SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1
TO
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of
earliest event reported) December 20, 2002
Wells Real Estate Investment Trust, Inc.
(Exact name of registrant as specified in
its charter)
Maryland
(State or other jurisdiction of incorporation)
| 0-25739 |
58-2328421 | |
| (Commission File Number) |
(IRS Employer Identification No.) |
6200 The Corners Parkway, Suite 250, Atlanta, Georgia 30092
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code (770) 449-7800
(Former name or former address, if changed since last report)
INFORMATION TO BE INCLUDED IN THE REPORT
Wells Real Estate Investment Trust, Inc. (the “Registrant”) hereby amends its Current Report on Form 8-K dated December 20, 2002
to provide the required financial statements of the Registrant relating to the acquisition by the Registrant of the Nestle Building on December 20, 2002, as described in such Current Report.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements. The following financial statements of the Registrant are submitted at the end of this Amendment to Current Report on Form 8-K and are filed
herewith and incorporated herein by reference:
| Nestle Building |
Page | |
| Report of Independent Auditors |
F-1 | |
| Statements of Revenues Over Certain Operating Expenses for the year ended December 31, 2001 (audited) and for the nine months ended September 30, 2002 (unaudited) |
F-2 | |
| Notes to Statements of Revenues Over Certain Operating Expenses for the year ended December 31, 2001 (audited) and for the nine months ended September 30, 2002 (unaudited) |
F-3 | |
| Wells Real Estate Investment Trust, Inc. and Subsidiary |
||
| Unaudited Pro Forma Financial Statements |
||
| Summary of Unaudited Pro Forma Financial Statements |
F-5 | |
| Pro Forma Balance Sheet as of September 30, 2002 (unaudited) |
F-6 | |
| Pro Forma Statement of Income for the year ended December 31, 2001 (unaudited) |
F-8 | |
| Pro Forma Statement of Income for the nine months ended September 30, 2002 (unaudited) |
F-9 |
1
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Amendment No. 1 to Current Report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
| WELLS REAL ESTATE INVESTMENT TRUST, INC. (Registrant) |
||
| By: |
/s/ LEO F. WELLS,
III | |
| Leo F. Wells, III President | ||
Date: January 30, 2003
2
Report of Independent Auditors
Shareholders and Board of Directors
Wells Real Estate Investment Trust, Inc.
We have audited the accompanying statement of revenues over certain operating expenses of the Nestle Building for the year ended December 31, 2001. This statement is the responsibility of the Nestle
Building’s management. Our responsibility is to express an opinion on this statement based on our audit.
We conducted our audit in
accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the statement of revenues over certain operating expenses is free of
material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the statement of revenues over certain operating expenses. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall presentation of the statement of revenues over certain operating expenses. We believe that our audit provides a reasonable basis for our opinion.
The accompanying statement of revenues over certain operating expenses was prepared for the purpose of complying with the rules and regulations of the Securities
and Exchange Commission, as described in Note 2, and is not intended to be a complete presentation of the Nestle Building’s revenues and expenses.
In our opinion, the statement of revenues over certain operating expenses referred to above presents fairly, in all material respects, the revenues and certain operating expenses described in Note 2 of the Nestle Building for the
year ended December 31, 2001 in conformity with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
Atlanta, Georgia
January 21, 2003
F-1
Nestle Building
Statements of Revenues Over Certain Operating Expenses
For the year ended December 31, 2001 and the nine months ended September 30, 2002
| 2002 |
2001 | |||||
| (Unaudited) |
||||||
| Revenues: |
||||||
| Base rent |
$ |
10,995,810 |
$ |
14,660,259 | ||
| Parking |
|
617,318 |
|
848,917 | ||
| Tenant reimbursements |
|
698,210 |
|
853,872 | ||
| |
|
|
| |||
| Total revenues |
|
12,311,338 |
|
16,363,048 | ||
| Operating expenses |
|
3,914,726 |
|
4,968,193 | ||
| |
|
|
| |||
| Revenues over certain operating expenses |
$ |
8,396,612 |
$ |
11,394,855 | ||
| |
|
|
| |||
See accompanying notes.
