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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2002
-------------
OR
[ ] 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 (I.R.S. Employer
incorporation or organization) Identification No.)
2600 Citadel Plaza Drive, P.O. Box 924133, Houston, Texas 77292-4133
- ----------------------------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 866-6000
--------------
____________________________________________
(Former name, former address and former fiscal
year, if changed since last report)
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 .
---- ----
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes . No .
---- ----
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. As of August 5, 2002, there
were 51,973,522 common shares of beneficial interest of Weingarten Realty
Investors, $.03 par value, outstanding.
PART 1
FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
WEINGARTEN REALTY INVESTORS
STATEMENTS OF CONSOLIDATED INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- ----------------------
2002 2001 2002 2001
--------- --------- ---------- ----------
Revenues:
Rentals . . . . . . . . . . . . . . . . . . . . . . . . . $ 90,338 $ 76,493 $ 174,597 $ 142,392
Interest income . . . . . . . . . . . . . . . . . . . . . 231 349 431 649
Other . . . . . . . . . . . . . . . . . . . . . . . . . . 1,257 1,539 2,018 2,347
--------- --------- ---------- ----------
Total. . . . . . . . . . . . . . . . . . . . . . . . 91,826 78,381 177,046 145,388
--------- --------- ---------- ----------
Expenses:
Depreciation and amortization . . . . . . . . . . . . . . 19,291 16,541 37,186 31,976
Interest. . . . . . . . . . . . . . . . . . . . . . . . . 16,532 14,522 31,528 25,395
Operating . . . . . . . . . . . . . . . . . . . . . . . . 13,623 10,749 25,980 20,526
Ad valorem taxes. . . . . . . . . . . . . . . . . . . . . 10,860 9,596 21,141 18,021
General and administrative. . . . . . . . . . . . . . . . 3,398 2,729 6,074 5,104
--------- --------- ---------- ----------
Total. . . . . . . . . . . . . . . . . . . . . . . . 63,704 54,137 121,909 101,022
--------- --------- ---------- ----------
Income Before Equity in Earnings of Joint Ventures,
Minority Interest in Income of Partnerships, Gain on
Sale of Properties and Discontinued Operations . . . . 28,122 24,244 55,137 44,366
Equity in Earnings of Joint Ventures. . . . . . . . . . . . 965 1,042 2,039 2,047
Minority Interest in Income of Partnerships . . . . . . . . (943) (115) (1,059) (182)
Gain on Sale of Properties. . . . . . . . . . . . . . . . . 674 4,984
--------- --------- ---------- ----------
Income Before Discontinued Operations . . . . . . . . . . . 28,144 25,845 56,117 51,215
--------- --------- ---------- ----------
Operating Income from Discontinued Operations . . . . . . . 71 136 294 168
Gain on Sale of Properties. . . . . . . . . . . . . . . . . 3,119 4,340
--------- --------- ---------- ----------
Income From Discontinued Operations. . . . . . . . . 3,190 136 4,634 168
--------- --------- ---------- ----------
Net Income. . . . . . . . . . . . . . . . . . . . . . . . . 31,334 25,981 60,751 51,383
Dividends on Preferred Shares . . . . . . . . . . . . . . . 4,939 5,010 9,878 10,020
--------- --------- ---------- ----------
Net Income Available to Common Shareholders . . . . . . . . $ 26,395 $ 20,971 $ 50,873 $ 41,363
========= ========= ========== ==========
Net Income Per Common Share - Basic:
Income Before Discontinued Operations . . . . . . . . . . .45 .44 .89 .89
Income From Discontinued Operations . . . . . . . . . . . .06 .09
--------- --------- ---------- ----------
Net Income. . . . . . . . . . . . . . . . . . . . . . . . $ .51 $ .44 $ .98 $ .89
========= ========= ========== ==========
Net Income Per Common Share - Diluted:
Income Before Discontinued Operations . . . . . . . . . . .45 .43 .89 .88
Income From Discontinued Operations . . . . . . . . . . . .06 .09
--------- --------- ---------- ----------
Net Income. . . . . . . . . . . . . . . . . . . . . . . . $ .51 $ .43 $ .98 $ .88
========= ========= ========== ==========
Net Income. . . . . . . . . . . . . . . . . . . . . . . . . $ 31,334 $ 25,981 $ 60,751 $ 51,383
--------- --------- ---------- ----------
Other Comprehensive Income (Loss):
Cumulative effect of change in accounting principle
(SFAS 133) on other comprehensive loss. . . . . . . . . (1,877)
Unrealized derivative gain (loss) on interest rate swaps. (445) 282 (3,735) (987)
Unrealized derivative gain (loss) on forward-starting
interest rate swaps . . . . . . . . . . . . . . . . . . (39) 3,771 1,441 3,771
--------- --------- ---------- ----------
Other Comprehensive Income (Loss) . . . . . . . . . . . . . (484) 4,053 (2,294) 907
--------- --------- ---------- ----------
Comprehensive Income. . . . . . . . . . . . . . . . . . . . $ 30,850 $ 30,034 $ 58,457 $ 52,290
========= ========= ========== ==========
See Notes to Consolidated Financial Statements.
