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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999 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 0-20707
COLONIAL REALTY LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Delaware 63-1098468
(State of organization) (I.R.S. employer
identification no.)
2101 Sixth Avenue North 35203
Suite 750 (Zip Code)
Birmingham, Alabama
(Address of principal
executive offices)
Registrant's telephone number, including area code: (205) 250-8700
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
------------------- -----------------------------------------
Not applicable Not applicable
Securities registered pursuant to Section 12(g) of the Act:
Class A Units of Limited Partnership Interest
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 and (2) has been subject to such
filing requirements for the past 90 days. YES _X_ NO __
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. |_|
Documents Incorporated by Reference
None.
PART I
Item 1. Business.
As used herein, the terms "CRLP" and "Operating Partnership" include Colonial
Realty Limited Partnership, a Delaware limited partnership, and its subsidiaries
and other affiliates (including, Colonial Properties Services Limited
Partnership and Colonial VRS L.L.C.) or, as the context may require, Colonial
Realty Limited Partnership only. As used herein, the term "Company" includes
Colonial Properties Trust, an Alabama real estate investment trust, and one or
more of its subsidiaries and other affiliates (including CRLP, Colonial
Properties Services Limited Partnership and Colonial Properties Services, Inc.)
or, as the context may require, Colonial Properties Trust only. As used herein,
the terms "we", "us", and "our" refer to Colonial Realty Limited Partnership.
This annual report on Form 10-K contains certain "forward-looking
statements", including but not limited to anticipated timetables for
acquisitions, developments and expansions, expected economic growth in
geographic markets where CRLP owns or expects to own properties, and plans for
continuing CRLP's diversified strategy. These statements involve risks and
uncertainties that may cause actual results to be materially different from
those anticipated. Prospective investors should specifically consider, in
connection with these forward-looking statements, the various risk factors
identified herein and in CRLP's filings with the SEC which could cause actual
results to differ, including downturns in local or national economies,
competitive factors, the availability of suitable properties for acquisition at
favorable prices, and other risks inherent in the real estate business.
CRLP is the Operating Partnership of the Company, which is one of the
largest owners, developers and operators of multifamily, retail and office
properties in the Sunbelt region of the United States. It is a fully-integrated
real estate company, whose activities include ownership of a diversified
portfolio of 111 properties as of December 31, 1999, located in Alabama,
Florida, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, Texas,
and Virginia, development of new properties, acquisition of existing properties,
build-to-suit development, and the provision of management, leasing, and
brokerage services for commercial real estate. As of December 31, 1999, CRLP
owned 52 multifamily apartment communities containing a total of 16,415
apartment units (the "Multifamily Properties"), 18 office properties containing
a total of approximately 3.1 million square feet of office space (the "Office
Properties"), 41 retail properties containing a total of approximately 13.9
million square feet of retail space (the "Retail Properties"), and certain
parcels of land adjacent to or near certain of these properties (the "Land").
(The Multifamily Properties, the Office Properties, the Retail Properties, and
the Land are referred to collectively as the "Properties"). As of December 31,
1999, the Multifamily Properties, the Office Properties, and the Retail
Properties that had achieved stabilized occupancy were 93.9%, 93.3% and 89.9%
leased, respectively.
CRLP's executive offices are located at 2101 Sixth Avenue North, Suite
750, Birmingham, Alabama, 35203 and its telephone number is (205) 250-8700. CRLP
was formed in Delaware on August 6, 1993.
Formation of the Company and the Operating Partnership
The Company and the Operating Partnership were formed to succeed to
substantially all of the interests of Colonial Properties, Inc., an Alabama
corporation ("Colonial"), its affiliates and certain other entities in a
diversified portfolio of multifamily, office, and retail properties located in
Alabama, Florida, and Georgia and to the development, acquisition, management,
leasing, and brokerage businesses of Colonial.
On September 29, 1993, (i) the Company consummated an initial public
offering (the "IPO") of 8,480,000 of its common shares of beneficial interest,
$.01 par value per share ("Common Shares"), (ii) the Operating Partnership
assumed ownership of 36 Properties (or interests therein) held by Thomas H.
Lowder, James K. Lowder, Robert E. Lowder, and their mother, Catherine Lowder
(the "Lowder family"), and third-party partners of the Lowder family, and the
operating businesses of Colonial, (iii) the Company transferred the net proceeds
from the IPO through Colonial Properties Holding Company, Inc. ("CPHC"), which
was dissolved in 1998, to the Operating Partnership, in exchange for 8,480,000
units of limited partnership interest in the Operating Partnership ("OP Units"),
(iv) the Operating Partnership repaid approximately $150.2 million of
indebtedness and prepayment penalties associated therewith secured by certain of
the Properties, and (v) the Operating Partnership established a $35.0 million
line of credit with SouthTrust Bank, which has since been increased to $250.0
million, to fund development activities and property acquisitions and for
general corporate purposes (collectively, the "Formation Transactions"). On
October 28, 1993, the underwriters of the IPO exercised an over-allotment option
to purchase an additional 686,200 shares.
Recent Developments
Since the IPO, CRLP has significantly expanded its portfolio of
Properties and its operating businesses. Acquisitions by CRLP of new properties
represent a total investment of over $1.3 billion. CRLP has also completed the
expansion and development of 17 multifamily properties since the IPO, adding a
total of 3,474 units to its multifamily portfolio. CRLP currently has seven
active expansion, development, and redevelopment projects in progress for
Multifamily Properties, one Office Property development, and five Retail
Property developments and redevelopments. CRLP has also disposed of 13
Multifamily Properties representing 4,783 apartment units, and one Office
Property representing 25,000 square feet of office space, and has entered into
three joint ventures.
The following is a summary of CRLP's acquisition, disposition, joint
venture, and development activity in 1999.
Acquisition and Disposition Activity
CRLP disposed of seven Multifamily Properties, including three in
Florida, two in Alabama, and two in Georgia, representing 2,319 units for a
total sale price of $119.8 million.
CRLP acquired one Office Property, in Alabama, containing 163,000
square feet of office space for a total purchase price of $16.5 million.
CRLP also added 468,000 square feet of retail shopping space through
the acquisition of an enclosed mall at a net cost of $29.3 million.
Joint Ventures
During the third quarter of 1999, CRLP entered into a joint venture
with CMS, a Delaware general partnership. In connection with this joint venture,
CRLP sold the following six properties: Colonial Village at Stockbridge,
Colonial Grand at Barrington Club, Colonial Grand at Ponte Vedra, Colonial
Village at River Hills, Colonial Grand at Mountain Brook, and Colonial Village
at Cahaba Heights. CMS acquired an 85% interest in the joint venture from CRLP
for $80.6 million. CRLP acquired a 15% interest in the joint venture and will
serve as manager of the properties. Subsequent to formation, the joint venture
leveraged the properties for a total of $73.6 million of nonrecourse notes, and
the proceeds were distributed proportionately to the joint venture partners. At
December 31, 1999, CRLP had an ending net investment in the joint venture of
$2.8 million.
Development Activity
During 1999, CRLP completed development of 1,404 new apartment units in
10 multifamily communities and acquired land on which it intends to develop
additional multifamily communities during 2000 and 2001. The aggregate cost of
this multifamily development activity was $105.1 million. As of December 31,
1999, CRLP had 1,290 apartment units in seven multifamily communities under
development, redevelopment, or expansion. Management anticipates that the seven
multifamily projects will be completed during 2000 and 2001. Management expects
to invest an additional $15.5 million over this period to complete these
multifamily projects.
During 1999, CRLP completed development of two office properties, and
began development of one office property in Atlanta, Georgia. The aggregate
investment in the office developments during 1999 was $30.8 million. Management
estimates that it will invest an additional $14.0 million to complete these
projects.
During 1999, CRLP continued development of a community shopping center
in Birmingham, Alabama, began construction of two new community shopping
centers, and began the redevelopment of an enclosed mall and community shopping
center. The aggregate investment in these retail developments during 1999 was
$32.0 million. Management anticipates that it will invest an additional $68.6
million to complete the retail developments.
The table below provides an overview of CRLP's acquisition,
development, expansion, and redevelopment activity during 1999:
Summary of 1999
Acquisition and Development
Activity
Completion or Type of Units (M) Cost or
Anticipated Name of Property GLA (R/O) Anticipated
Completion Date Property (1) Location (2) (3) Cost (4)
- ------------------- ------------------------------------------ --------------------- ----------- ------------- --------------
Acquisitions:
2nd Qtr 99 Emmett R. Johnson Building Birmingham, AL O 163,000 $ 16,500
3rd Qtr 99 The Plaza Mall Greenville, NC R 468,000 29,300
Developments:
1st Qtr 99 CG at Cypress Crossing Orlando, FL M 250 21,600
2nd Qtr 99 CG at Inverness Lakes II (expansion) Birmingham, AL M 132 8,300
2nd Qtr 99 CG at Edgewater II (expansion) Huntsville, AL M 192 12,800
2nd Qtr 99 CG at Citrus Park Tampa, FL M 176 12,700
2nd Qtr 99 CG at Lakewood Ranch Sarasota, FL M 288 22,600
3rd Qtr 99 CG at Wesleyan II (expansion) Macon, GA M 88 7,000
1st Qtr 00 CV at Ashley Plantation (expansion) Bluffton, SC M 214 13,100
1st Qtr 00 CV at Walton Way (redevelopment) Augusta, GA M 256 2,900
2nd Qtr 00 CV at Heather Glen Orlando, FL M 448 34,200
2nd Qtr 00 CG at Madison Huntsville, AL M 336 23,000
2nd Qtr 00 CG at Promenade Montgomery, AL M 384 27,200
4th Qtr 00 CG at Reservoir Jackson, MS M 170 13,600
1st Qtr 01 CG at Liberty Park Birmingham, AL M 300 26,500
2nd Qtr 99 Colonial Plaza (redevelopment) Birmingham, AL O 179,000 1,900
3rd Qtr 99 1800 International Park Birmingham, AL O 146,000 13,800 (5)
3rd Qtr 99 Colonial Center at Research Park Huntsville, AL O 133,000 11,500 (5)
3rd Qtr 00 Colonial Center 300 at Mansell Overlook Atlanta, GA O 162,000 23,400
2nd Qtr 00 Colonial Promenade Trussville Birmingham, AL R 388,000 33,300
4th Qtr 00 Colonial Promenade at Tutwiler Farm Birmingham, AL R 213,000 26,200
4th Qtr 00 Colonial Promenade Madison Huntsville, AL R 111,000 10,000
4th Qtr 00 Northdale Court (redevelopment) Tampa, FL R 193,000 3,200
2nd Qtr 01 Brookwood Village Mall (redevelopment) Birmingham, AL R 751,000 35,000
--------------
Total $ 429,600
==============
(1) In the listing of Multifamily Property names, CG has been used as an
abbreviation for Colonial Grand and CV has been used as an abbreviation for
Colonial Village.
(2) M refers to Multifamily Properties, O refers to Office Properties, and R
refers to Retail Properties.
(3) Units (in this table only) refers to multifamily apartment units and GLA
refers to gross leasable area of office and retail space.
(4) Amounts in thousands.
(5) Amounts represent costs to complete the noted buildings, however,
additional tenant improvement costs will be incurred to complete the
projects.
Multifamily Property Acquisitions
Colonial Village at Haverhill--On May 1, 1999, CRLP acquired the
remaining 20.2% ownership interest in Colonial Village at Haverhill, a 322-unit
apartment complex on approximately 19 acres of land in San Antonio, Texas. On
July 1, 1998, CRLP had acquired a 79.8% ownership interest in Colonial Village
at Haverhill. The purchase of the remaining 20.2% interest was funded through
the issuance of 157,140 limited partnership units, valued at approximately $4.2
million.
CRLP intends to continue to pursue acquisitions in the Sunbelt region
of the United States that meet CRLP's acquisition criteria for property quality,
market strength, and investment return.
Completed Multifamily Expansion and Development Activity
Colonial Grand at Cypress Crossing-- CRLP completed construction on a
250-unit development located in Orlando, Florida during the first quarter of
1999. The new apartments feature numerous luxuries, including a security system,
automated climate control, high-speed Internet access, and home theatre
pre-wiring. Project development costs, including land acquisition costs, totaled
$21.6 million and were funded through advances on CRLP's line of credit.
Colonial Grand at Inverness Lakes II--CRLP completed construction on a
132-unit expansion of Colonial Grand at Inverness Lakes located in Mobile,
Alabama during the second quarter of 1999. This expansion phase offers the same
amenities as the existing community. Project development costs, including land
acquisition costs, totaled $8.3 million and were funded through advances on
CRLP's line of credit.
Colonial Grand at Edgewater II--CRLP completed construction on a
192-unit expansion of Colonial Grand at Edgewater in Huntsville, Alabama during
the second quarter of 1999. This expansion phase offers the same amenities as
the existing community. Project development costs, including land acquisition
costs, totaled $12.8 million and were funded through advances on CRLP's line of
credit.
Colonial Village at Citrus Park--CRLP completed construction on a
176-unit development located in Tampa, Florida during the second quarter of
1999. The new apartment community offers a variety of amenities, including a
swimming pool, fitness center, resident business center, garages and a gated
entry. Project development costs, including land acquisition costs, totaled
$12.7 million and were funded through advances on CRLP's line of credit.
Colonial Grand at Lakewood Ranch--CRLP completed construction on a
288-unit development located in Sarasota, Florida during the second quarter of
1999. The new apartments feature numerous luxuries, including a security system,
automated climate control, high-speed Internet access, and home theatre
pre-wiring. Amenities include a swimming pool, fitness center, tennis courts and
a gated entry. Project development costs, including land acquisition costs,
totaled $22.6 million and were funded through advances on CRLP's line of credit.
Colonial Grand at Wesleyan II--CRLP completed construction on an
88-unit expansion of Colonial Grand at Wesleyan located in Macon, Georgia during
the third quarter of 1999. This expansion phase offers the same amenities as the
existing community. Project development costs, including land acquisition costs,
totaled $7.0 million and were funded through advances on CRLP's line of credit.
Continuing Multifamily Expansion and Development Activity
Colonial Village at Ashley Plantation--CRLP began construction on a
214-unit expansion of Colonial Village at Ashley Plantation located in Bluffton,
South Carolina during the second quarter of 1998. Project development costs,
including land acquisition costs, are expected to total $13.1 million and will
be funded through advances on CRLP's line of credit. CRLP expects to complete
construction in the first quarter of 2000.
Colonial Village at Walton Way--CRLP began the redevelopment of
Colonial Village at Walton Way, a 256-unit multifamily community located in
Augusta, Georgia. Project redevelopment costs are expected to total $2.9 million
and will be funded through advances on CRLP's line of credit. CRLP expects to
complete the redevelopment in the first quarter of 2000.
Colonial Village at Heather Glen--CRLP began construction on a 448-unit
development located in Orlando, Florida during the third quarter of 1998. The
new apartments will offer a variety of amenities, including a clubhouse,
car-care center, fitness center with a child play area, two swimming pools,
tennis courts, and a picnic area. Project development costs, including land
acquisition costs, are expected to total $34.2 million and will be funded
through advances on CRLP's line of credit. CRLP expects to complete construction
in the second quarter of 2000.
Colonial Grand at Madison--CRLP began construction on a 336-unit
development located in Huntsville, Alabama. The new apartments will offer a
variety of amenities, including a swimming pool, an exercise room, tennis
courts, and a car wash. Project development costs, including land acquisition
costs, are expected to total $23.0 million and will be funded through advances
on CRLP's line of credit. CRLP expects to complete construction in the first
quarter of 2000.
Colonial Grand at Promenade--CRLP began construction on a 384-unit
development located in Montgomery, Alabama. The new apartments will feature
numerous luxuries, including a security system, automated climate control,
high-speed Internet access, and home theatre pre-wiring. Project development
costs, including land acquisition costs, are expected to total $27.2 million and
will be funded through advances on CRLP's line of credit. CRLP expects to
complete construction in the second quarter of 2000.
Colonial Grand at Reservoir--CRLP began construction on a 170-unit
development located in Jackson, Mississippi. The new apartments will offer a
variety of amenities, including a fitness center, swimming pool, garages, and
tennis courts. Project development costs, including land acquisition costs, are
expected to total $13.6 million and will be funded through advances on CRLP's
line of credit. CRLP expects to complete construction in the first quarter of
2000.
Colonial Grand at Liberty Park--CRLP began construction on a 300-unit
development located in Birmingham, Alabama during the third quarter of 1998. The
new apartments will feature numerous luxuries, including a security system,
automated climate control, high-speed Internet access, and home theatre
pre-wiring. Project development costs, including land acquisition costs, are
expected to total $26.5 million and will be funded through advances on CRLP's
line of credit. CRLP expects to complete construction in the second quarter of
2000.
Office Property Acquisitions
Emmett R. Johnson Building--In June 1999, CRLP acquired the Emmett R.
Johnson Building, a 163,000 square-foot Class A office building located in
Birmingham, Alabama. The property was built in 1982, renovated in 1995, and was
90% occupied at the time of acquisition. The Emmett R. Johnson Building was
acquired for a total purchase price of $16.5 million, which was funded through
an advance on CRLP's line of credit.
Completed Office Property Development and Redevelopment Activity
1800 International Park--In October 1999, CRLP completed development
of a six story multi-tenant office building in Birmingham, Alabama with a total
of 146,000 square feet of leasable area. Project development costs, including
land acquisition costs, totaled $13.8 million and were funded through advances
on CRLP's line of credit. CRLP expects to incur an additional $4.5 million in
tenant improvements during the lease-up of this property.
Colonial Center at Research Park--Also in October 1999, CRLP completed
development of two office buildings in Huntsville, Alabama with a total of
133,000 square feet of leasable area. Colonial Center at Research Park features
Class A office space with first-class amenities. Project development costs,
including land acquisitions, totaled $11.5 million and were funded through
advances on CRLP's line of credit. CRLP expects to incur an additional $1.7
million in tenant improvements during the lease-up of this property.
Colonial Plaza--During 1999, CRLP began and completed the redevelopment
of Colonial Plaza, a 179,000 square foot office building located in Birmingham,
Alabama. The renovation included a new exterior finish, the relocation and
modernization of the building lobby, the renovation of all common areas, common
conference facilities, and a new fitness center. Project redevelopment costs
were approximately $1.9 million, and were funded through CRLP's line of credit.
New Office Property Development
Colonial Center 300 at Mansell Overlook--During the third quarter of
1999, CRLP began the development of Colonial Center 300 at Mansell Overlook, a
162,000 Class A office building located in Atlanta, Georgia. The building will
include the most advanced technology systems available in the market, including
high-speed Internet access, fiber optic network infrastructure, and state-of-the
art, customer controlled energy management system. Project development costs,
including land acquisitions are expected to total $23.4 million and will be
funded through advances on CRLP's line of credit. CRLP expects to complete the
project in the third quarter of 2000.
Retail Property Acquisitions
The Plaza Mall--In August 1999, CRLP acquired the Plaza Mall, a 468,000
square-foot mall in Greenville, North Carolina for a total purchase price of
$29.3 million. The mall anchors include two Belk stores, a recently expanded and
renovated JC Penney, and Proffitt's. The purchase price was partially funded
through the proceeds received from the disposition of assets, and an advance on
CRLP's line of credit.
Retail Development and Redevelopment Activity
Colonial Promenade Trussville--During the third quarter of 1998, CRLP
began the development of a 388,000 square foot retail shopping center in
Birmingham, Alabama. The shopping center development will be anchored by a
Wal-Mart Supercenter, Regal Cinemas, Marshall's Department Store, and Goody's
Family Clothing. Project expansion costs are expected to total $33.3 million and
will be funded through advances on CRLP's line of credit. CRLP expects to
complete the development during the second quarter of 2000.
Colonial Promenade at Tutwiler Farm--During the third quarter of 1999,
CRLP began the development of a 516,000 square foot retail shopping center in
Birmingham, Alabama. The shopping center development will be anchored by a Home
Depot, Target, and Michaels. Project expansion costs are expected to total $26.2
million and will be funded through advances on CRLP's line of credit and the
issuance of limited partnership units. CRLP expects to complete the development
during the fourth quarter of 2000.
Colonial Promenade Madison--During the third quarter of 1999, CRLP
began the development of an 111,000 square foot retail shopping center in
Huntsville, Alabama. The shopping center development will be anchored by a
Publix Supermarket, and will include approximately 30,000 square feet of small
shop space. Project expansion costs are expected to total $10.0 million and will
be funded through advances on CRLP's line of credit. CRLP expects to complete
the development during the fourth quarter of 2000.
Brookwood Village Mall--During the third quarter of 1999, CRLP began
the redevelopment and expansion of Brookwood Village Mall, an enclosed mall
located in Birmingham, Alabama. The renovations will include a grand entrance
offering valet parking, natural lighting through the use of skylights, custom
light fixtures, stone flooring, and plush area carpeting. The mall will also
offer an upscale selection of merchants as new tenants, restaurants, and
entertainment venues are added. Project redevelopment and expansion costs are
expected to total $35.0 million and will be funded through CRLP's unsecured line
of credit. CRLP expects to complete the redevelopment and expansion during the
second quarter of 2001.
Northdale Court--During the fourth quarter of 1999, CRLP began the
redevelopment of Northdale Court, a 193,000 square foot strip center located in
Tampa, Florida. Project redevelopment costs are expected to total $3.2 million,
and will be funded through advances on CRLP's unsecured line of credit. CRLP
expects to complete the redevelopment during the fourth quarter of 2000.
Financing Activity
CRLP funded a large portion of its acquisitions and developments
through the issuance of preferred units and debt securities. During 1999, CRLP
completed the following equity and debt transactions:
Preferred Unit Offering
(in thousands)
----------------------------------
Number of Price Per Gross Offering Net
Date Preferred Units Unit Proceeds Costs Proceeds
- ------------ -------------- ---------- ---------- ---------- ------------
February 2,000,000 $ 50.000 $ 100,000 $ 2,600 $ 97,400
Debt Offerings
Gross
Type of Proceeds
Date Note Maturity Rate (in thousands)
- ----------------- ------------------- -------------------------- --------------
August Medium-term August, 2002 7.93% $ 57,500
August Medium-term August, 2004 8.19% $ 25,000
CRLP's current borrowing capacity under its unsecured line of credit is
$250 million. The credit facility, which is used by CRLP primarily to finance
additional property investments, bears interest at a rate ranging between 80 and
135 basis points above LIBOR and is renewable in July 2000. The line of credit
agreement includes a competitive bid feature that will allow CRLP to convert up
to $125 million under the line of credit to a fixed rate, for a fixed term not
to exceed 90 days. As of December 31, 1999, the balance outstanding on CRLP's
line of credit was $228.3 million.
Business Strategy
The general business strategy of the Company and CRLP is to generate
stable and increasing cash flow and portfolio value for their shareholders and
unitholders, respectively. The Company and CRLP have implemented this strategy
principally by (i) realizing growth in income from its existing portfolio of
properties, (ii) developing, expanding, and selectively acquiring additional
multifamily, office, and retail properties in growth markets located in the
Sunbelt region of the United States, where CRLP has first-hand knowledge of
growth patterns and local economic conditions, (iii) managing its own
properties, which has enabled it to better control operating expenses and
establish long-term relationships with its office and retail tenants, (iv)
maintaining its third-party property management business, which has increased
cash flow and established additional relationships with tenants, and (v)
employing a comprehensive capital maintenance program to maintain properties in
first-class condition. CRLP's business strategy and the implementation of that
strategy are determined by CRLP's board of trustees and may be changed from time
to time.
Financing Strategy
CRLP's strategy is to maintain coverage ratios in order to sustain its
investment grade status. CRLP's total market capitalization as of December 31,
1999, was $2.0 billion, and its ratio of debt to total market capitalization was
51.3%. We calculate debt to total market capitalization as total debt as a
percentage of total debt, including preferred units, plus the market value of
our outstanding common shares of beneficial interest and the outstanding units.
At December 31, 1999, CRLP's total debt included fixed-rate debt of $758.0
million, or 72.9% of total debt, and floating-rate debt of $281.9 million, or
27.1% of total debt. CRLP has obtained interest rate protection for $50.0
million of the floating-rate debt.
CRLP has only limited involvement with derivative financial instruments
and does not use them for trading purposes. Interest rate cap agreements and
interest rate swaps are used to reduce the potential impact of increases in
interest rates on variable-rate debt. Treasury lock agreements are used by CRLP
to lock in interest rates in connection with public debt offerings. On January
4, 1999, CRLP entered into an interest rate swap for $50 million of its line of
credit at 4.97% plus 80 to 135 basis points and on January 15, 1999, CRLP
entered into an interest rate swap for $52 million of tax exempt bonds at a rate
of 3.23%. Additionally, on May 4, 1999, Colonial entered into an interest rate
swap agreement for $25 million of its line of credit at a rate of 5.07%. All of
these interest rate swap agreements have one-year terms and any payments made or
received under the agreements are recognized as adjustments to interest expense
as incurred. On February 10, 2000, CRLP entered into two reverse interest rate
swap agreements for a total of $50 million of its medium-term notes. Under the
terms of the agreements, Colonial will receive a fixed interest rate of 7.37%
and will be required to pay a floating rate equal to one month LIBOR that is
compounded and paid semi-annually. Both of these agreements have five-year
terms, and any payments made or received under the agreements are recognized as
adjustments to interest expense. CRLP is exposed to credit losses in the event
of nonperformance by the counterparties to its interest rate cap and
nonderivative financial assets but has no off-balance-sheet credit risk of
accounting loss. CRLP anticipates, however, that counterparties will be able to
fully satisfy their obligations under the contracts. CRLP does not obtain
collateral or other security to support financial instruments subject to credit
risk but monitors the credit standing of counterparties.
CRLP may from time to time reevaluate its borrowing policies in light
of then current economic conditions, relative costs of debt and equity capital,
market values of properties, growth and acquisition opportunities, and other
factors. CRLP may modify its borrowing policy and may increase or decrease its
ratio of debt to total market capitalization. To the extent that the board of
trustees of the Company, the general partner of CRLP, determines to seek
additional capital, CRLP may raise such capital through additional equity
offerings, debt financings, asset dispositions, or retention of cash flow
(subject to provisions in the Code requiring the distribution by a REIT of a
certain percentage of taxable income and taking into account taxes that would be
imposed on undistributed taxable income) or a combination of these methods.
Property Management
CRLP is experienced in the management and leasing of multifamily,
office, and retail properties and believes that the management and leasing of
its own portfolio has helped the Properties maintain consistent income growth
and has resulted in reduced operating expenses from the Properties. The
third-party management, leasing, and brokerage businesses conducted through the
Management Corporation have provided CRLP both with a source of cash flow that
is relatively stable and with the benefits of economies of scale in conjunction
with the management and leasing of its own properties. These businesses also
allow CRLP to establish additional relationships with tenants who may require
additional office or retail space and to identify potential acquisitions.
