to WRI's Registration Statement on
Form S-4 (No. 33-19730) and incorporated herein by reference).
4.5.1 - First Supplemental Indenture of Trust between WRI Holdings, Inc. and Chase Bank of Texas,
National Association (formerly, Texas Commerce Trust Company of New York), as Trustee,
amending Trust Indenture, dated December 28, 1984, between WRI Holdings, Inc. and Chase
Bank of Texas, National Association (formerly, Texas Commerce Bank National Association),
as Trustee, relating to the 16% Mortgage Bonds Due 2004 of WRI Holdings, Inc. in the original
principal amount of $16,682,000 (filed as Exhibit 10.7.1 to WRI's Annual Report on Form 10-K
for the year ended December 31, 1989 and incorporated herein by reference).
4.6 - Third Amended Promissory Note, as restated, effective as of January 1, 1992, executed by
WRI Holdings, Inc., pursuant to which it may borrow up to the principal sum of $40,000,000
from WRI (filed as Exhibit 10.8 to WRI's Annual Report on Form 10-K for the year ended
December 31, 1997 and incorporated herein by reference).
4.7 - 16% Mortgage Bonds Due 2004 of WRI Holdings, Inc., dated December 28, 1984, payable to
WRI in the original principal amount of $7,000,000 (filed as Exhibit 10.13 to WRI's Registration
Statement on Form S-4 (No. 33-19730) and incorporated herein by reference).
4.8 - Trust Indenture, dated December 28, 1984, between WRI Holdings, Inc. and Chase Bank of
Texas, National Association (formerly, Texas Commerce Bank National Association), as
Trustee, relating to the 16% Mortgage Bonds Due 2004 of WRI Holdings, Inc. in the original
principal amount of $7,000,000 (filed as Exhibit 10.14 to WRI's Registration Statement on Form
S-4 (No. 33-19730) and incorporated herein by reference).
4.8.1 - First Supplemental Indenture of Trust between WRI Holdings, Inc. and Chase Bank of Texas,
National Association (formerly, Texas Commerce Trust Company of New York), as Trustee,
amending Trust Indenture, dated December 28, 1984, between WRI Holdings, Inc. and Chase
Bank of Texas, National Association (formerly, Texas Commerce Bank National Association),
as Trustee, relating to the 16% Mortgage Bonds Due 2004 of WRI Holdings, Inc. in the original
principal amount of $7,000,000 (filed as Exhibit 10.10.1 to WRI's Annual Report on Form 10-K
for the year ended December 31, 1989 and incorporated herein by reference).
4.9 - Agreement Correcting Trust Indenture, dated February 11, 1985, relating to 16% Mortgage
Bonds Due 2004 of WRI Holdings, Inc. in the original principal amount of $7,000,000 (filed as
Exhibit 10.15 to WRI's Registration Statement on Form S-4 (No. 33-19730) and incorporated
herein by reference).
4.10 - Amendment to Note Purchase Agreement, dated March 31, 1991, amending loan agreement,
dated August 6, 1987, Life and Accident Insurance Company for $5,000,000, American
General Life Insurance Company of Delaware for $5,000,000, Republic National Life Insurance
Company for $3,000,000 and American Amicable Life Insurance Company of Texas for
2,000,000 (filed as Exhibit 10.15.1 to WRI's Annual Report on Form 10-K for the year ended
December 31, 1992 and incorporated herein by reference).
4.11 - Promissory Note in the amount of $12,000,000 between WRI, as payee, and Plaza
Construction, Inc., as maker (filed as Exhibit 10.23 to WRI's Annual Report on Form 10-K for
the year ended December 31, 1991 and incorporated herein by reference).
4.11.1* - Eleventh Renewal and Extension of Promissory Note in the amount of $12,000,000, effective
as of December 1, 2000, between WRI, as payee, and Plaza Construction, Inc., as maker.
4.12 - Amended and Restated Master Swap Agreement dated as of January 29, 1992, between WRI
and Chase Bank of Texas, National Association (formerly, Texas Commerce Bank National
Association) (filed as Exhibit 10.24 to WRI's Annual Report on Form 10-K for the year ended
December 31, 1992 and incorporated herein by reference).