PAGE 2
WEINGARTEN REALTY INVESTORS
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
June 30, December 31,
2002 2001
------------ ------------
ASSETS
Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,555,925 $ 2,352,393
Accumulated Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . (432,619) (402,958)
------------ ------------
Property - net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,123,306 1,949,435
Investment in Real Estate Joint Ventures . . . . . . . . . . . . . . . . . . . 30,732 25,742
------------ ------------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,154,038 1,975,177
Notes Receivable from Real Estate Joint Ventures and Partnerships. . . . . . . 6,351 6,068
Unamortized Debt and Lease Costs . . . . . . . . . . . . . . . . . . . . . . . 46,775 42,755
Accrued Rent and Accounts Receivable (net of allowance for doubtful
accounts of $3,710 in 2002 and $2,926 in 2001) . . . . . . . . . . . . . . . 26,911 32,382
Cash and Cash Equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . 36,143 12,434
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,963 26,931
------------ ------------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,299,181 $ 2,095,747
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,220,391 $ 1,070,835
Accounts Payable and Accrued Expenses. . . . . . . . . . . . . . . . . . . . . 74,305 80,412
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,588 19,542
------------ ------------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,317,284 1,170,789
------------ ------------
Minority Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54,718 3,886
------------ ------------
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 3,520 and 3,526 shares
outstanding in 2002 and 2001; liquidation preference $25 per share . 106 106
7.0% Series C cumulative redeemable preferred shares of
beneficial interest; 2,300 shares issued and 2,255 and 2,256 shares
outstanding in 2002 and 2001; liquidation preference $50 per share . 67 67
Common Shares of Beneficial Interest - par value, $.03 per share;
shares authorized: 150,000; shares issued and outstanding:
51,970 in 2002 and 51,521 in 2001. . . . . . . . . . . . . . . . . . . . 1,556 1,548
Capital Surplus. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,079,015 1,066,757
Accumulated Dividends in Excess of Net Income. . . . . . . . . . . . . . . . (151,361) (144,560)
Accumulated Other Comprehensive Loss . . . . . . . . . . . . . . . . . . . . (2,294) (2,936)
------------ ------------
Shareholders' Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . 927,179 921,072
------------ ------------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,299,181 $ 2,095,747
============ ============
See Notes to Consolidated Financial Statements.
PAGE 3
WEINGARTEN REALTY INVESTORS
STATEMENTS OF CONSOLIDATED CASH FLOWS
(UNAUDITED)
(AMOUNTS IN THOUSANDS)
Six Months Ended
June 30,
--------------------------
2002 2001
----------- -----------
Cash Flows from Operating Activities:
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 60,751 $ 51,383
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization . . . . . . . . . . . . . . . 37,588 32,466
Equity in earnings of joint ventures. . . . . . . . . . . . (2,039) (2,047)
Minority interest in income of partnerships . . . . . . . . 1,059 182
Gain on sale of properties. . . . . . . . . . . . . . . . . (4,340) (4,984)
Changes in accrued rent and accounts receivable . . . . . . 4,341 2,168
Changes in other assets . . . . . . . . . . . . . . . . . . (10,933) (16,272)
Changes in accounts payable and accrued expenses. . . . . . (3,585) (6,215)
Other, net. . . . . . . . . . . . . . . . . . . . . . . . . 303 1,007
----------- -----------
Net cash provided by operating activities . . . . . . . . 83,145 57,688
----------- -----------
Cash Flows from Investing Activities:
Investment in properties. . . . . . . . . . . . . . . . . . . . . (116,312) (288,669)
Notes Receivable:
Advances. . . . . . . . . . . . . . . . . . . . . . . . . . (653) (1,861)
Collections . . . . . . . . . . . . . . . . . . . . . . . . 2,032 158
Proceeds from sales and disposition of property 20,134 6,811
Real estate joint ventures and partnerships:
Investments . . . . . . . . . . . . . . . . . . . . . . . . (5,355) (1,010)
Distributions . . . . . . . . . . . . . . . . . . . . . . . 2,130 2,414
----------- -----------
Net cash used in investing activities . . . . . . . . . . (98,024) (282,157)
----------- -----------
Cash Flows from Financing Activities:
Proceeds from issuance of:
Debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . 122,000 166,590
Common shares of beneficial interest. . . . . . . . . . . . 11,886 218,089
Principal payments of debt. . . . . . . . . . . . . . . . . . . . (27,667) (102,155)
Common and preferred dividends paid . . . . . . . . . . . . . . . (67,552) (60,574)
Other, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . (79) 554
----------- -----------
Net cash provided by financing activities . . . . . . . . 38,588 222,504
----------- -----------
Net increase (decrease) in cash and cash equivalents. . . . . . . . . 23,709 (1,965)
Cash and cash equivalents at January 1. . . . . . . . . . . . . . . . 12,434 7,321
----------- -----------
Cash and cash equivalents at June 30. . . . . . . . . . . . . . . . . $ 36,143 $ 5,356
=========== ===========
See Notes to Consolidated Financial Statements.
PAGE 4
WEINGARTEN REALTY INVESTORS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(AMOUNTS IN THOUSANDS)
1. INTERIM FINANCIAL STATEMENTS
The consolidated financial statements included in this report are
unaudited, however, amounts presented in the balance sheet as of December
31, 2001 are derived from the audited financial statements of the Company
at that date. In the opinion of WRI, all adjustments necessary for a fair
presentation of such financial statements have been included. Such
adjustments consisted of normal recurring items. Interim results are not
necessarily indicative of results for a full year.
The consolidated financial statements and notes are presented as permitted
by Form 10-Q, and do not contain certain information included in WRI's
annual financial statements and notes.
Certain reclassifications of prior year's amounts have been made to conform
to the current year presentation.
2. NEWLY ADOPTED ACCOUNTING PRONOUNCEMENTS
On January 1, 2002, WRI adopted SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." SFAS No. 144 addresses
accounting and reporting for the impairment or disposal of a segment of a
business. More specifically, this Statement broadens the presentation of
discontinued operations to include a component of an entity whose
operations and cash flows can be clearly distinguished, operationally and
for financial reporting purposes, from the rest of the entity.