Operational Structure
Multifamily Division--CRLP's multifamily division is responsible for
all aspects of CRLP's multifamily operations, including day-to-day management
and leasing of the 52 Multifamily Properties, as well as the provision of
third-party management services for apartment communities in which CRLP does not
have an ownership interest or has a non-controlling ownership interest. The
multifamily division utilizes centralized functions of accounting, information
technology, due diligence and administrative services. Decisions for investments
in acquisitions and developments and for dispositions are also centralized. The
multifamily division has regional offices in Birmingham, Alabama, Orlando,
Pensacola, and Tampa, Florida, Macon, Georgia, and Greenville, South Carolina.
Office Division--CRLP's office division is responsible for all aspects
of CRLP's commercial office operations, including the provision of management
and leasing services for the 18 Office Properties, as well as the provision of
third-party management services for office properties in which CRLP does not
have an ownership interest and for brokerage services in other office property
transactions. The office division utilizes centralized functions of accounting,
information technology, due diligence and administrative services. Decisions for
investments in acquisitions and developments and for dispositions are also
centralized. The office division has regional offices in Birmingham, Alabama and
Atlanta, Georgia.
Retail Division--CRLP's retail division is responsible for all aspects
of CRLP's retail operations, including the provision of management and leasing
services for the 41 Retail Properties, as well as the provision of third-party
management services for retail properties in which CRLP does not have an
ownership interest and for brokerage services in other retail property
transactions. The retail division utilizes centralized functions of accounting,
information technology, due diligence and administrative services. Decisions for
investments in acquisitions and developments and for dispositions are also
centralized. The retail division has regional offices in Birmingham, Alabama,
Orlando, Florida, Macon, Georgia and Burlington, North Carolina.
Employees
CRLP employs approximately 1,000 persons, including on-site property
employees who provide services for the Properties that CRLP owns and/or manages.
Tax Status
CRLP has no provision for income taxes since all taxable income or loss
or tax credits are passed through to the partners. The Company has made an
election to be taxed as a REIT under Sections 856 through 860 of the Internal
Revenue Code of 1986, as amended (the "Code"), commencing with its taxable year
ending December 31, 1993. If the Company qualifies for taxation as a REIT, the
Company generally will not be subject to Federal income tax to the extent it
distributes at least 95% of its REIT taxable income to its shareholders. Even if
the Company qualifies for taxation as a REIT, the Company may be subject to
certain state and local taxes on its income and property and to federal income
and excise taxes on its undistributed income.
RISK FACTORS
Set forth below are the risks that we believe are material to investors
who purchase or own our units of limited partnership. Our units are redeemable
for cash or, at the election of Colonial Properties Trust, on a one-for-one
basis for Colonial Properties Trust's shares of beneficial interest.
Our performance and share value are subject to risks associated with
the real estate industry. If our assets do not generate income sufficient to pay
our expenses, service our debt and maintain our properties, we may not be able
to make expected distributions to our unitholders. Whether our properties will
generate sufficient revenue to pay our expenses and permit us to make
distributions to our unitholders will depend on whether we can attract tenants
at favorable rental rates and whether we can adequately control our costs.
Factors that may adversely affect our ability to attract tenants or to generate
sufficient revenue include:
o local conditions such as an oversupply of multifamily, retail or
office properties or a reduction in demand for multifamily, office or
retail properties;
o the attractiveness of our properties to residents, shoppers and tenants;
o decreases in market rental rates; and
o our ability to collect rent from our tenants.
Factors that may adversely affect our operating costs include:
o the need to pay for adequate insurance and other operating costs,
including real estate taxes, which could increase over time; and
o the need to periodically repair, renovate and re-lease space.
Our expenses may remain constant even if our revenues drop. The
expenses of owning and operating a property are not necessarily reduced when
circumstances such as market factors and competition cause a reduction in income
from the property. As a result, if revenues drop, we may not be able to reduce
our expenses accordingly. Loan payments are an example of a cost that will not
be reduced if our revenues drop. If a property is mortgaged and we are unable to
meet the mortgage payments, the lender could foreclose on the mortgage and take
the property, resulting in a further reduction in revenues.
We may be unable to renew leases or re-lease space as leases expire.
When our tenants decide not to renew their leases upon their expiration, we may
not be able to re-lease the space. Even if the tenants do renew or we can relet
the space, the terms of renewal or re-leasing, including the cost of required
renovations, may be less favorable than current lease terms. If we are unable to
promptly renew the leases or re-leasing the space, or if the rental rates upon
such renewal or re-leasing are significantly lower than expected rates, then our
cash flow and ability to service debt and make distributions to unitholders
would be adversely affected.
We depend on local economic conditions in our primary markets. All of
our properties are located in the Sunbelt region of the United States and 45 of
our properties are located in Birmingham and Montgomery, Alabama, Orlando,
Florida and Macon, Georgia. Our performance and ability to make debt service
payments or distributions to unitholders could be adversely affected by economic
conditions in the Sunbelt region and in Birmingham, Montgomery, Orlando and
Macon in particular.
New acquisitions may fail to perform as expected. Assuming we are able
to obtain capital on commercially reasonable terms, we intend to selectively
acquire multifamily, retail or office properties where we perceive strategic
opportunities consistent with our strategy. Newly acquired properties may fail
to perform as expected. We may underestimate the costs necessary to bring an
acquired property up to the standards we have established for its intended
market position. In addition, we may not be in a position or have the
opportunity in the future to make suitable property acquisitions on favorable
terms. See "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Liquidity and Capital Resources", included under Item 7
of this Form 10-K.
Competition for acquisitions could result in increased prices for
properties. We expect other major real estate investors with significant capital
to compete with us for attractive investment opportunities. These competitors
include publicly traded REITs, private REITs, investment banking firms and
private institutional investment funds. This competition could increase prices
for multifamily, retail or office properties.
Our development and expansion activities subject us to risks. We intend
to continue to develop new properties and expand existing properties where we
believe that development or expansion is consistent with our business
strategies. New projects subject us to a number of risks, including risks that:
o construction delays or cost overruns may increase project costs;
o permanent debt or equity financing may not be available on acceptable
terms to finance new development or expansion projects;
o we may fail to meet anticipated occupancy or rent levels;
o we may fail to secure required zoning, occupancy and other governmental
permits and authorizations; and
o changes in applicable zoning or land use laws may require us to abandon
projects prior to their completion, resulting in the loss of
development costs incurred prior to abandonment.
Because real estate investments are illiquid, we may not be able to
sell properties when appropriate. Real estate investments generally cannot be
sold quickly. We may not be able to vary our portfolio promptly in response to
economic or other conditions. This inability to respond to changes in the
performance of our investments could adversely affect our ability to service
debt and make distributions to our unitholders.
Scheduled debt payments could adversely affect our financial condition.
Our business is subject to risks normally associated with debt financing. If
principal payments due at maturity cannot be refinanced, extended or paid with
proceeds of other capital transactions, such as new equity capital, our cash
flow will not be sufficient in all years to repay all maturing debt. If
prevailing interest rates or other factors at the time of refinancing, such as
the possible reluctance of lenders to make commercial real estate loans, result
in higher interest rates, increased interest expense would adversely affect cash
flow and our ability to service our debt and make distributions to unitholders.
Our obligation to comply with financial covenants in our debt
agreements could restrict our range of operating activities. Our credit facility
contains customary restrictions, requirements and other limitations on our
ability to incur indebtedness, including:
o debt to assets ratios;
o secured debt to total assets ratios;
o debt service coverage ratios; and
o minimum ratios of unencumbered assets to unsecured debt.
The indenture under which our senior unsecured indebtedness is issued
contains financial and operating covenants including coverage ratios. Our
indenture also limits our ability to (1) incur secured and unsecured
indebtedness, (2) sell all or substantially all or our assets and (3) engage in
mergers, consolidations and acquisitions.
Our degree of leverage could limit our ability to obtain additional
financing. Our "debt to market capitalization" ratio, which we calculate as
total debt as a percentage of total debt plus the market value of our
outstanding common shares and the outstanding units of Colonial Realty, was
approximately 51.3% as of December 31, 1999. Increases in our leverage could
adversely affect our ability to obtain additional financing in the future for
(1) working capital, (2) capital expenditures, (3) acquisitions, (4) development
or (5) other general corporate purposes, and may make us more vulnerable to a
downturn in business or the economy generally.
Rising interest rates could adversely affect our cash flow. Advances
under our credit facility bear interest at a variable rate ranging between 80
and 135 basis points above LIBOR. We may borrow additional money with variable
interest rates in the future, and may enter into other transactions to limit our
exposure to rising interest rates as appropriate and cost effective. Increases
in interest rates, or the loss of the benefits of hedging agreements, would
increase our interest expense, which would adversely affect cash flow and our
ability to service our debt and make distributions to unitholders.
Environmental problems are possible and can be costly. Federal, state
and local laws and regulations relating to the protection of the environment may
require a current or previous owner or operator of real property to investigate
and clean up hazardous or toxic substances or petroleum product releases at the
property, without regard to whether the owner or operator knew or caused the
presence of the contaminants. If unidentified environmental problems arise at
one of our properties, we may have to make substantial payments to a
governmental entity or third parties for property damage and for investigation
and clean-up costs. Even if more that one person may have been responsible for
the contamination, we may be held responsible for all of the clean-up costs
incurred. Our liability under environmental laws could adversely affect our cash
flow and our ability to make distributions to our unitholders.
At one of our properties, the Gadsden Mall in Gadsden, Alabama, four
underground storage tanks were removed in 1989. In connection with the removal
of these gasoline storage tanks, associated petroleum contamination was
discovered in the soil and groundwater. We are currently working with the state
regulatory agency to remediate the contamination in accordance with applicable
requirements. Because the tanks were registered with the Alabama Department of
Environmental Management and the facility was in compliance with regulations
prior to the incident, we have been reimbursed under the Alabama Underground
Storage Tank Trust Fund for the costs incurred to date in connection with the
ongoing cleanup, and expect to be reimbursed for the remaining costs as well. We
have received a "no further action" letter from the Alabama Department of
Environmental Management.
On December 29, 1998, we acquired Bel Air Mall in Mobile, Alabama.
During the course of our environmental due diligence, we identified several
different areas of the property in which contamination is present. One of those
areas involves drycleaner solvent; the others involve petroleum contamination.
The Alabama Department of Environmental Management is overseeing the
investigation and cleanup of the drycleaner contamination. It is possible that a
claim could be asserted against us, as owner of the property, for the
investigation and remediation of the contamination. Pursuant to the purchase and
sale agreement, the former owner of the property purchased a $10 million
insurance policy and established escrow accounts totaling $1,275,000 to cover
the costs associated with investigating and remediating the contaminated areas.
In addition, subject to limitations, the seller will be performing all required
remediation of the drycleaner contamination.
Some of our general partners' trustees and officers have conflicts of
interest and could exercise influence in a manner inconsistent with unitholders'
best interests. As a result of their substantial ownership of the Company's
common shares and units of CRLP, Messrs. Thomas Lowder, our Chairman of the
Board, Chief Executive Officer and President, and James Lowder, Harold Ripps,
Herbert Meisler and William Johnson, each of whom is a trustee, might seek to
exert influence over our decisions as to sales or refinancings of particular
properties we own. Any such exercise of influence might produce decisions which
are not in the best interest of all of our unitholders.
The Lowder family, which includes Thomas, James, Robert and Catherine
Lowder and their affiliates, holds interests in companies that have performed
construction management, insurance brokerage and other services with respect to
our properties. These companies may perform similar services for us in the
future. As a result, the Lowder family may realize benefits from transactions
between such companies and us that are not realized by other unitholders. In
addition, Thomas Lowder and his brother, James Lowder, as trustees, may be in a
position to influence us to do business with companies in which the Lowder
family has a financial interest. Our policies may not be successful in
eliminating the influence of conflicts. Moreover, transactions with companies
controlled by the Lowder family, if any, may not be on terms as favorable to us
as we could obtain in an arms-length transaction with a third party.
We do not control our management, leasing and brokerage businesses. To
facilitate maintenance of Colonial Properties Trust's REIT qualification,
Colonial Properties Trust has a "non-controlled subsidiary" which conducts
management, leasing and brokerage business for properties we do not wholly own.
While Colonial Properties Trust owns 99% of the economic interest in the
non-controlled subsidiary, 99% of its voting stock is owned by members of the
Lowder family. We therefore lack the ability to set the business policies and
operations of the non-controlled subsidiary.
We are dependent on external sources of capital. To qualify as a REIT,
Colonial Properties Trust must distribute to its shareholders each year at least
95% (90% for taxable years beginning after December 31, 2000) of its net taxable
income, excluding any net capital gain. Because of these distribution
requirements, it is not likely that we will be able to fund all future capital
needs from income from operations. We therefore will have to rely on third-party
sources of capital, which may or may not be available on favorable terms or at
all. Our access to third-party sources of capital depends on a number of things,
including the market's perception of our growth potential and our current and
potential future earnings. Moreover, additional equity offerings may result in
substantial dilution of shareholders' interests, and additional debt financing
may substantially increase our leverage.
We intend to qualify as a partnership, but cannot guarantee that we
will qualify. We intend to qualify as a partnership for federal income tax
purposes. However, we will be treated as a corporation for federal income tax
purposes if we are a "publicly traded partnership," unless at least 90% of our
income is qualifying income as defined in the tax code. The income requirements
applicable to REITs and the definition of qualifying income for purposes of this
90% test are similar in most, but not all, respects. Qualifying income for the
90% test generally includes passive income, such as specified types of real
property rents, dividends and interest. We cannot guarantee that we will meet
this qualifying income test. If we were to be taxed as a corporation, we would
incur substantial tax liabilities, Colonial Properties Trust would fail to
qualify as a REIT for tax purposes and Colonial Properties Trust's and our
ability to raise additional capital could be impaired.
Colonial Properties Trust intends to qualify as a REIT, but we cannot
guarantee that it will qualify. We believe that Colonial Properties Trust has
qualified for taxation as a REIT for federal income tax purposes commencing with
our taxable year ended December 31, 1993. If Colonial Properties Trust qualifies
as a REIT, it generally will not be subject to federal income tax on its income
that it distributes to its shareholders. Colonial Properties Trust plans to
continue to meet the requirements for taxation as a REIT, but it may not qualify
as a REIT. Many of the REIT requirements are highly technical and complex. The
determination that Colonial Properties Trust is a REIT requires an analysis of
various factual matters and circumstances that may not be totally within its
control. For example, to qualify as a REIT, at least 95% of our gross income
must come from certain sources that are itemized in the REIT tax laws. Colonial
Properties Trust is also required to distribute to shareholders at least 95%
(90% for taxable years beginning after December 31, 2000) of our REIT taxable
income, excluding capital gains. The fact that Colonial Properties Trust holds
its assets through Colonial Realty further complicates the application of the
REIT requirements. Even a technical or inadvertent mistake could jeopardize
Colonial Properties Trust's REIT status. Furthermore, Congress and the IRS might
make changes to the tax laws and regulations, and the courts might issue new
rulings that make it more difficult, or impossible, for Colonial Properties
Trust to remain qualified as a REIT. We do not believe, however, that any
pending or proposed tax law changes would jeopardize its REIT status.
If Colonial Properties Trust failed to qualify as a REIT, Colonial
Properties Trust would be subject to federal income tax at regular corporate
rates. Also, unless the IRS granted us relief under certain statutory
provisions, Colonial Properties Trust would remain disqualified as a REIT for
the four years following the year Colonial Properties Trust first failed to
qualify. If Colonial Properties Trust failed to qualify as a REIT, it would have
to pay significant income taxes and would therefore have less money available
for investments or for distributions to shareholders. This would likely have a
significant adverse affect on the value of our securities. In addition, Colonial
Properties Trust would no longer be required to make any distributions to
shareholders, but we would still be required to distribute quarterly
substantially all of our net cash revenues to our unitholders.
REIT Modernization Act changes to the REIT asset tests. Currently, a
REIT may not own securities in any one issuer if the value of those securities
exceeds 5% of the value of the REIT's total assets or the securities owned by
the REIT represent more than 10% of the issuer's outstanding voting securities.
As a result of the REIT Modernization Act, after December 31, 2000, the 5% value
test and the 10% voting security test will be modified in two respects. First,
the 10% voting securities test will be expanded so that REITs also will be
prohibited from owning more than 10% of the value of the outstanding securities
of any one issuer. Second, an exception to these tests that will allow a REIT to
own securities of a subsidiary that exceed the 5% value test and the new 10%
vote or value test if the subsidiary elects to be a "taxable REIT subsidiary,"
which would be a fully taxable corporation. The expanded 10% vote or value test,
however, will not apply to an existing subsidiary unless it engages in a
substantial new line of business or acquires any substantial asset or the
Company acquires any securities in that subsidiary after July 12, 1999. Under a
new asset test, for taxable years beginning after December 31, 2000, the Company
will not be able to own securities of taxable REIT subsidiaries that represent
in the aggregate more than 20% of the value of the Company's total assets. At
the present time, no decision has been made as to whether Colonial Property
Services, Inc. will elect to be treated as a taxable REIT subsidiary.
Several provisions of the new law will ensure that a taxable REIT
subsidiary will be subject to an appropriate level of federal income taxation.
For example, a taxable REIT subsidiary will be limited in its ability to deduct
interest payments made to an affiliated REIT. In addition, the REIT will have to
pay a 100% penalty tax on some payments that it receives if the economic
arrangements between the REIT, the REIT's tenants, and the taxable REIT
subsidiary are not comparable to similar arrangements between unrelated parties.
Item 2. Properties.
General
As of December 31, 1999, CRLP's real estate portfolio consisted of 111
operating properties consisting of whole or partial ownership interests, located
in nine states in the Sunbelt region of the United States. CRLP acquired 36
properties in connection with the Formation Transactions, and acquired or
developed 84 properties since the IPO. Since the IPO, CRLP has developed 17
additional Multifamily Properties, and two Office Properties, and has disposed
of nine properties, all through tax-deferred, like-kind exchanges. Additionally,
CRLP maintains non-controlling partial interests of 15% to 50% in ten operating
properties. The 111 Properties owned by CRLP at December 31, 1999 consisted of
52 Multifamily Properties, 18 Office Properties, and 41 Retail Properties, as
described in more detail below.
Summary of Properties
Units/ Property Total 1999 Percentage
Number of GLA/ Revenue (2) Property Occupancy at
Type of Property Properties NRA (1) (in thousands) Revenue (2) Dec. 31, 1999 (3)
- ---------------------- ----------- ------------- --------------- ------------ -----------------
Multifamily 52 16,415 (4) $ 116,330 40.0% 93.9%
Office 18 3,137,509 (5) 41,067 14.1% 93.3%
Retail 41 13,947,410 (6) 133,752 45.9% 89.9%
----------- --------------- ------------
Total 111 $ 291,149 100.0%
=========== =============== ============
(1) Units (in this table only) refers to multifamily apartment units, GLA
refers to gross leasable area of retail space and NRA refers to net
rentable area of office space. Information is presented as of December 31,
1999.
(2) Includes CRLP's proportionate share of revenue from those Multifamily,
Office and Retail Properties accounted for under the equity method, and
CRLP's share of the properties disposed of in 1999.
(3) Excludes the units/square feet of development or expansion phases of six
Multifamily Properties, two Office Properties, and three Retail Properties
that had not achieved stabilized occupancy as of December 31, 1999.
(4) Amount includes 1,949 units which the Company maintains a 15.0% ownership
interest.
(5) Amount includes 65,840 square feet which the Company maintains a 33.33%
ownership interest.
(6) Amount includes 1,124,291 square feet which the Company maintains a 50.0%
ownership interest.
Multifamily Properties
The 52 Multifamily Properties owned by CRLP at December 31, 1999,
contain a total of 16,415 garden-style apartments and range in size from 104 to
1,080 apartment units. Fourteen of the Multifamily Properties were acquired by
CRLP in connection with the Formation Transactions, and 29 Multifamily
Properties have been acquired since the IPO. Also, since the IPO, CRLP has
developed 17 additional Multifamily Properties and disposed of eight Multifamily
Properties. Twenty-three Multifamily Properties (containing a total of 7,697
apartment units) are located in Alabama, 16 Multifamily Properties (containing a
total of 5,366 apartment units) are located in Florida, nine Multifamily
Properties (containing a total of 1,938 apartments units) are located in
Georgia, one Multifamily Property (containing a total of 328 apartment units) is
located in Mississippi, two Multifamily Properties (containing a total of 764
apartment units) are located in South Carolina, and one Multifamily Property
(containing 322 apartment units) is located in Texas. Each of the Multifamily
Properties is established in its local market and provides residents with
numerous amenities, which may include a swimming pool, exercise room, jacuzzi,
clubhouse, laundry room, tennis court(s), and/or a playground. All of the
Multifamily Properties are managed by CRLP.
The following table sets forth certain additional information relating
to the Multifamily Properties as of and for the year ended December 31, 1999.
Multifamily Properties
Average Total Multifamily Percent of
Year Number Approximate Rental Property Total 1999
Multifamily Completed of Rentable Area Percent Rate Revenue for Property
Property (1) Location (2) Units (3)(Square Feet) Occupied Per Unit 1999 Revenue (4)
- ----------------------- -------------- ---------- -------- ------------- -------- -------------------------- -----------
Alabama:
CG at Edgewater Huntsville 1990 500 541,650 90.2% 680 3,568,657 1.2%
CG at Galleria Birmingham 1986/96 1,080 1,195,186 89.3% 666 7,549,207 2.6%
CG at Galleria Woods Birmingham 1994 244 260,720 96.3% 658 1,791,054 0.6%
CG at Liberty Park Birmingham 1999 44 43,780 (7) 987 64,856 (6) 0.0%
CG at Madison Huntsville 1999 200 199,000 (7) 753 534,509 (6) 0.2%
CG at Mountain Brook (8)Birmingham 1987/91 392 392,700 94.4% 680 2,226,957 (8) 0.8%
CG at Promenade Montgomery 1999 144 143,280 (7) 796 367,458 (6) 0.1%
CG at Riverchase Birmingham 1984/91 468 745,840 90.8% 776 3,989,662 1.4%
CG/CV at Inverness LakesMobile 1983/96 498 506,386 94.6% 614 3,502,926 1.2%
Colony Park Mobile 1975 201 129,600 91.5% 400 835,892 0.3%
CV at Ashford Place Mobile 1983 168 139,128 92.3% 517 1,000,381 0.3%
CV at Cahaba Heights (8)Birmingham 1992 125 131,230 98.4% 705 784,884 (8) 0.3%
CV at Hillcrest Mobile 1981 104 114,400 100.0% 619 788,737 0.3%
CV at Hillwood Montgomery 1984 160 150,912 97.5% 562 990,881 0.3%
CV at Huntleigh Woods Mobile 1978 233 199,052 94.4% 460 1,218,201 0.4%
CV at Inverness Birmingham 1986/87/90 586 491,072 97.4% 588 3,924,860 1.3%
CV at McGehee Place Montgomery 1986/95 468 404,188 89.3% 559 2,688,016 0.9%
CV at Monte D'Oro Birmingham 1977 200 295,840 99.5% 658 1,607,116 0.6%
CV at Research Park Huntsville 1987/94 736 809,344 86.3% 610 4,567,061 1.6%
CV at Rocky Ridge Birmingham 1984 226 258,900 98.7% 640 1,529,280 0.5%
CV at Trussville Birmingham 1996/97 376 410,340 94.7% 699 2,891,258 1.0%
Patio Auburn 1966/83/84 240 179,040 92.1% 421 1,105,853 0.4%
Ski Lodge Tuscaloosa Tuscaloosa 1976/92 304 273,056 97.0% 413 1,544,765 0.5%
-------- ------------- -------- -------- -------------- -----------
Subtotal - Alabama (23 Properties) 7,697 8,014,644 92.5% 624 49,072,471 16.8%
-------- ------------- -------- -------- -------------- -----------
Florida:
CG at Bayshore Bradenton 1997 376 368,870 97.9% 731 3,269,156 1.1%
CG at Carrollwood Tampa 1966 244 286,080 99.6% 835 2,295,220 0.8%
CG at Citrus Park Tampa 1999 176 200,288 94.3% 878 1,480,260 (6) 0.5%
CG at Cypress Crossing Orlando 1999 250 314,596 93.6% 975 2,566,739 (6) 0.9%
CG at Gainesville Gainesville 1989/93/94 560 488,624 97.7% 750 4,793,642 1.6%
CG at Heather Glen Orlando 1999 228 226,860 (7) 866 572,414 (6) 0.2%
CG at Heathrow Orlando 1997 312 370,028 93.3% 910 3,337,699 1.1%
CG at Hunter's Creek Orlando 1997 496 624,464 96.0% 889 5,057,741 1.7%
CG at Kirkman (9) Orlando 1991 - - - - 805,462 (9) 0.3%
CG at Lakewood Ranch Sarasota 1999 288 301,656 95.8% 907 1,992,614 (6) 0.7%
CG at Palm Aire Sarasota 1991 248 251,504 97.2% 814 2,307,676 0.8%
CG at Palma Sola Bradenton 1992 340 291,796 91.2% 709 2,593,782 0.9%
CG at Ponte Vedra (8) Jacksonville 1988 240 211,640 93.3% 705 1,358,704 (8) 0.5%
CV at Cordova Pensacola 1983 152 116,400 97.4% 522 926,026 0.3%
CV at Lake Mary Orlando 1991/95 504 431,396 98.4% 679 4,200,380 1.4%
CV at Oakleigh Pensacola 1997 176 185,680 91.0% 722 1,509,376 0.5%
CV at River Hills (8) Tampa 1991/97 776 690,312 91.3% 632 4,253,500 (8) 1.5%
-------- ------------- -------- -------- -------------- -----------
Subtotal - Florida (16 Properties) 5,366 5,360,194 95.8% 770 43,320,391 14.8%
-------- ------------- -------- -------- -------------- -----------
Georgia:
CG at Barrington (8) Macon 1996 176 191,940 99.4% 688 1,015,579 (8) 0.3%
CG at Spring Creek Macon 1992/94 296 328,032 93.2% 637 2,165,618 0.7%
CG at Wesleyan Macon 1997 328 382,946 94.2% 724 2,225,918 0.8%
CV at North Ingle Macon 1983 140 133,338 88.6% 562 804,267 0.3%
CV at Stockbridge (8) Stockbridge 1993/94 240 253,200 91.3% 744 1,338,734 (8) 0.5%
CV at Timothy Woods Athens 1996 204 211,444 98.0% 752 1,665,469 0.6%
CV at Vernon Marsh Savannah 1986/87 178 151,226 97.2% 629 1,321,736 0.5%
CV at Walton Way Augusta 1984 256 254,264 (7) 560 1,391,302 (6) 0.5%
CV at White Bluff Savannah 1986 120 108,288 95.8% 640 930,903 0.3%
-------- ------------- -------- -------- -------------- -----------
Subtotal - Georgia (9 Properties) 1,938 2,014,678 97.0% 665 12,859,526 4.5%
-------- ------------- -------- -------- -------------- -----------
-------- ------------- -------- -------- -------------- -----------
Mississippi:
CG at Natchez Trace Jackson 1995/97 328 342,800 98.2% 658 2,493,318 0.9%
-------- ------------- -------- -------- -------------- -----------
Subtotal - Mississippi (1 Property) 328 342,800 98.2% 658 2,493,318 0.9%
-------- ------------- -------- -------- -------------- -----------
South Carolina:
CV at Ashley Plantation Bluffton 1998 414 425,095 (7) 777 2,918,196 (6) 1.0%
CV at Caledon Wood Greenville 1995/96 350 348,305 94.6% 709 2,609,160 0.9%
-------- ------------- -------- -------- -------------- -----------
Subtotal - South Carolina (2 Properties) 764 773,400 94.6% 746 5,527,356 0.9%
-------- ------------- -------- -------- -------------- -----------
-------- ------------- -------- -------- -------------- -----------
Texas:
CV at Haverhill San Antonio 1997 322 326,914 88.5% 884 3,056,624 1.0%
-------- ------------- -------- -------- -------------- -----------
Subtotal - Texas (1 Property) 322 326,914 88.5% 884 3,056,624 1.0%
-------- ------------- -------- -------- -------------- -----------
--------
TOTAL (52 Properties) 16,415 16,832,630 93.9% $ 688 (5) $ 116,329,686 40.0%
======== ============= ======== ======== ============== ===========
(footnotes on next page)
(1) All Multifamily Properties are 100% owned by CRLP with the exception of the
properties noted in (8) below. In the listing of Multifamily Property
names, CG has been used as an abbreviation for Colonial Grand and CV as an
abbreviation for Colonial Village.