4.12.1 - Rate Swap Transaction, dated as of May 15, 1992, between WRI and Chase Bank of Texas,
National Association (formerly, Texas Commerce Bank National Association) (filed as Exhibit
10.24.1 to WRI's Annual Report on Form 10-K for the year ended December 31, 1992 and
incorporated herein by reference).
4.12.2 - Rate Swap Transaction, dated as of June 24, 1992, between WRI and Chase Bank of Texas,
National Association (formerly, Texas Commerce Bank National Association) (filed as Exhibit
10.24.2 to WRI's Annual Report on Form 10-K for the year ended December 31, 1992 and
incorporated herein by reference).
4.12.3 - Rate Swap Transaction, dated as of July 2, 1992, between WRI and Chase Bank of Texas,
National Association (formerly, Texas Commerce Bank National Association) (filed as Exhibit
10.24.3 to WRI's Annual Report on Form 10-K for the year ended December 31, 1992 and
incorporated herein by reference).
4.13 - Amended and Restated Credit Agreement dated as of November 21, 1996 between WRI and
Chase Bank of Texas, National Association (formerly, Texas Commerce Bank National
Association), as Agent, and individually as a Bank, and the Banks defined therein (filed as
Exhibit 10.17 to WRI's Annual Report on Form 10-K for the year ended December 31, 1997
and incorporated herein by reference).
4.13.1 - First, Second and Third Amendments to the Amended and Restated Credit Agreement dated
November 21, 1996 between WRI and Chase Bank of Texas, National Association (formerly,
Texas Commerce Bank National Association) (filed as Exhibit 10.17.1 to WRI's Annual Report
on Form 10-K for the year ended December 31, 1997 and incorporated herein by reference).
4.14 - Note Purchase Agreement, dated April 1, 1994, between The Variable Annuity Life Insurance
Company, American General Life Insurance Company and WRI in the amount of $30,000,000
(filed as Exhibit 10.25 to WRI's Annual Report on Form 10-K for the year ended December 31,
1994 and incorporated herein by reference).
4.15 - Master Promissory Note in the amount of $20,000,000 between WRI, as payee, and Chase
Bank of Texas, National Association (formerly, Texas Commerce Bank National Association),
as maker, effective December 30, 1998 (filed as Exhibit 4.15 to WRI's Annual Report on Form
10-K for the year ended December 31, 1998 and incorporated herein by reference).
4.16 - Distribution Agreement among WRI and the Agents dated November 15, 1996 relating to the
Medium Term Notes (filed as Exhibit 1.1 to WRI's Current Report of Form 8-K dated November
15, 1996 and incorporated herein by reference).
4.17 - Senior Indenture dated as of May 1, 1995 between WRI and Chase Bank of Texas, National
Association (formerly, Texas Commerce Bank National Association), as trustee (filed as Exhibit
4(a) to WRI's Registration Statement on Form S-3 (No. 33-57659) and incorporated herein by
reference).
4.18 - Subordinated Indenture dated as of May 1, 1995 between WRI and Chase Bank of Texas,
National Association (formerly, Texas Commerce Bank National Association) (filed as Exhibit
4(b) to WRI's Registration Statement on Form S-3 (No. 33-57659) and incorporated herein by
reference).
4.19 - Form of Fixed Rate Senior Medium Term Note (filed as Exhibit 4.19 to WRI's Annual Report on
Form 10-K for the year ended December 31, 1998 and incorporated herein by reference).
4.20 - Form of Floating Rate Senior Medium Term Note (filed as Exhibit 4.20 to WRI's Annual Report
on Form 10-K for the year ended December 31, 1998 and incorporated herein by reference).
4.21 - Form of Fixed Rate Subordinated Medium Term Note (filed as Exhibit 4.21 to WRI's Annual
Report on Form 10-K for the year ended December 31, 1998 and incorporated herein by
reference).
4.22 - Form of Floating Rate Subordinated Medium Term Note (filed as Exhibit 4.22 to WRI's Annual
Report on Form 10-K for the year ended December 31, 1998 and incorporated herein by
reference).
4.23 - Statement of Designation of 7.44% Series A Cumulative Redeemable Preferred Shares (filed
as Exhibit 99 to WRI's Current Report on Form 8-A dated February 18, 1998 and incorporated
herein by reference).
4.24 - Statement of Designation of 7.125% Series B Cumulative Redeemable Preferred Shares (filed
as Exhibit 4.2 to WRI's Current Report on Form 8-K dated October 28, 1998 and incorporated
herein by reference).