In March 2002, we sold two retail projects located in Houston and San
Antonio, Texas. In June 2002, the River Pointe Apartments located in
Conroe, Texas were sold. Accordingly, the operating results of the disposed
properties have been reclassified and reported as discontinued operations
in the Statements of Consolidated Income and Comprehensive Income. Included
in the December 31, 2001 Consolidated Balance Sheet was $18.5 million of
Property and $2.5 million of Accumulated Depreciation associated with the
two shopping centers and the multi-family residential project that were
sold.
In June 2001, FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations", which is effective for fiscal years beginning after June 15,
2002. SFAS No. 143 addresses financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets
and the associated asset retirement costs. The adoption of SFAS No. 143
will not have a material impact on our financial position, results of
operations, or cash flows.
In April 2002, FASB issued SFAS No. 145, "Rescission of SFAS Statements No.
4, 44, and 64, Amendment of SFAS No. 13, and Technical Corrections." The
purpose of this statement is to update, clarify and simplify existing
accounting standards. We adopted this statement effective April 30, 2002
and determined that the adoption of this statement did not have a material
impact on our financial position, results of operations, or cash flows.
3. DERIVATIVES AND HEDGING
On January 1, 2001, WRI adopted SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities," as amended. SFAS No. 133 establishes
accounting and reporting standards for derivative instruments.
Specifically, SFAS No. 133 requires an entity to recognize all derivatives
as either assets or liabilities in the statement of financial position and
PAGE 5
to measure those instruments at fair value. Additionally, the fair value
adjustments will affect either shareholders' equity or net income depending
on whether the derivative instruments qualifies as a hedge for accounting
purposes and, if so, the nature of the hedging activity.
WRI hedges the future cash flows of debt transactions principally through
interest rate swaps with major financial institutions. WRI has four
interest rate swap contracts with an aggregate notional amount of $70
million, which are designated as cash flow hedges, and eleven interest rate
swap contracts with an aggregate notional amount of $107.5 million, which
are designated as fair value hedges. In July 2002, one interest rate swap
matured with a notional amount of $25 million.
On June 30, 2002, the derivative instruments designated as cash flow hedges
were reported at their fair values as Other Liabilities of $3.8 million.
The derivative instruments designated as fair value hedges on June 30, 2002
were reported at their fair values as Other Assets and Fixed-Rate Debt of
$3.3 million.
Within the next twelve months, the Company expects to reclassify to
earnings as interest expense approximately $2.6 million of the current
balance held in accumulated other comprehensive loss. As of June 30, 2002,
the balance in accumulated other comprehensive loss relating to the
derivatives was $2.3 million. With respect to fair value hedges, both
changes in fair market value of the derivative hedging instrument and
changes in the fair value of the hedged item will be recorded in earnings
each reporting period. These amounts should completely offset with no
impact to earnings, except for the portion of the hedge that proves to be
ineffective, if any.
4. PER SHARE DATA
Net income per common share - basic is computed using net income available
to common shareholders and the weighted average shares outstanding that
have been adjusted for the three-for-two share split described in Footnote
9. Net income per common share - diluted includes the effect of potentially
dilutive securities for the periods indicated, as follows (in thousands):
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
2002 2001 2002 2001
--------- --------- --------- ---------
Numerator:
Net income available to common shareholders - basic . . . $ 26,395 $ 20,971 $ 50,873 $ 41,363
Income attributable to operating partnership units. . . . 845 29 875 64
--------- --------- --------- ---------
Net income available to common shareholders - diluted . . $ 27,240 $ 21,000 $ 51,748 $ 41,427
========= ========= ========= =========
Denominator:
Weighted average shares outstanding - basic . . . . . . . 51,926 48,135 51,806 46,658
Effect of dilutive securities:
Share options and awards. . . . . . . . . . . . . . 396 170 344 142
Operating partnership units . . . . . . . . . . . . 1,432 77 759 77
--------- --------- --------- ---------
Weighted average shares outstanding - diluted . . . . . . 53,754 48,382 52,909 46,877
========= ========= ========= =========
Options to purchase 150 and 1,200 common shares for the second quarter
ended June 30, 2002 and 2001, 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, while 150 and 1,950 common
shares have been excluded from the calculation of net income per common
share-diluted for the six months ended June 30, 2002 and 2001,
respectively.
PAGE 6
5. DEBT
WRI's debt consists of the following (in thousands):
June 30, December 31,
2002 2001
------------ ------------
Fixed-rate debt payable to 2030 at 6.0% to 8.75% . . . . . . . . . $ 889,546 $ 796,900
Variable-rate unsecured notes payable. . . . . . . . . . . . . . . 100,000 100,000
Unsecured notes payable under revolving credit agreements. . . . . 191,500 134,500
Obligations under capital leases . . . . . . . . . . . . . . . . . 33,534 33,554
Industrial revenue bonds payable to 2015 at 1.3% to 3.6% . . . . . 5,798 5,868
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 13
------------ ------------
Total . . . . . . . . . . . . . . . . . . . . . . . . $ 1,220,391 $ 1,070,835
============ ============
At June 30, 2002, the variable interest rate for notes payable under the
$50 million term loan agreement was 2.36%, and the $350 million revolving
credit agreement was 2.44%. At June 30, 2002, $18.5 million was outstanding
under the $20 million revolving credit agreement at 2.31%.
In January 2002, WRI issued $35 million of twelve-year 6.7% fixed-rate,
unsecured medium term notes. An additional $30 million of twelve-year
6.525% fixed-rate, unsecured medium term notes were issued in February
2002.
