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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
[Fee Required]
For the fiscal year ended December 31, 2001 or
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[ ] Transition report pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
[No Fee Required]
For the transition period from _____________________ to________________________
Commission file number 0-20103
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WELLS REAL ESTATE FUND IV, L. P.
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(Exact name of registrant as specified in its charter)
Georgia 58-1915128
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State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
6200 The Corners Parkway, Suite 250
Norcross, GA 30092
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(Address of principal executive
offices) (Zip Code)
Registrant's telephone number,
including area code (770) 449-7800
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Securities registered pursuant to Section 12 (b) of the Act:
Title of each class Name of exchange on which registered
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NONE NONE
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Securities registered pursuant to Section 12 (g) of the Act:
CLASS A UNIT
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(Title of Class)
CLASS B UNIT
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(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No ______
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Aggregate market value of the voting stock held by
non-affiliates: Not Applicable
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PART I
ITEM 1. BUSINESS
General
Wells Real Estate Fund IV, L.P. (the "Partnership") is a Georgia public limited
partnership with Leo F. Wells, III and Wells Partners, L.P. ("Wells Partners"),
a Georgia non-public limited partnership, serving as the General Partners. The
Partnership was formed on October 25, 1990, for the purpose of acquiring,
developing, constructing, owning, operating, improving, leasing and otherwise
managing income-producing commercial properties for investment purposes. The
Partnership has two classes of limited partnership interests, Class A and Class
B units. Limited partners may vote to, among other things, (a) amend the
partnership agreement, subject to certain limitations, (b) change the business
purpose or investment or investment objectives of the Partnership, and (c) add
or remove a general partner. A majority vote on any of the above described
matters will bind the Partnership, without the concurrence of the general
partners. Each limited partner unit has equal voting rights, regardless of
class.
On March 4, 1991, the Partnership commenced an offering of up to $25,000,000 of
Class A or Class B limited partnership units ($10.00 per unit) pursuant to a
Registration Statement on Form S-11 under the Securities Act of 1933. The
Partnership did not commence active operations until it received and accepted
subscriptions for 125,000 units on May 13, 1991. The offering was terminated on
February 29, 1992, at which time the Partnership had sold 1,322,909 Class A
Units and 38,551 Class B Units representing $13,614,652 of capital
contributions by investors who were admitted to the Partnership as Limited
Partners.
The Partnership owns interests in properties through its equity ownership in
the following two joint ventures: (i) Fund III and Fund IV Associates, a joint
venture between the Partnership and Wells Real Estate Fund III, L.P. ( the
"Fund III - IV Joint Venture"); and (ii) Fund IV and Fund V Associates, a joint
venture between the Partnership and Wells Real Estate Fund V, L.P. (the "Fund
IV - V Joint Venture").
As of December 31, 2001, the Partnership owned interests in the following
properties through its ownership of the foregoing joint ventures: (i) a retail
shopping center located in Stockbridge, Georgia, (the "Stockbridge Village
Shopping Center"), which is owned by the Fund III - IV Joint Venture; (ii) a
two-story office building located in Richmond, Virginia (the "Reciprocal Group
Building"), which is owned by the Fund III - IV Joint Venture; (iii) two
substantially identical two-story office buildings located in Clayton County,
Georgia (the "Village Overlook Property"), which are owned by the Fund IV - V
Joint Venture, and (iv) a four-story office building located in Jacksonville,
Florida (the "IBM Jacksonville Building"), which is owned by the Fund IV - V
Joint Venture. All of the foregoing properties were acquired on an all cash
basis and are described in more detail in Item 2, below.
Employees
The Partnership has no direct employees. The employees of Wells Capital Inc.
and Wells Management Company, Inc. perform a full range of real estate services
including leasing and property management, accounting, asset management and
investor relations for the Partnership. See Item 11 - "Compensation of General
Partners and Affiliates" for a summary of the fees paid to the General Partners
and their affiliates during the fiscal year ended December 31, 2001.
2
Insurance
Wells Management Company, Inc., an affiliate of the General Partners, carries
comprehensive liability and extended coverage with respect to all properties in
which the Partnership has an ownership interest. In the opinion of management
of the partnership, all such properties are adequately insured.
Competition
The Partnership will experience competition for tenants from owners and
managers of competing projects which may include the General Partners and their
affiliates. As a result, the Partnership may provide free rent, reduced charges
for tenant improvements and other inducements, all of which may have an adverse
impact on results of operations. At the time the Partnership elects to dispose
of its properties, the Partnership will also be in competition with sellers of
similar properties to locate suitable purchasers for its properties.
ITEM 2. PROPERTIES
The Partnership owns interests in four properties through its investments in
the joint ventures described in Item 1 of which three are office buildings and
one is a retail building. The Partnership does not have control over the
operations of the joint ventures; however, it does exercise significant
influence. Accordingly, investment in joint ventures is recorded using the
equity method of accounting. As of December 31, 2001, these properties were
97.3% occupied, as compared to 79.2% at December 31, 2000 and 91.7% at December
31, 1999.
The following table shows lease expirations during each of the next ten years
for all leases at properties in which the Partnership owned an interest through
the joint ventures described in Item 1 as of December 31, 2001, assuming no
exercise of renewal options or termination rights:
Share of Partnerships
Year of Number of Square Annualized Annualized Percentage of Percentage of
Lease Leases Feet Gross Base Gross Base Total Square Total Annualized
Expiration Expiring Expiring Rent(1) Rent(1) Feet Expiring Base Rent
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2002 10 36,552 $ 967,681 $ 386,025 13.60% 23.76%
2003(2) 8 79,089 1,227,416 468,826 29.43 30.14
2004 7 15,909 318,104 123,930 5.92 7.81
2005 9 21,426 387,528 152,490 7.97 9.52
2006 1 3,646 69,274 26,093 1.36 1.70
2008 1 5,124 89,670 38,368 1.91 2.20
2009(3) 1 43,000 520,300 222,629 16.00 12.78
2011(4) 1 63,986 492,692 210,816 23.81 12.09
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38 268,732 $4,072,665 $ 1,629,177 100.00% 100.00%
(1) Average monthly gross rent over the life of the lease,
annualized.
(2) Expiration of IBM lease (68,100 square feet) at the IBM
Jacksonville Building.
(3) Expiration of Reciprocal Group lease (43,000 square feet) at the
Reciprocal Group Building.
(4) Expiration of Kroger lease (63,986 square feet) at the
Stockbridge Village Shopping Center.
The following describes the properties in which the Partnership owned an
interest as of December 31, 2001:
3
Fund III - IV Joint Venture
On March 27, 1991, the Partnership and Wells Real Estate Fund III,
L.P. ("Wells Fund III"), a Georgia public limited partnership
having Leo F. Wells, III and Wells Capital, Inc., as General
Partners, formed Fund III- IV Joint Venture. The investment
objectives of Wells Fund III are substantially identical to those
of the Partnership. The Partnership holds an approximate 43%
equity interest in the Fund III- IV Joint Venture, which includes
a multi-tenant retail center and an office building. As of
December 31, 2001, the Partnership had contributed $6,415,731 and
Wells Fund III had contributed $8,357,551 for total contributions
of $14,773,282 to the Fund III- IV Joint Venture. The Partnership
owns interests in the following two properties through the Fund
III- IV Joint Venture:
Stockbridge Village Shopping Center
On April 4, 1991, the Fund III- IV Joint Venture purchased 13.62
acres of real property located in Clayton County, Georgia for the
purchase price of $3,057,729, including acquisition costs, for the
purpose of developing, constructing and operating a shopping
center known as the Stockbridge Village Shopping Center. The
multi-tenant shopping center contains approximately 112,891 square
feet of which approximately 64,097 square feet are occupied by the
Kroger Company, a retail grocery chain. This is the only tenant
which occupies more than ten percent of the rentable square feet
of this property. The lease with Kroger Company is for an initial
term of 20 years commencing on November 14, 1991, with an option
to extend for four consecutive five year periods at the same
rental rate as the original lease. The annual base rent payable
under the Kroger lease during the initial term is $492,692. The
remaining 48,794 square feet are comprised of 12 separate retail
spaces and 3 free-standing retail buildings. As of December 31,
2001, the Partnership had contributed a total of $4,574,247 and
Wells Fund III had contributed a total of $5,114,502 to fund the
total costs of approximately $9,688,749 to fund the acquisition
and development of the Stockbridge Village Shopping Center.
The occupancy rate at year end for the Stockbridge Village
Shopping Center was 100% in 2001, 100% in 2000, 95% in 1999, 100%
in 1998 and 93% in 1997. The average effective annual rental per
square foot was $11.82 for 2001, $11.29 for 2000, $11.23 for 1999,
$10.82 for 1998 and $9.86 for 1997.
Reciprocal Group Building
The Reciprocal Group Building is a two-story office building
containing approximately 43,000 square feet located in Richmond,
Virginia, which was acquired by the Fund III- IV Joint Venture on
July 1, 1992, for a purchase price of $4,687,600. As of December
31, 2001, a total of $5,084,533 had been incurred for the
acquisition (including deferred lease acquisition costs) of the
Reciprocal Group Building. Of this amount, the Partnership
contributed $1,301,229 and Wells Fund III contributed $3,783,304
to the Fund III- IV Joint Venture.