(2) Year initially completed and, where applicable, year(s) in which additional
phases were completed at the Property.
(3) Units (in this table only) refers to multifamily apartment units. Number of
Units includes all apartment units occupied or available for occupancy at
December 31, 1999.
(4) Percent of Total 1999 Property Revenue represents the Multifamily
Property's proportionate share of all revenue from CRLP's 111 Properties,
including the partially owned properties.
(5) Represents weighted average rental rate per unit of the 52 Multifamily
Properties at December 31, 1999.
(6) Represents revenues from the date of CRLP's development/expansion of this
Property in 1999 through December 31, 1999.
(7) Expanded or newly developed property currently undergoing lease-up.
(8) These properties were sold by CRLP during 1999 to a joint venture formed by
CRLP and an unrelated party. CRLP holds a 15% non-controlling interest in
this joint venture.
(9) This property was sold during 1999.
The following table sets forth the total number of apartment units,
percent leased and average base rental rate per apartment unit as of the end of
each of the last five years for the Multifamily Properties:
Average Base
Number Percent Rental Rate
Year-End of Units (1) Leased (2) Per Unit
-------- ------------ ----------- --------
December 31, 1999 16,415 93.9% $688
December 31, 1998 15,381 93.5% $642
December 31, 1997 13,759 93.8% $631
December 31, 1996 13,617 94.8% $579
December 31, 1995 11,239 95.7% $552
(1) Units (in this table only) refers to multifamily apartment units owned at
year end, which includes 1,949 units partially owned by the Company at
December 31, 1999.
(2) Represents weighted average occupancy of the Multifamily Properties that
had achieved stabilized occupancy at the end of the respective period.
Office Properties
The 18 Office Properties owned by CRLP at December 31, 1999, contain a
total of approximately 3.1 million rentable square feet. Fifteen of the Office
Properties are located in Alabama (representing 71% of the office portfolio's
net rentable square feet) , one is located in Atlanta, Georgia and two are
located in Florida. The Office Properties range in size from approximately
30,000 square feet to 536,000 square feet. Five of the Office Properties were
developed by Colonial, four of the Properties were acquired at various times
between 1980 and 1990, eight of the Properties were acquired in 1997 and 1998,
and one of the Properties was acquired in 1999. All of the Office Properties are
managed by CRLP.
The following table sets forth certain additional information relating
to the Office Properties as of and for the year ended December 31, 1999.
Office Properties
Average
Base
Net Rent
Rentable Per Total Office Percent of
Year Area Total Leased Property Total 1999
Office Completed Square Percent Annualized Square Revenue for Property
Property (1) Location (2) Feet Leased Base Rent(2) Foot 1999 (3) Revenue (4)
- ----------------------------------- ------------ ---------- -------- ------- ------------ ----------- -------------- -------
Alabama:
Interstate Park Montgomery 1982-85/89 226,992 97.3% $ 2,950,332 $ 13.86 $ 3,126,350 1.0%
Riverchase Center Birmingham 1984-88 304,731 92.6% 2,818,325 9.98 3,355,926 1.1%
International Park Birmingham 1987/89 109,810 99.6% 1,377,267 14.97 1,390,077 0.5%
1800 International Park (8) Birmingham 1999 146,128 (7) (7) (7) 23,615(6) 0.0%
Colonial Plaza Birmingham 1982 178,617 69.3% 1,950,429 16.62 1,776,589 0.6%
Progress Center Huntsville 1983-91 224,329 98.1% 2,088,741 9.48 2,231,219 0.8%
Lakeside Office Park Huntsville 1989/90 121,520 91.8% 1,454,016 13.07 1,522,745 0.5%
AmSouth Center Huntsville 1990 154,421 94.5% 2,588,088 17.73 3,192,903 1.1%
Colonial Center at Research Park Huntsville 1999 131,686 (7) (7) (7) 214,887(6) 0.1%
250 Commerce St Montgomery 1904/81 36,935 100.0% 401,544 10.86 427,112 0.1%
Anderson Block (5) Montgomery 1981/83 33,589 97.7% 110,101 10.06 124,109 0.0%
Land Title Bldg Birmingham 1975 32,251 100.0% 131,481 12.23 149,381 0.1%
Independence Plaza Birmingham 1979 105,805 89.4% 1,313,797 13.89 1,491,927 0.5%
Shades Brook Building Birmingham 1979 34,410 83.9% 444,969 15.42 433,696 0.1%
Emmett R. Johnson Building Birmingham 1982/95 162,763 94.4% 2,535,499 16.51 1,436,632(6) 0.5%
Perimeter Corporate Park Huntsville 1986/89 234,465 85.1% 2,858,070 14.33 3,400,453 1.2%
------- -------- ------------ ---------- ------------- ----
Subtotal-Alabama (15 Properties) 2,238,452 91.4% 23,022,659 13.21 24,297,621 8.2%
------- -------- ------------ ---------- ------------- ----
Florida:
Concourse Center Tampa 1981/85 291,400 97.2% 4,567,104 16.12 4,690,782 1.6%
University Park Plaza Orlando 1985 71,945 90.5% 950,796 14.93 1,015,187 0.3%
------- -------- ------------ --------- ------------- ----
Subtotal-Florida (2 Properties) 363,345 95.9% 5,517,900 15.90 5,705,969 1.9%
------- -------- ----------- --------- ------------- ----
Georgia:
Colonial Center at Mansell Overlook Atlanta 1987/96/97 535,712 98.4% 10,787,855 22.53 11,063,385 3.8%
------- -------- ------------ --------- ------------- ----
Subtotal-Georgia (1 Property) 535,712 98.4% 10,787,855 22.53 11,063,385 3.8%
------- -------- ------------ --------- ------------- ----
TOTAL (18 Properties) 3,137,509 93.3% $39,328,414 $ 15.29 $41,066,975 14.1%
======= ======== ============ ========= ============= ====
(1) All Office Properties are 100% owned by CRLP with the exceptions of
Anderson Block and Land Title Building, which are each 33.33% owned by
CRLP.
(2) Year initially completed and, where applicable, most recent year in which
the Property was substantially renovated or in which an additional phase of
the Property was completed.
(3) Total 1999 Office Property revenue is CRLP's share (based on its percentage
ownership of the property) of total Office Property revenue, unless
otherwise noted. However, amounts exclude $530,544 of straight-line rents
reflected in CRLP's Consolidated Financial Statements for the period ended
December 31, 1999.
(4) Percent of Total 1999 Property Revenue represents the Office Property's
proportionate share of all revenue from CRLP's 111 Properties.
(5) CRLP has a leasehold interest in this Property.
(6) Represents revenues from the date of CRLP's acquisition of this Property in
1999 through December 31, 1999.
(7) These properties were recently developed and are currently undergoing
lease-up.
(8) This property is located within the International Park office complex and
is included in the property total with International Park.
The following table sets out a schedule of the lease expirations for
leases in place as of December 31, 1999, for the Office Properties (including
all lease expirations for partially-owned Properties).
Net Rentable Annualized Percent of Total
Year of Number of Area Of Base Rent of Annual Base Rent
Lease Tenants with Expiring Leases Expiring Represented by
Expiration Expiring Lease(Square Feet) (1Leases (1)(2) Expiring Leases(1)
- ---------------------------------------------------------------------------------
2000 161 632,280 8,095,029 20.6%
2001 73 400,515 5,705,864 14.5%
2002 81 424,057 6,115,747 15.6%
2003 54 438,179 6,654,753 16.9%
2004 56 365,716 5,565,872 14.2%
2005 18 274,475 3,084,551 7.8%
2006 7 133,015 1,695,560 4.3%
2007 5 58,397 959,765 2.4%
2008 3 26,486 503,363 1.3%
2009 6 52,749 899,910 2.3%
Thereafter 4 35,000 48,000 0.1%
--------- ------------ -------------- -----------
468 2,840,869 $39,328,414 100.0%
========= ============ ============== ===========
(1) Excludes 297,000 square feet of space not leased as of December 31, 1999.
(2) Annualized base rent is calculated using base rents as of December 31, 1999.
The following sets forth the net rentable area, total percent leased
and average base rent per leased square foot for each of the last five years for
the Office Properties:
Average Base
Rentable Area Total Rent Per Leased
Year-end (Square Feet)(2) Percent Leased Square Foot (1)
-------- ------------- -------------- ---------------
December 31, 1999 3,138,000 93.3% $15.29
December 31, 1998 2,707,000 92.2% $14.58
December 31, 1997 1,859,000 95.5% $12.18
December 31, 1996 1,009,000 97.4% $13.80
December 31, 1995 1,009,000 94.0% $13.52
- -----------------
(1) Average base rent per leased square foot is calculated using base rents as
of December 31 for each respective year.
(2) Rentable square feet includes 65,840 square feet that is partially owned by
CRLP at December 31, 1999.
Retail Properties
The 41 Retail Properties owned by CRLP at December 31, 1999, contain a
total of approximately 13.9 million square feet (including space owned by anchor
tenants). Twelve of the Retail Properties are located in Alabama, twelve are
located in Florida, seven are located in Georgia, six are located in North
Carolina, one is located in South Carolina, one is located in Tennessee, and two
are located in Virginia. The Retail Properties consist of 16 enclosed regional
malls, two power centers, and 23 neighborhood shopping centers. Nine of the 40
Retail Properties were originally developed by CRLP, 31 were acquired between
1994 and 1998, and one was acquired in 1999. All of the Retail Properties are
managed by CRLP.
The following table sets forth certain information relating to the
Retail Properties as of and for the year ended December 31, 1999.
Retail Properties
Average
Base
Gross Rent
Leasable Per Total Retail % of
Year Area Number Total Leased Property Total 1999
Retail Completed (Square Of Percent Annualized Square Revenue for Property
Property (1) Location (2) Feet) (3) Stores Leased (3)Base Rent Foot(4) 1999(10)Revenue(5)
- ---------------------------------------------------------------------------------------------------------------------------- -----
Alabama:
Colonial Mall Decatur Decatur 1979/89 494,895 59 86.9% $ 3,507,389 $ 16.92 5,541,189 1.9%
80,866 (6)
Brookwood Village Mall Birmingham 1973/91 460,599 66 (8) 3,824,878 14.66 6,831,926 2.3%
231,953 (6)
Colonial Mall Gadsden Gadsden 1974/91 490,898 62 94.5% 3,004,299 16.54 5,049,928 1.7%
Colonial Mall Auburn/Opelika Auburn 1973/84/89 399,889 61 89.5% 2,668,936 17.61 4,349,120 1.5%
Colonial Promenade Montgomery Montgomery 1990/97 273,196 40 92.7% 2,588,512 3,170,784 1.1%
146,121 (6)
Colonial Shoppes McGehee Montgomery 1986 54,638 17 61.9% 426,509 12.58 567,512 0.2%
50,000 (6)
Colonial Shoppes Bellwood Montgomery 1988 42,762 20 82.3% 456,145 11.83 590,142 0.2%
50,000 (6)
Old Springville Birmingham 1982 63,707 12 46.1% 214,559 8.29 257,573 0.1%
Colonial Shoppes Inverness Birmingham 1984 28,243 5 100.0% 432,188 12.66 537,287 0.2%
Olde Town Montgomery 1978/90 38,822 16 86.4% 322,033 10.22 420,136 0.1%
Colonial Promenade Tutwiler Farm(8)Birmingham Development - - - - - 134,836 0.0%
Bel Air Mall Mobile 1966/90/97 1,099,041 106 87.2% 7,859,254 14.97 11,998,379 4.1%
333,990 (6)
Parkway City Mall Huntsville 1975 415,440 44 (8) 1,329,513 11.35 1,518,461 0.5%
P&S Building (9) Gadsden 1946/76/91 39,560 1 100.0% 178,020 4.50 178,020 0.1%
----------- -------------------------------------------------- -----
Subtotal-Alabama (12 Properties) 4,794,620 509 87.5% 26,812,235 15.03 41,145,293 14.1%
----------- -------------------------------------------------- -----
Florida:
Colonial Promenade University Park Orlando 1986/89 399,111 36 81.4% 2,483,362 14.98 3,857,249 1.3%
Colonial Promenade Tuskawilla Orlando 1990 217,209 27 94.1% 1,320,904 13.19 1,840,898 0.6%
Colonial Promenade Burnt Store Punta Gorda 1990 198,918 29 92.2% 1,368,434 12.38 1,581,461 0.5%
Colonial Promenade Winter Haven Orlando 1986 197,472 23 86.4% 1,296,058 12.68 1,829,071 0.6%
Northdale Court Tampa 1988 192,726 24 (8) 981,663 12.50 1,339,272 0.5%
55,000 (6)
Colonial Promenade Bear Lake Orlando 1990 131,552 20 46.4% 745,046 13.14 984,413 0.3%
Colonial Shoppes Paddock Park Ocala 1988 87,136 17 96.8% 709,143 12.97 916,052 0.3%
Colonial Promenade Bardmoor VillageSt. Petersbur1981 152,667 30 75.3% 1,201,320 15.46 1,729,879 0.6%
Colonial Promenade Hunter's Creek Orlando 1993/95 222,485 26 95.8% 1,871,614 14.71 2,543,897 0.9%
Colonial Promenade Wekiva Orlando 1990 209,398 26 90.8% 1,825,929 12.97 2,569,181 0.9%
Colonial Promenade Lakewood Jacksonville 1995 193,833 50 96.2% 1,685,106 11.39 2,312,432 0.8%
Orlando Fashion Square Orlando 1973/89/93 708,851 131 92.6% 9,997,980 25.87 8,584,676 2.9%
361,432 (6)
----------- -------------------------------------------------- -----
Subtotal-Florida (12 Properties) 3,327,790 439 87.6% 25,486,559 18.07 30,088,481 10.3%
----------- -------------------------------------------------- -----
Georgia:
Macon Mall Macon 1975/88/97 758,399 158 90.6% 10,546,232 22.81 17,743,446 6.1%
682,160 (6)
Colonial Promenade Beechwood Athens 1963/92 343,569 47 90.7% 2,415,421 10.24 2,977,491 1.0%
Britt David Columbus 1990 109,630 9 98.5% 273,458 12.73 941,410 0.3%
Colonial Mall Lakeshore Gainesville 1984-97 518,115 69 91.9% 3,663,564 18.26 5,989,399 2.1%
Colonial Mall Valdosta Valdosta 1982-85 327,249 57 95.1% 3,042,992 16.69 5,972,488 2.1%
73,723 (6)
Colonial Mall Glynn Place Brunswick 1986 281,901 57 84.2% 2,800,795 17.49 4,117,877 1.4%
225,549 (6)
Village at Roswell Summit Atlanta 1988 25,510 9 100.0% 293,071 14.56 470,679 0.2%
----------- -------------------------------------------------- -----
Subtotal-Georgia (7 Properties) 3,345,805 406 90.7% 23,035,533 18.56 38,212,790 13.2%
----------- -------------------------------------------------- -----
North Carolina:
Colonial Mall Burlington Burlington 1969/86/94 412,697 57 94.6% 2,772,983 16.26 5,406,600 1.9%
Mayberry Mall Mount Airy 1968/86 150,823 22 97.1% 806,451 10.91 1,148,697 0.4%
57,843 (6)
Plaza Mall Greenville 1965/89/99 421,453 61 96.7% 3,531,909 17.22 1,924,725(7) 0.7%
46,051 (6)
Colonial Shoppes Quaker Greensboro 1968/88/97 103,548 29 93.7% 964,165 12.97 1,422,639 0.5%
Colonial Shoppes Yadkin Yadkinville 1971/97 90,917 11 90.7% 609,923 7.00 707,123 0.2%
Colonial Shoppes Stanly Locust 1987/96 46,970 8 100.0% 255,445 7.84 285,951 0.1%
----------- -------------------------------------------------- -----
Subtotal-North Carolina (6 Properties) 1,330,302 188 95.6% 8,940,876 14.51 10,895,735 3.7%
----------- -------------------------------------------------- -----
South Carolina:
Colonial Mall Myrtle Beach Myrtle Beach 1986 486,493 72 92.5% 4,261,940 20.28 8,346,881 2.9%
----------- -------------------------------------------------- -----
Subtotal-South Carolina (1 Property) 486,493 72 92.5% 4,261,940 20.28 8,346,881 2.9%
----------- -------------------------------------------------- -----
Tennessee:
Rivermont Shopping Center Chattanooga 1986/97 73,539 10 95.4% 385,290 6.43 503,190 0.2%
----------- -------------------------------------------------- -----
Subtotal-Tennessee (1 Property) 73,539 10 95.4% 385,290 6.43 503,190 0.2%
----------- -------------------------------------------------- -----
Virginia:
Colonial Mall Staunton Staunton 1969/86/97 423,177 50 91.8% 1,925,376 10.98 3,289,907 1.1%
Colonial Promenade Abington Abingdon 1987/96 165,684 18 100.0% 1,015,969 10.31 1,270,073 0.4%
----------- -------------------------------------------------- -----
Subtotal-Virginia (2 Properties) 588,861 68 94.1% 2,941,345 10.78 4,559,980 1.6%
----------- -------------------------------------------------- -----
Total (41 Properties) 13,947,410 1,692 89.9% $91,863,778 $ 16.66 $133,752,350 45.9%
=========== ================================================== =====
(footnotes on next page)
(1) All Retail Properties are 100% owned by CRLP, with the exception of Orlando
Fashion Square and Parkway City mall, which are owned 50% by CRLP.
(2) Year initially completed and, where applicable, year(s) in which the
Property was substantially renovated or an additional phase of the Property
was completed.
(3) Total GLA includes space owned by anchor tenants, but Percent Leased
excludes such space.
(4) Includes specialty store space only.
(5) Percent of Total 1999 Property Revenue represents the Retail Property's
proportionate share of all revenue from the 111 Properties.
(6) Represents space owned by anchor tenants.
(7) Represents revenues from the date of CRLP's acquisition of the Property in
1999 through December 31, 1999.
(8) This property is currently under development and is not included in the
property total.
(9) This property is located on the premises of the Colonial Mall Gadsden and
is included in the property total with Colonial Mall Gadsden.
(10) Amounts exclude $710,400 of straight-line rents reflected in CRLP's
Consolidated Financial Statements for the period ended December 31, 1999.
The following table sets forth the total gross leasable area, percent
leased and average base rent per leased square foot as of the end of each of the
last five years for the Retail Properties:
Gross Average
Leasable Area Percent Base Rent Per
Year-End (Square Feet) (1) Leased Leased Square Foot(2)
-------- ----------------- ------ ---------------------
December 31, 1999 13,947,000 89.9% $16.66
December 31, 1998 11,105,000 91.9% $14.48
December 31, 1997 8,880,000 93.3% $14.38
December 31, 1996 4,856,000 93.8% $14.66
December 31, 1995 3,758,000 93.1% $13.23
(1) Excludes 2,395,000 square feet of space owned by anchor tenants and
includes 1,124,291 square feet partially owned by CRLP at December 31,
1999.
(2) Average base rent per leased square foot is calculated using specialty
store year-end base rent figures.
The following table sets out a schedule of the lease expirations for
leases in place as of December 31, 1999, for the Retail Properties:
Net Rentable Annualized Percent of Total
Year of Number of Area Of Base Rent of Annual Base Rent
Lease Tenants with Expiring Leases Expiring Represented by
Expiration Expiring Leases (Square Feet) (1) Leases (1)(2) Expiring Leases (1)
- -------------------------------------------------------------------------------------
2000 375 1,217,885 12,565,084 13.7%
2001 208 744,002 8,024,893 8.7%
2002 247 770,532 10,017,682 10.9%
2003 170 802,113 7,520,417 8.2%
2004 174 1,361,508 9,137,176 9.9%
2005 100 322,579 5,671,149 6.2%
2006 101 1,167,922 7,818,020 8.5%
2007 113 1,171,862 8,365,703 9.1%
2008 66 508,596 5,272,415 5.7%
2009 59 560,417 4,959,719 5.4%
Thereafter 79 3,546,539 12,511,520 13.6%
-------------- --------------- ------------- ----------
1,692 12,173,955 $ 91,863,778 100.0%
============== =============== ============= ==========
(1) Excludes 2,395,000 square feet of space owned by anchor tenants and
1,883,000 square feet of space not leased as of December 31, 1999.
(2) Annualized base rent is calculated using base rents as of December 31, 1999.
Undeveloped Land
CRLP owns nine undeveloped land parcels consisting of approximately
175.0 acres (collectively, the "Land"). Land adjacent to Multifamily Properties
typically will be considered for potential development of another phase of an
existing Multifamily Property if CRLP determines that the particular market can
absorb additional apartment units. CRLP currently owns one such parcel. For
expansions at Retail Properties, CRLP owns parcels both contiguous to the
boundaries of Retail Properties, which would accommodate expansion of the mall
or shopping center, and outparcels which are suitable for restaurants, financial
institutions or free standing retailers. CRLP owns two such parcels.
Property Markets
The table below sets forth certain information with respect to the
geographic concentration of the Properties as of December 31, 1999.
Geographic Concentration of Properties
Percent
Units Total Of Total
(Multifamily) GLA NRA 1999 Property 1999 Property
State (1) (Retail) (2) (Office)(3) Revenue Revenue
- -------------- ---------- ------------ ------------ --------------- --------------
Alabama 7,697 4,794,620 2,238,452 $ 114,515,385 39.4%
Florida 5,366 3,327,790 363,345 79,114,841 27.2%
Georgia 1,938 3,345,805 535,712 61,635,459 21.2%
Mississippi 328 -0- -0- 2,493,318 0.9%
North Carolina -0- 1,330,302 -0- 10,895,735 3.7%
South Carolina 764 486,493 -0- 13,874,237 4.8%
Tennessee -0- 73,539 -0- 503,190 0.2%
Texas 322 -0- -0- 3,056,624 1.0%
Virginia -0- 588,861 -0- 4,559,980 1.6%
---------- ------------ ------------ --------------- -----------
Total 16,415 13,947,410 3,137,509 $ 290,648,769 100.0%
========== ============ ============ =============== ===========
(1) Units (in this table only) refer to multifamily apartment units.
(2) GLA refers to gross leaseable area of retail space.
(3) NRA refers to net rentable area of office space.
CRLP believes that the demographic and economic trends and conditions
in the markets where the Properties are located indicate a potential for
continued growth in property net operating income. The Properties are located in
a variety of distinct submarkets within Alabama, Florida, Georgia, Mississippi,
North Carolina, South Carolina, Tennessee, Texas and Virginia. However,
Birmingham, Huntsville and Montgomery, Alabama, Orlando, Tampa and
Sarasota/Bradenton, Florida, and Macon and Atlanta, Georgia, are CRLP's primary
markets. CRLP believes that its markets in these nine states, which are
characterized by stable and increasing population and employment growth, should
continue to provide a steady demand for multifamily, office, and retail
properties.