Subsequent to quarter-end, the Company issued $62 million of unsecured
fixed-rate medium term notes. On July 1, 2002, WRI issued $10 million of
five-year 5.29% fixed-rate medium term notes. An additional $42 million was
issued on July 15, 2002 consisting of $15 million five-year and $27 million
eleven-year fixed-rate medium term notes at 5.14% and 6.11%, respectively.
On July 18, 2002, WRI issued an additional $10 million of ten-year 6.00%
fixed-rate medium term notes. Proceeds received were used to pay down
amounts outstanding under our $350 million revolving credit facility.
In March 2001, we filed a $500 million shelf registration statement, of
which $336.9 million is currently available. Also, we have a $400 million
shelf registration statement, of which $18 million is currently available.
WRI's debt can be summarized as follows (in thousands):
June 30, December 31,
2002 2001
------------ ------------
As to interest rate (including the effects of
interest rate swaps):
Fixed-rate debt . . . . . . . . . . . $ 873,132 $ 780,500
Variable-rate debt. . . . . . . . . . 347,259 290,335
------------ ------------
Total . . . . . . . . . . . . . . . . $ 1,220,391 $ 1,070,835
============ ============
As to collateralization:
Unsecured debt. . . . . . . . . . . . $ 897,849 $ 798,524
Secured debt. . . . . . . . . . . . . 322,542 272,311
------------ ------------
Total . . . . . . . . . . . . . . . . $ 1,220,391 $ 1,070,835
============ ============
PAGE 7
In July 2001, we sold $200 million of unsecured notes with a coupon of 7%.
Net proceeds from the offering totaled $198.3 million and were used to pay
down amounts outstanding under our $350 revolving credit facility.
Concurrent with the sale of the 7% notes, we settled our $188.7 million
forward-starting interest rate swap contracts, resulting in a gain of $1.6
million that was recorded in the caption Accumulated Other Comprehensive
Loss. This gain is being amortized to earnings over the life of the 7%
notes.
Also, in July 2001, we entered into eleven interest rate swaps with an
aggregate notional amount of $107.5 million that convert fixed interest
payments to variable interest payments at rates from 6.35% to 7.35%. These
interest rate swaps have been designated as fair value hedges. We have
determined that these contracts will be highly effective in limiting our
risk of changes in the fair value of the fixed-rate notes attributable to
changes in variable interest rates.
WRI has two interest rate swap contracts with an aggregate notional amount
of $20 million that serve as a hedge against changes in interest rates on a
like amount of our $350 million variable-rate revolving credit facility.
Such contracts, which expire in 2004, have been outstanding since their
purchase in 1992 and fix the interest rate at 7.7%. We also entered into
two additional interest rate swaps for a notional amount of $25 million
each which serve as hedges against changes in interest rates on two
separate $25 million variable-rate medium term notes. These swaps fix the
interest rates on the medium term notes at 7.0% and 6.8%, respectively.
Subsequent to quarter-end, one interest rate swap with a notional of $25
million matured in July 2002 with the remaining interest rate swap of $25
million maturing in July 2003.
6. PROPERTY
WRI's property consists of the following (in thousands):
June 30, December 31,
2002 2001
------------ ------------
Land . . . . . . . . . . . . . . $ 474,609 $ 439,332
Land held for development. . . . 22,957 24,131
Land under development . . . . . 53,861 56,414
Buildings and improvements . . . 1,906,057 1,750,059
Construction in-progress 98,441 82,457
------------ ------------
Total. . . . . . . . . . . . . . $ 2,555,925 $ 2,352,393
============ ============
Interest and ad valorem taxes capitalized to land under development or
buildings under construction was $2.5 million for the quarters ended June
30, 2002 and 2001, respectively, and $5.1 million and $4.5 million for the
six months ended June 30, 2002 and 2001, respectively.
PAGE 8
7. INVESTMENTS IN REAL ESTATE JOINT VENTURES
WRI owns interests in 16 joint ventures or limited partnerships where we do
not exercise financial and operating control. These partnerships are
accounted for under the equity method since WRI exercises significant
influence. Our interests in these joint ventures and limited partnerships
range from 20% to 75% and, with the exception of one partnership, which
owns seven industrial properties, each venture owns a single real estate
asset. Combined condensed financial information of these ventures (at 100%)
is summarized as follows (in thousands):
June 30, December 31,
2002 2001
------------ ------------
Combined Balance Sheets
Property. . . . . . . . . . . . . . $ 181,771 $ 171,344
Accumulated Depreciation. . . . . . (27,038) (24,941)
------------ ------------
Property - net . . . . . . . . . 154,733 146,403
Other Assets. . . . . . . . . . . . 10,539 11,373
------------ ------------
Total . . . . . . . . . . $ 165,272 $ 157,776
============ ============
Debt. . . . . . . . . . . . . . . . $ 76,292 $ 76,635
Amounts Payable to WRI. . . . . . . 9,239 9,270
Other liabilities . . . . . . . . . 3,223 4,705
Accumulated Equity. . . . . . . . . 76,518 67,166
------------ ------------
Total . . . . . . . . . . $ 165,272 $ 157,776
============ ============
Combined Statements of Income
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
2002 2001 2002 2001
--------- --------- --------- ---------
Revenues. . . . . . . . . . . . . . . . $ 6,281 $ 6,442 $ 12,702 $ 12,763
--------- --------- --------- ---------
Expenses:
Depreciation and amortization . . . . 1,319 1,143 2,483 2,246
Operating . . . . . . . . . . . . . . 848 899 1,708 1,793
Interest. . . . . . . . . . . . . . . 1,629 1,828 3,263 3,679
Ad valorem taxes. . . . . . . . . . . 796 783 1,593 1,592
General and administrative. . . . . . 13 28 28 44
--------- --------- --------- ---------
Total . . . . . . . . . . . . . 4,605 4,681 9,075 9,354
--------- --------- --------- ---------
Net Income. . . . . . . . . . . . . . . $ 1,676 $ 1,761 $ 3,627 $ 3,409
========= ========= ========= =========
PAGE 9
Our investment in real estate joint ventures, as reported on the balance
sheets, differs from our proportionate share of the joint ventures'
underlying net assets due to basis differentials, which arose upon the
transfer of assets from WRI to the joint ventures. This basis differential,
which totaled $4.8 million and $5.0 million at June 30, 2002 and December
31, 2001, respectively, is depreciated over the useful lives of the related
assets.