4.25 - Statement of Designation of 7.00% Series C Cumulative Redeemable Preferred Shares (filed
as Exhibit 4.1 to WRI's Registration Statement on Form 8-A dated January 19, 1999 and
incorporated herein by reference).
4.26 - 7.44% Series A Cumulative Redeemable Preferred Share Certificate (filed as Exhibit 4 to
WRI's Current Report on Form 8-K dated February 23, 1998 and incorporated herein by
reference).
4.27 - 7.125% Series B Cumulative Redeemable Preferred Share Certificate (filed as Exhibit 4.1 to
WRI's Current Report on Form 8-K dated October 28, 1998 and incorporated herein by
reference).
4.28 - 7.00% Series C Cumulative Redeemable Preferred Share Certificate (filed as Exhibit 4.2 to
WRI's Registration Statement on Form 8-A dated January 19, 1999 and incorporated herein by
reference).
4.29 - Distribution Agreement among WRI and the Agents dated August 10, 1998 relating to the
Medium Term Notes (filed as Exhibit 1.1 to WRI's current report on Form 8-K dated August 12,
1998 and incorporated herein by reference).
4.30* - Credit Agreement, dated January 6, 2000, between WRI and Bank of America, N.A.
4.30.1* - First Amendment to Credit Agreement, dated February 24, 2000, between WRI and Bank of
America, N.A.
4.31* - Promissory Note in the amount of $100,000,000, or aggregate principal amount outstanding
under Credit Agreement, between WRI, as payee, and Bank of America, N.A., as maker, dated
January 6, 2000.
10.1** - 1988 Share Option Plan of WRI, as amended (filed as Exhibit 10.1 to WRI's Annual Report on
Form 10-K for the year ended December 31, 1990 and incorporated herein by reference).
10.2** - Weingarten Realty Investors Supplemental Retirement Account Plan, as amended and
restated (filed as Exhibit 10.26 to WRI's Annual Report on Form 10-K for the year ended
December 31, 1992 and incorporated herein by reference).
10.3** - The Savings and Investment Plan for Employees of WRI, as amended (filed as Exhibit 4.1 to
WRI's Registration Statement on Form S-8 (No. 33-25581) and incorporated herein by
reference).
10.4** - The Fifth Amendment to Savings and Investment Plan for Employees of WRI (filed as Exhibit
4.1.1 to WRI's Post-Effective Amendment No. 1 to Registration Statement on Form S-8 (No.
33-25581) and incorporated herein by reference).
10.5** - The 1993 Incentive Share Plan of WRI (filed as Exhibit 4.1 to WRI's Registration Statement on
Form S-8 (No. 33-52473) and incorporated herein by reference).
10.6*** - 1999 WRI Employee Share Purchase Plan
12.1* - Computation of Fixed Charges Ratios.
21.1* - Subsidiaries of the Registrant.
23.1* - Consent of Deloitte & Touche LLP.
27.1* - Financial Data Schedule.
* Filed with this report.
** Management contract or compensatory plan or arrangement.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
WEINGARTEN REALTY INVESTORS
By: Stanford Alexander
---------------------------------
Stanford Alexander
Chairman/Chief Executive Officer
Date: March 17, 2000
Pursuant to the requirement of the Securities and Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:
SIGNATURE TITLE DATE
--------- ----- ----
By: Stanford Alexander Chairman and Trust Manager March 17, 2000
------------------------
Stanford Alexander (Chief Executive Officer)
By: Andrew M. Alexander President March 17, 2000
------------------------
Andrew M. Alexander and Trust Manager
By: Robert J. Cruikshank Trust Manager March 17, 2000
------------------------
Robert J. Cruikshank
By: Martin Debrovner Vice Chairman March 17, 2000
------------------------
Martin Debrovner and Trust Manager
By: Melvin Dow Trust Manager March 17, 2000
------------------------
Melvin Dow
By: Stephen A. Lasher Trust Manager March 17, 2000
------------------------
Stephen A. Lasher
By: Joseph W. Robertson, Jr. Executive Vice President and March 17, 2000
------------------------