The Reciprocal Group Building was leased to the Reciprocal Group
on October 4, 2000 for a term of eight years, with rent commencing
in February 2001. The total cost of refurbishments, tenant
improvements and building maintenance was $1,407,002. These costs
were funded out of cash from operations of the Partnership and
Wells Fund III, which caused a substantial reduction in
distributions paid to the Partnership from Fund III-IV Joint
Venture and, consequently, distributions payable from the
Partnership to the Limited Partners in
4
2000. These improvements have now been fully funded. The
Partnership funded $570,914 of these improvements.
At year-ends the occupancy rate at the Reciprocal Group Building
was 100% in 2001, 0% in 2000; and 100% in 1999, 1998 and 1997. The
average effective annual rental per square foot was $12.33 for
2001, $3.07 for 2000 and $12.27 for 1999, 1998, and 1997.
Fund IV - V Joint Venture
On April 14, 1992, the Partnership and Wells Real Estate Fund V,
L.P. ("Wells Fund V"), a Georgia public limited partnership
affiliated with the Partnership through common general partners,
formed the Fund IV-V Joint Venture. The investment objectives of
Wells Fund V are substantially identical to those of the
Partnership. As of December 31, 2001, the Partnership had
contributed approximately $4,837,041 to the Fund IV - V Joint
Venture, and Wells Fund V had contributed approximately
$8,032,509. The Partnership holds an equity interest of
approximately 38%, and Wells Fund V holds an equity interest of
approximately 62% in the Fund IV- V Joint Venture.
The Partnership owns interests in the following two properties
through the Fund IV - V Joint Venture:
IBM Jacksonville Building
On June 8, 1992, the Fund IV- V Joint Venture acquired 5.676 acres
of real property located in Jacksonville, Florida at a purchase
price of $1,360,000 for the purpose of developing, constructing,
and operating a four-story office building containing
approximately 87,600 square feet (the "IBM Jacksonville
Building"). As of December 31, 2001, the Partnership contributed
$3,479,750 and Wells Fund V contributed $5,000,116 to the Fund IV-
V Joint Venture to fund the acquisition and development of the IBM
Jacksonville Building.
The IBM Jacksonville Building is leased primarily by International
Business Machines Corporation ("IBM"), a computer sales and
service corporation, and Customized Transportation, Inc. ("CTI"),
a division of the CSX Railroad. The initial term of the IBM lease
for 68,100 square feet is 9 years and 11 months and commenced upon
completion of the building in June 1993, with an option to extend
the initial lease for two consecutive five-year periods. The
annual base rent payable under the IBM lease during the initial
term is $1,122,478. IBM is also required to pay additional rent
equal to its share of operating expenses during the lease term.
The term of the original CTI lease for 23,869 square feet was 8
years and commenced in March, 1994. The original CTI lease expired
on February 28, 2001 and was extended through March 31, 2002 with
an annual base rent of $501,249.
The occupancy rates at year end for the IBM Jacksonville Building
were 93% in 2001, 93% in 2000, 94% in both 1999 and 1998, and 100%
in 1997. The average effective annual rental per square foot was
$17.49 for 2001, $16.46 for 2000, $16.80 for 1999, $16.69 for 1998
and $16.71 for 1997.
5
Village Overlook Property
On September 14, 1992, the Fund IV- V Joint Venture acquired 2.655
acres of real property in Stockbridge, Georgia for $440,000 for
the purpose of constructing two substantially identical two-story
office buildings containing approximately 17,847 rentable square
feet each (the "Village Overlook Property"). As of December 31,
2001, the Partnership had contributed $1,357,291 and Wells Fund V
had contributed $3,032,393 to the Fund IV- V Joint Venture for the
acquisition and development of the Village Overlook Property.
The occupancy rate at year end for the Village Overlook Property
was 93% in 2001, 78% in 2000, 62% in 1999, 92% in 1998 and 81% in
1997. The average effective annual rental per square foot was
$16.51 for 2001, $15.90 for 2000, $12.75 for 1999, $13.46 for
1998 and $10.93 for 1997.
Because of the requirement for fiduciaries of retirement plans subject to ERISA
to determine the value of the assets of such retirement plans on an annual
basis, the General Partners are required under the Partnership Agreement to
report estimated Unit values to the Limited Partners each year in the
Partnership's annual Form 10-K. The methodology to be utilized for determining
such estimated Unit values under the Partnership Agreement is for the General
Partners to estimate the amount a Unit holder would receive if the
Partnership's properties were sold at their estimated fair market values as of
the end of the Partnership's fiscal year and the proceeds therefrom (without
reduction for selling expenses) were distributed to the Limited Partners in
liquidation of the Partnership. Utilizing this methodology, the General
Partners have estimated Unit valuations, based upon their estimates of property
values as of December 31, 2001, to be approximately $9.50 per Class A Unit and
$9.50 per Class B Unit, based upon market conditions existing in early December
2001. In connection with these estimated valuations, the General Partners
obtained an opinion from David L. Beal Company, an independent MAI appraiser,
to the effect that such estimates of value were reasonable; however, due to the
inordinate expense involved in obtaining appraisals for all of the
Partnership's properties, no actual appraisals were obtained. Accordingly,
these estimates should not be viewed as an accurate reflection of the fair
market value of the Partnership's properties, nor do they represent the amount
of net proceeds which would result from an immediate sale of the Partnership's
properties. The valuations performed by the General Partners are estimates
only, and are based a number of assumptions which may not be accurate or
complete. In addition, property values are subject to change and could decline
in the future. Further, as set forth above, no appraisals have or will be
obtained. For these reasons, the estimated Unit valuations set forth above
should not be relied upon for any purpose other than required ERISA
disclosures.
ITEM 3. LEGAL PROCEEDINGS
There were no material pending legal proceedings or proceedings known to be
contemplated by governmental authorities involving the Partnership during 2001.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of the Limited Partners during 2001.
6
PART II
ITEM 5. MARKET FOR PARTNERSHIP'S UNITS AND RELATED SECURITY HOLDER MATTERS
As of February 28, 2002, the Partnership had 1,322,909 outstanding Class A
Units held by a total of 1,273 Limited Partners and 38,551 outstanding Class B
Units held by a total of 20 Limited Partners. The capital contribution per unit
is $10.00. There is no established public trading market for the Partnership's
limited partnership units, and it is not anticipated that a public trading
market for the units will develop. Under the Partnership Agreement, the General
Partners have the right to prohibit transfers of units.
Cash available for distribution to the Limited Partners is distributed on a
quarterly basis unless Limited Partners elect to have distributions paid
monthly. Under the Partnership Agreement, distributions are allocated first to
the Limited Partners holding Class A Units until they have received cash
distributions in each fiscal year of the Partnership equal to 10% of their
adjusted capital contribution. After this preference is satisfied, the General
Partners will receive an amount of Net Cash from Operations equal to one-tenth
of the total amount of Net Cash from Operations distributed. Afterwards, the
Limited Partners holding Class A Units will receive 90% of Net Cash from
Operations, and the General Partners will receive 10%. No Net Cash from
Operations will be distributed to Limited Partners holding Class B Units. Cash
distributions made to the Limited Partners holding Class A Units for the two
most recent fiscal years were as follows:
Per Class A Per Class General
Unit A Unit Per Class B Partner
Distribution For Total Cash Investment Return of Unit Return Return of
Quarter Ended Distribution Income Capital of Capital Capital
March 31, 2000 $206,144 $0.09 $0.07 $0.00 $0.00
June 30, 2000 0 0.00 0.00 0.00 0.00
Sept. 30, 2000 0 0.00 0.00 0.00 0.00
Dec. 31, 2000 0 0.00 0.00 0.00 0.00
March 31, 2001 231,582 0.10 0.07 0.00 0.00
June 30, 2001 239,783 0.12 0.06 0.00 0.00
Sept. 30, 2001 264,576 0.12 0.09 0.00 0.00
Dec. 31, 2001 264,571 0.11 0.09 0.00 0.00
The cash distributions to Limited Partners holding Class A units were
substantially reduced in 2000 (reserved for the last three quarters) due to the
vacancy at the Reciprocal Group Building and the related costs necessary to
lease up the property, as previously discussed. Distributions increased to a
normalized level in 2001.
7
ITEM 6. SELECTED FINANCIAL DATA
The following sets forth a summary of the selected financial data for the
fiscal years ended December 31, 2001, 2000, 1999, 1998, and 1997.
2001 2000 1999 1998 1997
---- ---- ---- ---- ----
Total assets $9,506,490 $9,644,595 $9,758,573 $10,191,338 $10,578,235
Total revenues 678,096 428,694 684,024 655,837 589,451
Net income 595,337 357,405 608,712 574,034 519,907
Net (loss) allocated
to General Partners 0 0 0 0 0
Net income allocated to
Class A Limited Partners 595,337 357,405 608,712 574,034 519,907
Net loss allocated to
Class B Limited Partners 0 0 0 0 0
Net Income per Class A
Limited Partner Unit .45 .27 .46 .43 .39
Net Loss per Class B
Limited Partner Unit 0 0 0 0 0
Cash Distributions per Class
Cash Distribution per Class A
Limited Partner Unit:
Investment Income .45 .09 .45 .43 .39
Return of Capital $.31 $.07 $.35 $.30 $.33
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS
AND RESULTS OF OPERATIONS
Forward Looking Statements
The following discussion and analysis should be read in conjunction with the
selected financial data and the accompanying financial statements of the
Partnership and notes thereto. This Report contains forward-looking statements,
within the meaning of Section 27A of the Securities Act of 1933 and 21E of the
Securities Exchange Act of 1934, including discussion and analysis of the
financial condition of the Partnership, anticipated capital expenditures
required to complete certain projects, amounts of cash distributions anticipated
to be distributed to Limited Partners in the future and certain other matters.