Fees earned by WRI for the management of these joint ventures totaled: $.1
million for the quarters ended June 30, 2002 and 2001, respectively, and
$.3 million and $.2 million for the six months ended June 30, 2002 and
2001, respectively.
In December 1999, WRI sold seven industrial properties totaling 2.0 million
square feet to a limited partnership in which we retained 20% ownership.
WRI serves as general partner. WRI loaned $41.4 million to the partnership
until August of 2000, at which time the loan was replaced with a ten-year
non-recourse third party mortgage with an interest rate of 8.1%.
In 2000, three shopping centers were acquired through joint ventures with
an institutional investor. WRI loaned these three partnerships an aggregate
of $32.0 million, which was replaced with ten-year non-recourse third party
mortgages with a weighted average rate of 7.8%.
In August of 2001, WRI sold its interest in two joint ventures, which owned
mini-storage warehouses resulting in a gain of $2.9 million.
In May of 2002, a 50% owned joint venture commenced construction on
Tropicana Beltway Center, a 660,000 square foot center in Las Vegas,
Nevada, which will include a corporate-owned WalMart of 224,000 square feet
and a corporate-owned Lowe's of 170,000 square feet.
8. 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.
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, California, Louisiana, Arizona, Nevada,
Arkansas, New Mexico, Oklahoma, Tennessee, Kansas, Colorado, Missouri,
Illinois, Florida, Mississippi, North Carolina and Maine. The customer base
includes supermarkets, discount retailers, 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, Georgia, Florida 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.
PAGE 10
Information concerning WRI's reportable segments is as follows (in thousands):
SHOPPING
CENTER INDUSTRIAL OTHER TOTAL
------------ ---------- ---------- ------------
Three Months Ended
June 30, 2002:
Revenues . . . . . . . . . . . . . . . . . . . $ 82,205 $ 9,234 $ 387 $ 91,826
Net operating income . . . . . . . . . . . . . 60,518 6,376 449 67,343
Equity in earnings of joint ventures . . . . . 921 59 (15) 965
Investment in real estate joint ventures . . . 29,881 851 30,732
Total assets . . . . . . . . . . . . . . . . . 1,962,078 222,027 115,076 2,299,181
Three Months Ended
June 30, 2001:
Revenues . . . . . . . . . . . . . . . . . . . $ 69,648 $ 7,981 $ 752 $ 78,381
Net operating income . . . . . . . . . . . . . 51,368 5,628 1,040 58,036
Equity in earnings of joint ventures . . . . . 930 135 (23) 1,042
Investment in real estate joint ventures . . . 25,131 1,187 26,318
Total assets . . . . . . . . . . . . . . . . . 1,639,061 184,560 93,337 1,916,958
Six Months Ended
June 30, 2002:
Revenues . . . . . . . . . . . . . . . . . . . $ 157,813 $ 18,300 $ 933 $ 177,046
Net operating income . . . . . . . . . . . . . 116,164 12,635 1,126 129,925
Equity in earnings of joint ventures . . . . . 1,908 155 (24) 2,039
Six Months Ended
June 30, 2001:
Revenues . . . . . . . . . . . . . . . . . . . $ 128,248 $ 15,643 $ 1,497 $ 145,388
Net operating income . . . . . . . . . . . . . 94,019 11,071 1,751 106,841
Equity in earnings of joint ventures . . . . . 1,847 260 (60) 2,047
Net operating income reconciles to income before discontinued operations as
shown on the Statements of Consolidated Income and Comprehensive Income as
follows (in thousands):
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- -----------------------
2002 2001 2002 2001
---------- ---------- ---------- ----------
Total segment net operating income . . . . . . . . . $ 67,343 $ 58,036 $ 129,925 $ 106,841
Less:
Depreciation and amortization . . . . . . . . . 19,291 16,541 37,186 31,976
Interest. . . . . . . . . . . . . . . . . . . . 16,532 14,522 31,528 25,395
General and administrative. . . . . . . . . . . 3,398 2,729 6,074 5,104
Minority interest in income of partnerships . . 943 115 1,059 182
Equity in earnings of joint ventures. . . . . . (965) (1,042) (2,039) (2,047)
Gain on sale of properties. . . . . . . . . . . (674) (4,984)
---------- ---------- ---------- ----------
Income Before Discontinued Operations. . . . . . . . $ 28,144 $ 25,845 $ 56,117 $ 51,215
========== ========== ========== ==========
PAGE 11
9. COMMON SHARES OF BENEFICIAL INTEREST
In February 2002, a three-for-two share split, affected in the form of a
50% share dividend, was declared for shareholders of record on April 1,
2002, payable April 15, 2002. We issued 17.3 million common shares of
beneficial interest as a result of the share split. All references to the
number of shares and per share amounts have been restated to reflect the
share split, and an amount equal to the par value of the number of common
shares issued have been reclassified to common stock from retained
earnings.