Mortgage Financing
Certain of the Properties are subject to mortgage indebtedness. The
Properties whose financial results are consolidated in the financial statements
of CRLP are subject to existing mortgage indebtedness and other notes payable in
an aggregate amount as of December 31, 1999, of approximately $1.04 billion
carrying a weighted average interest rate of 7.15% and a weighted average
maturity of 7.0 years. The mortgage indebtedness on the Properties as of
December 31, 1999, is set forth in the table below:
Mortgage Debt and Notes Payable
Anticipated
Annual Debt
Principal Service Estimated
Interest Balance (as of (1/1/00- Maturity Balance Due
Property (1) Rate 12/31/99) 12/31/00) Date (2) on Maturity
- ----------------------------------- ---------- -------------- -------------- ---------- ------------
Multifamily Properties:
CG at Carrollwood 7.490% 10,200,000 $ 763,980 08/27/09 $10,200,000
CG at Natchez Trace 7.950% 6,795,394 612,387 09/01/35 47,813
CG at Natchez Trace 8.000% 4,050,445 371,424 02/01/37 29,071
CV at Rocky Ridge 5.900% 6,000,000 354,000 08/01/02 (4) 6,000,000
CV at Rocky Ridge 7.625% 1,146,667 208,731 08/01/02 841,667
CG at Galleria Woods 6.910% 9,708,854 771,155 07/01/09 8,459,760
CV at Inverness 3.980% 9,900,000 495,587 07/01/26 (5) 9,900,000
CV at Inverness Lakes 5.900% 4,000,000 236,000 08/01/02 (4) 4,000,000
CV at Inverness Lakes 7.625% 1,495,000 197,022 08/01/02 1,234,167
CG at Galleria 3.980% 22,400,000 1,041,395 07/01/26 (5) 22,400,000
CG at Research Park 3.980% 12,775,000 592,942 07/01/26 (5) 12,775,000
CV at White Bluff 3.980% 4,500,000 212,175 07/01/26 (5) 4,500,000
CV at Vernon Marsh 3.980% 3,400,000 165,201 07/01/26 (5) 3,400,000
CV at Hillwood 5.900% 3,330,000 196,470 08/01/02 (4) 3,300,000
CV at Hillwood 7.625% 1,430,000 211,436 08/01/02 1,179,167
Retail Properties:
Colonial Promenade Hunter's Creek 8.800% 9,925,950 1,060,640 10/01/01 9,578,044
Mayberry Mall 9.220% 3,294,223 362,823 10/01/01 3,237,064
Colonial Promenade Montgomery 7.490% 12,250,000 917,525 07/01/00 12,250,000
Rivermont Shopping Center 10.125% 1,587,738 270,113 09/01/08 52,091
Colonial Promenade Unversity Park 7.490% 21,500,000 1,617,050 03/05/05 21,500,000
Village at Roswell Summit 8.930% 1,603,043 159,515 09/01/05 1,401,860
Office Properties:
Interstate Park 8.500% 3,910,807 643,623 08/01/03 2,648,144
Riverchase Center 7.880% 7,981,452 8,621,945 12/01/00 7,766,043
Colonial Center 100 at Mansell
Overlook 8.625% 13,732,487 1,305,949 01/10/08 15,285,811
Colonial Center at Mansell Overlook8.250% 17,255,156 15,149,832 06/01/00 13,692,324
Perimeter Corporate Park 8.680% 5,347,697 610,230 12/01/03 4,858,772
Other debt:
Land Loan 7.580% 610,772 610,722 09/30/00 610,722
Line of Credit 7.430% (7) 228,337,000 13,434,213 07/10/00 (8)228,337,000
Unsecured Senior Notes 7.500% 65,000,000 4,868,724 07/15/01 65,000,000
Unsecured Senior Notes 8.050% 65,000,000 5,213,989 07/15/06 65,000,000
Unsecured Senior Notes 7.000% 175,000,000 12,250,008 07/15/06 65,000,000
Medium Term Notes 7.050% 50,000,000 3,525,000 12/15/03 50,000,000
Medium Term Notes 7.160% 50,000,000 3,580,000 01/17/03 50,000,000
Medium Term Notes 6.960% 75,000,000 5,220,000 07/26/04 75,000,000
Medium Term Notes 6.960% 25,000,000 1,740,000 08/01/05 25,000,000
Medium Term Notes 6.980% 25,000,000 1,745,000 09/26/05 25,000,000
Medium Term Notes 8.190% 25,000,000 2,047,500 08/01/05 25,000,000
Medium Term Notes 7.930% 57,500,000 4,559,750 09/26/05 25,000,000
Unamortized Discount on Senior Notes (1,104,853) (1,104,853)
-------------- -------------- ------------
TOTAL $ 1,039,862,832 $ 95,944,056 $878,379,667
============== ============== ============
(1) As noted in the table, certain Properties were developed in phases and
separate mortgage indebtedness may encumber each of the various phases. In
the listing of property names, CG has been used as an abbreviation for
Colonial Grand and CV as an abbreviation for Colonial Village.
(2) All of the mortgages can be prepaid at any time, subject to prepayment
penalties calculated typically on a percentage basis, except for the
mortgages encumbering CV at Rocky Ridge, CV at Inverness Lakes, and CV at
Hillwood, which are closed to prepayment for varying lengths of time.
(3) The maturity date noted represents the date on which credit enhancement
expires for the tax-exempt municipal bonds put in place as part of the
original financing for the Property. The stated maturity date for the loans
is August 1, 2007.
(4) These loans are financed through tax-exempt bonds which are credit enhanced
by Fannie Mae. The loans, which bear interest at a weekly variable interest
rate, require monthly interest payments through June 2006 and principal and
interest payments from July 2006 through June 2026. The weighted average
interest rate of these three loans was 3.93% at December 31, 1999. On
February 15, 1999, CRLP entered into an interest rate swap for these bonds
at a rate of 3.23%.
(5) The maturity date noted represents the date on which credit enhancement
expires for the tax-exempt municipal bonds put in place as part of the
original financing for the Property. The stated maturity date for the loans
is August 1, 2022.
(6) The maturity date noted represents the date on which credit enhancement
expires for the tax-exempt municipal bonds put in place as part of the
original financing for the Property. The stated maturity date for the loans
is August 1, 2010.
(7) This line of credit facility bears interest at a variable rate, based on
LIBOR plus a spread that ranges from 80 to 135 basis points. At December
31, 1999, the line of credit facility bore interest at a rate of 95 basis
points above LIBOR. The facility also includes a competitive bid feature
that allows CRLP to convert up to $125 million under the line of credit to
a fixed rate, for a fixed term not to exceed 90 days. At December 31, 1999,
there were no amounts outstanding under the competitive bid feature.
(8) This credit facility has a term of two years beginning in July 1998 and
provides for a two-year amortization in the event of non-renewal. On
January 4, 1999, CRLP entered into an interest rate swap for $50.0 million
of its line of credit at 4.97% plus 80 to 135 basis points. Additionally,
on May 4, 1999, CRLP entered into an interest rate swap for $25.0 million
on its line of credit at a rate of 5.07%.
In addition to the foregoing mortgage debt, the six Multifamily
Properties, two Office Properties and two Retail Properties in which CRLP owns
partial interests (and which therefore are not consolidated in the financial
statements of CRLP) also are subject to existing mortgage indebtedness. CRLP's
pro-rata share of such indebtedness as of December 31, 1999, was $49,027,000,
which carried a weighted average interest rate of 7.1%. The maturity dates of
these loans range from February 1, 2000 to October 1, 2009 and as of December
31, 1999, the loans had a weighted average maturity of 9.9 years.
Item 3. Legal Proceedings.
Neither CRLP nor the Properties are presently subject to any material
litigation nor, to CRLP's knowledge, is any material litigation threatened
against CRLP or the Properties, other than routine litigation arising in the
ordinary course of business which is expected to be covered by liability
insurance.
Item 4. Submission of Matters to a Vote of Security Holders.
No matters were submitted to CRLP's unitholders during the fourth
quarter of 1999.
PART II
Item 5. Market for Registrant's Common Equity and Related Shareholder
Matters.
There is no established public trading market for the Units. As of
March 8, 2000, there were 116 holders of record of Units.
CRLP has made consecutive quarterly distributions since its formation
in the third quarter of 1993. CRLP's ability to make distributions depends on a
number of factors, including its net cash provided by operating activities,
capital commitments and debt repayment schedules. Holders of Units are entitled
to receive distributions when, as and if declared by the Board of Trustees of
the Company, its general partner, out of any funds legally available for that
purpose.
The following table sets forth the distributions per Unit paid by CRLP
during the periods noted:
Calendar Period Distribution
1999:
First Quarter.................$ .58
Second Quarter................$ .58
Third Quarter.................$ .58
Fourth Quarter................$ .58
1998:
First Quarter.................$ .55
Second Quarter................$ .55
Third Quarter.................$ .55
Fourth Quarter................$ .55
Item 6. Selected Financial Data.
The following table sets forth selected financial and operating
information on a historical basis for CRLP for each of the five years ended
December 31, 1999.
Dollar amounts in thousands, except unit data 1999 1998 1997 1996 1995
- ------------------------------------------------------------------------------------------------------------------------
OPERATING DATA
Total revenue $282,564 $ 257,367 $ 184,126 $ 134,881 $ 111,437
Expenses:
Depreciation and amortization 55,185 48,647 33,278 23,533 20,615
Other operating expenses 94,354 87,972 63,581 46,819 42,282
Income from operations 133,025 120,748 87,267 64,529 48,540
Interest expense 57,211 52,063 40,496 24,584 23,972
Other income (expense), net 9,489 (62) 3,069 1,104 674
Income before extraordinary items 85,303 68,623 49,840 41,049 25,242
Dividends to preferred unitholders 18,531 10,938 1,671 - -
Net income available to common unitholders 66,144 57,284 44,519 40,538 25,242
Per unit - basic and diluted:
Net income 1.88 1.64 1.55 1.58 1.28
Distributions 2.32 2.20 2.08 2.00 1.90
- ------------------------------------------------------------------------------------------------------------------------
BALANCE SHEET DATA
Land, buildings, and equipment, net $ 1,586,332 $ 1,566,840 $1,268,430 $ 801,798 $ 624,514
Total assets 1,864,146 1,756,548 1,396,660 947,947 681,297
Total debt 1,039,863 909,322 702,044 506,435 354,100
- ------------------------------------------------------------------------------------------------------------------------
OTHER DATA
Total properties (at end of period) 111 106 93 73 61
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
GENERAL
Colonial Realty Limited Partnership, a Delaware limited partnership is the
operating partnership of Colonial Properties Trust, an Alabama real estate
investment trust (the "Company"), whose shares are listed on the New York Stock
Exchange. The Company is engaged in the ownership, development, management, and
leasing of multifamily communities, office buildings, retail malls and shopping
centers. The Company owns and operates properties in nine states in the Sunbelt
region of the United States. As of December 31, 1999, CRLP's real estate
portfolio consisted of 52 multifamily communities, 18 office properties, and 41
retail properties.
CRLP manages its business with three separate and distinct operating divisions:
Multifamily, Office, and Retail. Each division has an Executive Vice President
that oversees growth and operations and has a separate management team that is
responsible for acquiring, developing, and leasing properties within each
division. This structure allows CRLP to utilize specialized management personnel
for each operating division. Constant communication among the Executive Vice
Presidents and centralized functions of accounting, information technology, due
diligence and administrative services provide CRLP with unique synergy allowing
CRLP to take advantage of a variety of investment opportunities. Decisions for
investments in acquisitions and developments and for dispositions are also
centralized.
The following discussion should be read in conjunction with the Consolidated
Financial Statements and Notes to Consolidated Financial Statements appearing
elsewhere in this report.
Any statement contained in this report which is not a historical fact, or which
might be otherwise considered an opinion or projection concerning CRLP or its
business, whether express or implied, is meant as, and should be considered, a
forward-looking statement as that term is defined in the Private Securities
Litigation Reform Act of 1996. Forward-looking statements are based upon
assumptions and opinions concerning a variety of known and unknown risks,
including but not limited to changes in market conditions, the supply and demand
for leasable real estate, interest rates, increased competition, changes in
governmental regulations, and national and local economic conditions generally,
as well as other risks more completely described in CRLP's other filings with
the Securities and Exchange Commission. If any of these assumptions or opinions
prove incorrect, any forward-looking statements made on the basis of such
assumptions or opinions may also prove materially incorrect in one or more
respects.
Results of Operations--1999 vs. 1998
In 1999, CRLP experienced growth in revenues, operating expenses, and net
income, which is primarily the result of the acquisition and development of 21
properties and the expansion of 6 properties during 1999 and 1998. As a result
of the acquisitions, developments, and expansions, CRLP's net income before
distributions to preferred unitholders increased by $16.5 million, or 24.1%, for
1999 when compared to 1998. On a per unit basis, net income is $1.88 for 1999, a
14.6% increase, compared to $1.64 for 1998. The increase in net income available
to unitholders, on a per unit basis, is directly attributable to the
acquisition, development, and expansion of properties.
Revenues--Total revenues increased by $25.2 million, or 9.8%, during 1999 when
compared to 1998. Of this increase, $18.1 million relates to revenues generated
by properties that were acquired, developed, or expanded during 1999 and 1998.
The remaining increase primarily relates to increases in rental rates at
existing properties and lease buyouts during 1999. The multifamily division
accounts for the largest portion of the overall revenue increase, approximately
$11.3 million, while the office and retail divisions account for $6.6 million
and $7.3 million, respectively. The divisional revenue growth is primarily
attributable to the acquisition, development, and expansion of 15 multifamily
properties, 8 office properties, and 4 retail properties during 1999 and 1998.
Operating Expenses--Total operating expenses increased by $12.9 million, or
9.5%, during 1999 when compared to 1998. The majority of this increase relates
to additional property operating expenses of $3.5 million and additional
depreciation of $3.9 million associated with properties that were acquired,
developed, or expanded during 1999 and 1998, net of operating expenses of
properties disposed of during 1998. Depreciation expense on existing properties
increased by $2.2 million during 1999 when compared to 1998. Divisional property
operating expenses increased by $7.2 million, $3.5 million, and $1.3 million for
the multifamily, office, and retail divisions, respectively, during 1999 when
compared to 1998. The increase in divisional property operating expenses is
primarily attributable to the acquisition and development of 15 multifamily
properties, 8 office properties, and 4 retail properties during 1999 and 1998.
The remaining change primarily relates to increases in operating expenses at
existing properties, and overall increases in corporate overhead and personnel
costs associated with CRLP's continued growth.
Other Income and Expenses--Interest expense increased by $5.1 million, or 9.9%,
during 1999 when compared to 1998. The increase in interest expense is primarily
attributable to the issuance of $82.5 million in Medium Term Notes, and the
increased usage of CRLP's line of credit in conjunction with the financing of
acquisitions, developments, expansions, and investment activities.
Results of Operations--1998 vs. 1997
In 1998, CRLP experienced growth in revenues, operating expenses, and net
income, which primarily resulted from the acquisition and development of 53
properties during 1998 and 1997. As a result of the acquisitions and
developments, CRLP's net income before distributions to preferred unitholders
increased by $22.0 million, or 47.7%, for 1998 when compared to 1997. On a per
unit basis, net income was $1.64 for 1998, a 5.2% increase, compared to $1.55
for 1997. The increase in net income available to unitholders, on a per unit
basis, is primarily attributable to the acquisition, development, and expansion
of properties.
Revenues--Total revenues increased by $73.2 million, or 39.8%, during 1998 when
compared to 1997. Of this increase, $61.7 million relates to revenues generated
by properties that were acquired or developed during 1998 and 1997, net of
revenues of properties disposed of in 1997. The retail division accounted for
the majority of the overall revenue increase, approximately $46.4 million, while
the multifamily and office division accounted for $9.0 million and $18.2
million, respectively. The divisional revenue growth was primarily attributable
to the acquisition and development of 21 retail properties, 22 multifamily
properties, and 10 office properties during 1998 and 1997. The remaining
increase relates to increases in rental rates at existing properties and lease
buyouts during 1998.
Operating Expenses--Total operating expenses increased by $39.8 million, or
41.1%, during 1998 when compared to 1997. The majority of this increase relates
to additional property operating expenses of $20.3 million and additional
depreciation of $13.4 million associated with properties that were acquired or
developed during 1998 and 1997, net of operating expenses of properties disposed
of during 1997. Depreciation expense on existing properties increased by $1.5
million during 1998 when compared to 1997. Divisional property operating
expenses increased by $2.8 million, $5.5 million, and $14.8 million for
multifamily, office, and retail divisions, respectively, during 1998 when
compared to 1997. The increase in divisional property operating expenses was
primarily attributable to the acquisition and development of 22 multifamily
properties, 10 office properties, and 21 retail properties during 1998 and 1997.
The remaining increase primarily relates to increases in operating expenses at
existing properties, and overall increases in corporate overhead and personnel
costs associated with CRLP's continued growth.
Other Income and Expenses--Interest expense increased by $11.6 million, or
28.6%, during 1998 when compared to 1997. The increase in interest expense is
primarily attributable to the assumption of $5.7 million of debt, the issuance
of $175 million in Medium Term Notes, and the net increased usage of CRLP's line
of credit in conjunction with the financing of acquisitions and developments.
LIQUIDITY AND CAPITAL RESOURCES
During 1999, CRLP invested $225.8 million in the acquisition, development, and
expansion of properties. This acquisition and development activity increased
CRLP's multifamily, office, and retail property holdings. CRLP financed the
growth through proceeds from public and private offerings of equity and debt
totaling $182.5 million during 1999, advances on its bank line of credit, the
issuance of limited partnership units, the proceeds from joint ventures,
disposition of assets, and cash from operations.
During 1999, the Board of Trustees of Colonial Properties Trust, our general
partner, authorized a common unit repurchase program under which CRLP may
repurchase up to $150 million of its currently outstanding common units from
time to time at the discretion of management in open market and negotiated
transactions. During 1999, CRLP repurchased 4,612,815 shares at an all in cost
of $122.1 million.
Acquisition and Development Activities
Multifamily Properties--During 1999, CRLP completed development of 1,404
apartment units in 10 multifamily communities and acquired land on which it
intends to develop additional multifamily communities during 1999. The aggregate
investment in the multifamily developments during 1999 was $105.1 million. As of
December 31, 1999, CRLP has 1,290 apartment units in seven multifamily
communities under development or expansion. Management anticipates that the
seven multifamily projects will be completed during 2000 and 2001. Management
estimates that it will invest an additional $15.5 million to complete these
multifamily communities.
Office Properties--During 1999, CRLP increased its office portfolio by
approximately 443,000 square feet with the acquisition of one office property at
a cost of $16.5 million, and the development of two office properties. In
addition, CRLP began development on one office property in Atlanta, Georgia. The
aggregate investment in the office developments during 1999 was $30.8 million.
Management estimates that it will invest an additional $14.0 million to complete
these properties.
Retail Properties--During 1999, CRLP added approximately 468,000 square feet of
retail shopping space through the acquisition of an enclosed mall at a net cost
of $29.3 million. In addition, CRLP continued the development of a community
shopping center, began construction of two new community shopping centers, and
began the redevelopment of an enclosed mall and community shopping center. The
aggregate investment in the retail developments during 1999 was $32.0 million.
Management anticipates that it will invest an additional $68.6 million to
complete the retail developments.
Joint Ventures
During the third quarter of 1999, CRLP entered into a joint venture with CMS. In
connection with this joint venture, CRLP sold the following six properties:
Colonial Village at Stockbridge, Colonial Grand at Barrington Club, Colonial
Grand at Ponte Vedra, Colonial Village at River Hills, Colonial Grand at
Mountain Brook, and Colonial Village at Cahaba Heights. CMS acquired an 85%
interest in the joint venture from Colonial for $80.6 million. CRLP acquired a
15% interest in the joint venture and will serve as manager of the properties.
Subsequent to formation, the joint venture leveraged the properties for a total
of $73.6 million of nonrecourse notes, and the proceeds were distributed
proportionately to the joint venture partners. At December 31, 1999, CRLP had an
ending net investment in the joint venture of $2.8 million. The joint venture is
accounted for using the equity method.
Financing Activities
CRLP funded a large portion of its acquisitions, developments, and expansions
through the issuance of preferred units and debt securities. During 1999, CRLP
completed the following equity and debt transactions:
Preferred Unit Offering
-------------------------------------------------------------------------------
(in thousands)
-------------------------------------
Number of Price Per Gross Offering Net
Date Preferred Units Unit Proceeds Costs Proceeds
- --------- ---------------- ---------- ------------- ---------- ---------
February 2,000,000 $ 50.00 $ 100,000 $ 2,600 $ 97,400
Debt Offering
------------------------------------------------------------------------------
Gross
Type of Proceeds
Date Note Maturity Rate (in thousands)
- ----------------- --------------- -------------------------- ---------------
August Medium-term August, 2002 7.93% $ 57,500
August Medium-term August, 2004 8.19% 25,000
CRLP's current borrowing capacity under its unsecured line of credit is $250
million. The credit facility, which is used by CRLP primarily to finance
additional property investments, bears interest at a rate ranging between 80 and
135 basis points above LIBOR and is renewable in July 2000. The line of credit
agreement includes a competitive bid feature that will allow CRLP to convert up
to $125 million under the line of credit to a fixed rate, for a fixed term not
to exceed 90 days. As of December 31, 1999, the balance outstanding on CRLP's
line of credit was $228.3 million.
At December 31, 1999, CRLP's total outstanding debt balance was $1.04 billion.
The outstanding balance includes fixed rate debt of $758.0 million, or 72.9%,
and floating-rate debt of $281.9 million, or 27.1%. CRLP has obtained interest
rate protection for $50.0 million of the floating-rate debt through the purchase
of an interest rate cap agreement. The cap agreement limits the debt to an
interest rate of 8.00% through May 2, 2000. CRLP's total market capitalization
as of December 31, 1999 was $2.0 billion and its ratio of debt to total market
capitalization was 51.3%. Certain loan agreements of CRLP contain restrictive
covenants, which, among other things, require maintenance of various financial
ratios. At December 31, 1999, CRLP was in compliance with these covenants.
CRLP has only limited involvement with derivative financial instruments and does
not use them for trading purposes. Interest rate cap agreements and interest
rate swaps are used to reduce the potential impact of increases in interest
rates on variable-rate debt. Treasury lock agreements are used by CRLP to lock
in interest rates in connection with public debt offerings. On January 4, 1999,
Colonial entered into an interest rate swap for $50 million of its line of
credit at 4.97% plus 80 to 135 basis points and on January 15, 1999, Colonial
entered into an interest rate swap for $52 million of tax exempt bonds at a rate
of 3.23%. Additionally, on May 4, 1999, CRLP entered into an interest rate swap
agreement for $25 million of its line of credit at a rate of 5.07%. All of these
interest rate swap agreements have one-year terms and any payments made or
received under the agreements are recognized as adjustments to interest expense
as incurred. On February 10, 2000, CRLP entered into two reverse interest rate
swap agreements for a total of $50 million of its medium-term notes. Under the
terms of the agreements, CRLP will receive a fixed interest rate of 7.37% and
will be required to pay a floating rate equal to one month LIBOR that is
compounded and paid semi-annually. Both of these agreements have five-year
terms, and any payments made or received under the agreements are recognized as
adjustments to interest expense. CRLP is exposed to credit losses in the event
of nonperformance by the counterparties to its interest rate cap and
nonderivative financial assets but has no off-balance-sheet credit risk of
accounting loss. CRLP anticipates, however, that counterparties will be able to
fully satisfy their obligations under the contracts. CRLP does not obtain
collateral or other security to support financial instruments subject to credit
risk but monitors the credit standing of counterparties.
YEAR 2000 ISSUE
The Year 2000 or "Y2K" problem refers to the inability of many existing computer
programs having time-sensitive software to recognize a date using "00" as the
year 2000. Instead, the computer programs interpret such data as the year 1900.
This failure to accurately recognize the year 2000 and other key dates could
have resulted in a variety of problems ranging from data miscalculations to the
failure of entire systems.
In order to address the Y2K problem, CRLP reviewed all of their property
management and informational systems, and replaced, upgraded, or modified the
systems as needed to minimize the risks associated with the Y2K problem. The
Year 2000 issue did not have a material impact on CRLP's business, results of
operations, or financial condition.
OUTLOOK
Management intends to maintain CRLP's strength through continued
diversification, while pursuing acquisitions and developments that meet CRLP's
criteria for property quality, market strength, and investment return.
Management will continue to use its line of credit to provide short-term
financing for acquisition, development, and expansion activities and plans to
continue to replace significant borrowings under the bank line of credit with
funds generated from the sale of additional equity securities, permanent
financing, as market conditions permit, and the disposition of assets.
Management believes that these potential sources of funds, along with the
possibility of issuing limited partnership units of CRLP in exchange for
properties, will provide CRLP with the means to finance additional acquisitions,
developments, and expansions.
In addition to the issuance of equity and debt, management is investigating
alternate financing methods and sources to raise future capital. Private
placements, joint ventures, and non-traditional equity and debt offerings are
some of the alternatives CRLP is contemplating. CRLP continues to work
diligently to improve its credit rating, in order to reduce its cost of raising
future capital.
Management anticipates that its net cash provided by operations and its existing
cash balances will provide the necessary funds on a short- and long- term basis
to cover its operating expenses, interest expense on outstanding indebtedness,
recurring capital expenditures, and dividends to shareholders in accordance with
Internal Revenue Code requirements applicable to real estate investment trusts.
RECENTLY ISSUED ACCOUNTING STANDARD
Statement of Financial Accounting Standards No. 133 (SFAS 133), Accounting for
Derivative Instruments and Hedging Activities, addresses the accounting for
derivative instruments, including certain derivative instruments embedded in
other contracts, and hedging activities. Under SFAS 133, CRLP will be required
to account for derivative financial instruments, if any, at their fair market
value, and make certain required disclosures. CRLP is required to adopt SFAS 133
for periods beginning January 1, 2001.
INFLATION
Leases at the multifamily properties generally provide for an initial term of
six months to one year and allow for rent adjustments at the time of renewal.
Leases at the office properties typically provide for rent adjustments and the
pass-through of certain operating expenses during the term of the lease.
Substantially all of the leases at the retail properties provide for the
pass-through to tenants of certain operating costs, including real estate taxes,
common area maintenance expenses, and insurance. All of these provisions permit
CRLP to increase rental rates or other charges to tenants in response to rising
prices and, therefore, serve to minimize CRLP's exposure to the adverse effects
of inflation.
Item 8. Financial Statements and Supplementary Data.
The following are filed as a part of this report:
Report of Independent Accountants
Financial Statements:
Consolidated Balance Sheets as of December 31, 1999 and 1998
Consolidated Statements of Income for the years ended December 31,
1999, 1998, and 1997
Consolidated Statements of Partner's Capital for the years ended
December 31, 1999, 1998, and 1997
Consolidated Statements of Cash Flows for the years ended December 31,
1999, 1998, and 1997
Notes to Consolidated Financial Statements
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Trustees
of Colonial Properties Trust
In our opinion, the consolidated financial statements listed in the accompanying
index present fairly, in all material respects, the financial position of
Colonial Realty Limited Partnership (the "Company") at December 31, 1999 and
1998, and the results of its operations and its cash flows for each of the three
years in the period ended December 31, 1999, in conformity with accounting
principles generally accepted in the United States. In addition, in our opinion,
the financial statement schedules listed in the accompanying index present
fairly, in all material respects, the information set forth therein when read in
conjunction with the related consolidated financial statements. These financial
statements and financial statement schedules are the responsibility of the
Company's management; our responsibility is to express an opinion on these
financial statements and financial statement schedules based on our audits. We
conducted our audits of these statements in accordance with auditing standards
generally accepted in the United States, which 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,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for the opinion expressed
above.
/s/ PricewaterhouseCoopers L.L.P.
PRICEWATERHOUSECOOPERS L.L.P.