Readers of this Report should be aware that there are various factors that could
cause actual results to differ materially from any forward-looking statement
made in this Report, which include construction costs which may exceed
estimates, construction delays, lease-up risks, inability to obtain new tenants
upon the expiration of existing leases, and the potential need to fund tenant
improvements or other capital expenditures out of operating cash flow.
Results of Operations
Gross revenues of the Partnership were $678,096 for the year ended December 31,
2001 as compared to $428,694 for the year ended December 31, 2000 and $684,024
for the year ended December 31, 1999. The increase in 2001, as compared to 2000,
was due primarily to the Reciprocal Group taking occupancy of the Reciprocal
Group Building during 2001; whereas, the property was 0% occupied at year end
2000. 2001 revenue numbers are consistent with 1999 figures, due to occupancy
rates. Expenses of the Partnership increased to $82,759 in 2001 compared to
$71,289 in 2000 and $75,312 in 1999 primarily
8
due to an increase in administrative salaries. As a result, net income of the
Partnership increased to $595,337 for the year ended December 31, 2001 compared
to $357,405 for the year ended December 31, 2000 and $608,712 for the year
ended December 31, 1999.
The Partnership made cash distributions to the Limited Partners holding Class A
Units of $.76 and $.16 per Class A Unit for the years ended December 31, 2001
and 2000, respectively. No cash distributions were made to the Limited Partners
holding Class B Units or to the General Partners for the fiscal years ended
December 31, 2001, 2000 and 1999. The increase in distributions for 2001 is
consistent with the increase in revenues and net income from 2000 to 2001.
Refer to footnotes of audited Financial Statements where a complete summary of
operations is disclosed.
Liquidity and Capital Resources
During its offering, which terminated on February 29, 1992, the Partnership
raised a total $13,614,600 in capital through the sale of approximately
1,361,465 units. No additional units will be sold by the Partnership. From the
original funds raised, the Partnership had invested a total of $11,088,611 in
properties, paid $748,805 in acquisition and advisory fees, $1,767,236 in
selling commission and organization and offering expenses, and is maintaining a
working capital reserve of $10,000.
Since the Partnership is an investment partnership formed for the purpose of
acquiring, owning and operating income-producing real property and has invested
all of its funds available for investment, it is unlikely that the Partnership
will acquire interests in any additional properties. The Partnership's capital
resources are anticipated to remain relatively stable over the holding period
of its investments.
The Partnership's net cash used in operating activities remained consistent at
$74,470 in 2001, $64,803 in 2000 and $78,269 in 1999. Net cash provided by
investing activities decreased to $603,678 in 2001 from $743,211 in 2000 and
$1,058,115 in 1999. The decrease for the year ended December 31, 2001, as
compared to 2000, was a result of investing in joint ventures for purposes of
tenant improvements for the Reciprocal Group Building and reduced distributions
from joint ventures in order to fund such improvements. This resulted in lower
distributions from the joint ventures to the Partnership. Net cash used in
financing activities increased to $735,940 in 2001 as compared to $471,383 in
2000, and $1,037,233 in 1999. The increase from 2000 to 2001 was fueled by an
increase in the income generated by and distributions received from the joint
ventures which is consistent with a corresponding increase in property revenues
and no longer reserving for tenant improvements for the Reciprocal Group
Building. The decrease from 1999 to 2000 stemmed from a decrease in the
Reciprocal Building rental income and increased funding in Reciprocal Building
tenant improvements. As a result, cash and cash equivalents decreased from
$252,598 at December 31, 2000 to $45,866 in 2001.
The Partnership's distributions payable in 2001 have been paid from net cash
from operations and from distributions received from its investments in joint
ventures. Even though there is no guarantee, the General Partners anticipate
that cash distributions to Limited Partners holding Class A units will continue
in 2002 at a level at least comparable with 2001 cash distributions on an
annual basis. The Partnership expects to continue to meets its short-term
liquidity requirements generally through net cash provided by operations which
the Partnership believes will continue to be adequate to meet both operating
requirements and distributions to limited partners.
The Partnership is unaware of any additional demands, commitments, events or
capital expenditures which are required for the normal operations of its
properties that will result in the Partnership's liquidity increasing or
decreasing in any material way.
9
Inflation
The real estate market has not been affected significantly by inflation in the
past three years due to the relatively low inflation rate. There are provisions
in the majority of tenant leases executed by the Partnership to protect the
Partnership from the impact of inflation. Most leases contain common area
maintenance charges, real estate tax and insurance reimbursements on a per
square foot basis, or in some cases, annual reimbursement of operating expenses
above a certain per square foot allowance. These provisions should reduce the
Partnership's exposure to increases in costs and operating expenses resulting
from inflation. In addition, a number of the Partnership's leases are for terms
of less than five years, which may permit the Partnership to replace existing
leases with new leases at higher base rental rates if the existing leases are
below market rate. There is no assurance, however, that the Partnership would
be able to replace existing leases with new leases at higher base rentals.
Critical Accounting Policies
The Partnership's accounting policies have been established and conformed to in
accordance with accounting principles generally accepted in the United States
("GAAP"). The preparation of financial statements in conformity with GAAP
requires management to use judgment in the application of accounting policies,
including making estimates and assumptions. These judgments affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the dates of the financial statements and the reported amounts of
revenue and expenses during the reporting periods. If our judgment or
interpretation of the facts and circumstances relating to various transactions
had been different, it is possible that different accounting policies would have
been applied; thus, resulting in a different presentation of our financial
statements. Below is a discussion of the accounting policies that we consider to
be critical in that they may require complex judgment in their application or
require estimates about matters, which are inherently uncertain. Additional
discussion of accounting policies that we consider to be significant, including
further discussion of the critical accounting policies described below, is
presented in the notes to the Partnership's financial statements in Item 14(a).
Straight-Lined Rental Revenues
The Partnership recognizes rental income generated from all leases on real
estate assets in which the Partnership has an ownership interest, either
directly or through investments in joint ventures, on a straight-line basis over
the terms of the respective leases. If a tenant was to encounter financial
difficulties in future periods, the amount recorded as receivable may not be
realized.
Operating Cost Reimbursements
The Partnership generally bills tenants for operating cost reimbursements,
either directly or through investments in joint ventures, on a monthly basis at
amounts estimated largely based on actual prior period activity and the
respective lease terms. Such billings are generally adjusted on an annual basis
to reflect reimbursements owed to the landlord based on the actual costs
incurred during the period and the respective lease terms. Financial
difficulties encountered by tenants may result in receivable not being realized.
Real Estate
Management continually monitors events and changes in circumstances indicating
that the carrying amounts of the real estate assets in which the Partnership
has an ownership interest, either directly or through investments in joint
10
ventures, may not be recoverable. When such events or changes in circumstances
are present, management assesses the potential impairment by comparing the fair
market value of the asset, estimated at an amount equal to the future
undiscounted operating cash flows expected to be generated from tenants over the
life of asset and from its eventual disposition, to the carrying value of the
asset. In the event that the carrying amount exceeds the estimated fair market
value, the Partnership would recognize an impairment loss in the amount required
to adjust the carrying amount of the asset to its estimated fair market value.
Neither the Partnership nor its joint ventures have recognized impairment losses
on real estate assets in 2001, 2000 or 1999.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Financial Statements of the Registrant and supplementary data are detailed
under Item 14(a) and filed as part of the report on the pages indicated.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
There were no disagreements with the Partnership's accountants or other
reportable events during 2001.
(THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK)
11
PART III
ITEM 10. GENERAL PARTNERS OF THE PARTNERSHIP
Wells Partners, L.P. The sole General Partner of Wells Partners, L.P. is Wells
Capital, Inc. The executive offices of Wells Capital, Inc. are located at 6200
The Corners Parkway, Norcross, Georgia, 30092.
Leo F. Wells, III. Mr. Wells is a resident of Atlanta, Georgia, is 58 years
of age and holds a Bachelor of Business Administration Degree in Economics from
the University of Georgia. Mr. Wells is the President and sole Director of
Wells Capital. Mr. Wells is the President of Wells & Associates, Inc., a real
estate brokerage and investment company formed in 1976 and incorporated in
1978, for which he serves as the principal broker. Mr. Wells is also
currently the sole Director and President of Wells Management Company, Inc., a
property management company he founded in 1983. In addition, Mr. Wells is the
President and Chairman of the Board of Wells Investment Securities, Inc., Wells
& Associates, Inc., and Wells Management Company, Inc., all of which are
affiliates of the General Partners. From 1980 to February 1985, Mr. Wells
served as vice-president of Hill-Johnson, Inc., a Georgia corporation engaged
in the construction business. From 1973 to 1976, he was associated with Sax
Gaskin Real Estate Company, and from 1970 to 1973, he was a real estate
salesman and property manager for Roy D. Warren & Company, an Atlanta real
estate company.
ITEM 11. COMPENSATION OF GENERAL PARTNERS AND AFFILIATES
The following table summarizes the compensation and fees paid to the General
Partners and their affiliates during the year ended December 31, 2001.