In February 2002, we completed the sale of .3 million common shares of
beneficial interest. Net proceeds to WRI totaled $9.5 million based on a
price of $33.65 per share and were used to pay down amounts outstanding
under our $350 million revolving credit facility.
On January 29, 2001, we issued 6.8 million common shares of beneficial
interest in a secondary public offering. In February 2001, the underwriters
exercised their over-allotment option and purchased an additional 300,000
shares. Net proceeds to WRI totaled $188.1 million based on a price of
$28.13 per share. In May 2001, we issued 1.0 million common shares of
beneficial interest in a secondary public offering. Net proceeds of $27.9
million were based on a price of $28.57 per share. In November 2001, we
issued 2.7 million common shares of beneficial interest in a secondary
public offering. Net proceeds of $86.0 million were based on a price of
$33.47 per share. Proceeds from these offerings were used to pay down
amounts outstanding under our $350 million revolving credit facility.
10. BANKRUPTCY REMOTE PROPERTIES
On April 2, 2001, we purchased 19 supermarket-anchored shopping centers,
aggregating 2.5 million square feet, in California. The purchase price for
the properties was $277.5 million, including the assumption of
approximately $132 million in debt secured by all 19 properties.
These 19 properties, having a net book value of approximately $272.7
million at June 30, 2002 (collectively the "Bankruptcy Remote Properties",
and each a "Bankruptcy Remote Property"), are wholly owned by various
"Bankruptcy Remote Entities". Each Bankruptcy Remote Entity is an indirect
subsidiary of the Company. The assets of each Bankruptcy Remote Entity,
including the respective Bankruptcy Remote Property or Properties owned by
each, are owned by that Bankruptcy Remote Entity alone and are not
available to satisfy claims that any creditor may have against the Company,
its affiliates, or any other person or entity. No Bankruptcy Remote Entity
has agreed to pay or make its assets available to pay creditors of the
Company, any of its affiliates, or any other person or entity. Neither the
Company nor any of its affiliates has agreed to pay or make its assets
available to pay creditors of any Bankruptcy Remote Entity (other than any
agreement by a Bankruptcy Remote Entity to pay its own creditors). No
affiliate of any Bankruptcy Remote Entity has agreed to pay or make its
assets available to pay creditors of any Bankruptcy Remote Entity.
The accounts of the Bankruptcy Remote Entities are included in WRI's
consolidated financial statements, as WRI owns, indirectly, 100% of each of
the entities. Additionally, WRI, through its wholly owned subsidiaries,
makes all day to day operating and financial decisions with respect to
these properties, subject to approval by the loan servicing agent for the
certain significant transactions. WRI has the right to prepay the loan at
any time, which would eliminate all encumbrances and restrictions.
PAGE 12
PART I
FINANCIAL INFORMATION
ITEM 2. 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 and operated 239 anchored shopping centers, 57
industrial properties and one office building at June 30, 2002. Of WRI's 297
developed properties, 178 are located in Texas (including 93 in Houston and
Harris County). Our remaining properties are located in California (19),
Louisiana (15), Arizona (13), Florida (11), Nevada (10), Tennessee (8), Colorado
(8), North Carolina (8), Arkansas (6), New Mexico (6), Kansas (5), Oklahoma (4),
Missouri (2), Illinois (1), Mississippi (1), Georgia (1) and Maine (1). WRI has
5,600 leases and 4,400 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,
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, 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 was $83.1 million for the first six months of 2002 as
compared to $57.7 million for the same period of 2001. The increase was due
primarily to WRI's acquisition and new development programs and improvements in
the performance of its existing portfolio of properties.
Our Board of Trust Managers approved a quarterly dividend of $.555 per common
share for the second quarter of 2002. Our dividend payout ratio on common
equity for the second quarter of 2002 and 2001 was 68% and 69%, respectively,
based on funds from operations for the applicable period.
WRI invested $125.8 million for the acquisition of ten shopping centers during
the second quarter.
On April 4, 2002, the Company completed the acquisition of seven
supermarket-anchored shopping centers in the Raleigh-Durham market totaling 1.15
million square feet from Bob Hughes and Associates and related partnerships.
This transaction utilized a DownREIT structure whereby we issued operating
partnership units that are convertible into WRI common shares and will be
included in the consolidated financial statements of WRI as we exercise
financial and operating control.
On April 8, 2002, we also acquired Pitman Corners, a supermarket-anchored center
located in Plano, Texas (a Dallas suburb), containing a total of 189,800 square
feet.
PAGE 13
On June 21, 2002, Westminster Plaza, a 91,300 square foot center located in
Westminster, Colorado, was acquired through a 50% joint venture with our
Denver-based development partner. This joint venture will be included in the
consolidated financial statements of WRI as we exercise financial and operating
control.
On June 28, 2002, we acquired Lake Washington Square, an 112,000 square foot
center located in Melbourne, Florida.
In May 2002, a 50% owned joint venture commenced construction on Tropicana
Beltway Center, a 660,000 square foot center in Las Vegas, Nevada, which will
include a corporate-owned WalMart of 224,000 square feet and a corporate-owned
Lowe's of 170,000 square feet. This joint venture will be accounted for using
the equity method of accounting, as WRI has the ability to exercise significant
influence, but does not have financial or operating control.