Birmingham, Alabama
January 17, 2000, except for Note 13, as
to which the date is February 29, 2000
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands)
December 31, 1999 and 1998
- ---------------------------------------------------------------------------------------------------------------------------
1999 1998
- ---------------------------------------------------------------------------------------------------------------------------
ASSETS
Land, buildings, & equipment, net $ 1,586,332 $ 1,566,840
Undeveloped land and construction in progress 214,043 128,336
Cash and equivalents 4,630 4,582
Restricted cash 2,634 2,897
Accounts receivable, net 10,606 9,151
Prepaid expenses 2,371 3,116
Notes receivable 695 696
Deferred debt and lease costs 10,500 9,644
Investment in partially owned entities 24,623 26,079
Other assets 7,712 5,207
- ---------------------------------------------------------------------------------------------------------------------------
$ 1,864,146 $ 1,756,548
- ---------------------------------------------------------------------------------------------------------------------------
LIABILITIES AND PARTNERS' CAPITAL
Notes and mortgages payable $ 1,039,863 $ 909,322
Accounts payable 10,522 8,150
Accounts payable to affiliates 4,651 4,670
Accrued interest 12,901 12,051
Accrued expenses 4,283 3,559
Tenant deposits 4,011 4,272
Unearned rent 2,820 2,800
- ---------------------------------------------------------------------------------------------------------------------------
Total liabilities 1,079,051 944,824
- ---------------------------------------------------------------------------------------------------------------------------
Redeemable units, at redemption value 255,011 282,597
Preferred units:
Series A Preferred Units 125,000 125,000
Series B Preferred Units 100,000 -0-
Partners' capital excluding redeemable units 305,084 404,127
- ---------------------------------------------------------------------------------------------------------------------------
$ 1,864,146 $ 1,756,548
- ---------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF INCOME
(Amounts in Thousands, Except Per Share Data)
For the Years Ended December 31, 1999, 1998, 1997
--------- --------- ---------
1999 1998 1997
--------- --------- ---------
Revenue:
Base rent $ 225,781 $ 206,234 $ 154,063
Base rent from affiliates 1,460 1,027 879
Percentage rent 4,683 4,002 2,161
Tenant recoveries 32,913 31,573 17,349
Other 17,727 14,531 9,674
--------- --------- ---------
Total revenue 282,564 257,367 184,126
--------- --------- ---------
Property operating expenses:
General operating expenses 20,324 20,590 12,603
Salaries and benefits 14,547 12,600 10,283
Repairs and maintenance 27,664 24,795 18,669
Taxes, licenses, and insurance 23,061 22,312 15,578
General and administrative 8,758 7,675 6,448
Depreciation 52,913 46,841 31,956
Amortization 2,272 1,806 1,322
--------- --------- ---------
Total operating expenses 149,539 136,619 96,859
--------- --------- ---------
--------- --------- ---------
Income from operations 133,025 120,748 87,267
--------- --------- ---------
Other income (expense):
Interest expense (57,211) (52,063) (40,496)
Income (loss) from partially owned entities 2,045 (43) 502
Gains (losses) from sales of property 7,444 (19) 2,567
--------- --------- ---------
Total other expense (47,722) (52,125) (37,427)
--------- --------- ---------
Income before extraordinary items 85,303 68,623 49,840
Extraordinary loss from early extinguishment of debt (628) (401) (3,650)
--------- --------- ---------
Net income 84,675 68,222 46,190
Distributions to preferred unitholders (18,531) (10,938) (1,671)
--------- --------- ---------
--------- --------- ---------
Net income available to common unitholders 66,144 57,284 44,519
--------- --------- ---------
Basic and Diluted net income per unit:
Income before extraordinary item $ 1.90 $ 1.65 $ 1.64
Extraordinary loss from early extinguishment of debt (0.02) (0.01) (0.09)
--------- --------- ---------
Net income per common unit $ 1.88 $ 1.64 $ 1.55
--------- --------- ---------
Weighted average common units outstanding 35,183 34,944 28,719
--------- --------- ---------
The accompanying notes are an integral part of these financial statements.
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL
(Amounts in Thousands)
For the Years Ended December 31, 1999, 1998, 1997
Total
Partners'
Capital
--------
Balance, December 31, 1996 $ 157,090
Cash contributions 221,873
Distributions (59,471)
Net income 44,519
Issuance of limited partnership units 45,079
Allocations to redeemable units (43,393)
--------
Balance, December 31, 1997 $ 365,697
Cash contributions 142,243
Distributions (76,545)
Net income 57,284
Earnings in minority interest property 153
Issuance of limited partnership units 23,400
Allocations to redeemable units 16,895
--------
Balance, December 31, 1998 $ 529,127
Cash contributions 3,686
Issuance of preferred units 97,406
Distributions (86,295)
Redemption of partnership units (122,144)
Net income 66,144
Earnings in minority interest property 82
Issuance of limited partnership units 14,493
Allocations to redeemable units 27,585
--------
Balance, December 31, 1999 $ 530,084
--------
COLONIAL REALTY LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Thousands)
For the Years Ended December 31, 1999, 1998, 1997
1999 1998 1997
--------- --------- ---------
Cash flows from operating activities:
Net income $ 84,675 $ 68,222 $ 46,190
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 55,185 48,647 33,278
Income from partially owned entities (2,045) (110) (502)
(Gains) losses from sales of property (7,444) 19 (2,567)
Other, net 1,767 336 4,204
Decrease (increase) in:
Restricted cash 263 (232) (215)
Accounts receivable (2,594) (4,287) (2,620)
Prepaid expenses 805 (75) 879
Other assets (4,027) 729 424
Increase (decrease) in:
Accounts payable 2,353 (1,413) (3,191)
Accrued interest 850 5,525 1,061
Accrued expenses and other (179) (2,967) (5,421)
--------- --------- ---------
Net cash provided by operating activities 129,609 114,394 71,520
--------- --------- ---------
Cash flows from investing activities:
Acquisition of properties (45,164) (312,585) (301,931)
Development expenditures (98,414) (62,075) (37,589)
Development expenditures paid to an affiliate (84,256) (40,347) (46,481)
Tenant improvements (8,424) (4,140) (2,792)
Capital expenditures (18,867) (24,982) (12,325)
Proceeds from sales of property, net of selling costs 119,552 52,238 54,092
Distributions from partnerships 8,821 32,314 719
Capital contributions to partnerships (5,237) (5,850) (320)
--------- --------- ---------
Net cash used in investing activities (131,989) (365,427) (346,627)
--------- --------- ---------
Cash flows from financing activities:
Principal reductions of debt (59,507) (31,725) (122,880)
Proceeds from additional borrowings 136,200 173,976 175,246
Net change in revolving credit balances 53,848 57,403 68,271
Proceeds from preferred unit issuance, net of expenses paid 97,396 -0- -0-
Cash contributions 3,686 142,243 221,873
Repurchase of treasury units (122,136) -0- -0-
Distributions to common and preferred unitholders (104,826) (87,483) (61,142)
Payment of mortgage financing cost (1,607) (3,734) (1,417)
Other, net (626) 401 (3,650)
--------- --------- ---------
Net cash provided by financing activities 2,428 251,081 276,301
--------- --------- ---------
Increase in cash and equivalents 48 48 1,194
Cash and equivalents, beginning of period 4,582 4,534 3,340
--------- --------- ---------
Cash and equivalents, end of period $ 4,630 $ 4,582 $ 4,534
--------- --------- ---------
Supplemental disclosures of cash flow information:
Cash paid during the year for interest $ 56,361 $ 46,538 $ 39,435
--------- --------- ---------
The accompanying notes are an integral part of these financial statements.
1. Organization and Basis of Presentation
Organization - Colonial Realty Limited Partnership (the "Operating
Partnership" or "CRLP"), a Delaware limited partnership, was formed on August 6,
1993, to succeed as owner of substantially all of the predecessor interest of
Colonial Properties, Inc. (CPI), Equity Partners Joint Venture, and Colonial
Properties Management Association, and certain real estate interest of Thomas H.
Lowder, Robert E. Lowder, James K. Lowder, Catherine K. Lowder, and the Bellwood
Trust (collectively referred to as the Colonial Group for purposes of these
financial statements). CRLP is the operating partnership of Colonial Properties
Trust, an Alabama real estate investment trust (the "Company") whose shares are
listed on the New York Stock Exchange ("NYSE"). CRLP is engaged in the
ownership, development, management, and leasing of multifamily housing
communities, retail malls and centers, and office buildings. Certain parcels of
land are also included.
Federal Income Tax Status -No provision for income taxes is provided
since all taxable income or loss or tax credits are passed through to the
partners. The Company, which is considered a corporation for federal income tax
purposes, qualifies as a real estate investment trust ("REIT") for federal
income tax purposes and generally will not be subject to federal income tax to
the extent it distributes its REIT taxable income to its shareholders. REITs are
subject to a number of organizational and operational requirements. If the
Company fails to qualify as a REIT in any taxable year, the Company will be
subject to federal income tax on its taxable income at regular corporate rates.
Principles of Consolidation - The consolidated financial statements
include the Operating Partnership and Colonial Properties Services Limited
Partnership (in which CRLP holds 99% general and limited partner interests).
Investments in Partially Owned Entities - Partnerships and corporations
in which CRLP owns a 50% or less interest and does not control are reflected in
the consolidated financial statements as investments accounted for under the
equity method. Under this method the investment is carried at cost plus or minus
equity in undistributed earnings or losses since the date of acquisition.
2. Summary of Significant Accounting Policies
Land, Buildings, and Equipment - Land, buildings, and equipment is
stated at the lower of cost, less accumulated depreciation, or net realizable
value. Where an impairment of a property's value is determined to be other than
temporary, an allowance for the estimated potential loss is established to
record the property at its net realizable value. Depreciation is computed using
the straight-line method over the estimated useful lives of the assets, which
range from seven to 40 years. Repairs and maintenance are charged to expense as
incurred. Replacements and improvements are capitalized and depreciated over the
estimated remaining useful lives of the assets. When items of land, buildings,
or equipment are sold or retired, the related cost and accumulated depreciation
are removed from the accounts and any gain or loss is included in the results of
operations.
Undeveloped Land and Construction in Progress - Undeveloped land and
construction in progress is stated at the lower of cost or net realizable value.
CRLP capitalizes all costs associated with land development and construction.
Capitalization of Interest - CRLP capitalizes interest during periods
in which property is undergoing development activities necessary to prepare the
asset for its intended use.
Cash and Equivalents - CRLP includes highly liquid marketable
securities and debt instruments purchased with a maturity of three months or
less in cash equivalents.
Restricted Cash - Cash which is legally restricted as to use consists
primarily of tenant deposits.
Deferred Debt and Lease Costs - Amortization of debt costs is recorded
using the straight-line method, which approximates the effective interest
method, over the terms of the related debt. Leasing commissions and fees are
amortized using the straight-line method over the terms of the related leases.
Derivatives - CRLP has only limited involvement with derivative
financial instruments and does not use them for trading purposes. Interest rate
cap agreements and interest rate swaps are used to reduce the potential impact
of increases in interest rates on variable-rate debt. Premiums paid for
purchased interest rate cap agreements are amortized to expense over the terms
of the caps. Unamortized premiums are included in other assets in the balance
sheets. Amounts receivable under cap agreements are accrued as a reduction of
interest expense. Payments under interest rate swap agreements are recognized as
adjustments to interest expense as incurred. Treasury lock agreements are used
by CRLP to set interest rates in anticipation of public debt offerings. Any
gains or losses related to treasury locks are included in deferred debt and
lease cost on the balance sheet and amortized over the life of the related debt
to the extent that such treasury locks are utilized. All unutilized treasury
locks are expensed when their future utility expires. All treasury locks were
utilized during 1999 and 1998.
Revenue Recognition - Rental income attributable to leases is
recognized on a straight-line basis over the terms of the leases. Anticipated
losses, if any, are recognized when such amounts become known, or estimated.
Net Income Per Unit - Basic net income per unit is calculated by
dividing the net income available to common unitholders by the weighted average
numbers of common units outstanding during the periods. Diluted net income per
unit is calculated by dividing the net income available to common unitholders by
the weighted average numbers of common units outstanding during the periods,
adjusted for the assumed conversion of all potentially dilutive securities.
Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the reported amounts of revenues and expenses. Actual results
could differ from those estimates.
Recently Issued Accounting Standard - Statement of Financial Accounting
Standards No. 133 (SFAS 133), Accounting for Derivative Instruments and Hedging
Activities, addresses the accounting for derivative instruments, including
certain derivative instruments embedded in other contracts, and hedging
activity. Under SFAS 133, CRLP will be required to account for derivative
financial instruments, if any, at their fair market value, and make certain
required disclosures. CRLP is required to adopt SFAS 133 for periods beginning
January 1, 2001.
Segment Reporting - Reportable segments are identified based upon
management's approach for making operating decisions and assessing performance
of CRLP.
Software Development - CRLP capitalizes certain internally developed
software costs. Costs capitalized in connection with internal software
development are amortized using the straight-line method over the estimated
useful lives of the software.
Common Unit Repurchases - During 1999, CRLP's Board of Trustees
authorized a common unit repurchase program under which CRLP may repurchase up
to $150 million of its currently outstanding common units from time to time ad
the discretion of management in open market and negotiated transactions. During
1999, CRLP repurchased 4,612,815 units at an all in cost of $122.1 million.
These units are included as a reduction of partners' capital.
Reclassifications - Certain immaterial reclassifications have been made
to the 1998 and 1997 financial statements in order to conform them to the 1999
financial statement presentation. These reclassifications have no impact on
partners' capital or net income.
3. Property Acquisitions and Dispositions
CRLP acquired two operating properties during 1999, 12 properties
during 1998, and 25 properties during 1997 at aggregate costs of $45.8 million,
$348.6 million, and $430.6 million, respectively. CRLP funded these acquisitions
with cash proceeds from its public offerings of equity (see Note 10) and debt
(see Note 8), advances on bank lines of credit, the issuance of limited
partnership units in CRLP, the proceeds received from the formation of joint
ventures (see Note 6), the proceeds received from the issuance of preferred
units in CRLP (see Note 9), and cash from operations.
The properties acquired during 1999, 1998, and 1997 are listed below:
Effective
Acquisition
Location Date
--------------------------------
Multifamily Properties:
Colonial Village at Trussville Birmingham, AL April 1, 1997
Colonial Village at Timothy Woods Athens, GA July 1, 1997
Colonial Grand at Oakleigh Pensacola, FL July 1, 1997
Colonial Grand at Natchez Trace Jackson, MS August 1, 1997
Colonial Village at Caledon Wood Greenville, SC October 1, 1997
Colonial Village at Ashley Plantation Bluffton, SC May 1, 1998
Colonial Village at Haverhill San Antonio, TX July 1, 1998
Colonial Village at Walton Way Augusta, GA July 1, 1998
Colonial Village at River Hills I Tampa, FL July 1, 1998
Office Properties:
Riverchase Center Birmingham, AL January 1, 1997
Lakeside Office Park Huntsville, AL May 23, 1997
Progress Center Huntsville, AL June 24, 1997
Colonial Center at Mansell Overlook Atlanta, GA July 31, 1997
Perimeter Corporate Park Huntsville, AL January 1, 1998
Independence Plaza Birmingham, AL January 1, 1998
Shades Brook Building Birmingham, AL July 1, 1998
Colonial Center 200 Mansell Overlook Atlanta, GA July 1, 1998
Concourse Center Tampa, FL July 1, 1998
Emmett R. Johnson Building Birmingham, AL June 1, 1999
Retail Properties:
Colonial Shoppes Inverness Birmingham, AL March 24, 1997
Colonial Promenade Beechwood Athens, GA March 27, 1997
Brookwood Village Birmingham, AL May 13, 1997
Colonial Promenade Lakewood Jacksonville, FL October 1, 1997
Colonial Mall Glynn Place Brunswick, GA November 1, 1997
Colonial Mall Lakeshore Gainesville, GA November 1, 1997
Colonial Shoppes Yadkin Yadkinville, NC November 1, 1997
Colonial Mall Valdosta Valdosta, GA November 1, 1997
Colonial Mall Burlington Burlington, NC November 1, 1997
Mayberry Mall Mount Airy, NC November 1, 1997
Colonial Shoppes Quaker Village Greensboro, NC November 1, 1997
Colonial Shoppes Stanly Locust, NC November 1, 1997
Rivermont Shopping Center Chattanooga, TN November 1, 1997
Colonial Mall Staunton Staunton, VA November 1, 1997
Colonial Promenade Abingdon Abingdon, VA November 1, 1997
Village at Roswell Summit Atlanta, GA December 31,1997
Orlando Fashion Square Orlando, FL May 29, 1998
Shoppes at Mansell Atlanta, GA July 1, 1998
Colonial Mall Bel Air Mobile, AL December 29,1998
The Plaza Mall Greenville, NC August 1, 1999
In addition to the acquisition of the operating properties mentioned
above, CRLP also acquired a parcel of land in October 1999 through the issuance
of 388,898 limited partnership units valued at $10.3 million.
Results of operations of these properties, subsequent to their
respective acquisition dates, are included in the consolidated financial
statements of CRLP. The cash paid to acquire these properties is included in the
statements of cash flows. The acquisitions during 1999, 1998, and 1997 are
comprised of the following:
(in thousands) 1999 1998 1997
--------- --------- ---------
Assets purchased:
Land, buildings, and equipment $ 56,026 $ 348,564 $ 430,614
Other assets 60 0 4
--------- --------- ---------
56,086 348,564 430,618
Notes and mortgages assumed 0 (7,509) (74,910)
Other liabilities assumed or recorded (660) (5,070) (8,716)
Issuance of limited partnership units (10,262) (23,400) (45,061)
--------- --------- ---------
Cash paid $ 45,164 $ 312,585 $ 301,931
--------- --------- ---------
During 1999, CRLP disposed of seven multifamily properties,
representing 2,319 units, which included Colonial Grand at Kirkman, Colonial
Village at Stockbridge, Colonial Grand at Barrington Club, Colonial Grand at
Ponte Vedra, Colonial Village at River Hills, Colonial Grand at Mountain Brook,
and Colonial Village at Cahaba Heights. The properties were sold for a total
purchase price of $119.8 million, of which $15.0 million was used to repay two
secured loans, and the remaining proceeds were used to repay a portion of the
borrowings under CRLP's unsecured line of credit, fund additional acquisitions,
and to support CRLP's future investment activities.
CRLP sold six of these properties to a joint venture formed by CRLP and
an unrelated party. CRLP will maintain a 15% interest in the joint venture and
serve as manager of the properties. CRLP accounts for its 15% interest in this
joint venture as an equity investment (see Note 6).
During 1998, CRLP sold Orlando Fashion Square to a joint venture
equally owned by CRLP and an unrelated party. Proceeds received from this
contribution were used to fund additional acquisitions and developments. CRLP
accounts for its 50% interest in this joint venture as an equity investment (see
Note 6).
CRLP's unaudited pro forma results of operations, assuming these
acquisitions and dispositions had been effected by CRLP prior to January 1,
1998, are as follows:
For the Year For the Year
Ended December Ended December
December 31, 1999 December 31, 1998
(in thousands) (unaudited) (unaudited)
Revenues $ 279,953 $ 265,903
Net income available to common unitholders $ 60,868 $ 58,275
Net income per unit - basic and diluted $ 1.86 $ 1.67
4. Land, Buildings, and Equipment
Land, buildings, and equipment consists of the following at December
31, 1999 and 1998:
(in thousands)
1999 1998
----------- -----------
Buildings $ 1,464,148 $ 1,416,937
Furniture and fixtures 46,108 43,074
Equipment 14,106 12,027
Land improvements 36,631 35,580
Tenant improvements 23,290 18,733
----------- -----------
1,584,284 1,526,351
Accumulated depreciation (206,451) (169,522)
----------- -----------
1,377,833 1,356,829
Land 208,500 210,010
----------- -----------
$ 1,586,332 $ 1,566,840
=========== ===========
5. Undeveloped Land and Construction in Progress
During 1999 CRLP completed the construction of six multifamily
development projects, two office development projects, and one office
redevelopment project at a combined total cost of $112.0 million. The
multifamily development projects produced 1,126 new apartment units that were
completed during 1999 and 1998, and the office development projects produced
279,540 square feet of new office space, which was also completed in 1999 and
1998. The completed development projects are as follows:
Total
Units/ Total
Completed Developments Location Sq. Feet Cost
and Redevelopments: -------------- ------- --------
Multifamily Properties
Colonial Grand at Citrus Park Tampa, FL 176 $ 12,706
Colonial Grand at Cypress Crossing Orlando, FL 250 21,585
Colonial Grand at Edgewater II Huntsville, AL 192 12,770
Colonial Grand at Inverness Lakes II Mobile, AL 132 8,317
Colonial Grand at Lakewood Ranch Bradenton, FL 288 22,552
Colonial Grand at Wesleyan II Macon, GA 88 6,958
------- --------
1,126 $ 84,888
------- --------
Office Properties
1800 International Park Birmingham, AL 146,128 13,744
Colonial Center at Research Park Huntsville, AL 133,412 11,494
------- --------
279,540 $ 25,238
------- --------
Redevelopment
Colonial Plaza Birmingham, AL 178,617 1,852
--------
Total $111,978
========
CRLP currently has 13 active expansion, development, and redevelopment
projects in progress and various parcels of land available for expansion,
construction, or sale. During 1999 CRLP completed construction on 1,404
apartment units (including the remaining units completed in the projects
mentioned above), and CRLP has an additional 1,290 apartment units in progress
at December 31, 1999. Also, CRLP has 161,637 and 712,233 square feet of new
office and retail space, respectively, in progress at December 31, 1999.
Undeveloped land and construction in progress is comprised of the following at
December 31, 1999:
Total Costs
Units/ Estimated Capitalized
Square Estimated Total Costs To Date
Feet Completion (in thousands) (in thousands)
----------- ------------ ------------- ------------
Multifamily Projects:
Colonial Grand at Heather Glen 448 2000 $ 34,171 $ 32,318
Colonial Grand at Liberty Park 300 2001 26,492 20,312
Colonial Grand at Promenade 384 2000 27,189 24,310
Colonial Grand at Madison 336 2000 22,983 21,476
Colonial Grand at Reservoir 170 2000 13,552 10,786
Colonial Village at Ashley Plantation II 214 2000 13,147 12,905
(expansion)
Colonial Village at Walton Way (redevelopment) 256 2000 2,900 2,856
---- -------- --------
Total Multifamily Projects 2,108 140,434 124,963
Office Projects:
Colonial Center 300 at Mansell Overlook 161,637 2001 23,435 9,471
---- -------- --------
Total Office Projects 161,637 23,435 9,471
Retail Projects:
Colonial Promenade at Trussville 388,302 2000 33,300 21,879
Colonial Promenade at Tutwiler Farm 213,111 2000 26,221 11,502
Colonial Promenade Madison 110,820 2000 9,988 2,891
Brookwood Village Mall (redevelopment) 750,754 2001 34,950 1,692
Northdale Court (redevelopment) 192,726 2000 3,166 1,084
---- -------- --------
Total Retail Projects 1,655,713 107,625 39,048
Other Projects and Undeveloped Land 40,561
-------- --------
$271,494 $214,043
======== ========
Interest capitalized on construction in progress during 1999, 1998, and
1997 was $8.7 million, $3.7 million, and $4.1 million, respectively.
6. Investment in Partially Owned Entities
Investment in partially owned entities at December 31, 1999 and 1998
consists of the following:
(in thousands)
Percent
Owned 1999 1998
----------- ------------- -------------
Multifamily:
CMS/Colonial Joint Venture 15.00% $ 2,789 $ 0
Office:
600 Building Partnership, Birmingham, AL 33.33% (16) (30)
Anderson Block Properties Partnership,
Montgomery, AL 33.33% (2) (24)
------------- ------------
(18) (54)
Retail:
Orlando Fashion Square Joint Venture, Orlando, FL 50.00% 19,777 20,241
Parkway Place Limited Partnership, Huntsville, AL 50.00% 2,035 5,858
------------- ------------
21,812 26,099
Other:
Colonial/Polar-BEK Management Company,
Birmingham, AL 50.00% 40 33
------------- ------------
$ 24,623 $ 26,079
=============== =============
During September 1999, CRLP entered into a joint venture with CMS. The
CMS/Colonial Joint Venture owns and operates six multifamily properties
consisting of the following properties: Colonial Village at Stockbridge,
Colonial Grand at Barrington Club, Colonial Grand at Ponte Vedra, Colonial
Village at River Hills, Colonial Grand at Mountain Brook, and Colonial Village
at Cahaba Heights. CRLP's net investment in the joint venture at December 31,
1999 is $2.8 million. The joint venture is accounted for using the equity
method.
During December 1998, CRLP entered into two joint ventures. The Parkway
Place Limited Partnership owns and operates the Parkway City Mall in Huntsville,
Alabama. At December 31, 1999 and 1998, CRLP had a net ending investment of $2.0
million and $5.9 million, respectively. The Orlando Fashion Square Joint Venture
owns and operates the Orlando Fashion Square in Orlando, Florida. CRLP's net
ending investment in this joint venture at December 31, 1999 and 1998 is $19.8
million and $20.2 million, respectively. Both joint ventures are accounted for
using the equity method.
The summarized financial information related to the significant joint
ventures is as follows:
Balance Sheet
Assets
Land, building, & equipment, net $ 211,045
Construction in progress 6,399
Other assets 3,855
------------------
Total assets $ 221,299
==================
Liabilities and Partners' Equity
Notes payable $ 150,893
Other liabilities 11,446
Partners' Equity 58,960
------------------
Total liabilities and partners' capital $ 221,299
==================
Statement of Operations
(for the year ended)
Revenues $ 27,207
Operating expenses (12,061)
Interest expense (7,093)
Depreciation and amortization (4,811)
------------------
Net income $ 3,242
==================
7. Segment Information
CRLP is organized into, and manages its business based on the
performance of three separate and distinct operating divisions: Multifamily,
Office, and Retail. Each division has a separate management team that is
responsible for acquiring, developing, managing, and leasing properties within
each division. The applicable accounting policies of the segments are the same
as those described in the "Summary of Significant Accounting Policies."
Management evaluates the performance of its segments and allocates resources to
them based on net operating income (NOI). NOI consists of revenues in excess of
general operating expenses, salaries and wages, repairs and maintenance, taxes,
licenses, and insurance. Segment information for the years ended December 31,
1999, 1998, and 1997 is as follows:
(in thousands)
1999 Multifamily Office Retail Total
- -----------------------------------------------------------------
Divisional revenues $115,724 $ 40,988 $124,845 $ 281,557
NOI 75,929 29,005 90,967 195,901
Divisional assets 768,798 289,288 739,518 1,797,604
1998
- -----------------------------------------------------------------
Divisional revenues $104,462 $ 34,409 $117,572 $ 256,443
NOI 68,789 24,307 83,059 176,155
Divisional assets 783,097 240,161 683,042 1,706,300
1997
- -----------------------------------------------------------------
Divisional revenues $ 95,503 $ 16,224 $ 71,179 $ 182,906
NOI 62,658 11,615 51,500 125,773
Divisional assets 652,923 147,974 577,954 1,378,851
A reconciliation of total segment revenues to total revenues, total
segment NOI to income from operations, and total divisional assets to total
assets, for the years ended December 31, 1999, 1998, and 1997, is presented
below:
(in thousands)
Revenues 1999 1998 1997
- -----------------------------------------------------------------------------------------------
Divisional revenues $ 281,557 $ 256,443 $ 182,906
Unallocated corporate revenues 1,007 924 1,220
- -----------------------------------------------------------------------------------------------
Total revenues $ 282,564 $ 257,367 $ 184,126
- -----------------------------------------------------------------------------------------------
NOI 1999 1998 1997
- -----------------------------------------------------------------------------------------------
Total divisional NOI $ 195,901 $ 176,155 $ 125,773
Unallocated corporate revenues 1,007 924 1,220
General and administrative (8,758) (7,675) (6,448)
Depreciation (52,913) (46,841) (31,956)
Amortization (2,272) (1,806) (1,322)
Other 60 (9) -
- -----------------------------------------------------------------------------------------------
Income from operations $ 133,025 $ 120,748 $ 87,267
- -----------------------------------------------------------------------------------------------
Assets 1999 1998 1997
- -----------------------------------------------------------------------------------------------
Total divisional assets $ 1,797,604 $ 1,706,300 $ 1,378,851
Unallocated corporate assets (1) 66,542 50,248 17,809
- -----------------------------------------------------------------------------------------------
Total assets $ 1,864,146 $ 1,756,548 $ 1,396,660
- -----------------------------------------------------------------------------------------------
(1) Includes CRLP's investment in joint ventures of $24,623 and $26,079 as of
December 31, 1999 and 1998, respectively. (see Note 6)
8. Notes and Mortgages Payable
Notes and mortgages payable at December 31, 1999 and 1998 consist of
the following:
(in thousands)
1999 1998
---------- --------
Revolving credit agreement $ 228,337 $174,489
Mortgages and other notes:
3.98% to 6.00% 66,305 66,305
6.01% to 7.50% 517,554 471,694
7.51% to 9.00% 222,785 179,187
9.01% to 10.25% 4,882 17,647
---------- --------
$1,039,863 $909,322
========== ========
As of December 31, 1999, CRLP has an unsecured bank line of credit
providing for total borrowings of up to $250 million. This line of credit
agreement bears interest at LIBOR plus 80 to 135 basis points, is renewable in
July 2000, and provides for a two-year amortization in the case of non-renewal.