CASH COMPENSATION TABLE
Name of individual or Capacities in which served -
number in group Form of Compensation Cash Compensation
- --------------------- ---------------------------- -----------------
Wells Management Property Manager- $148,456 (1)
Company, Inc. Management and Leasing
Fees
(1) The Partnership does not own any properties directly. Accordingly, these
fees are payable to Wells Management, Inc. by the joint ventures described
in Item 1 and represent the partnership's ownership interest in amounts
attributable to the properties owned directly by these joint ventures for
services rendered during 2001. Some of these fees were accrued for
accounting purposes in 2001; however, were not paid until January 2002.
12
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
No Limited Partner is known by the Partnership to own beneficially more than 5%
of the outstanding units of the Partnership.
Set forth below is the security ownership of management as of February 28,
2002.
Name and Address of Amount and Nature of
Title of Class Beneficial Owner Beneficial Ownership Parent of Class
- ---------------------- ------------------------ ------------------------ -------------------
Class A Units Leo F. Wells, III 114.68 units (IRA, less than 1%
401(k) and Profit Sharing)
No arrangements exist which would, upon expectation thereof, result in a change
in control of the Partnership.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The compensation and fees paid or to be paid by the Partnership to the General
Partners and their affiliates in connection with the operation of the
Partnership are as follows:
Interest in Partnership Cash Flow and Net Sale Proceeds. The General Partners
will receive a subordinated participation in net cash flow from operations
equal to 10% of net cash flow after the Limited Partners holding Class A Units
have received preferential distributions equal to 10% of their adjusted capital
contribution. The General Partners will also receive a subordinated
participation in net sale proceeds and net financing proceeds equal to 20% of
residual proceeds available for distribution after the Limited Partners holding
Class A Units have received a return of their adjusted capital contribution
plus a 10% cumulative return on their adjusted capital contributions and
Limited Partners holding Class B Units have received a return of their adjusted
capital contribution plus a 15% cumulative return on their adjusted capital
contribution; provided, however, that in no event shall the General Partners
receive in the aggregate in excess of 15% of net sale proceeds and net
financing proceeds remaining after payments to Limited Partners from such
proceeds of amounts equal to the sum of their adjusted capital contributions
plus a 6% cumulative return on their adjusted capital contributions. The
General Partners have received no distribution from cash flow or net sales
proceeds in 2001.
Property Management and Leasing Fees. Wells Management Company, Inc., an
affiliate of the General Partners, will receive compensation for supervising the
management of the Partnership properties equal to the lesser of: (A)(i) 3% of
gross revenues for management and 3% of the gross revenues for leasing
(aggregate maximum of 6%) plus a separate one-time fee for initial rent-up or
leasing-up of newly constructed properties in an amount not to exceed the fee
customarily charged in arm's length transactions by others rendering similar
services in the same geographic area for similar properties; and (ii) in the
case of industrial and commercial properties which are leased on a long-term
basis (ten or more years), 1% of the gross revenues except for initial leasing
fees equal to 3% of the gross revenues over the first five years of the lease
term; or (B) the amounts charged by unaffiliated persons rendering comparable
services in the same geographic area. Wells Management Company, Inc. received
$148,456 in cash compensation for services rendered during the year ended
December 31, 2001.
13
Real Estate Commissions. In connection with the sale of Partnership properties,
the General Partners or their affiliates may receive commissions not exceeding
the lesser of (A) 50% of the commissions customarily charged by other brokers in
arm's-length transactions involving comparable properties in the same geographic
area or (B) 3% of the gross sales price of the property, and provided that
payments of such commissions will be made only after Limited Partners have
received prior distributions totaling 100% of their capital contributions plus a
6% cumulative return on their adjusted capital contributions. During 2001, no
real estate commissions were paid to the General Partners or their affiliates.
14
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K.
(a)1. The Financial Statements are contained on pages F-2 through F-19 of
this Annual Report on Form 10-K, and the list of the Financial
Statements contained herein is set forth on page F-1, which is hereby
incorporated by reference.
(a)2. The Exhibits filed in response to Item 601 of Regulation S-K are
listed the Exhibit Index attached hereto.
(b) No reports on Form 8-K were filed with the Commission during the
fourth quarter of 2001.
(c) The Exhibits filed in response to Item 601 of Regulation S-K are
listed on the Exhibit Index attached hereto.
(d) See (a)2.
15
SIGNATURES
Pursuant to the requirements of Sections 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized this 21st day of March,
2001
Wells Real Estate Fund IV, L.P.
(Registrant)
By: /s/ Leo F. Wells, III
---------------------------------
Leo F. Wells, III
Leo F. Wells, III Individual
General Partner and as President
and Chief Financial Officer of
Wells Capital, Inc., the General
Partner of Wells Partners, L.P.
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following person on behalf of the
registrant and in the capacity as and on the date indicated.
Signature Title Date
- --------------------------- ------------------------------------------ -------------------------
/s/ Leo F. Wells, III Individual General Partner, March 21, 2002
- ------------------------
Leo F. Wells, III President and Sole Director
of Wells Capital, Inc., the General
Partner of Wells Partners, L.P.
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE ACT BY REGISTRARS THAT HAVE NOT BEEN REGISTERED PURSUANT TO
SECTION 12 OF THE ACT.
No annual report or proxy material relating to an annual or other meeting of
security holders has been sent to security holders.
16
INDEX TO THE FINANCIAL STATEMENTS
Financial Statements Page
- ----------------------------------------------------------------------------- ------------
Independent Auditors' Report F-2
Balance Sheets as of December 31, 2001 and 2000 F-3
Statements of Income for the Years Ended December 31, 2001, 2000 and 1999 F-4
Statements of Partners' Capital for the Years Ended December 31, 2001, 2000 F-5
and 1999
Statements of Cash Flows for the Years Ended December 31, 2001, 2000 and 1999 F-6
Notes to Financial Statements for December 31, 2001, 2000 and 1999 F-7
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To Wells Real Estate Fund IV, L.P.:
We have audited the accompanying balance sheets of WELLS REAL ESTATE FUND IV,
L.P. (a Georgia public limited partnership) as of December 31, 2001 and 2000 and
the related statements of income, partners' capital, and cash flows for each of
the three years in the period ended December 31, 2001. These financial
statements are the responsibility of the Partnership's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial 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, the financial statements referred to above present fairly, in
all material respects, the financial position of Wells Real Estate Fund IV, L.P.
as of December 31, 2001 and 2000 and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 2001 in
conformity with accounting principles generally accepted in the United States.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
January 25, 2002
F-2
WELLS REAL ESTATE FUND IV, L.P.
(A Georgia Public Limited Partnership)
BALANCE SHEETS
DECEMBER 31, 2001 AND 2000
ASSETS
2001 2000
----------- -----------
INVESTMENT IN JOINT VENTURES $9,201,538 $9,233,292
CASH AND CASH EQUIVALENTS 45,866 252,598
DUE FROM AFFILIATES 259,086 158,705
----------- -----------
Total assets $9,506,490 $9,644,595
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
LIABILITIES:
Accounts payable $ 2,498 $ 0
Partnership distributions payable 267,575 3,003
----------- -----------
270,073 3,003
COMMITMENTS AND CONTINGENCIES ----------- -----------
PARTNERS' CAPITAL:
Limited partners:
Class A--1,322,909 units 9,236,417 9,641,592
Class B--38,551 units 0 0
----------- -----------
Total partners' capital 9,236,417 9,641,592
----------- -----------
Total liabilities and partners' capital $9,506,490 $9,644,595
=========== ===========
The accompanying notes are an integral part of these balance sheets.
F-3
WELLS REAL ESTATE FUND IV, L.P.
(A Georgia Public Limited Partnership)
STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
2001 2000 1999
----------- ------------ ----------
REVENUES:
Equity in income of joint ventures $672,305 $422,208 $682,737
Interest income 5,791 6,486 1,287
-------- -------- --------
678,096 428,694 684,024
-------- -------- --------
EXPENSES:
Partnership administration 54,121 43,841 46,917
Legal and accounting 15,928 17,175 17,639
Computer costs 12,710 10,273 10,756
-------- -------- --------
82,759 71,289 75,312
-------- -------- --------
NET INCOME $595,337 $357,405 $608,712
======== ======== ========
NET INCOME ALLOCATED TO CLASS A LIMITED PARTNERS $595,337 $357,405 $608,712
======== ======== ========
NET INCOME PER CLASS A LIMITED PARTNER UNIT $ 0.45 $ 0.27 $ 0.46
======== ======== ========
DISTRIBUTION PER CLASS A LIMITED PARTNER UNIT $ 0.76 $ 0.16 $ 0.80
======== ======== ========
The accompanying notes are an integral part of these statements.
F-4
WELLS REAL ESTATE FUND IV, L.P.