With respect to new development, we had 17 projects at various stages of
construction. These projects, upon completion, will represent an investment of
approximately $228 million and will add 1.8 million square feet to the
portfolio. We expect to invest approximately $80.1 million in these properties
during 2002. These projects will continue to come on-line during the remainder
of 2002 through 2003.
In January 2002, WRI issued $35 million of twelve-year 6.7% fixed-rate,
unsecured medium term notes. An additional $30 million of twelve-year 6.525%
fixed-rate, unsecured medium term notes were issued in February 2002.
Subsequent to quarter-end, the Company issued $62 million of unsecured
fixed-rate medium term notes. On July 1, 2002, WRI issued $10 million of
five-year 5.29% fixed-rate medium term notes. An additional $42 million was
issued on July 15, 2002 consisting of $15 million five-year and $27 million
eleven-year fixed-rate medium term notes at 5.14% and 6.11%, respectively. On
July 18, 2002, WRI issued an additional $10 million of ten-year 6.00% fixed-rate
medium term notes. Proceeds received were used to pay down amounts outstanding
under our $350 million revolving credit facility.
Total debt outstanding increased $149.6 million to $1.2 billion at June 30,
2002. This increase was primarily due to the funding of the Company's
acquisitions and ongoing development and redevelopment efforts. Included in
total debt outstanding of $1.2 billion at June 30, 2002 is variable-rate debt of
$347.3 million, after recognizing the net effect of $177.5 million of interest
rate swaps.
In March 2001, we filed a $500 million shelf registration statement, of which
$336.9 million is currently available. Also, we have a $400 million shelf
registration statement, of which $18 million is currently available.
In February 2002, a three-for-two share split, affected in the form of a 50%
share dividend, was declared for shareholders of record on April 1, 2002,
payable April 15, 2002. We issued 17.3 million common shares of beneficial
interest as a result of the share split.
In February 2002, we completed the sale of .3 million common shares of
beneficial interest. Net proceeds to WRI totaled $9.5 million based on a price
of $33.65 per share and were used to pay down amounts outstanding under our $350
million revolving credit facility.
FUNDS FROM OPERATIONS
The Board of Governors of the National Association of Real Estate Investment
Trusts defines funds from operations (FFO) as net income (loss) computed in
accordance with generally accepted accounting principles, excluding gains or
losses from sales of property, plus real estate related depreciation and
amortization, and after adjustments for unconsolidated partnerships and joint
ventures. In addition, NAREIT recommends that extraordinary items not be
considered in arriving at FFO. We calculate FFO in a manner consistent with the
NAREIT definition. Most industry analysts and equity REITS, including
Weingarten, believe FFO is an appropriate measure of performance relative to
other REITs. FFO provides investors with an understanding of our ability to
incur and service debt, make capital expenditures and pay common share
PAGE 14
dividends. There can be no assurance that FFO presented by Weingarten is
comparable to similarly titled measures of other REITs. FFO should not be
considered as an alternative to net income or other measurements under GAAP as
an indicator of our operating performance or to cash flows from operating,
investing, or financing activities as a measure of liquidity. FFO does not
reflect working capital changes, cash expenditures for capital improvements, or
principal payments on indebtedness.
Funds from operations - diluted for the three and six months ended June 30, 2002
and 2001 is calculated as follows:
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
2002 2001 2002 2001
--------- --------- --------- ---------
Net income available to common shareholders . . . . . . $ 26,395 $ 20,971 $ 50,873 $ 41,363
Depreciation and amortization . . . . . . . . . . . . . 18,754 16,235 36,230 31,446
Depreciation and amortization of unconsolidated
joint ventures. . . . . . . . . . . . . . . . . . . . 543 479 1,018 941
Gain on sale of properties. . . . . . . . . . . . . . . (3,119) (674) (4,340) (4,984)
--------- --------- --------- ---------
Funds from operations . . . . . . . . . . 42,573 37,011 83,781 68,766
Funds from operations attributable to operating
partnership units . . . . . . . . . . . . . . . . . . 1,144 53 1,199 113
--------- --------- --------- ---------
Funds from operations assuming
conversion of OP units. . . . . . . . . $ 43,717 $ 37,064 $ 84,980 $ 68,879
========= ========= ========= =========
Weighted average shares outstanding - basic . . . . . . 51,926 48,135 51,806 46,658
Effect of dilutive securities:
Share options and awards. . . . . . . . . . . . . 396 170 344 142
Operating partnership units . . . . . . . . . . . 1,432 77 759 77
--------- --------- --------- ---------
Weighted average shares outstanding - diluted . . . . . 53,754 48,382 52,909 46,877
========= ========= ========= =========
RESULTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 2002 AND 2001
Net income available to common shareholders increased to $26.4 million, or $.51
per diluted share, from $21.0 million, or $.43 per diluted share for the second
quarter of 2002 as compared with the same quarter of 2001. The increase in net
income available to common shareholders is due primarily from growth in the
portfolio from acquisitions and new development, and the $3.1 million gain on
the sale of the multi-family residential project.
Rental revenues were $90.3 million in 2002, as compared to $76.5 million in
2001, representing an increase of approximately $13.8 million or 18.1%. Of
these increases, property acquisitions and new development contributed $11.8
million in 2002, as compared to $16.8 million for the same period of 2001. The
remaining portion of these increases is due to activity at our existing
properties. Occupancy of the total portfolio was 91.3% at June 30, 2002 as
compared to 92.7% last year. The occupancy of the retail portfolio was down
slightly at 91.9% as compared to 92.8% at June 30,2001, while the occupancy of
the industrial portfolio decreased to 89.0% from 92.1% in the prior year. The
decrease in the retail portfolio is due to three K-Mart and two Service
Merchandise stores that were vacated during the second quarter, representing
approximately 370,000 square feet. During the first six months of 2002, WRI
completed 584 renewals or new leases comprising 2.3 million square feet at an
average rental rate increase of 9.9%. Net of the amortized portion of capital
costs for tenant improvements, the increase averaged 8.1%.