The line of credit agreement includes a competitive bid feature that will allow
CRLP to convert up to $125 million under the line of credit to a fixed rate, for
a fixed term not to exceed 90 days. The credit facility is primarily used by
CRLP to finance property acquisitions and development and has an outstanding
balance at December 31, 1999, of $228.3 million. The interest rate of this
short-term borrowing facility, including the competitive bid balance, is 7.43%
and 6.42% at December 31, 1999 and 1998, respectively.
During 1999 and 1998, CRLP completed three public offerings of
unsecured medium term and senior debt securities totaling $257.5 million. The
proceeds of the offerings were used to fund acquisitions, development
expenditures, repay balances outstanding on CRLP's revolving credit facility,
repay certain notes and mortgages payable, and for general corporate purposes.
Details relating to these debt offerings are as follows:
Gross
Type of Proceeds
Date Note Maturity Rate (in thousands)
- ----------------- --------------- -------------------------- ----------------
July, 1998 Senior July, 2007 7.00% $175,000
August, 1999 Medium-term August, 2002 7.93% 57,500
August, 1999 Medium-term August, 2004 8.19% 25,000
CRLP has entered into an interest rate cap agreement which limits debt
of $50 million to an interest rate of 8.00% through May 2, 2000. CRLP paid
$227,500 for the interest rate cap, which is being amortized over the life of
the agreement. On January 4, 1999, CRLP entered into an interest rate swap for
$50 million of its line of credit at 4.97% plus 80 to 135 basis points, and on
January 15, 1999, CRLP entered into an interest rate swap for $52 million of tax
exempt bonds at a rate of 3.23%. Additionally, on May 4, 1999, CRLP entered into
an interest rate swap agreement for $25 million of its line of credit at a rate
of 5.07%. All of these interest rate swap agreements have one-year terms and any
payments made or received under the agreements are recognized as adjustments to
interest expense as incurred. On February 10, 2000, CRLP entered into two
reverse interest rate swap agreements for a total of $50 million of its
medium-term notes. Under the terms of the agreements, CRLP will receive a fixed
interest rate of 7.37% and will be required to pay a floating rate equal to one
month LIBOR that is compounded and paid semi-annually. Both of these agreements
have five-year terms, and any payments made or received under the agreements are
recognized as adjustments to interest expense. Treasury lock agreements are used
by CRLP to set interest rates in anticipation of public debt offerings. CRLP is
exposed to credit losses in the event of nonperformance by the counterparties to
its interest rate cap and nonderivative financial assets but has no
off-balance-sheet credit risk of accounting loss. CRLP anticipates, however,
that counterparties will be able to fully satisfy their obligations under the
contracts. CRLP does not obtain collateral or other security to support
financial instruments subject to credit risk but monitors the credit standing of
counterparties.
At December 31, 1999, CRLP had $839.8 million in unsecured indebtedness
including balances outstanding on its bank line of credit and certain other
notes payable. The remainder of CRLP's notes and mortgages payable are
collateralized by the assignment of rents and leases of certain properties and
assets with an aggregate net book value of $266.2 million at December 31, 1999.
The aggregate maturities of notes and mortgages payable, including
CRLP's line of credit at December 31, 1999, are as follows:
(in thousands)
2000 $ 250,662
2001 78,220
2002 74,902
2003 109,259
2004 100,000
Thereafter 426,820
------------------
$ 1,039,863
==================
Based on borrowing rates available to CRLP for notes and mortgages
payable with similar terms, the estimated fair value of CRLP's notes and
mortgages payable at December 31, 1999 and 1998 was approximately $1.05 billion
and $912.6 million, respectively.
Certain loan agreements of CRLP contain restrictive covenants which,
among other things, require maintenance of various financial ratios. At December
31, 1999, CRLP was in compliance with those covenants.
Certain partners of CRLP have guaranteed indebtedness of CRLP totaling
$26.0 million at December 31, 1999. These individuals have not been indemnified
by CRLP.
9. Cash Contributions
During 1999, 1998 and 1997, CRLP completed seven public offerings of
common stock totaling 7,975,070 common shares of beneficial interest and one
public offering of preferred stock of 5,000,000 shares. The proceeds of the
offerings were used to fund acquisition and development expenditures, repay
balances outstanding on CRLP's revolving credit agreement, repay certain notes
and mortgages payable, and for general corporate purposes. Details relating to
these equity offerings are as follows:
(in thousands)
------------------------------------------
Type of Number of Price Per Gross Offering Net
Date Offering Shares Share Proceeds Costs Proceeds
- ----------------- --------------- -------------------- --------------- ------------- ------------ ------------
January, 1997 Common 1,500,000 $ 29.8750 $ 44,812 $ 1,457 $ 43,355
July, 1997 Common 1,700,000 $ 30.9375 $ 52,594 $ 2,945 $ 49,649
November, 1997 Preferred 5,000,000 $ 25.0000 $ 125,000 $ 4,451 $ 120,549
December, 1997 Common 165,632 $ 30.1875 $ 5,000 $ 330 $ 4,670
February, 1998 Common 375,540 $ 30.0000 $ 11,266 $ 627 $ 10,639
March, 1998 Common 806,452 $ 31.0000 $ 25,000 $ 1,389 $ 23,611
March, 1998 Common 381,046 $ 31.0000 $ 11,812 $ 656 $ 11,156
April, 1998 Common 3,046,400 $ 30.1250 $ 91,773 $ 4,973 $ 86,800
In February 1999, CRLP issued 2.0 million units of $50 par value 8.875%
Series B Cumulative Redeemable Perpetual Preferred Units (Preferred Units),
valued at $100 million in a private placement. CRLP has the right to redeem the
Preferred Units, in whole or in part, after five years at the cost of the
original capital contribution plus the cumulative priority return, whether or
not declared. The Preferred Units are exchangeable for 8.875% Series B Preferred
Shares of CRLP after ten years at the option of the holders of the Preferred
Units. The proceeds of the issuance, net of offering costs of $2.6 million were
used to repay balances outstanding on CRLP's revolving credit agreement and to
fund development, acquisition, and expansion expenditures.
In November 1997, CRLP completed its first public offering of
preferred stock totaling 5,000,000 preferred shares of beneficial interest of
Colonial Properties Trust (Preferred Shares). The Series A Preferred Shares pay
a quarterly dividend at 8.75% per annum and may be called by CRLP on or after
November 6, 2002. The Preferred Shares have no stated maturity, sinking fund or
mandatory redemption and are not convertible into any other securities of CRLP.
The preferred shares have a liquidation preference of $25.00 per share.
10. Employee Benefits
Employees of CRLP and Colonial Properties Services, Inc. ("CPSI")
participate in a noncontributory defined benefit pension plan designed to cover
substantially all employees. Pension expense includes service and interest costs
adjusted by actual earnings on plan assets and amortization of prior service
cost and the transition amount. The benefits provided by this plan are based on
years of service and the employee's final average compensation. CRLP's policy is
to fund the minimum required contribution under ERISA and the Internal Revenue
Code.
The table below presents a summary of pension plan status as of
December 31, 1999 and 1998, as it relates to the employees of CRLP and CPSI, and
the actuarial assumptions used in determining the actuarial present value of
accumulated benefit obligations at January 1, 1999, are as follows:
(amounts in thousands) 1999 1998
- --------------------------------------------------------- --------- ---------
Actuarial present value of accumulated benefit obligation
including vested benefits of $1,030 and $1,193 $ 1,312 $ 1,368
at December 31, 1999 and 1998, respectively
Actuarial present value of projected benefit obligations
at year end $ 2,538 $ 2,593
Fair value of assets at year end $ 1,030 $ 981
Accrued pension cost $ 1,481 $ 868
Net pension cost for the year $ 613 $ 393
1999 1998
--------- ---------
Weighted-average interest rate 8.00% 6.75%
- -------------------------------------------------------------------------------
Increase in future compensation levels 4.25% 4.00%
CRLP and CPSI participate in a salary reduction profit sharing plan
covering substantially all employees. This plan provides, with certain
restrictions, that employees may contribute a portion of their earnings with
CRLP and CPSI matching one-half of such contributions, solely at CRLP and CPSI's
discretion. Contributions by CRLP and CPSI were approximately $275,000,
$178,000, and $159,000 for the years ended December 31, 1999, 1998 and 1997,
respectively.
11. Leasing Operations
CRLP is in the business of leasing and managing multifamily, office,
and retail property. For properties owned by CRLP, minimum rentals due in future
periods under noncancelable operating leases extending beyond one year at
December 31, 1999, are as follows:
(in thousands)
-----------------
2000 $ 119,773
2001 106,511
2002 93,974
2003 78,644
2004 65,065
Thereafter 220,648
-----------------
$ 684,615
=================
The noncancelable leases are with tenants engaged in retail and office
operations in Alabama, Georgia, Florida, North Carolina, South Carolina,
Tennessee, and Virginia. Performance in accordance with the lease terms is in
part dependent upon the economic conditions of the respective areas. No
additional credit risk exposure relating to the leasing arrangements exists
beyond the accounts receivable amounts shown in the December 31, 1999 balance
sheet. Leases with tenants in multifamily properties are generally for one year
or less and are thus excluded from the above table. Substantially all of CRLP's
land, buildings, and equipment represent property leased under the above and
other short-term leasing arrangements.
Rental income for 1999, 1998, and 1997 includes percentage rent of $4.7
million,$4.0 million and $2.2 million, respectively. This rental income was
earned when certain retail tenants attained sales volumes specified in their
respective lease agreements.
12. Related Party Transactions
CRLP has generally used affiliated construction companies to manage and
oversee its development and expansion projects. CRLP paid $62.8 million, $40.0
million and $41.3 million for property development costs to Lowder Construction
Company, Inc., a construction company owned by The Colonial Company ("TCC") (an
affiliate of certain shareholders, trustees and minority interest holders),
during the years ended December 31, 1999, 1998, and 1997, respectively. Of these
amounts, $58.5 million, $37.3 million, and $39.8 million was then paid to
unaffiliated subcontractors for the construction of these development and
expansion projects during 1999, 1998, and 1997, respectively. CRLP had
outstanding construction invoices and retainage payable to Lowder Construction
Company, Inc. totaling $5.7 million and $4.3 million at December 31, 1999 and
1998, respectively. CRLP also paid $21.5 million, $0.4 million and $5.2 million
for property construction costs to a construction company owned by a trustee
during the years ended December 31, 1999, 1998, and 1997, respectively. Of these
amounts, $19.4 million, $0.4 million, and $4.7 million was then paid to
unaffiliated subcontractors for the construction of these development projects
during 1999, 1998, and 1997, respectively. CRLP had outstanding construction
invoices and retainage payable to this construction company totaling $0.7
million and $1.2 million at December 31, 1999 and 1998, respectively.
Colonial Commercial Investments, Inc. ("CCI"), which is owned by
trustees James K. Lowder and Thomas H. Lowder has guaranteed indebtedness
totaling $1.1 million at December 31, 1999 for Anderson Block Properties, which
is a partnership accounted for by CRLP under the equity method (listed in Note
6). CRLP has indemnified CCI from its guarantees of this indebtedness.
On July 1, 1998, CRLP acquired a 79.8% interest in Colonial Village at
Haverhill. Effective May 1999, CRLP purchased the remaining 20.2% interest in
this property by issuing 157,140 limited partnership units to the seller. The
seller is a trustee of CRLP.
In connection with the Riverchase Center acquisition, CRLP initially
acquired a 73% interest in a portion of the office complex. Effective November
1, 1997, CRLP purchased the remaining 27% interest in the property by issuing
114,798 limited partnership units to the seller. The seller is a trustee of
CRLP.
In November 1997, CRLP purchased Polar BEK's 50% interest in Polar
BEK/Colonial Partnership I (a partnership previously accounted for under the
equity method of accounting), a partnership which owned a 168,000 square foot
office building in Birmingham for $7.4 million. This purchase increased CRLP's
ownership from 50% to 100%.
Following is a summary of property acquisitions from entities for which
trustees of CRLP are involved as a partner or shareholder:
Date Property and Land Acquired Purchase Price Units Issued
- ----------------------- ------------------------------------------ ------------------- ----------------------
May 1999 Colonial Village at Haverhill $4.2 million(1) 157,140 CRLP Units
November 1998 Colonial Center at Research Park $1.0 million 36,647CRLP Units
September 1998 1800 International Park $1.8 million (2)
October 1998 Colonial Grand at Promenade $1.5 million 34,700 CRLP Units
July 1998 Colonial Center 100 at Mansell Overlook $27.7 million 396,365 CRLP Units
July 1998 Shoppes at Mansell $3.7 million 76,809 CRLP Units
March 1997 Colonial Shoppes Inverness $3.0 million 16,303 CRLP Units
April 1997 Colonial Village at Trussville $20.5 million 57,072 CRLP Units
July 1997 Colonial Village at Timothy Woods $12.8 million 27,275 CRLP Units
August 1997 Colonial Grand at Inverness Lakes II $0.5 million 10,822 CRLP Units
November 1997 Riverchase Center $3.4 million 114,798 CRLP Units
December 1997 Village at Roswell Summit $3.0 million 34,777 CRLP Units
(1) Represents the remaining 20.2% interest in the property.
(2) In connection with purchase, CRLP issued a $1.8 million note payable to a
related entity, which was repaid in 1999.
During 1997 CRLP, through CPSI, exercised options to purchase land from
a related party in the amount of $366,000. As of December 31, 1998, all options
to purchase land from a related party had expired. In December 1997, CPSI
acquired a parcel of land from CCI and sold the land, along with an adjoining
parcel of land, to an unaffiliated third party for a net gain of $60,000. Also
in December 1997, CPSI sold a separate parcel of land to CCI, which resulted in
a net gain of $120,000.
CRLP and its subsidiaries provide certain services to and received
certain services from related entities, which resulted in the following income
(expense) included in the accompanying statements of income:
(Amounts in thousands)
1999 1998 1997
----------------------------------
Rental income $1,460 $1,027 $879
Management/leasing fee income 262 289 368
Insurance brokerage expense (167) (131) (182)
Rental expense 0 0 (156)
13. Subsequent Events
On January 22, 2000, the Board of Trustees declared a cash distribution
to partners of CRLP in the amount of $.60 per partnership unit, totaling $19.9
million. The distribution was made to partners of record as of January 31, 2000,
and was paid on February 7, 2000.
During January 2000, CRLP initiated and completed an Executive Unit
Purchase Program (Unit Purchase Program), in which the Board of Trustees and
certain members of CRLP's management were able to purchase Units of CRLP. Under
the Unit Purchase Program, the Board of Trustees and the members of management
were able to take out full-recourse personal loans from an unrelated financial
institution, in order to purchase the Units. The Units are pledged as collateral
against the loans. In addition, CRLP has provided a guarantee to the unrelated
financial institution for the personal loans. The value of the Units purchased
under the Unit Purchase Program was approximately $10 million.
On February 7, 2000, CRLP completed an offering of unsecured
Medium-Term Notes for $25.0 million at 8.82%, which mature on February 7, 2005.
Additionally, on February 29, 2000 CRLP completed an offering of unsecured
Medium-Term Notes for $20.0 million at 8.80%, which mature on February 1, 2010.
CRLP used the net proceeds from both offerings to repay a portion of the
outstanding balance on its unsecured line of credit.
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
CRLP is managed by the Company, the general partner of CRLP. The
directors and officers of the Company are as follows:
Thomas H. Lowder, 50, has been a trustee of the Company since its
formation in July 1993. He is the chairman of the board, president and chief
executive officer of the Company. Mr. Lowder became President of Colonial
Properties, Inc., the Company's predecessor, in 1976, and since that time has
been actively engaged in the acquisition, development, management, leasing and
sale of multifamily, office and retail properties for the Company. Mr. Lowder is
a member and past president of the Alabama Chapter of the Commercial Investment
Real Estate Institute. Mr. Lowder is a member of the National Association of
Industrial Office Parks, the International Council of Shopping Centers and the
National Association of Real Estate Investment Trusts (NAREIT). He serves on the
Board of Directors of, among other organizations, the Children's Hospital of
Alabama, American Red Cross - Birmingham Area Chapter and the United Way of
Central Alabama. Mr. Lowder is a member of the Executive Committee of the Board
of Trustees and a member of the board of directors of the Management
Corporation.
Carl F. Bailey, 69, has been a trustee of the Company and a director
of Colonial Properties Services, Inc., which conducts the Company's third-party
management, leasing and brokerage operations (the "Management Corporation"),
since September 1993. Mr. Bailey is a former co-chairman of BellSouth
Telecommunications, Inc. and former chairman and chief executive officer of
South Central Bell Telephone Company, positions from which he retired in 1991.
He worked for South Central Bell in a number of capacities over the past three
and a half decades and was elected president and a member of the board of
directors in 1982. Mr. Bailey is president of BDI, a distribution company, and a
member of the board of directors of SouthTrust Corporation. Mr. Bailey serves on
the board of trustees of Birmingham Southern College. Mr. Bailey is a member of
the Executive Committee and is chairman of the Audit Committee of the Board of
Trustees.
Harold W. Ripps, 61, has been a trustee of the Company since 1995.
Together with Herbert A. Meisler, another member of the Board of Trustees, he
formed The Rime Companies, a real estate development, construction and
management firm specializing in the development of multifamily properties. In
December 1994, the Company purchased ten multifamily properties from partners
associated with The Rime Companies. While with The Rime Companies, Mr. Ripps
oversaw the development and construction of approximately 15,000 multifamily
apartment units in the southeastern United States. He is a member of the
executive committee of the Birmingham Council of Boy Scouts of America, the
Board of Trustees of Birmingham Southern College and the President's Council of
the University of Alabama in Birmingham. Mr. Ripps is a member of the Executive
Committee of the Board of Trustees and is a member of the board of directors and
the executive compensation committee of the Management Corporation.
M. Miller Gorrie, 64, has been a trustee of the Company since 1993. Mr.
Gorrie is chairman of the board and chief executive officer of Brasfield &
Gorrie, L.L.C., a general contracting firm located in Birmingham, Alabama that
is ranked consistently among ENR's "Top 100 Contractors." He serves on the board
of directors of American Cast Iron Pipe Company and is a past director of
Winsloew Furniture Co., AmSouth Bank of Alabama, the Southern Research
Institute, the Alabama Chamber of Commerce, the Associated General Contractors,
the Building Science Advisory Board of Auburn University, the Business Council
of Alabama and the United Way of Alabama. Mr. Gorrie is chairman of the
Executive Committee and is a member of the Executive Compensation Committee of
the Board of Trustees. He also is a member of the executive compensation
committee of the board of directors of the Management Corporation.
James K. Lowder, 50, has been a trustee of the Company since its
formation in July 1993. Mr. Lowder is also chairman of the board and chief
executive officer of The Colonial Company, chairman of the board of Lowder
Construction Company, Inc., chairman of the board of Lowder New Home Sales,
Inc., chairman of the board of Colonial Commercial Realty, Inc., chairman of the
board of Colonial Homes, Inc., chairman of the board of American Colonial
Insurance Company, chairman of the board and president of Colonial Commercial
Investments, Inc. and treasurer of Colonial Insurance Agency. He also is a
member of the Alabama Association of Realtors, the Montgomery Board of Realtors,
the Home Builders Association of Alabama, and the Greater Montgomery Home
Builders Association, and is a member of the board of directors of Alabama Power
Company. Mr. Lowder is a member of the Executive Compensation Committee of the
Board of Trustees. Mr. Lowder is the brother of Thomas H. Lowder.
Herbert A. Meisler, 72, has been a trustee of the Company since 1995.
Together with Mr. Ripps, he formed The Rime Companies, a real estate
development, construction and management firm specializing in the development of
multifamily properties. In December 1994, the Company purchased ten multifamily
properties from partners associated with The Rime Companies. While with The Rime
Companies, Mr. Meisler oversaw the development and construction of approximately
15,000 multifamily apartment units in the southeastern United States. He
currently serves on the board of directors of the Community Foundation of South
Alabama and the Mobile Airport Authority. He is a past director of the Alabama
Eye and Tissue Bank and past president of the Mobile Jewish Welfare Fund. Mr.
Meisler is a member of the Executive Compensation Committee (and its Option Plan
Subcommittee) and the Audit Committee of the Board of Trustees.
William M. Johnson, 53, has been a trustee of the Company since July
1997, in connection with the Company's acquisition from Mr. Johnson, by merger,
of six office buildings in Mansell 400 Business Center, the largest Class-A
multi-tenant office park in the North Fulton (Atlanta, Georgia) area, and
additional office and retail space totaling 560,600 square feet. Mr. Johnson is
president and chief executive officer of Johnson Development Company, a real
estate development, construction and management firm which he founded in 1978.
As chief executive officer, he directed the development of 1.2 million square
feet of office, warehouse, retail and hotel space having a value in excess of
$117 million. Mr. Johnson has been an active member of the Roswell United
Methodist Church and the North Fulton Chamber of Commerce, was the founding
chairman of the board of the Coalition for Drug-Free North Fulton, is a member
of the board of directors and the executive committee of the American Tract
Society Ministry, and is a member of the board of directors of Reach Out
Ministries. Mr. Johnson serves as an advisor in strategic planning for
not-for-profit agencies in Colorado, Montana, Texas and Kentucky. Mr. Johnson is
a member of the Executive Compensation Committee and Executive Committee of the
Board of Trustees of the Company.
Claude B. Nielsen, 49, has been a trustee of the Company since
September 1993. Since 1990, Mr. Nielsen has been president of Coca-Cola Bottling
Company United, Inc., headquartered in Birmingham, Alabama, serving also as
chief operating officer from 1990 to 1991 and as chief executive officer since
1991. Prior to 1990, Mr. Nielsen served as president of Birmingham Coca-Cola
Bottling Company. Mr. Nielsen is on the board of directors of AmSouth
Bancorporation. He also currently serves as a board member of the Birmingham
Civil Rights Institute and the Birmingham Airport Authority. Mr. Nielsen is
chairman of the Executive Compensation Committee and is chairman of its Option
Plan Subcommittee, and is also a member of the Executive Committee of the Board
of Trustees of the Company.
Donald T. Senterfitt, 80, has been a trustee of the Company since
September 1993. Mr. Senterfitt is a former director and vice chairman of
SunTrust Banks, Inc., a bank holding company. He is past president of the
American Bankers Association and former general counsel of the Florida Bankers
Association, and served both organizations in a variety of other capacities. Mr.
Senterfitt is president and chief executive officer of The Pilot Group, L.C., a
financial institutions consulting firm headquartered in Orlando, Florida. He is
a member of the board of directors and currently serves as president of CITE,
Inc., the Center for Independence, Technology and Education, a non-profit
organization which serves the needs of blind, visually handicapped and
multi-handicapped children and adults. Mr. Senterfitt is a member of the Audit
Committee of the Board of Trustees of the Company.
Executive Officers of the Company
Thomas H. Lowder, 50, has been President and Chief Executive Officer of
the Company and a trustee of the Company, since 1993. Mr. Lowder became
President of Colonial Properties Inc., the Company's predecessor, in 1976 and
since that time has been actively engaged in the acquisition, development,
management, leasing, and sale of multifamily, office, and retail properties for
Colonial Properties. Mr. Lowder's most recent board appointment was his election
to the National Real Estate Investment Trust (NAREIT) board in June 1999. He is
a current member of the National Association of Industrial and Office Parks, the
International Council of Shopping Centers and the National Association of the
Real Estate Investment Trusts (NAREIT). He is also a member and past president
of the Alabama Chapter of the Realtors National Marketing Institute through
which he successfully completed commercial real estate investment courses to
receive the CCIM (Certified Commercial Investment Member) designation. He is
presently a member of the Board of the following organizations: University of
Alabama-Birmingham President's Council, McWane Center, United Way, Children's
Hospital, Birmingham Southern College, The Colonial Company, Supporters Board of
the UAB Comprehensive Cancer Center and the Crippled Children's Foundation. Mr.
Lowder is also a member and past captain for the Monday Morning Quarterback
Club. He currently serves as Chairman of the Birmingham Area Chapter of the
American Red Cross. Mr. Lowder served as Co-Chairman of the 1994 United Way
Campaign for Central Alabama and as Chairman of the Alexis de Tocqueville
Society in 1995 for the United Way Campaign. He has also been nominated to serve
as Chairman for the United Way Campaign in 2001. He graduated with honors from
Auburn University with a Bachelor of Science Degree.
C. Reynolds Thompson, III, 37, Chief Operating Officer of the Company
since September 1999, responsible for the Multifamily, Office, Retail and Mixed
Use divisions. Thompson oversees the management, acquisition, leasing and
development of properties within the Company's three operating divisions and
development in the Mixed-Use Division. Prior to his appointment as Chief
Operating Officer, Mr. Thompson was Chief Investment Officer, responsible for
investment strategies, market research, due diligence, mergers and acquisitions,
joint venture development and cross-divisional acquisitions. Prior to his
position as Chief Investment Officer, Thompson served as Executive Vice
President - Office Division, with responsibility for management of all office
properties owned and/or managed by the Company, from May 1997 to May 1998. Mr.
Thompson joined Colonial Properties in February 1997 as Senior Vice President -
Office Acquisitions, with responsibility for all acquisitions of office
properties. Prior to joining Colonial, Mr. Thompson worked for CarrAmerica
Realty Corporation in office building acquisitions and due diligence. Mr.
Thompson's twelve-year real estate background includes acquisitions,
development, leasing, and management of office properties in the south. He is an
active member of the National Association of Industrial and Office Parks, serves
on the Board of Trustees for the Alabama Real Estate and Education Center, and
holds a Bachelor of Science Degree from Washington and Lee University.