(A Georgia Public Limited Partnership)
STATEMENTS OF PARTNERS' CAPITAL
FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
Limited Partners Total
-----------------------------------------------------
Class A Class B Partners'
---------------------------- -----------------------
Units Amount Units Amount Capital
------------ -------------- ---------- ----------- -------------
BALANCE, December 31, 1998 1,322,909 $9,939,003 38,551 $0 $9,939,003
Net income 0 608,712 0 0 608,712
Partnership distributions 0 (1,057,384) 0 0 (1,057,384)
------------ -------------- ---------- ----------- -------------
BALANCE, December 31, 1999 1,322,909 9,490,331 38,551 0 9,490,331
Net income 0 357,405 0 0 357,405
Partnership distributions 0 (206,144) 0 0 (206,144)
------------ -------------- ---------- ----------- -------------
BALANCE, December 31, 2000 1,322,909 9,641,592 38,551 0 9,641,592
Net income 0 595,337 0 0 595,337
Partnership distributions 0 (1,000,512) 0 0 (1,000,512)
------------ -------------- ---------- ----------- -------------
BALANCE, December 31, 2001 1,322,909 $9,236,417 38,551 $0 $9,236,417
========== ============== ========== =========== =============
The accompanying notes are an integral part of these statements.
F-5
WELLS REAL ESTATE FUND IV, L.P.
(A Georgia Public Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2001, 2000, AND 1999
2001 2000 1999
---------- ----------- ---------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $595,337 $357,405 $ 608,712
Adjustments to reconcile net income to net cash used in ---------- ----------- ---------------
operating activities:
Equity in income of joint ventures (672,305) (422,208) (682,737)
Changes in accounts payable and accrued expenses 2,498 0 (4,244)
---------- ----------- ---------------
Total adjustments (669,807) (422,208) (686,981)
---------- ----------- ---------------
Net cash used in operating activities (74,470) (64,803) (78,269)
---------- ----------- ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in joint ventures (375,720) (178,744) (65,371)
Distributions received from joint ventures 979,398 921,955 1,123,486
---------- ----------- ---------------
Net cash provided by investing activities 603,678 743,211 1,058,115
---------- ----------- ---------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners in excess of accumulated earnings (221,326) (31,265) (445,725)
Distributions to partners from accumulated earnings (514,614) (440,118) (591,508)
---------- ----------- ---------------
Net cash used in financing activities (735,940) (471,383) (1,037,233)
---------- ----------- ---------------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (206,732) 207,025 (57,387)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 252,598 45,573 102,960
---------- ----------- ---------------
CASH AND CASH EQUIVALENTS, END OF YEAR $ 45,866 $252,598 $ 45,573
========== =========== ===============
The accompanying notes are an integral part of these statements.
F-6
WELLS REAL ESTATE FUND IV, L.P.
(A Georgia Public Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001, 2000, AND 1999
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION AND BUSINESS
Wells Real Estate Fund IV, L.P. (the "Partnership") is a public limited
partnership organized on October 25, 1990 under the laws of the state of
Georgia. The general partners are Leo F. Wells, III and Wells Partners,
L.P. ("Wells Partners"), a Georgia nonpublic limited partnership. The
Partnership has two classes of limited partnership interests, Class A and
Class B units. Limited partners may vote to, among other things, (a) amend
the partnership agreement, subject to certain limitations, (b) change the
business purpose or investment objectives of the Partnership, and (c)
remove a general partner. A majority vote on any of the above-described
matters will bind the Partnership without the concurrence of the general
partners. Each limited partnership unit has equal voting rights,
regardless of class.
The Partnership was formed to acquire and operate commercial real
properties, including properties which are either to be developed, are
currently under development or construction, are newly constructed, or
have operating histories. The Partnership owns an interest in the
following properties through joint ventures between the Partnership and
other Wells Real Estate Funds: (i) the Stockbridge Village Shopping
Center, a retail shopping center located in Stockbridge, Georgia,
southeast of Atlanta, Georgia, (ii) the Reciprocal Group Building
(formerly G.E. Lighting National Customer Center), a two-story office
building located in Richmond, Virginia, (iii) the Village Overlook
Project, two substantially identical two-story office buildings located in
Clayton County, Georgia, and (iv) the Jacksonville IBM Building, a
four-story office building located in Jacksonville, Florida.
USE OF ESTIMATES AND FACTORS AFFECTING THE PARTNERSHIP
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to
make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
The carrying values of real estate are based on management's current
intent to hold the real estate assets as long-term investments. The
success of the Partnership's future operations and the ability to realize
the investment in its assets will be dependent on the Partnership's
ability to maintain rental rates, occupancy, and an appropriate level of
operating expenses in future years. Management believes that the steps it
is taking will enable the Partnership to realize its investment in its
assets.
INCOME TAXES
The Partnership is not subject to federal or state income taxes;
therefore, none have been provided for in the accompanying financial
statements. The partners are required to include their respective shares
of profits and losses in their individual income tax returns.
F-7
DISTRIBUTIONS OF NET CASH FROM OPERATIONS
Cash available for distribution, as defined by the partnership agreement,
is distributed on a cumulative noncompounded basis to the limited partners
quarterly. In accordance with the partnership agreement, distributions are
paid first to limited partners holding Class A units until they have
received a 10% per annum return on their adjusted capital contributions,
as defined. Cash available for distribution is then paid to the general
partners until they have received an amount equal to 10% of distributions.
Any remaining cash available for distribution is split between the limited
partners holding Class A units and the general partners on a basis of 90%
and 10%, respectively. No distributions will be made to the limited
partners holding Class B units.
DISTRIBUTION OF SALES PROCEEDS
Upon sales of properties, the net sales proceeds are distributed in the
following order:
. To limited partners on a per unit basis until each limited partner
has received 100% of his/her adjusted capital contribution, as
defined
. To limited partners holding Class B units on a per unit basis
until they receive an amount equal to the net cash available for
distribution received by the limited partners holding Class A
units
. To all limited partners on a per unit basis until they receive a
cumulative 10% per annum return on their adjusted capital
contribution, as defined
. To limited partners holding Class B units on a per unit basis
until they receive a cumulative 15% per annum return on their
adjusted capital contribution, as defined
. To all limited partners until they receive an amount equal to
their respective cumulative distributions, as defined
. To the general partners until they have received 100% of their
capital contributions, as defined
. Thereafter, 80% to the limited partners and 20% to the general
partners
Allocation of Net Income, Net Loss, and Gain On Sale
Net income is defined as net income recognized by the Partnership,
excluding deductions for depreciation and amortization. Net income, as
defined, of the Partnership will be allocated each year in the same
proportions that net cash from operations is distributed to the partners.
To the extent the Partnership's net income in any year exceeds net cash
from operations, it will be allocated 99% to the limited partners holding
Class A units and 1% to the general partners.
Net loss, depreciation, and amortization deductions for each fiscal year
will be allocated as follows: (a) 99% to the limited partners holding
Class B units and 1% to the general partners until their capital accounts
are reduced to zero, (b) then to any partner having a positive balance in
his/her capital account in an amount not to exceed such positive balance,
and (c) thereafter to the general partners.
Gain on the sale or exchange of the Partnership's properties will be
allocated generally in the same manner that the net proceeds from such
sale are distributed to partners after the following allocations are made,
if applicable: (a) allocations made pursuant to a qualified income offset
provision in the partnership agreement, (b) allocations to partners having
negative capital accounts until all negative capital accounts have been
restored to zero, and (c) allocations to Class B limited partners in
amounts equal to deductions for depreciation and amortization previously
allocated to them with respect to the
F-8
specific partnership property sold, but not in excess of the amount of
gain on sale recognized by the Partnership with respect to the sale of
such property.
Investment in Joint Ventures
Basis of Presentation
The Partnership does not have control over the operations of the joint
ventures; however, it does exercise significant influence. Accordingly,
investments in joint ventures are recorded using the equity method of
accounting.
Real Estate Assets
Real estate assets held by the joint ventures are stated at cost less
accumulated depreciation. Major improvements and betterments are
capitalized when they extend the useful life of the related asset. All
ordinary repairs and maintenance expenditures are expensed as incurred.
Management continually monitors events and changes in circumstances
which could indicate that carrying amounts of real estate assets may
not be recoverable. When events or changes in circumstances are present
which indicate that the carrying amounts of real estate assets may not
be recoverable, management assesses the recoverability of real estate
assets by determining whether the carrying value of such real estate
assets will be recovered through the future cash flows expected from
the use of the asset and its eventual disposition. Management has
determined that there has been no impairment in the carrying value of
real estate assets held by the joint ventures as of December 31, 2001
or 2000.
Depreciation for buildings and improvements is calculated using the
straight-line method over 25 years. Tenant improvements are amortized
over the life of the related lease or real estate asset, whichever is
shorter.
Revenue Recognition
All leases on real estate assets held by the joint ventures are
classified as operating leases, and the related rental income is
recognized on a straight-line basis over the terms of the respective
leases.
Partners' Distributions and Allocations of Profit and Loss
Cash available for distribution and allocations of profit and loss to
the Partnership by the joint ventures are made in accordance with the
terms of the individual joint venture agreements. Generally, these
items are allocated in proportion to the partners' respective ownership
interests. Cash is paid from the joint ventures to the Partnership
quarterly.
Deferred Lease Acquisition Costs
Costs incurred to procure operating leases are capitalized and
amortized on a straight-line basis over the terms of the related
leases. Deferred lease acquisition costs are included in prepaid
expenses and other assets, net, in the balance sheets presented in Note
3.
Cash and Cash Equivalents
For the purposes of the statements of cash flows, the Partnership
considers all highly liquid instruments purchased with an original
maturity of three months or less to be cash equivalents. Cash
equivalents include cash and short-term investments. Short-term
investments are stated at cost, which approximates fair value, and
consist of investments in money market accounts.