Gross interest costs, before capitalization of interest, increased by $2.0
million from $16.9 million in the second quarter of 2001 to $18.9 million for
the second quarter of 2002. The increase is due primarily to an increase in the
average debt outstanding between periods of $962.6 in 2001 to $1.2 billion in
2002. The average interest rate decreased from 7.0% in 2001 to 6.4% in 2002.
The amount of interest capitalized during the period was $2.3 million and $2.4
million in 2002 and 2001, respectively.
General and administrative expenses increased by $.7 million to $3.4 million in
the second quarter of 2002 from $2.7 million for the same quarter of 2001. The
increase is due primarily to an increase in staffing necessitated by the growth
in the portfolio from acquisitions and new development.
The increases in depreciation and amortization, operating expenses and ad
valorem taxes were primarily the result of WRI's acquisitions and new
development programs.
RESULTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2002 AND 2001
Net income available to common shareholders increased to $50.9 million, or $.98
per diluted share, from $41.4 million, or $.88 per diluted share for the six
months of 2002 as compared with the same period of 2001. The increase in net
income available to common shareholders is due primarily from growth in the
portfolio from acquisitions and new development.
Rental revenues were $174.6 million in 2002, as compared to $142.4 million in
2001, representing an increase of approximately $32.2 million or 22.6%. Of
these increases, property acquisitions and new development contributed $30.1
million in 2002, as compared to $23.1 million for the same period of 2001. The
remaining portion of these increases is due to activity at our existing
properties.
Gross interest costs, before capitalization of interest, increased by $6.5
million from $29.7 million for the six months of 2001 to $36.3 million for the
six months of 2002. The increase is due primarily to an increase in the average
debt outstanding between periods of $829.1 million in 2001 to $1.1 billion in
2002. The average interest rate decreased from 7.2% in 2001 to 6.4% in 2002.
The amount of interest capitalized during the period was $4.7 million and $4.3
million in 2002 and 2001, respectively.
PAGE 15
General and administrative expenses increased by $1.0 million to $6.1 million
for the six months of 2002 from $5.1 million for the same period of 2001. The
increase is due primarily to an increase in staffing necessitated by the growth
in the portfolio from acquisitions and new development.
The increases in depreciation and amortization, operating expenses and ad
valorem taxes were primarily the result of WRI's acquisitions and new
development programs.
NEWLY ADOPTED ACCOUNTING PRONOUNCEMENTS
On January 1, 2002, WRI adopted SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-Lived Assets." SFAS No. 144 addresses accounting and reporting
for the impairment or disposal of a segment of a business. More specifically,
this Statement broadens the presentation of discontinued operations to include a
component of an entity whose operations and cash flows can be clearly
distinguished, operationally and for financial reporting purposes, from the rest
of the entity.
In March 2002, we sold two retail projects located in Houston and San Antonio,
Texas. In June 2002, the River Pointe Apartments located in Conroe, Texas were
sold. Accordingly, the operating results of the disposed properties have been
reclassified and reported as discontinued operations in the Statements of
Consolidated Income and Comprehensive Income. Included in the December 31, 2001
Consolidated Balance Sheet was $18.5 million of Property and $2.5 million of
Accumulated Depreciation associated with the two shopping centers and the
multi-family residential project that were sold.
In June 2001, FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations", which is effective for fiscal years beginning after June 15, 2002.
SFAS No. 143 addresses financial accounting and reporting for obligations
associated with the retirement of tangible long-lived assets and the associated
asset retirement costs. The adoption of SFAS No. 143 will not have a material
impact on our financial position, results of operations, or cash flows.
PAGE 16
In April 2002, FASB issued SFAS No. 145, "Rescission of SFAS Statements No. 4,
44, and 64, Amendment of SFAS No. 13, and Technical Corrections." The purpose
of this statement is to update, clarify and simplify existing accounting
standards. We adopted this statement effective April 30, 2002 and determined
that the adoption of this statement did not have a material impact on our
financial position, results of operations, or cash flows.
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, primarily interest rate swap agreements with major financial institutions.
These swap agreements expose WRI to credit risk in the event of non-performance
by the counter-parties to the swaps. We do not engage in the trading of
derivative financial instruments in the normal course of business. At June 30,
2002, WRI had fixed-rate debt of $873.1 million and variable-rate debt of $347.3
million, after adjusting for the net effect of $177.5 million of interest rate
swaps.
PAGE 17
PART II
OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits (numbered in accordance with Item 601 of Regulation S-K)
(12) A statement of computation of ratios of earnings and
funds from operations to combined fixed charges
and preferred dividends.
(99.1) Certification certificate for Chief Executive
Officer.
(99.2) Certification certificate for Chief Financial
Officer.
(b) Reports on Form 8-K
A Form 8-K, dated April 9, 2002, was filed in response
to Item 2., Acquisition of Disposition of Assets.
PAGE 18
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
WEINGARTEN REALTY INVESTORS
-----------------------------
(Registrant)
BY: /s/ Andrew M. Alexander
--------------------------
Andrew M. Alexander
President/Chief Executive Officer
(Principal Executive Officer)
BY: /s/ Joe D. Shafer
--------------------------
Joe D. Shafer
Vice President/Controller
(Principal Accounting Officer)
DATE: August 13, 2002
-----------------
PAGE 19