Howard B. Nelson, Jr., 52, has been Chief Financial Officer of the
Company, with general responsibility for financing matters, since May 1997. Mr.
Nelson was Senior Vice President and Chief Operating Officer of the Company,
with responsibility for the day-to-day management of the Company, from September
1993 to May 1997. He joined Colonial in 1984 as a vice president and became
Senior Vice President-Finance in 1987. Mr. Nelson has served as treasurer, vice
president, president, and board member of the Birmingham Chapter of the National
Association of Industrial and Office Parks as well as vice president and board
member of the Building Owners and Managers Association of Metropolitan
Birmingham. He also serves on the Board of Directors of the College of Business
Advisory Council of Auburn University. He holds a Bachelor of Science Degree
from Auburn University.
John P. Rigrish, 51, Executive Vice President-Administration, with
responsibilities for the supervision of Accounting Operations, Management
Information Systems, Human Resources and Employee Services since 1998. Prior to
joining Colonial, Mr. Rigrish worked for BellSouth in Corporate Administration
and Services. John holds a Bachelors degree from Samford University and did his
postgraduate study at Birmingham-Southern College. He served on the Edward Lee
Norton Board of Advisors for Management and Professional Education at
Birmingham-Southern College and the Board of Directors of Senior Citizens, Inc.
in Nashville, Tennessee.
Paul F. Earle, 41, Executive Vice President-Multifamily Division of
the Company, with responsibility for management of all multifamily properties
owned and/or managed by Colonial, since May, 1997. He joined Colonial in 1991
and has served as Vice President - Acquisitions, as well as Senior Vice
President - Multifamily Division. Mr. Earle serves as Chairman of the Alabama
Multifamily Council and is an active member of the National Apartment
Association. He also serves on the Board of Directors of Big Brother/Big Sisters
and is a Board member of the National Multifamily Housing Council. Before
joining Colonial, Mr. Earle was the President and Chief Operating Officer of
American Residential Management, Inc., Executive Vice President of Great
Atlantic Management, Inc. and Senior Vice President of Balcor Property
Management, Inc.
John N. Hughey, 40, has been Executive Vice President-Retail Division
of the Company, with responsibility for all retail properties owned and/or
managed by the Company, since May 1997. He joined Colonial in 1982 and assumed
responsibility for an increasing number of shopping centers until being named to
Senior Vice President-Retail Division of Colonial in 1991. Mr. Hughey served as
the Alabama/Mississippi State Operations Chairman for the International Council
of Shopping Centers from 1993-1995. He holds a Bachelor of Science Degree from
Auburn University.
Charles A. McGehee, 53, has been Executive Vice President-Mixed Use
Division and has had responsibility for the Company's acquisitions and
dispositions and the sales brokerage departments, since October 1999. Mr.
McGehee was Senior Vice President--Multifamily Acquisitions/Development from
September 1993 to September 1999 and Senior Vice President--Office Division from
January 1990 to September 1993. He joined Colonial in 1976 as vice president of
retail leasing and was responsible for leasing all retail space owned and/or
managed by Colonial. Mr. McGehee has served as president and a board member of
the National Association of Industrial and Office Parks as well as a member of
the Board of Directors of the Birmingham Board of Realtors. He holds a Bachelor
of Science Degree from Auburn University.
Robert A. "Bo" Jackson, 45, has been Executive Vice President-Office
Division of the Company, with general responsibility for management of all
office properties owned and/or managed by the Company since May 1998. Prior to
joining the Company, Mr. Jackson worked for Beacon Properties as a vice
president responsible for leasing performance, new office development and
acquisitions. He has received professional accolades from The Atlanta Board of
Realtors, The Downtown Developers Group and NAIOP. He holds a Bachelor of
Science Degree in Business Administration from the University of Delaware.
Kenneth E. Howell, 50, has been Senior Vice President-Chief Accounting
Officer of the Company, with general responsibility for the supervision of
accounting for all of the properties owned and/or managed by the Company, since
August 1998. He joined the Company in 1981 and was Vice President, Controller
from 1981 to 1998. Mr. Howell holds a Bachelor of Science Degree in Business
Administration from Auburn University.
Item 11. Executive Compensation.
The following table sets forth certain information concerning the
annual and long-term compensation for the chief executive officer and the four
other most highly compensated executive officers of the Company (the "Named
Executive Officers"):
Summary Compensation Table
Annual Compensation Long-Term Compensation
----------------------------------------- ----------------------------------------------
Restricted Securities All
Other Annual Share Underlying Other
Name and Principal Position Year Salary ($)Bonus ($)(1) Compensation Awards ($) (1) Options (#) Compensation(2)
- --------------------------- ---- ---------------------- ------------ -------------- ----------- ---------------
Thomas H. Lowder........... 1999 $315,000 $ -- -- $47,600 50,000 $4,800
Chairman of the Board, 1998 310,000 -- -- 94,640 0 2,721
President and Chief 1997 295,000 225,000 -- 89,250 16,000 4,500
Executive Officer
Howard B. Nelson, Jr....... 1999 215,000 -- -- 37,800 16,667 4,800
Chief Financial Officer 1998 208,000 -- -- 53,200 0 2,721
and Secretary 1997 198,000 120,000 -- 51,000 10,000 3,453
C. Reynolds Thompson, III.. 1999 199,213 -- -- 41,300 16,667 4,800
Chief Operating Officer 1998 149,500 22,500 -- 38,500 0 2,906
1997 103,242 75,000 -- 14,438 2,500 --
John N. Hughey............. 1999 170,000 66,000 -- -- 13,333 3,803
Executive Vice President- 1998 145,000 41,405 -- 60,333 0 2,721
Retail Division 1997 120,000 75,000 -- 19,125 3,500 3,453
Charles A. McGehee......... 1999 152,500 10,320 -- 105,952 13,333 3,431
Executive Vice President - 1998 140,000 -- -- 74,900 -- 2,721
Mixed Use Division 1997 125,000 75,000 -- 19,125 3,500 3,453
(1) The Company's incentive compensation plan permits officers to elect to
receive all or part of their annual bonus in the form of restricted
shares instead of cash. Officers who elect to receive up to 50% of
their bonus in restricted shares receive shares having a market value
on the issue date equal to 125% of the deferred amount. Officers who
elect to receive more than 50% of their annual bonus in restricted
shares receive shares having a market value on the issue date equal to
140% of the deferred amount. For 1999, Messrs. Lowder, Nelson,
Thompson, Hughey and McGehee elected to receive 100%, 100%, 100%, 0%
and 88%, respectively, of their bonuses in restricted shares. The
restricted shares issued to Messrs. Lowder, Nelson, Thompson and
McGehee vest over 3 years, with 50% vesting on the first anniversary of
the issue date and the remaining 25% vesting in equal installments on
the second and third anniversaries of the issue date. The restricted
shares issued under the incentive compensation plan were issued in
March 2000. The number and value of restricted shares held by the Named
Executive Officers as of December 31, 1999 were as follows: Mr. Lowder
- 14,668 shares ($340,114); Mr. Nelson - 6,719 shares ($155,797); Mr.
Thompson - 1,907 shares ($44,219); Mr. Hughey - 3,044 shares ($70,581);
and Mr. McGehee- 5,272 shares ($122,244). Dividends are paid on
restricted shares at the same rate paid to all other holders of Common
Shares.
(2) All Other Compensation consists solely of employer contributions to the
Company's 401(k) Plan.
The following table sets forth certain information concerning exercised
and unexercised options held by the Named Executive Officers at December 31,
1999:
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
Number of Value of Unexercised
Shares Securities Underlying In-the-Money
Acquired Value Unexercised Options Options
Name on Exercise(#) Realized($) at December 31, 1999 at December 31, 1999(1)
- ---- -------------- ----------- -----------------------------------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------ ----------- -------------
Thomas H. Lowder...... -- -- 58,502 55,333 $ 5,969 $ --
Howard B. Nelson, Jr.. -- -- 25,077 20,000 1,858 --
C. Reynolds Thompson, III -- -- 1,667 17,500 -- --
John N. Hughey........ -- -- 11,868 14,500 1,132 --
Charles A. McGehee.... -- -- 13,248 1,167 1,296 --
- ------------------------
(1) Based on the closing price of $23.1875 per Common Share on December 31,
1999, as reported by the New York Stock Exchange.
The following table sets forth certain information relating to options
to purchase Common Shares granted to the Named Executive Officers during 1999:
Option Grants in Last Fiscal Year
Individual Grants
- ----------------------------------------------------------------------------------------------------------------
Percent Potential Realizable
Number of of Total Value at Assumed
Securities Options Annual Rates of Share
Underlying Granted to Exercise Price Appreciation for
Options Employees in Price Expiration Option Term
Name Granted (#) Fiscal Year ($/Sh) Date 5% 10%
- -------------------------------------------------------------------------------------- --------------------
Thomas H. Lowder...... 50,000 23.8% $ 27.38 1/25/09 $ 860,957 $ 2,181,833
Howard B. Nelson, Jr.. 16,667 7.9% 27.38 1/25/09 286,991 727,291
C. Reynolds Thompson, III 16,667 7.9% 27.38 1/25/09 286,991 727,291
John N. Hughey........ 13,333 6.3% 27.38 1/25/09 229,583 581,808
Charles A. McGehee.... 13,333 6.3% 27.38 1/25/09 229,583 581,808
Defined Benefit Plan
The Company maintains a Retirement Plan (the "Plan") for all of the
employees of the Company and its subsidiaries. An employee becomes eligible to
participate in the Plan on January 1 or July 1 following the first anniversary
of the person's employment by the Company or one of its consolidated or
unconsolidated subsidiaries or age 21 if later. Benefits are based upon the
number of years of service (maximum 25 years) and the average of the
participant's earnings during the five highest years of compensation during the
final 10 years of employment. Each participant accrues a benefit at a specified
percentage of compensation up to the Social Security covered compensation level,
and at a higher percentage of compensation above the Social Security covered
compensation level. Employment by Colonial, the Company's predecessor, or
certain of its affiliated entities is treated as covered service for purposes of
the Plan. A participant receives credit for a year of service for every year in
which 1,000 hours are completed in the employment of the Company or its
subsidiaries.
The following table reflects estimated annual benefits payable upon
retirement under the Plan as a single life annuity commencing at age 65. These
benefits ignore the lower benefit rate applicable to earnings below the Social
Security covered compensation level.
Pension Plan Table
Years of Service
------------------------------------------------------------------------------------
Remuneration 5 10 15 20 25
- ------------
$100,000 $ 7,600 $15,200 $22,800 $30,400 $38,000
$125,000 $ 9,500 $19,000 $28,500 $38,000 $47,500
$150,000 $11,400 $22,800 $34,200 $45,600 $57,000
$170,000 or over $12,920 $25,840 $38,760 $51,680 $64,600
The benefits shown are limited by the current statutory limitations
which restrict the amount of benefits which can be paid from a qualified
retirement plan. The statutory limit on compensation which may be recognized in
calculating benefits is $170,000 in 2000. This limit is scheduled to increase
periodically with the cost of living.
Covered compensation under the Plan includes the employees' base salary
and other earnings received from the Company. Thomas H. Lowder has 25 years of
covered service under the Plan, Howard B. Nelson, Jr. has 15 years of service,
C. Reynolds Thompson, III has three years of service, John N. Hughey has 17
years of service, and Charles A. McGehee has 23 years of service.
Employment Agreement
Thomas H. Lowder, the chief executive officer of the Company, entered
into an employment agreement with the Company in September 1993. This agreement
provides for an initial term of three years, with automatic renewals for
successive one year terms if neither party delivers notice of non-renewal at
least six months prior to the next scheduled expiration date. The agreement
provides for annual compensation of at least $275,000 and incentive compensation
on substantially the same terms as set forth in the description of the Annual
Incentive Plan. See "Report on Executive Compensation - Annual Incentive Plan."
The agreement includes provisions restricting Mr. Lowder from competing with the
Company during employment and, except in certain circumstances, for two years
after termination of employment. In addition, in the event of disability or
termination by the Company without cause or by the employee with cause, the
agreement provides that the Company must pay Mr. Lowder the greater of (i) his
base compensation and benefits for the remainder of the employment term or (ii)
six months' base compensation and benefits.
EXECUTIVE COMPENSATION COMMITTEE INTERLOCKS AND
INSIDER PARTICIPATION
None of the five members of our general partner's Executive
Compensation Committee is an employee of the Company. As described below, M.
Miller Gorrie and James K. Lowder, who are members of the Committee, own
interests in certain entities that, during 1999, were parties to certain
transactions involving the Company.
On May 1, 1999, the Company acquired the remaining 20.2% interest in
Colonial Village at Haverhill, a multifamily property located in San Antonio,
Texas from certain entities controlled by Mr. Gorrie. The Company paid the
purchase price of approximately $4.3 million with 157,140 units of limited
partnership interest in the Operating Partnership.
On October 31, 1999, the Company repaid an outstanding promissory note
of $1.8 million to Polar BEK/Colonial Partnership II, a general partnership of
which one of the two general partners is Equity Partners Joint Venture, a
general partnership of which Messrs. J. Lowder, T. Lowder and their brother,
Robert E. Lowder, are the sole general partners ("EPJV").
The Company engaged Lowder Construction Company, Inc., of which Mr. J.
Lowder serves as the chairman of the board and which is indirectly owned by
Messrs. J. Lowder and T. Lowder, to serve as construction manager for twelve
multifamily development and expansion projects during 1999. The Company paid a
total of $62.8 million ($58.5 million of which was then paid to unaffiliated
subcontractors) for the construction of these development and expansion projects
during 1999. The Company had outstanding construction invoices and retainage
payable to Lowder Construction Company, Inc. totaling $5.7 million at December
31, 1999.
Brasfield & Gorrie General Contractors, Inc. ("B&G"), a corporation of
which Mr. Gorrie is a shareholder and chairman of the board, was engaged to
serve as construction manager for five office and retail development and
redevelopment projects during 1999. The Company paid B&G a total of $21.5
million ($19.4 million of which was then paid to unaffiliated subcontractors)
during 1999. The Company had outstanding construction invoices and retainage
payable to this company totaling $0.7 million at December 31, 1999.
Colonial Commercial Investments, Inc. ("CCI"), a corporation owned by
Messrs. J. Lowder and T. Lowder, has guaranteed indebtedness of a partnership
accounted for by the Company under the equity method in the aggregate amount of
$1.1 million as of December 31, 1999. The Company has indemnified CCI against
any liability it may incur under this guarantee.
The Management Corporation provided management and leasing services
during 1999 to certain entities in which Messrs. J. Lowder, T. Lowder and R.
Lowder have an interest. The aggregate amount of fees paid to the Management
Corporation by such entities during 1999 was approximately $262,000. The Company
owns a 99% economic interest in the Management Corporation but, due to
limitations imposed by the IRS's REIT rules, owns only 1% of the voting stock.
The remainder of the voting stock is held by CCI.
Colonial Insurance Company, a corporation indirectly owned by the
Lowder family, provided insurance brokerage services for the Company during
1999. The aggregate amount paid by the Company to Colonial Insurance Company for
these services for the year ended December 31, 1999, was approximately $167,000.
The Company leased space to certain entities in which the Lowder family
has an interest and received rent from these entities totaling approximately
$1.4 million during 1999.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information regarding the beneficial
ownership of Units as of March 8, 2000, for (1) each person known by CRLP to be
the beneficial owner of more than five percent of CRLP's outstanding Units, (2)
each trustee of the Company and each Named Executive Officer, and (3) the
trustees and executive officers of Colonial as a group. Each person named in the
table has sole voting and investment power with respect to all Units shown as
beneficially owned by such person, except as otherwise set forth in the notes to
the table. The extent to which a person held common shares of beneficial
interest of Colonial Properties Trust as of March 8, 2000, is set forth in
Colonial Properties Trust's Proxy Statement on Schedule 14A dated March 20,
2000, under the caption "Voting Securities and Principal Holders Thereof", and
is incorporated by reference in this Annual Report and shall be deemed a part
hereof. Unless otherwise provided in the table, the address of each beneficial
owner is Colonial Plaza, Suite 750, 2101 Sixth Avenue North, Birmingham, Alabama
35203.
Name and Business Address Number of Percent of
of Beneficial Owner Units Units (1)
- ------------------------------------- -------- ---------
Colonial Properties Trust................... 21,885,928 65.7%
Thomas H. Lowder .. ........................ 2,925,896 (2) 8.8%
James K. Lowder ............................ 2,925,896 (3) 8.8%
2000 Interstate Parkway
Suite 400
Montgomery, Alabama 36104
Robert E. Lowder ........................... 1,750,372 (4) 5.3%
One Commerce Street
Montgomery, Alabama 36104
Carl F. Bailey ............................. 17,595 *
M. Miller Gorrie ........................... 289,902 (5) *
William M. Johnson ......................... 1,054,781 (6) 3.2%
Herbert A. Meisler ......................... 544,529 (7) 1.6%
Claude B. Nielsen .......................... 5,865 *
Harold W. Ripps ............................ 1,925,975 5.8%
Donald T. Senterfitt ....................... 2,159 *
Howard B. Nelson, Jr. ...................... 17,964 *
C. Reynolds Thompson, III .................. 17,595 *
Charles A. McGehee ......................... 17,595 *
John N. Hughey ............................. 17,595 *
All executive officers and trustees as a group
(17 persons) ........................... 7,457,967 (8) 22.4%
- ----------------------
* Less than 1%
(1) The number of units outstanding as of March 8, 2000 was 33,309,647.
(2) Includes 466,521 Units owned by Thomas Lowder, 89,285 Units owned by
Thomas Lowder Investments, LLC, 1,356,919 Units owned by CCI, 1,012,976
Units owned by EPJV and 195 Units held in trust for the benefit of Thomas
Lowder's children. Units owned by CCI are reported twice in this table,
once as beneficially owned by Thomas Lowder and again as beneficially
owned by James Lowder. Units owned by EPJV are reported three times in
this table, as beneficially owned by each of Thomas Lowder, James Lowder,
and Robert Lowder.
(3) Includes 466,521 Units owned by James Lowder, 89,285 Units owned by James
Lowder Investments, LLC, 1,356,919 Units owned by CCI, 1,012,976 Units
owned by EPJV and 195 Units held in trust for the benefit of James
Lowder's children.
(4) Includes 737,201 Units owned by Robert Lowder, 1,012,976 Units owned by
EPJV and 195 Units held in trust for the benefit of Robert Lowder's
children.
(5) Includes 115,167 Units owned by B & G Properties Company, LLC.,
157,140 Units owned by MJE, LLC., and 17,595 Units owned by Mr. Gorrie.
(6) Includes 579,901 Units owned by Mr. Johnson, 387,669 Units owned by
William M. Johnson Investments II, LLP, an entity controlled by Mr.
Johnson, 74,505 Units owned by William M. Johnson Investments I, LLP, an
entity controlled by Mr. Johnson, and 12,706 Units owned by Mr. Johnson's
spouse.
(7) Includes 526,934 Units owned by Meisler Enterprises L.P., a limited
partnership of which Mr. Meisler and his wife are sole partners, and
17,595 Units directly owned by Mr. Meisler.
(8) Units held by CCI and EPJV have been counted only once for this purpose.
Item 13. Certain Relationships and Related Transactions.
The information required by this item is hereby incorporated by
reference to the material appearing in the Proxy Statement under the captions
"Executive Compensation Committee Interlocks and Insider Participation" and
"Certain Transactions."
Part IV
Item 14. Exhibits, Financial Schedule, and Reports on Form 8-K.
14(a)(1) and (2) Financial Statements and Schedule
Index to Financial Statements and Financial Statement Schedule
Financial Statements:
The following financial statements of CRLP are included in Part II,
Item 8 of this report:
Consolidated Balance Sheets as of December 31, 1999 and 1998
Consolidated Statements of Income for the years ended December 31,
1999, 1998, and 1997
Consolidated Statements of Partner's Capital for the years ended
December 31, 1999, 1998, and 1997
Consolidated Statements of Cash Flows for the years ended December 31,
1999, 1998, and 1997
Notes to Consolidated Financial Statements
Report of Independent Accountants
Financial Statement Schedule:
Schedule III Real Estate and Accumulated Depreciation
Report of Independent Accountants
All other schedules have been omitted because the required information
of such other schedules is not present in amounts sufficient to require
submission of the schedule or because the required information is included in
the consolidated financial statements.
14(a)(3) Exhibits
* 3.1 Declaration of Trust of Company.
* 3.2 Bylaws of the Company.
10.1 Third Amended and Restated Agreement of
Limited Partnership of the Operating
Partnership, as amended.
+ 10.2.1 Registration Rights and Lock-Up
Agreement dated September 29, 1993, among the
Company and the persons named therein.
(psi) 10.2.2 Registration Rights and Lock-Up
Agreement dated March 25, 1997, among the
Company and the persons named therein.
(psi) 10.2.3 Registration Rights and Lock-Up
Agreement dated November 4, 1994, among the
Company and the persons named therein.
(psi) 10.2.4 Registration Rights and Lock-Up
Agreement dated August 20, 1997, among the
Company and the persons named therein.
(psi) 10.2.5 Registration Rights and Lock-Up
Agreement dated November 1, 1997, among the
Company and the persons named therein.
(psi) 10.2.6 Registration Rights and Lock-Up
Agreement dated July 1, 1997, among the Company
and the persons named therein.
(psi) 10.2.7 Registration Rights and Lock-Up
Agreement dated July 1, 1996, among the Company
and the persons named therein.
(psi)(psi) 10.2.8 Registration Rights Agreement dated February
23, 1999, among the Company, Belcrest Realty
Corporation, and Belair Real Estate
Corporation.
(psi)(psi) 10.2.9 Registration Rights and Lock-Up
Agreement dated July 1, 1998, among the Company
and the persons named therein.
(psi)(psi) 10.2.10 Registration Rights and Lock-Up
Agreement dated July 31, 1997, among the
Company and the persons named therein.
(psi)(psi) 10.2.11 Registration Rights and Lock-Up
Agreement dated November 18, 1998, among the
Company and the persons named therein.
(psi)(psi) 10.2.12 Registration Rights and Lock-Up
Agreement dated December 29, 1994, among the
Company and the persons named therein.
10.2.13 Registration Rights and Lock-Up Agreement
dated April 30, 1999, among the Company and the
persons named therein.
+ 10.6++ Officers and Trustees Indemnification Agreement
+ 10.7 Partnership Agreement of the Management
Partnership.
** 10.8 Articles of Incorporation of the Management
Corporation, as amended.
+ 10.9 Bylaws of the Management Corporation.
++ 10.10 Credit Agreement between the Colonial Realty
Limited Partnership and SouthTrust Bank,
National Association, AmSouth Bank, N.A., Wells
Fargo Bank, National Association, Wachovia Bank
, N.A., First National Bank of Commerce, N.A.,
and PNC Bank, Ohio, National Association dated
July 10, 1997, as amended on July 10, 1997 and
related promissory notes.
(psi)(psi)10.11.1 Amendment to Credit Agreement dated July 10,
1998.
(psi)(psi)10.11.2 Second Amendment to Credit Agreement dated
August 21, 1998.
+ 10.12++ Annual Incentive Plan.
++++10.13 Indenture dated as of July 22, 1996, by and
between Colonial Realty Limited Partnership and
Bankers Trust Company, as amended
(psi)(psi)10.13.1 First Supplemental Indenture dated as of
December 31, 1998, by and between Colonial
Realty Limited Partnership and Bankers Trust
Company.
10.14 Executive Unit Purchase Program - Program
Summary
10.15 Form of Master Promissory Note
10.16 Form of Reimbursement Agreement dated January
25, 2000 between Colonial Realty Limited
Partnership and Employee Unit Purchase Plan
participants
23.1 Consent of PricewaterhouseCoopers LLP
27 Financial Data Schedules
- --------------------
* Incorporated by reference to the Company's Form 8-K dated November 5,1997
** Incorporated by reference to the same titled and number exhibit in the
Company's Annual Report on Form 10-K dated December 31, 1994.
(psi)Incorporated by reference to the same titled and number exhibit in the
Company's Annual Report on Form 10-K dated December 31, 1997.
+ Incorporated by reference to the same titled and numbered exhibit in the
Company's Registration Statement on Form S-11, No. 33-65954.
++ Management contract or compensatory plan required to be filed pursuant
to Item 14(c) of Form 10-K. ++ Incorporated by reference to the same titled
and number exhibit in the Company's Quarterly Report on Form 10-Q dated
June 30, 1997.
++++ Incorporated by reference to (i)Exhibit D to the Form 8-K dated July 19,
1996, filed by Colonial Realty Limited Partnership, and (ii) Exhibit B to
the Form 8-K dated December 6, 1996, filed by Colonial Realty Limited
Partnership.
(phi)Incorporated by reference to the Company's Registration Statement Amendment
No. 1 on Form S-3 dated November 20, 1997.
(psi)(psi)Incorporated by reference to the same titled and number exhibit in the
Company's Annual Report on Form 10-K dated December 31, 1998.
14(b) Reports on Form 8-K
Reports on Form 8-K filed during the last quarter of 1999:
None
14(c) Exhibits
The list of Exhibits filed with this report is set forth in
response to Item 14(a)(3).
14(d) Financial Statements
None.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized, on March
30, 2000.
COLONIAL REALTY LIMITED PARTNERSHIP
a Delaware limited partnership
By:Colonial Properties Trust,
its general partner
By: /s/ Howard B. Nelson Jr.
----------------------------
Howard B. Nelson, Jr.
Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, this report has been signed below by the following persons on behalf
of the registrant and in the capacities with Colonial Properties Trust indicated
on March 30, 2000.
Signature
/s/ Thomas H. Lowder Chairman of the Board,
President,and Chief
- --------------------------------------------------- Executive Officer
Thomas H. Lowder
/s/ Howard B. Nelson, Jr. Chief Financial Officer
- ---------------------------------------------------
Howard B. Nelson, Jr.