F-9
Reclassifications
Certain prior year amounts have been reclassified to conform with the
current year financial statement presentation.
2. RELATED-PARTY TRANSACTIONS
Due from affiliates at December 31, 2001 and 2000 represents the
Partnership's share of cash to be distributed from its joint venture
investments for the fourth quarters of 2001 and 2000 as follows:
2001 2000
---------- ----------
Fund III and IV Associates $174,807 $ 75,912
Fund IV and V Associates 84,279 82,793
---------- ----------
$259,086 $158,705
========== ==========
The Partnership entered into a property management and leasing agreement
with Wells Management Company, Inc. ("Wells Management"), an affiliate of
the general partners. In consideration for supervising the management of
the Partnership's properties, the Partnership will generally pay Wells
Management management and leasing fees equal to (a) 3% of the gross
revenues for management and 3% of the gross revenues for leasing
(aggregate maximum of 6%), plus a separate fee for the one-time initial
lease-up of newly constructed properties in an amount not to exceed the
fee customarily charged in arm's-length transactions by others rendering
similar services in the same geographic area for similar properties or
(b) in the case of commercial properties which are leased on a long-term
net basis (ten or more years), 1% of the gross revenues except for
initial leasing fees equal to 3% of the gross revenues over the first
five years of the lease term.
The Partnership incurred management and leasing fees and lease
acquisition costs at the joint venture level of $148,456, $173,471, and
$140,551 for the years ended December 31, 2001, 2000, and 1999,
respectively, which were paid to Wells Management.
Wells Capital, Inc. (the "Company"), the general partner of Wells
Partners, performs certain administrative services for the Partnership,
such as accounting and other partnership administration, and incurs the
related expenses. Such expenses are allocated among the various Wells Real
Estate Funds based on time spent on each fund by individual administrative
personnel. In the opinion of management, such allocation is a reasonable
estimation of such expenses.
The general partners are also general partners of other Wells Real Estate
Funds. As such, there may exist conflicts of interest where the general
partners in the capacity as general partners of other Wells Real Estate
Funds may be in competition with the Partnership for tenants in similar
geographic markets.
3. INVESTMENT IN JOINT VENTURES
The Partnership's investment and percentage ownership in joint ventures at
December 31, 2001 and 2000 are summarized as follows:
2001 2000
--------------------- ---------------------
Amount Percent Amount Percent
---------- --------- ---------- ---------
Fund III and IV Associates $5,294,701 43% $5,168,329 43%
Fund IV and V Associates 3,906,837 38 4,064,963 38
---------- ----------
$9,201,538 $9,233,292
========== ==========
F-10
The following is a roll forward of the Partnership's investment in the
joint ventures for the years ended December 31, 2001 and 2000:
2001 2000
----------- -----------
Investment in joint ventures, beginning of year $9,233,292 $9,463,148
Equity in income of joint ventures 672,305 422,208
Contributions to joint ventures 375,720 178,744
Distributions from joint ventures (1,079,779) (830,808)
----------- -----------
Investment in joint ventures, end of year $9,201,538 $9,233,292
=========== ===========
FUND III AND IV ASSOCIATES
On March 27, 1991, the Partnership entered into a joint venture agreement
with Wells Real Estate Fund III, L.P. The joint venture, Fund III and IV
Associates, was formed for the purpose of developing, constructing, and
operating the Stockbridge Village Shopping Center in Stockbridge, Georgia.
In addition, in July 1992, Fund III and IV Associates purchased the
Reciprocal Group Building (formerly G.E. Lighting National Customer
Center) in Richmond, Virginia.
The following are the financial statements for Fund III and IV Associates:
Fund III and IV Associates
(A Georgia Joint Venture)
Balance Sheets
December 31, 2001 and 2000
Assets
2001 2000
------------ ------------
Real estate assets, at cost:
Land $ 3,331,775 $ 3,331,775
Building and improvements, less accumulated depreciation of
$4,597,821 in 2001 and $3,980,865 in 2000 8,643,113 8,540,176
------------ ------------
Total real estate assets 11,974,888 11,871,951
Cash and cash equivalents 315,325 105,104
Accounts receivable 213,999 130,226
Prepaid expenses and other assets, net 321,531 191,722
------------ ------------
Total assets $12,825,743 $12,299,003
============ ============
Liabilities and Partners' Capital
Liabilities:
Accounts payable $ 39,665 $ 40,896
Partnership distributions payable 408,538 177,418
Due to affiliates 3,406 1,870
------------ ------------
Total liabilities 451,609 220,184
------------ ------------
Partners' capital:
Wells Real Estate Fund III 7,079,433 6,910,490
Wells Real Estate Fund IV 5,294,701 5,168,329
------------ ------------
Total partners' capital 12,374,134 12,078,819
------------ ------------
Total liabilities and partners' capital $12,825,743 $12,299,003
============ ============
F-11
Fund III and IV Associates
(A Georgia Joint Venture)
Statements of Income
for the Years Ended December 31, 2001, 2000, and 1999
2001 2000 1999
------------ ------------ ------------
Revenues:
Rental income $1,864,868 $1,405,938 $1,795,247
Interest income 450 4,921 11,790
Other income 22,917 0 0
------------ ------------ ------------
1,888,235 1,410,859 1,807,037
------------ ------------ ------------
Expenses:
Depreciation 616,956 558,282 551,956
Management and leasing fees 168,643 134,283 158,520
Operating costs, net of reimbursements 27,932 164,018 (21,669)
Property administration 35,540 39,875 40,357
Legal and accounting 14,515 8,312 9,163
------------ ------------ ------------
863,586 904,770 738,327
------------ ------------ ------------
Net income $1,024,649 $ 506,089 $1,068,710
============ ============ ============
Net income allocated to Wells Real Estate Fund III $ 586,219 $ 289,542 $ 611,605
============ ============ ============
Net income allocated to Wells Real Estate Fund IV $ 438,430 $ 216,547 $ 457,105
============ ============ ============
Fund III and IV Associates
(A Georgia Joint Venture)
Statements of Partners' Capital
for the Years Ended December 31, 2001, 2000, and 1999
Wells Real Wells Real Total
Estate Estate Partners'
Fund III Fund IV Capital
------------ ----------- ------------
Balance, December 31, 1998 $7,330,542 $5,459,021 $12,789,563
Net income 611,605 457,105 1,068,710
Partnership contributions 0 23,280 23,280
Partnership distributions (948,505) (708,892) (1,657,397)
------------ ----------- ------------
Balance, December 31, 1999 6,993,642 5,230,514 12,224,156
Net income 289,542 216,547 506,089
Partnership contributions 216,683 162,058 378,741
Partnership distributions (589,377) (440,790) (1,030,167)
------------ ----------- ------------
Balance, December 31, 2000 6,910,490 5,168,329 12,078,819
Net income 586,219 438,430 1,024,649
Partnership contributions 502,342 375,720 878,062
Partnership distributions (919,618) (687,778) (1,607,396)
------------ ----------- ------------
Balance, December 31, 2001 $7,079,433 $5,294,701 $12,374,134
============ =========== ============
F-12
Fund III and IV Associates
(A Georgia Joint Venture)
Statements of Cash Flows
for the Years Ended December 31, 2001, 2000, and 1999
2001 2000 1999
------------ ------------ ------------
Cash flows from operating activities:
Net income $1,024,649 $ 506,089 $1,068,710
------------ ------------ ------------
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation 616,956 558,282 551,956
Changes in assets and liabilities:
Accounts receivable (83,773) 40,821 2,586
Prepaid expenses and other assets, net (129,809) (126,509) 9,320
Accounts payable (1,231) 7,137 (4,380)
Due to affiliates 1,536 (6,008) 6,366
------------ ------------ ------------
Total adjustments 403,679 473,723 565,848
------------ ------------ ------------
Net cash provided by operating activities 1,428,328 979,812 1,634,558
------------ ------------ ------------
Cash flows from investing activities:
Investment in real estate (719,893) (305,527) (24,871)
------------ ------------ ------------
Cash flows from financing activities:
Contributions from joint venture partners 878,062 378,741 23,280
Distributions to joint venture partners (1,376,276) (1,258,531) (1,659,316)
------------ ------------ ------------
Net cash used in financing activities (498,214) (879,790) (1,636,036)
------------ ------------ ------------
Net increase (decrease) in cash and cash equivalents 210,221 (205,505) (26,349)
Cash and cash equivalents, beginning of year 105,104 310,609 336,958
------------ ------------ ------------
Cash and cash equivalents, end of year $ 315,325 $ 105,104 $ 310,609
============ ============ ============
FUND IV AND V ASSOCIATES
On April 14, 1992, the Partnership entered into a joint venture agreement with
Wells Real Estate Fund V, L.P. The joint venture, Fund IV and V Associates, was
formed for the purpose of investing in commercial real properties. During 1992,
Fund IV and V Associates purchased a parcel of land on which the Village
Overlook Project was developed. During 1992, the joint venture also purchased a
second parcel of land in Jacksonville, Florida, on which the Jacksonville IBM
Building was developed. During 2000, the Partnership made additional capital
contributions to Fund IV and V Associates. Ownership interests were recomputed
accordingly.