Joseph W. Robertson, Jr. Trust Manager (Chief Financial Officer)
By: Douglas W. Schnitzer Trust Manager March 17, 2000
------------------------
Douglas W. Schnitzer
By: Marc J. Shapiro Trust Manager March 17, 2000
------------------------
Marc J. Shapiro
By: J.T. Trotter Trust Manager March 17, 2000
------------------------
J.T. Trotter
By: Stephen C. Richter Senior Vice President/ March 17, 2000
------------------------
Stephen C. Richter Financial Administration
and Treasurer
(Principal Accounting Officer)
SCHEDULE II
WEINGARTEN REALTY INVESTORS
VALUATION AND QUALIFYING ACCOUNTS
DECEMBER 31, 1999, 1998 AND 1997
(AMOUNTS IN THOUSANDS)
CHARGED
BALANCE AT TO COSTS CHARGED BALANCE
BEGINNING AND TO OTHER DEDUCTIONS AT END OF
DESCRIPTION OF PERIOD EXPENSES ACCOUNTS (A) PERIOD
- ----------------------------------- ----------- --------- -------- ----------- ----------
1999:
Allowance for Doubtful Accounts. . . $ 888 $ 1,047 $ 1,027 $ 908
1998:
Allowance for Doubtful Accounts. . . $ 1,000 $ 683 $ 795 $ 888
1997:
Allowance for Doubtful Accounts. . . $ 1,236 $ 877 $ 1,113 $ 1,000
_________
Note A - Write-offs of accounts receivable previously reserved.
SCHEDULE III
WEINGARTEN REALTY INVESTORS
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1999
(AMOUNTS IN THOUSANDS)
Total Cost
-------------------------------------
Buildings Projects
and Under Total Accumulated Encumbrances
Land Improvements Development Cost Depreciation (A)
-------- ------------- ------------ ---------- ------------- --------------
SHOPPING CENTERS:
Texas . . . . . . . . . . .$167,757 $ 659,682 $ 827,439 $ 230,568 $ 11,709
Other States. . . . . . . . 78,388 316,309 394,697 61,746 23,948
-------- ------------- ------------ ---------- ------------- --------------
Total Shopping Centers. . 246,145 975,991 1,222,136 292,314 35,657
INDUSTRIAL:
Texas . . . . . . . . . . . 28,404 133,564 161,968 20,234 3,974
Other States. . . . . . . . 2,512 10,665 13,177 317
-------- ------------- ------------ ---------- ------------- --------------
Total Industrial. . . . . 30,916 144,229 175,145 20,551 3,974
OFFICE BUILDING:
Texas . . . . . . . . . . . 534 15,650 16,184 10,782
-------- ------------- ------------ ---------- ------------- --------------
MULTI-FAMILY
RESIDENTIAL:
Texas . . . . . . . . . . . 2,276 12,724 15,000 215
-------- ------------- ------------ ---------- ------------- --------------
Total Improved
Properties . . . . . . . 279,871 1,148,594 1,428,465 323,862 39,631
-------- ------------- ------------ ---------- ------------- --------------
LAND UNDER DEVELOPMENT
OR HELD FOR
DEVELOPMENT:
Texas . . . . . . . . . . . $ 29,544 29,544
Other States. . . . . . . . 7,104 7,104
-------- ------------- ------------ ---------- ------------- --------------
Total Land Under
Development or Held
for Development. . . . . 36,648 36,648
-------- ------------- ------------ ---------- ------------- --------------
LEASED PROPERTY
(SHOPPING CENTER)
UNDER CAPITAL LEASE:
Other States. . . . . . . . 41,093 41,093 4,783 5,857
-------- ------------- ------------ ---------- ------------- --------------
CONSTRUCTION IN
PROGRESS:
Texas . . . . . . . . . . . 5,240 5,240
Other States. . . . . . . . 2,693 2,693
-------- ------------- ------------ ---------- ------------- --------------
Total Construction in
Progress . . . . . . . . 7,933 7,933
-------- ------------- ------------ ---------- ------------- --------------
TOTAL OF ALL
PROPERTIES. . . . . . . . . .$279,871 $ 1,189,687 $ 44,581 $1,514,139 $ 328,645 $ 45,488
======== ============= ============ ========== ============= ==============
____________
Note A - Encumbrances do not include $24.9 million outstanding under a $30 million 20-year term loan,
payable to a group of insurance companies secured by a property collateral pool including all
or part of three shopping centers.