/s/ Kenneth E. Howell Senior Vice President-
Chief Accounting Officer
- ---------------------------------------------------
Kenneth E. Howell
/s/ Carl F. Bailey Trustee
- ---------------------------------------------------
Carl F. Bailey
/s/ M. Miller Gorrie Trustee
- ---------------------------------------------------
M. Miller Gorrie
/s/ William M. Johnson Trustee
- ---------------------------------------------------
William M. Johnson
/s/ James K. Lowder Trustee
- ---------------------------------------------------
James K. Lowder
/s/ Herbert A. Meisler Trustee
- ---------------------------------------------------
Herbert A. Meisler
/s/ Claude B. Nielsen Trustee
- ---------------------------------------------------
Claude B. Nielsen
/s/ Harold W. Ripps Trustee
- ---------------------------------------------------
Harold W. Ripps
/s/ Donald T. Senterfitt Trustee
- ---------------------------------------------------
Donald T. Senterfitt
SCHEDULE III
COLONIAL REALTY LIMITED PARTNERSHIP
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 1999
Gross Amount
at Which
Initial Cost to Carried at
Company Cost Close of Period
----------------------------------- Capitalized --------------
Buildings and Subsequent to
Description Encumbrances Land Improvements Acquisition Land
- --------------------------------------- ---------------- ---------------- ---------------- ---------------- --------------
Multifamily:
CG at Bayshore -0- 1,265,561 10,196,833 9,576,866 2,433,387
CG at Carrollwood 10,200,000 1,464,000 10,657,840 1,472,780 1,464,000
CG at Citrus Park -0- 1,323,593 -0- 11,232,173 1,328,323
CG at Cypress Crossing -0- 8,781,859 -0- 12,588,090 2,125,136
CG at Edgewater -0- 1,540,000 12,671,606 13,335,474 2,602,325
CG at Galleria 22,400,000 4,600,000 39,078,925 2,688,756 4,600,000
CG at Galleria II -0- 758,439 7,902,382 33,228 758,439
CG at Galleria Woods 9,708,854 1,220,000 12,480,949 492,655 1,220,000
CG at Heathrow -0- 2,560,661 17,612,990 399,383 2,560,661
CG at Hunter's Creek -0- 33,264,022 -0- 596,637 5,308,112
CG at Inverness Lakes -0- 641,334 8,873,906 (2,934,787) 1,136,762
CG at Lakewood Ranch -0- 2,320,442 -0- 19,718,710 2,148,814
CG at Natchez Trace 10,845,839 1,312,000 16,568,050 252,514 1,317,591
CG at Palm Aire -0- 1,488,000 13,515,075 430,430 1,489,500
CG at Palma Sola -0- 1,479,352 -0- 12,893,516 1,479,352
CG at Research Park 12,775,000 3,680,000 29,322,067 2,059,134 3,680,000
CG at Riverchase -0- 2,340,000 25,248,548 1,582,306 2,340,000
CG at Spring Creek -0- 1,184,000 13,243,975 393,612 1,184,000
CG at Wesleyan -0- 720,000 12,760,587 6,807,102 1,404,780
Colony Park -0- 409,401 4,345,599 748,351 409,406
CV at Ashford Place -0- 537,600 5,839,838 219,748 537,600
CV at Ashley Plantation -0- 1,160,000 11,284,785 1,438,602 1,160,000
CV at Caledon Wood -0- 2,100,000 19,482,210 436,694 2,108,949
CV at Cordova -0- 134,000 3,986,304 497,812 134,000
CV at Gainesville -0- 3,360,000 24,173,649 3,518,545 3,361,850
CV at Haverhill -0- 1,771,000 17,869,452 2,312,028 1,771,000
CV at Hillcrest -0- 332,800 4,310,671 284,138 332,800
CV at Hillwood 4,760,000 511,700 5,508,300 646,060 511,700
CV at Huntleigh Woods -0- 745,600 4,908,990 925,863 745,600
CV at Inverness 9,900,000 1,713,668 10,352,151 2,966,563 1,713,668
CV at Inverness II/III/IV -0- 635,819 5,927,265 5,876,219 1,255,323
CV at Inverness Lakes 5,495,000 735,080 7,254,920 437,915 735,080
CV at Lake Mary -0- 2,145,480 -0- 19,556,037 3,634,094
CV at McGehee Place -0- 795,627 -0- 17,415,968 842,321
CV at Monte D'Oro -0- 1,000,000 6,994,227 1,631,049 1,000,000
CV at North Ingle -0- 497,574 4,122,426 489,100 497,574
CV at Oakleigh -0- 880,000 9,685,518 297,797 1,028,699
CV at Rocky Ridge 7,146,667 644,943 8,325,057 968,544 644,943
CV at Timothy Woods -0- 1,020,000 11,910,546 112,737 1,024,347
CV at Trussville -0- 1,504,000 18,800,253 993,844 1,510,409
CV at Vernon Marsh 3,400,000 960,984 3,511,596 3,247,476 960,984
CV at Walton Way -0- 1,024,000 7,877,766 135,691 1,024,000
CV at White Bluff 4,500,000 699,128 4,920,872 371,619 699,128
Patio I, II & III -0- 249,876 3,305,124 2,082,751 366,717
Ski Lodge - Tuscaloosa -0- 1,064,000 6,636,685 1,163,784 1,064,000
Retail:
Bel Air Mall -0- 7,517,000 80,151,190 2,172,946 7,517,000
Britt David Shopping Center -0- 1,755,000 4,951,852 29,014 1,755,000
Brookwood Village Mall -0- 8,136,700 24,435,002 2,929,623 8,171,373
Colonial Mall Auburn-Opelika -0- 103,480 -0- 16,743,709 723,715
Colonial Mall Burlington -0- 4,120,000 25,632,587 626,918 4,137,557
Colonial Mall Decatur -0- 3,262,800 23,636,229 2,186,023 3,262,800
Colonial Mall Gadsden -0- 639,577 -0- 20,166,769 639,577
Colonial Mall Glynn Place -0- 3,588,178 22,514,121 2,116,976 3,603,469
Colonial Mall Lakeshore -0- 4,646,300 30,973,239 2,438,202 4,666,100
Colonial Mall Mrytle Beach -0- 9,099,972 33,663,654 198,953 7,799,976
Colonial Mall Staunton -0- 2,895,000 15,083,542 3,149,387 2,907,337
Colonial Mall Valdosta -0- 5,377,000 30,239,796 1,390,702 4,478,413
Colonial Promenade Abingdon -0- 2,051,250 6,687,616 168,201 2,059,991
Colonial Promenade Bardmoor -0- 1,989,019 9,047,663 392,218 1,989,019
Colonial Promenade Beechwood -0- 2,565,550 19,647,875 1,310,590 2,576,483
Colonial Promenade Burnt Store -0- 3,750,000 8,198,677 163,204 3,750,000
Colonial Promenade Hunter's Creek 9,925,950 4,181,760 13,023,401 200,377 4,181,760
Colonial Promenade Lakewood -0- 2,984,522 11,482,512 2,115,066 2,997,240
Colonial Promenade Montgomery 12,250,000 3,788,913 11,346,754 1,241,305 4,332,432
Colonial Promenade Montgomery N -0- 2,400,000 5,664,858 570,889 2,400,000
Colonial Promenade Tuskawilla -0- 3,659,040 6,783,697 163,622 3,659,040
Colonial Promenade University Park 21,500,000 6,946,785 20,104,517 544,189 6,946,785
Colonial Promenade Wekiva -0- 2,817,788 15,302,375 223,891 2,817,788
Colonial Promenade Winter Haven -0- 1,768,586 3,928,903 4,736,078 4,045,045
Colonial Shoppes at Inverness -0- 1,680,000 1,387,055 93,216 1,687,159
Colonial Shoppes Bear Lake -0- 2,134,440 6,551,683 182,596 2,134,440
Colonial Shoppes Bellwood -0- 330,000 -0- 3,233,886 330,000
Colonial Shoppes McGehee -0- 197,152 -0- 3,945,503 197,152
Colonial Shoppes Paddock Park -0- 1,532,520 3,754,879 207,346 1,532,520
Colonial Shoppes Quaker Village -0- 931,000 7,901,874 255,047 934,967
Colonial Shoppes Stanley -0- 450,000 1,657,870 101,073 451,918
Colonial Shoppes Yadkin -0- 1,080,000 1,224,136 3,234,400 1,084,602
Macon Mall -0- 1,684,875 -0- 92,885,313 5,508,562
Mayberry Mall 3,294,223 862,500 3,778,590 410,796 866,175
Northdale Court -0- 3,059,760 8,054,090 1,146,506 3,059,760
Old Springville Shopping Center -0- 272,594 -0- 3,377,049 277,975
Olde Town Shopping Center -0- 343,325 -0- 2,819,202 343,325
P&S Building -0- 104,089 558,646 214,930 104,089
The Plaza Mall -0- -0- 29,245,243 1,291,655 -0-
Rivermont Shopping Center 1,587,738 515,250 2,332,486 349,675 517,446
Village at Roswell Summit 1,603,043 450,000 2,563,642 171,468 451,918
Office:
250 Commerce Street -0- 25,000 200,200 2,312,429 25,000
AmSouth Center -0- 764,961 -0- 18,617,541 764,961
Colonial Center at Research Park -0- 1,003,865 -0- 10,553,933 1,003,865
Colonial Plaza -0- 1,001,375 12,381,023 4,424,521 1,005,642
Concourse Center -0- 4,875,000 25,702,552 562,445 4,875,000
Emmett R. Johnson Bldg. -0- 1,794,672 14,801,258 93,437 1,794,672
Independence Plaza -0- 1,505,000 6,018,476 285,288 1,505,000
International Park -0- 1,279,355 5,668,186 13,941,500 3,087,151
Interstate Park 3,910,807 1,125,990 7,113,558 9,457,866 1,125,988
Lakeside Office Park -0- 423,451 8,313,291 324,751 425,255
Colonial Center @ Mansell Overlook 30,987,643 4,540,000 44,012,971 29,628,976 6,740,981
Perimeter Corporate Park 5,347,697 1,422,169 18,377,648 505,535 1,422,169
Progress Center -0- 521,037 14,710,851 955,644 523,258
Riverchase Center 7,981,452 1,916,727 22,091,651 1,171,576 1,924,895
Shades Brook Building -0- 873,000 2,240,472 129,539 873,000
Shoppes at Mansell -0- 600,000 3,089,565 87,246 600,000
University Park -0- 396,960 2,971,049 1,680,413 396,959
Active Development Projects:
CG at Heather Glen -0- 3,800,000 -0- 28,518,483 3,800,000
CG at Liberty Park -0- 2,293,348 -0- 18,018,403 2,293,348
CG at North Heathrow -0- 3,972,240 -0- (1,697,538) 3,972,240
CG at North Lakewood Ranch -0- 1,059,046 -0- 489,822 1,059,046
CG at Promenade -0- 1,531,860 -0- 22,780,678 1,531,860
CG at Reservoir -0- 1,020,000 -0- 9,765,908 1,020,000
CG at Town Park -0- 3,555,408 -0- 898,949 3,555,408
CG at Wesleyan III -0- 225,021 -0- 9,520 225,021
Colonial Center Town Park -0- -0- -0- 25,816 -0-
Colonial Promenade Trussville -0- 4,201,186 -0- 18,380,064 4,201,186
Colonial Promenade Tutwiler Farm -0- 10,287,026 -0- 1,215,392 10,287,026
CV at Ashley Plantation -0- 930,900 -0- 11,973,834 930,900
CG at Madison -0- 1,689,400 -0- 19,793,967 1,689,400
CV at McGehee Place -0- 90,733 -0- 23,433 90,733
CV at Walton Way -0- -0- -0- 2,856,038 -0-
Colonial Center 300 @ Mansell Overlook -0- -0- -0- 9,471,387 -0-
Other Miscellaneous Projects -0- -0- -0- 1,380,906 -0-
Unimproved Land:
Colonial Mall Briarcliffe -0- 1,433,596 -0- 114,624 1,548,220
Colonial Mall Valdosta -0- 975,506 -0- 70,300 1,045,806
McGehee Place Land 668,364 436,471 -0- 175,442 611,913
North Heathrow Land -0- 9,553,734 -0- 4,249,004 13,802,738
Other Land -0- 13,829,213 -0- -0- 13,829,213
---------------- ---------------- ---------------- ---------------- -------------
$ 200,188,277 $ 289,200,519 $ 1,120,670,943 $ 585,539,100 $ 274,143,134
================ ================ ================ ================ =============
SCHEDULE III
COLONIAL REALTY LIMITED PARTNERSHIP
REAL ESTATE INVESTMENTS AND ACCUMULATED DEPRECIATION
December 31, 1999
Gross Amount Which Carried
at Close of Period Date
----------------------------------- Acquired/
Buildings and Accumulated Date Placed in Depreciable
Description Improvements Total Depreciation Completed Service Lives-Years
- --------------------------------------- ---------------- ----------- ------------- ------------ --------- ------------
Multifamily:
CG at Bayshore 18,605,872 $ 21,039,260 1,933,042 1997 1985/97/98 7-40 Years
CG at Carrollwood 12,130,620 $ 13,594,620 2,565,432 1966 1994 7-40 Years
CG at Citrus Park 11,227,443 $ 12,555,766 445,214 1999 1997 7-40 Years
CG at Cypress Crossing 19,244,813 $ 21,369,949 912,798 1999 1998 7-40 Years
CG at Edgewater 24,944,755 $ 27,547,080 3,417,721 1990 1994 7-40 Years
CG at Galleria 41,767,681 $ 46,367,681 5,580,156 1986 1994 7-40 Years
CG at Galleria II 7,935,610 $ 8,694,049 963,777 1996 1996 7-40 Years
CG at Galleria Woods 12,973,604 $ 14,193,604 1,717,835 1994 1996 7-40 Years
CG at Heathrow 18,012,373 $ 20,573,034 2,275,460 1997 1994/97 7-40 Years
CG at Hunter's Creek 28,552,547 $ 33,860,659 2,919,285 1996 1996 7-40 Years
CG at Inverness Lakes 16,860,115 $ 17,996,877 1,807,199 1996 1996 7-40 Years
CG at Lakewood Ranch 19,890,338 $ 22,039,152 643,120 1999 1997 7-40 Years
CG at Natchez Trace 16,814,973 $ 18,132,564 1,444,823 1995/97 1997 7-40 Years
CG at Palm Aire 13,944,005 $ 15,433,505 2,741,981 1991 1994 7-40 Years
CG at Palma Sola 12,893,517 $ 14,372,868 4,652,309 1992 1992 7-40 Years
CG at Research Park 31,381,201 $ 35,061,201 4,830,402 1987/94 1994 7-40 Years
CG at Riverchase 26,830,854 $ 29,170,854 3,938,847 1984/91 1994 7-40 Years
CG at Spring Creek 13,637,587 $ 14,821,587 1,762,091 1992/94 1996 7-40 Years
CG at Wesleyan 18,882,910 $ 20,287,689 1,395,736 1997 1996/97 7-40 Years
Colony Park 5,093,946 $ 5,503,351 862,251 1975 1993 7-40 Years
CV at Ashford Place 6,059,586 $ 6,597,186 587,358 1983 1996 7-40 Years
CV at Ashley Plantation 12,723,387 $ 13,883,387 749,921 1997 1998 7-40 Years
CV at Caledon Wood 19,909,955 $ 22,018,904 1,562,750 1995/96 1997 7-40 Years
CV at Cordova 4,484,115 $ 4,618,116 2,511,257 1983 1983 7-40 Years
CV at Gainesville 27,690,344 $ 31,052,194 5,430,854 1989/93/94 1994 7-40 Years
CV at Haverhill 20,181,480 $ 21,952,480 976,970 1998 1998 7-40 Years
CV at Hillcrest 4,594,809 $ 4,927,609 469,168 1981 1996 7-40 Years
CV at Hillwood 6,154,360 $ 6,666,060 1,009,364 1984 1993 7-40 Years
CV at Huntleigh Woods 5,834,853 $ 6,580,453 900,909 1978 1994 7-40 Years
CV at Inverness 13,318,714 $ 15,032,382 3,553,644 1986/87/90 1986/87/90 7-40 Years
CV at Inverness II/III/IV 11,183,980 $ 12,439,303 1,879,058 1997 1997 7-40 Years
CV at Inverness Lakes 7,692,835 $ 8,427,915 1,287,345 1983/96 1993 7-40 Years
CV at Lake Mary 18,067,423 $ 21,701,517 4,886,742 1991/95 1991/95 7-40 Years
CV at McGehee Place 17,369,274 $ 18,211,595 4,900,711 1986/95 1986/95 7-40 Years
CV at Monte D'Oro 8,625,276 $ 9,625,276 1,276,291 1977 1994 7-40 Years
CV at North Ingle 4,611,526 $ 5,109,100 781,980 1983 1983 7-40 Years
CV at Oakleigh 9,834,616 $ 10,863,315 895,599 1997 1997 7-40 Years
CV at Rocky Ridge 9,293,601 $ 9,938,544 1,453,138 1984 1993 7-40 Years
CV at Timothy Woods 12,018,936 $ 13,043,283 1,068,048 1996 1997 7-40 Years
CV at Trussville 19,787,688 $ 21,298,097 1,940,382 1996/97 1997 7-40 Years
CV at Vernon Marsh 6,759,072 $ 7,720,056 1,879,136 1986/87 1986/93 7-40 Years
CV at Walton Way 8,013,457 $ 9,037,457 297,317 1970/88 1998 7-40 Years
CV at White Bluff 5,292,491 $ 5,991,619 879,959 1986 1993 7-40 Years
Patio I, II & III 5,271,034 $ 5,637,751 863,184 1966/83/84 1994/93/93 7-40 Years
Ski Lodge - Tuscaloosa 7,800,469 $ 8,864,469 1,205,284 1976/92 1994 7-40 Years
Retail:
Bel Air Mall 82,324,136 $ 89,841,136 2,321,116 1966/90/97 1998 7-40 Years
Britt David Shopping Center 4,980,866 $ 6,735,866 640,478 1990 1994 7-40 Years
Brookwood Village Mall 27,329,952 $ 35,501,325 1,913,505 1973/91 1997 7-40 Years
Colonial Mall Auburn-Opelika 16,123,475 $ 16,847,189 8,853,685 1973/84/89 1973/84/89 7-40 Years
Colonial Mall Burlington 26,241,948 $ 30,379,505 1,494,609 1969/86/94 1997 7-40 Years
Colonial Mall Decatur 25,822,252 $ 29,085,052 3,116,954 1979/89 1993 7-40 Years
Colonial Mall Gadsden 20,166,769 $ 20,806,346 9,998,539 1974/91 1974 7-40 Years
Colonial Mall Glynn Place 24,615,806 $ 28,219,275 1,560,913 1986 1997 7-40 Years
Colonial Mall Lakeshore 33,391,641 $ 38,057,741 2,163,476 1984-87 1997 7-40 Years
Colonial Mall Mrytle Beach 35,162,603 $ 42,962,579 3,057,274 1986 1996 7-40 Years
Colonial Mall Staunton 18,220,592 $ 21,127,929 972,665 1969/86/97 1997 7-40 Years
Colonial Mall Valdosta 32,529,084 $ 37,007,498 2,031,493 1982-85 1997 7-40 Years
Colonial Promenade Abingdon 6,847,076 $ 8,907,067 401,325 1987/96 1997 7-40 Years
Colonial Promenade Bardmoor 9,439,881 $ 11,428,900 799,502 1981 1996 7-40 Years
Colonial Promenade Beechwood 20,947,532 $ 23,524,015 1,503,346 1963/92 1997 7-40 Years
Colonial Promenade Burnt Store 8,361,881 $ 12,111,881 1,151,711 1990 1994 7-40 Years
Colonial Promenade Hunter's Creek 13,223,778 $ 17,405,538 1,167,577 1993/95 1996 7-40 Years
Colonial Promenade Lakewood 13,584,860 $ 16,582,100 752,956 1995 1997 7-40 Years
Colonial Promenade Montgomery 12,044,540 $ 16,376,972 2,807,103 1990 1993 7-40 Years
Colonial Promenade Montgomery N 6,235,747 $ 8,635,747 307,190 1997 1995 7-40 Years
Colonial Promenade Tuskawilla 6,947,319 $ 10,606,359 799,458 1990 1995 7-40 Years
Colonial Promenade University Park 20,648,706 $ 27,595,491 6,965,246 1986/89 1993 7-40 Years
Colonial Promenade Wekiva 15,526,266 $ 18,344,054 1,330,561 1990 1996 7-40 Years
Colonial Promenade Winter Haven 6,388,522 $ 10,433,567 681,147 1986 1995 7-40 Years
Colonial Shoppes at Inverness 1,473,112 $ 3,160,271 111,276 1984 1997 7-40 Years
Colonial Shoppes Bear Lake 6,734,279 $ 8,868,719 800,890 1990 1995 7-40 Years
Colonial Shoppes Bellwood 3,233,886 $ 3,563,886 1,187,275 1988 1988 7-40 Years
Colonial Shoppes McGehee 3,945,503 $ 4,142,655 1,421,364 1986 1986 7-40 Years
Colonial Shoppes Paddock Park 3,962,225 $ 5,494,745 427,397 1988 1995 7-40 Years
Colonial Shoppes Quaker Village 8,152,954 $ 9,087,921 489,158 1968/88/97 1997 7-40 Years
Colonial Shoppes Stanley 1,757,025 $ 2,208,943 108,475 1987/96 1997 7-40 Years
Colonial Shoppes Yadkin 4,453,933 $ 5,538,536 221,299 1971/97 1997 7-40 Years
Macon Mall 89,061,626 $ 94,570,188 21,155,929 1975/88/97 1975/88 7-40 Years
Mayberry Mall 4,185,710 $ 5,051,886 232,747 1968/86 1997 7-40 Years
Northdale Court 9,200,596 $ 12,260,356 849,752 1988 1995 7-40 Years
Old Springville Shopping Center 3,371,668 $ 3,649,643 2,756,976 1982 1982 7-40 Years
Olde Town Shopping Center 2,819,202 $ 3,162,527 777,410 1978/90 1978/90 7-40 Years
P&S Building 773,576 $ 877,665 487,410 1946/76/91 1974 7-40 Years
The Plaza Mall 30,536,898 $ 30,536,898 247,626 1965/89/99 1999 7-40 Years
Rivermont Shopping Center 2,679,965 $ 3,197,411 149,693 1986/97 1997 7-40 Years
Village at Roswell Summit 2,733,192 $ 3,185,110 142,712 1988 1997 7-40 Years
Office:
250 Commerce Street 2,512,629 $ 2,537,629 2,363,374 1904/81 1980 7-40 Years
AmSouth Center 18,617,540 $ 19,382,502 6,853,112 1990 1990 7-40 Years
Colonial Center at Research Park 10,553,933 $ 11,557,798 33,434 1999 1998 7-40 Years
Colonial Plaza 16,801,278 $ 17,806,919 669,208 1982 1997 7-40 Years
Concourse Center 26,264,997 $ 31,139,997 927,653 1981/85 1998 7-40 Years
Emmett R. Johnson Bldg 14,894,696 $ 16,689,368 185,016 1982/95 1999 7-40 Years
Independence Plaza 6,303,764 $ 7,808,764 313,828 1981/92 1998 7-40 Years
International Park 17,801,890 $ 20,889,041 448,105 1987/89 1997 7-40 Years
Interstate Park 16,571,426 $ 17,697,414 5,403,053 1982-85/89 1982-85/89 7-40 Years
Lakeside Office Park 8,636,238 $ 9,061,493 572,243 1989/90 1997 7-40 Years
Colonial Center @ Mansell Overlook 71,440,966 $ 78,181,947 3,629,675 1987/96/97 1997 7-40 Years
Perimeter Corporate Park 18,883,183 $ 20,305,352 906,328 1986/89 1998 7-40 Years
Progress Center 15,664,275 $ 16,187,532 1,020,500 1983-91 1997 7-40 Years
Riverchase Center 23,255,059 $ 25,179,954 1,741,421 1984-88 1997 7-40 Years
Shades Brook Building 2,370,011 $ 3,243,011 81,188 1979 1998 7-40 Years
Shoppes at Mansell 3,176,811 $ 3,776,811 110,681 1996/97 1998 7-40 Years
University Park 4,651,463 $ 5,048,422 2,026,828 1985 1985 7-40 Years
Active Development Projects:
CG at Heather Glen 28,518,483 $ 32,318,483 148,929 N/A 1998 N/A
CG at Liberty Park 18,018,403 $ 20,311,751 404 N/A 1998 N/A
CG at North Heathrow (1,697,538) $ 2,274,702 -0- N/A 1997 N/A
CG at North Lakewood Ranch 489,822 $ 1,548,868 -0- N/A 1997 N/A
CG at Promenade 22,780,678 $ 24,312,538 119,808 N/A 1998 N/A
CG at Reservoir 9,765,908 $ 10,785,908 -0- N/A 1998 N/A
CG at Town Park 898,949 $ 4,454,357 -0- N/A 1997 N/A
CG at Wesleyan III 9,520 $ 234,541 -0- N/A 1996 N/A
Colonial Center Town Park 25,816 $ 25,816 -0- N/A 1997 N/A
Colonial Promenade Trussville 18,380,064 $ 22,581,250 -0- N/A 1998 N/A
Colonial Promenade Tutwiler Farm 1,215,392 $ 11,502,418 -0- N/A 1999 N/A
CV at Ashley Plantation 11,973,834 $ 12,904,734 181,457 N/A 1998 N/A
CG at Madison 19,793,967 $ 21,483,367 170,187 N/A 1998 N/A
CV at McGehee Place 23,433 $ 114,166 -0- N/A 1987 N/A
CV at Walton Way 2,856,038 $ 2,856,038 -0- N/A 1998 N/A
Colonial Center 300 @ Mansell Overlook 9,471,387 $ 9,471,387 -0- N/A 1999 N/A
Other Miscellaneous Projects 1,380,906 $ 1,380,906 129,982 N/A 1999 N/A
Unimproved Land:
Colonial Mall Briarcliffe -0- $ 1,548,220 N/A 1996 N/A
Colonial Mall Valdosta -0- $ 1,045,806 N/A 1997 N/A
McGehee Place Land -0- $ 611,913 N/A 1981 N/A
North Heathrow Land -0- $ 13,802,738 N/A 1997 N/A
Other Land -0- $ 13,829,213 N/A 1999 N/A
------------ ------------ -------------
$1,732,683,852 $2,006,826,986 $206,451,470
============ ============ =============
NOTES TO SCHEDULE III
COLONIAL REALTY LIMITED PARTNERSHIP
December 31, 1999
(1) The aggregate cost for Federal Income Tax purposes was approximately
$1,603,837,000 at December 31, 1999.
(2) See description of mortgage notes payable in Note 7 of Notes to
Consolidated Financial Statements.
(3) The following is a reconciliation of real estate to balances reported at
the beginning of the year:
Reconciliation of Real Estate
1999 1998 1997
--------------- ---------------- ----------------
Real estate investments:
Balance at beginning of year $ 1,863,798,665 $ 1,489,114,015 $ 1,017,009,315
Acquisitions of new property 48,577,019 346,267,522 451,256,964
Improvements and development 222,517,447 134,804,450 97,564,705
Dispositions of property (128,066,145) (106,387,322) (76,716,969)
--------------- ---------------- ----------------
Balance at end of year $ 2,006,826,986 $ 1,863,798,665 $ 1,489,114,015
=============== ================ ================
Reconciliation of Accumulated Depreciation
1999 1998 1997
--------------- ---------------- ----------------
Accumulated depreciation:
Balance at beginning of year $ 169,451,798 $ 124,236,057 $101,541,658
Depreciation 52,912,745 46,787,982 31,945,960
Depreciation of disposition of property (15,913,073) (1,572,241) (9,251,561)
--------------- ---------------- ----------------
Balance at end of year $206,451,470 $169,451,798 $124,236,057
=============== ================ ================