F-13
Following are the financial statements of Fund IV and V Associates:
Fund IV and V Associates
(A Georgia Joint Venture)
Balance Sheets
December 31, 2001 and 2000
Assets
2001 2000
------------- -------------
Real estate assets, at cost:
Land $ 2,011,534 $ 2,011,534
Building and improvements, less accumulated depreciation of
$3,710,357 in 2001 and $3,193,823 in 2000 8,001,259 8,456,768
Construction in progress 43,982 0
------------- -------------
Total real estate assets 10,056,775 10,468,302
Cash and cash equivalents 339,137 279,590
Accounts receivable 219,120 255,736
Prepaid expenses and other assets, net 157,525 170,084
------------- -------------
Total assets $10,772,557 $11,173,712
============= =============
Liabilities and Partners' Capital
Liabilities:
Accounts payable $ 94,553 $ 65,993
Partnership distributions payable 265,119 261,173
Due to affiliates 40,809 54,667
------------- -------------
Total liabilities 400,481 381,833
------------- -------------
Partners' capital:
Wells Real Estate Fund IV 3,906,837 4,064,963
Wells Real Estate Fund V 6,465,239 6,726,916
------------- -------------
Total partners' capital 10,372,076 10,791,879
------------- -------------
Total liabilities and partners' capital $10,772,557 $11,173,712
============= =============
F-14
Fund IV and V Associates
(A Georgia Joint Venture)
Statements of Income
for the Years Ended December 31, 2001, 2000, and 1999
2001 2000 1999
------------ ------------ ------------
Revenues:
Rental income $2,113,934 $2,002,958 $1,926,543
Interest income 8,618 10,460 10,436
Other income 330 360 360
------------ ------------ ------------
2,122,882 2,013,778 1,937,339
------------ ------------ ------------
Expenses:
Depreciation 516,534 508,805 500,956
Management and leasing fees 232,632 269,653 260,350
Operating costs, net of reimbursements 684,710 636,808 509,617
Property administration 50,690 43,268 54,176
Legal and accounting 17,414 9,246 11,748
------------ ------------ ------------
1,501,980 1,467,780 1,336,847
------------ ------------ ------------
Net income $ 620,902 $ 545,998 $ 600,492
============ ============ ============
Net income allocated to Wells Real Estate Fund IV $ 233,875 $ 205,660 $ 225,632
============ ============ ============
Net income allocated to Wells Real Estate Fund V $ 387,027 $ 340,338 $ 374,860
============ ============ ============
Fund IV and V Associates
(A Georgia Joint Venture)
Statements of Partners' Capital
for the Years Ended December 31, 2001, 2000, and 1999
Wells Real Wells Real Total
Estate Estate Partners'
Fund IV Fund V Capital
------------ ------------ -------------
Balance, December 31, 1998 $4,387,427 $7,289,167 $11,676,594
Net income 225,632 374,860 600,492
Partnership contributions 42,091 69,929 112,020
Partnership distributions (422,516) (701,958) (1,124,474)
------------ ------------ -------------
Balance, December 31, 1999 4,232,634 7,031,998 11,264,632
Net income 205,660 340,338 545,998
Partnership contributions 16,686 0 16,686
Partnership distributions (390,017) (645,420) (1,035,437)
------------ ------------ -------------
Balance, December 31, 2000 4,064,963 6,726,916 10,791,879
Net income 233,875 387,027 620,902
Partnership distributions (392,001) (648,704) (1,040,705)
------------ ------------ -------------
Balance, December 31, 2001 $3,906,837 $6,465,239 $10,372,076
============ ============ =============
F-15
Fund IV and V Associates
(A Georgia Joint Venture)
Statements of Cash Flows
for the Years Ended December 31, 2001, 2000, and 1999
2001 2000 1999
------------- ------------- -------------
Cash flows from operating activities:
Net income $ 620,902 $ 545,998 $ 600,492
------------- ------------- -------------
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation 516,534 508,805 500,956
Changes in assets and liabilities:
Accounts receivable 36,616 48,348 63,893
Prepaid expenses and other assets, net 12,559 185 (61,124)
Accounts payable 28,560 16,313 (5,052)
Due to affiliates (13,858) 9,069 8,789
------------- ------------- -------------
Total adjustments 580,411 582,720 507,462
------------- ------------- -------------
Net cash provided by operating activities 1,201,313 1,128,718 1,107,954
------------- ------------- -------------
Cash flows from investing activities:
Investment in real estate (105,007) (114,273) (115,706)
------------- ------------- -------------
Cash flows from financing activities:
Contributions from joint venture partners 0 16,686 112,020
Distributions to joint venture partners (1,036,759) (1,018,661) (1,102,344)
------------- ------------- -------------
Net cash used in financing activities (1,036,759) (1,001,975) (990,324)
------------- ------------- -------------
Net increase in cash and cash equivalents 59,547 12,470 1,924
Cash and cash equivalents, beginning of year 279,590 267,120 265,196
------------- ------------- -------------
Cash and cash equivalents, end of year $ 339,137 $ 279,590 $ 267,120
============= ============= =============
4. INCOME TAX BASIS NET INCOME AND PARTNERS' CAPITAL
The Partnership's income tax basis net income for the years ended
December 31, 2001, 2000, and 1999 is calculated as follows:
2001 2000 1999
---------- ---------- ----------
Financial statement net income $595,337 $357,405 $608,712
Increase (decrease) in net income resulting from:
Depreciation expense for financial reporting purposes in excess
of amounts for income tax purposes 192,719 170,604 166,632
Expenses deductible when paid for income tax purposes, accrued
for financial reporting purposes (7,139) 3,194 2,755
Rental income accrued for financial reporting purposes less
than (in excess of) amounts for income tax purposes (16,903) 30,924 36,052
Other (798) (2,570) 0
---------- ---------- ----------
Income tax basis net income $763,216 $559,557 $814,151
========== ========== ==========
F-16
The Partnership's income tax basis partners' capital at December 31,
2001, 2000, and 1999 is computed as follows:
2001 2000 1999
------------- ------------- -------------
Financial statement partners' capital $ 9,236,417 $ 9,641,592 $ 9,490,331
Increase (decrease) in partners' capital resulting from:
Depreciation expense for financial reporting
purposes in excess of amounts for income tax
purposes 1,043,723 851,004 680,400
Capitalization of organization costs for income
tax purposes, which are accounted for as cost
of capital for financial reporting purposes 1,735,988 1,735,988 1,735,988
Accumulated rental income accrued for financial
reporting purposes in excess of amounts for
income tax purposes (140,333) (123,430) (154,354)
Accumulated expenses deductible when paid for
income tax purposes, accrued for financial
reporting purposes 17,493 24,632 21,438
Partnership's distributions payable 267,575 3,004 268,242
Other (5,936) (5,138) (2,568)
------------- ------------- -------------
Income tax basis partners' capital $12,154,927 $12,127,652 $12,039,477
============= ============= =============
5. RENTAL INCOME
The future minimum rental income due from the Partnership's respective
ownership interests in joint ventures under noncancelable operating leases
at December 31, 2001 is as follows:
Year ending December 31:
2002 $1,196,129
2003 964,069
2004 786,651
2005 636,873
2006 541,952
Thereafter 1,650,736
------------
$5,776,410
============
Three tenants contributed 17%, 17%, and 16% of rental income. In addition,
three tenants will contribute 48%, 41%, and 10% of future minimum rental
income.
The future minimum rental income due Fund III and IV Associates under
noncancelable operating leases at December 31, 2001 is as follows:
Year ending December 31:
2002 $ 1,150,615
2003 1,398,357
2004 1,330,753
2005 1,242,927
2006 1,194,786
Thereafter 3,856,860
-------------
$10,174,298
=============
F-17
Two tenants contributed approximately 26% and 26% of rental income for the
year ended December 31, 2001. In addition, two tenants will contribute
approximately 48% and 41% of future minimum rental income.
The future minimum rental income due Fund IV and V Associates under
noncancelable operating leases at December 31, 2001 is as follows:
Year ending December 31:
2002 $1,866,488
2003 969,687
2004 575,831
2005 278,250
2006 81,123
Thereafter 0
------------
$3,771,379
============
Two tenants contributed approximately 45% and 23% of rental income for the
year ended December 31, 2001. In addition, one tenant will contribute
approximately 32% of future minimum rental income.
6. QUARTERLY RESULTS (UNAUDITED)
Presented below is a summary of the unaudited quarterly financial
information for the years ended December 31, 2001 and 2000:
2001 Quarters Ended
--------------------------------------------------------
March 31 June 30 September 30 December 31
---------- ---------- -------------- -------------
Revenues $158,503 $181,254 $167,922 $170,417
Net income 138,002 156,297 151,936 149,102
Net income allocated to Class A limited
partners 138,002 156,297 151,936 149,102
Net income per Class A limited partner unit (a) $0.10 $0.12 $0.11 $0.11
Distribution per Class A limited partner unit 0.18 0.18 0.20 0.20
(a) The totals of the four quarterly amounts for the year
ended December 31, 2001 do not equal the totals for the
year. This difference results from rounding differences
between quarters.
2000 Quarters Ended
--------------------------------------------------------
March 31 June 30 September 30 December 31
---------- ---------- -------------- --------------
Revenues $140,606 $ 99,580 $105,425 $83,083
Net income 116,834 77,658 94,533 68,380
Net income allocated to Class A limited
partners 116,834 77,658 94,533 68,380
Net income per Class A limited partner unit $0.09 $0.06 $0.07 $0.05
Distribution per Class A limited partner unit 0.16 0.00 0.00 0.00
F-18
7. COMMITMENTS AND CONTINGENCIES
Management, after consultation with legal counsel, is not aware of any
significant litigation or claims against the Partnership or Wells
Partners. In the normal course of business, the Partnership or Wells
Partners may become subject to such litigation or claims.