SCHEDULE III
(CONTINUED)
The changes in total cost of the properties for the years ended December
31, 1999, 1998 and 1997 were as follows:
1999 1998 1997
----------- ----------- -----------
Balance at beginning of year. . . . . . . $1,294,632 $1,118,758 $ 970,418
Additions at cost . . . . . . . . . . . . 258,683 179,587 158,258
Retirements or sales. . . . . . . . . . . (39,176) (3,713) (9,918)
----------- ----------- -----------
Balance at end of year. . . . . . . . . . $1,514,139 $1,294,632 $1,118,758
=========== =========== ===========
The changes in accumulated depreciation for the years ended December 31,
1999, 1998 and 1997 were as follows:
1999 1998 1997
----------- ----------- -----------
Balance at beginning of year. . . . . . . $ 296,989 $ 262,551 $ 233,514
Additions at cost . . . . . . . . . . . . 43,930 35,678 32,226
Retirements or sales. . . . . . . . . . . (12,274) (1,240) (3,189)
----------- ----------- -----------
Balance at end of year. . . . . . . . . . $ 328,645 $ 296,989 $ 262,551
=========== =========== ===========
SCHEDULE IV
WEINGARTEN REALTY INVESTORS
MORTGAGE LOANS ON REAL ESTATE
DECEMBER 31, 1999
(AMOUNTS IN THOUSANDS)
FINAL PERIODIC FACE CARRYING
INTEREST MATURITY PAYMENT AMOUNT OF AMOUNT OF
RATE DATE TERMS MORTGAGES MORTGAGES(A)
-------- -------- --------- --------- ------------
SHOPPING CENTERS:
FIRST MORTGAGES:
Eastex Venture
Beaumont, TX (Note B). . . 8% 10-31-09 $335 $ 2,300 $ 2,288
Annual
P & I
Main/O.S.T., Ltd.
Houston, TX. . . . . . . . 9.3% 02-01-20 $476 4,800 4,524
Annual
P & I
($1,241
balloon)
INDUSTRIAL:
FIRST MORTGAGES:
River Pointe, Conroe,TX
(Note C) . . . . . . . . . Prime 11-30-03 Varying 2,133 1,891
+2%
Little York, Houston, TX
(Note C) . . . . . . . . . Prime 12-31-03 Varying 1,922 1,760
+2%
AN/WRI Partnership, Ltd.
Houston, TX. . . . . . . . Libor 06-05-00 Varying 33,149 33,149
+2%
South Loop Business Park
Houston, TX. . . . . . . . 9.25% 11-01-07 $74 439 410
Annual
P & I
Schedule continued on next page
SCHEDULE IV
(CONTINUED)
WEINGARTEN REALTY INVESTORS
MORTGAGE LOANS ON REAL ESTATE
DECEMBER 31, 1999
(AMOUNTS IN THOUSANDS)
FINAL PERIODIC FACE CARRYING
INTEREST MATURITY PAYMENT AMOUNT OF AMOUNT OF
RATE DATE TERMS MORTGAGES MORTGAGES(A)
-------- -------- --------- --------- ------------
UNIMPROVED LAND:
SECOND MORTGAGE:
River Pointe
Conroe, TX . . . . . . . . Prime 12-01-00 Varying $ 12,000 $ 3,806
+1% ($3,806
balloon)
--------- ------------
TOTAL MORTGAGE LOANS ON
REAL ESTATE (Note D) . . . . $ 56,743 $ 47,828
========= ============
Note A - The aggregate cost at December 31, 1999 for federal income tax purposes
is $47,828.
Note B - The periodic payment terms were 6% interest only through October 31, 1999
and 8% interest and principal commencing November 1, 1999 through the
maturity date.
Note C - Principal payments are due monthly to the extent of cash flow generated
by the underlying property.
Note D - Changes in mortgage loans for the years ended December 31, 1999, 1998
and 1997 are summarized below:
--------- --------- ---------
1999 1998 1997
--------- --------- ---------
Balance, Beginning of Year . . . . $ 28,359 $ 25,653 $ 27,157
New Mortgage Loans. . . . . . . . . 33,588 3,116
Additions to Existing Loans . . . . 1,773 1,560 589
Collections of Principal. . . . . . (15,892) (1,970) (2,093)
--------- --------- ---------
Balance, End of Year . . . . . . . $ 47,828 $ 28,359 $ 25,653
========= ========= =========