F-19
EXHIBIT INDEX
-------------
(Wells Real Estate Fund IV, L.P.)
The following documents are filed as exhibits to this report. Those
exhibits previously filed and incorporated herein by reference are identified
below by an asterisk. For each such asterisked exhibit, there is shown below the
description of the previous filing. Exhibits which are not required for this
report are omitted.
Exhibit
Number Description of Document
- ------- -----------------------
*4(a) Agreement of Limited Partnership of Wells Real Estate Fund IV,
L.P. (Exhibit to Form 10-K of Wells Real Estate Fund IV, L.P.
for the fiscal year ended December 31, 1991, File No. 0-20103)
*4(b) Certificate of Limited Partnership of Wells Real Estate Fund
IV, L.P. (Exhibit 4(b) to Registration Statement of Wells Real
Estate Fund IV, L.P. and Wells Real Estate Fund V, L.P., File
No. 33-37830)
*10(a) Management Agreement between Wells Real Estate Fund IV, L.P.
and Wells Management Company, Inc. (Exhibit to Form 10-K of
Wells Real Estate Fund IV, L.P. for the fiscal year ended
December 31, 1991, File No. 0-20103)
*10(b) Leasing and Tenant Coordinating Agreement between Wells Real
Estate Fund IV, L.P. and Wells Management Company, Inc.
(Exhibit to Form 10-K of Wells Real Estate Fund IV, L.P. for
the fiscal year ended December 31, 1991, File No. 0-20103)
*10(c) Custodial Agency Agreement between Wells Real Estate Fund IV,
L.P. and Citizens and Southern Trust Company (Georgia)
National Association (Exhibit 10(f) to Amendment No. 3 to
Registration Statement of Wells Real Estate Fund IV, L.P. and
Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(d) Fund III and Fund IV Associates Joint Venture Agreement dated
March 27, 1991 (Exhibit 10(g) to Post-Effective Amendment No.
1 to Registration Statement of Wells Real Estate Fund IV, L.P.
and Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(e) Agreement of Purchase and Sale dated October 31, 1990 between
675 Industrial Park, Ltd. and The Vlass-Fotos Group, Inc.
(Exhibit 10(h) to Post-Effective Amendment No. 1 to
Registration Statement of Wells Real Estate Fund IV, L.P. and
Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(f) Lease dated January 31, 1991 between The Vlass-Fotos Group,
Inc. and The Kroger Co. (Exhibit 10(i) to Post-Effective
Amendment No. 1 to Registration Statement of Wells Real Estate
Fund IV, L.P. and Wells Real Estate Fund V, L.P., File No.
33-37830)
*10(g) Lease Agreement dated January 31, 1991 between The Vlass-Fotos
Group, Inc. and The Kroger Co. (Exhibit 10(j) to
Post-Effective Amendment No. 1 to Registration Statement of
Wells Real Estate Fund IV, L.P. and Wells Real Estate Fund V,
L.P., File No. 33-37830)
*10(h) First Amendment to Lease dated April 3, 1991 between The
Vlass-Fotos Group, Inc. and The Kroger Co. (Exhibit 10(k) to
Post-Effective Amendment No. 1 to Registration Statement of
Wells Real Estate Fund IV, L.P. and Wells Real Estate Fund V,
L.P., File No. 33-37830)
*10(i) First Amendment to Lease Agreement dated April 3, 1991 between
The Vlass-Fotos Group, Inc. and The Kroger Co. (Exhibit 10(l)
to Post-Effective Amendment No. 1 to Registration Statement of
Wells Real Estate Fund IV, L.P. and Wells Real Estate Fund V,
L.P., File No. 33-37830)
*10(j) Development Agreement dated April 4, 1991 between Fund III and
Fund IV Associates and The Vlass-Fotos Group, Inc. (Exhibit
10(m) to Post-Effective Amendment No. 1 to Registration
Statement of Wells Real Estate Fund IV, L.P. and Wells Real
Estate Fund V, L.P., File No. 33-37830)
*10(k) Fund IV and Fund V Associates Joint Venture Agreement dated
April 14, 1992 (Exhibit 10(n) to Post-Effective Amendment No.
7 to Registration Statement of Wells Real Estate Fund IV, L.P.
and Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(l) Agreement for the Purchase and Sale of Real Property with GL
National, Inc. (Exhibit 10(o) to Post-Effective Amendment No.
7 to Registration Statement of Wells Real Estate Fund IV, L.P.
and Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(m) Lease with International Business Machines Corporation (
Exhibit 10(p) to Post-Effective Amendment No. 7 to
Registration Statement of Wells Real Estate Fund IV, L.P. and
Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(n) Lease with ROLM Company (Exhibit 10(q) to Post-Effective
Amendment No. 7 to Registration Statement of Wells Real Estate
Fund IV, L.P. and Wells Real Estate Fund V, L.P., File No.
33-37830)
2
*10(o) Construction Agreement with McDevitt & Street Company (Exhibit
10(r) to Post-Effective Amendment No. 7 to Registration
Statement of Wells Real Estate Fund IV, L.P. and Wells Real
Estate Fund V, L.P., File No. 33-37830)
*10(p) Development Agreement with ADEVCO Corporation (Exhibit 10(s)
to Post-Effective Amendment No. 7 to Registration Statement of
Wells Real Estate Fund IV, L.P. and Wells Real Estate Fund V,
L.P., File No. 33-37830)
*10(q) Guaranty of Development Agreement by David M. Kraxberger
(Exhibit 10(t) to Post-Effective Amendment No. 7 to
Registration Statement of Wells Real Estate Fund IV, L.P. and
Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(r) Architect Agreement with Mayes, Sudderth & Etheredge, Inc.
(Exhibit 10(u) to Post-Effective Amendment No. 7 to
Registration Statement of Wells Real Estate Fund IV, L.P. and
Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(s) Architect Agreement with Peter C. Sutton, A.I.A. (Exhibit
10(v) to Post-Effective Amendment No. 7 to Registration
Statement of Wells Real Estate Fund IV, L.P. and Wells Real
Estate Fund V, L.P., File No. 33-37830)
*10(t) First Amendment to Joint Venture Agreement of Fund III and IV
Associates dated July 1, 1992 (Exhibit 10(v) to Form 10-K of
Wells Real Estate Fund III, L.P. for the fiscal year ended
December 31, 1992, File No. 0-18407)
*10(u) Agreement for the Purchase and Sale of Property between Rowe
Properties-Markel, L.P. and Fund III and Fund IV Associates
and Addendum to Agreement for the Purchase and Sale of
Property (Exhibit 10(w) to Form 10-K of Wells Real Estate Fund
III, L.P. for the fiscal year ended December 31, 1992, File
No. 0-18407)
*10(v) Office Lease with G.E. Lighting, Rider No. 1 to Lease,
Addendum of Lease, Second Addendum of Lease, Third Amendment
of Lease and Fourth Amendment to Office Lease (Exhibit 10(x)
to Form 10-K of Wells Real Estate Fund III, L.P. for the
fiscal year ended December 31, 1992, File No. 0-18407)
*10(w) First Amendment to Joint Venture Agreement of Fund IV and V
Associates dated September 9, 1992 (Exhibit 10(w) to
Post-Effective Amendment No. 8 to Registration Statement of
Wells Real Estate Fund IV, L.P. and Wells Real Estate Fund V,
L.P., File No. 33-37830)
3
*10(x) Option Agreement for the Purchase and Sale of Real Property
(Exhibit 10(x) to Post-Effective Amendment No. 8 to
Registration Statement of Wells Real Estate Fund IV, L.P. and
Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(y) First Amendment to Option Agreement for the Purchase and Sale
of Real Property (Exhibit 10(y) to Post-Effective Amendment
No. 8 to Registration Statement of Wells Real Estate Fund IV,
L.P. and Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(z) Partial Assignment and Assumption of Option Agreement for the
Purchase and Sale of Real Property (Exhibit 10(z) to
Post-Effective Amendment No. 8 to Registration Statement of
Wells Real Estate Fund IV, L.P. and Wells Real Estate Fund V,
L.P., File No. 33-37830)
*10(aa) Lease Agreement with the Executive Committee of the Baptist
Convention of the State of Georgia, d/b/a Georgia Baptist
Health Care System (Exhibit 10(aa) to Post-Effective Amendment
No. 8 to Registration Statement of Wells Real Estate Fund IV,
L.P. and Wells Real Estate Fund V, L.P., File No. 33-37830)
*10(bb) Construction Contract with Cecil N. Brown Co., Inc. (Exhibit
10(bb) to Post-Effective Amendment No. 8 to Registration
Statement of Wells Real Estate Fund IV, L.P. and Wells Real
Estate Fund V, L.P., File No. 33-37830)
*10(cc) Amended and Restated Custodial Agency Agreement between Wells
Real Estate Fund IV, L.P. and NationsBank of Georgia, N.A.
dated April 1, 1994 (Exhibit to Form 10-K of Wells Real Estate
Fund IV, L.P. for the fiscal year ended December 31, 1994,
File No. 0-20103)
4