F-2
Nestle Building
Notes to Statements of Revenues Over Certain Operating Expenses
For the year ended December 31, 2001 and the nine months ended September 30, 2002
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Description of Real Estate Property
Acquired
On December 20, 2002, Wells REIT-Glendale, CA, LLC (“the Company”) acquired the Nestle Building from Douglas
Emmett Joint Venture (“Douglas Emmett”). The Company, a Georgia limited liability company, was created on December 20, 2002. Wells Operating Partnership, L.P. (“Wells OP”) is the sole member of the Company. Wells OP is a Delaware
limited partnership formed to acquire, own, lease, operate, and manage real properties on behalf of Wells Real Estate Investment Trust, Inc., a Maryland corporation. As the sole general partner of Wells OP, Wells Real Estate Investment Trust, Inc.
possesses full legal control and authority over the operations of Wells OP.
The twenty-story building contains 505,115 square feet of
net rentable area and is 100% leased to several tenants, including Nestle USA, Inc. (“Nestle”). Nestle occupies a total of 502,994 square feet, or 99.6%, under a lease (“Nestle Lease”) that commenced in August 1990 and expires in
August 2010. The remaining square footage is leased to several retail tenants under lease agreements that expire over the next seven years. Douglas Emmett’s interests in the Nestle Lease and other retail lease agreements were assigned to the
Company upon acquisition of the Nestle Building. Under the Nestle Lease, the tenant is required to pay, as additional rent, its pro rata share of operating expenses over the base year operating allowance established in the first lease year.
Operating expenses shall consist of all direct costs of operation and maintenance of the building including, but not limited to, real estate taxes, water and sewer charges, utilities, janitorial services, security and labor. Additionally, the Nestle
Lease entitles Nestle to a specified number of parking spaces, and Nestle is required to pay monthly rental payments for the spaces which the Company records as parking revenues. The Company will be responsible for maintaining and repairing the
Nestle Building’s roof, foundation, common areas, electrical and mechanical systems.
Rental Revenues
Rental income is recognized on a straight-line basis over the terms of the leases.
2. BASIS OF ACCOUNTING
The
accompanying statements of revenues over certain operating expenses are presented in conformity with accounting principles generally accepted in the United States and in accordance with the applicable rules and regulations of the Securities and
Exchange Commission for real estate properties acquired. Accordingly, these statements exclude certain historical expenses that are not comparable to the proposed future operations of the property such as depreciation and interest. Therefore, these
statements are not comparable to the statement of operations of the Nestle Building after its acquisition by the Company.
F-3
Nestle Building
Notes to Statements of Revenues Over Certain Operating Expenses
(Continued)
3. FUTURE MINIMUM RENTAL COMMITMENTS
Future minimum rental commitments for the years ended December 31 are as follows:
| 2002 |
$ |
14,939,680 | |
| 2003 |
|
14,950,502 | |
| 2004 |
|
14,963,154 | |
| 2005 |
|
15,508,547 | |
| 2006 |
|
16,591,633 | |
| Thereafter |
|
60,926,465 | |
| |
| ||
| $ |
137,879,981 | ||
| |
|
4. INTERIM UNAUDITED FINANCIAL INFORMATION
The statement of revenues over certain operating expenses for the nine months ended September 30, 2002 is unaudited, however, in the opinion of
management, all adjustments (consisting solely of normal, recurring adjustments) necessary for the fair presentation of the statement for the interim period have been included. The results of the interim period are not necessarily indicative of the
results to be obtained for a full fiscal year.
F-4
WELLS REAL ESTATE INVESTMENT TRUST, INC.
SUMMARY OF UNAUDITED PRO FORMA FINANCIAL STATEMENTS
This pro forma information should be read in conjunction with the financial statements and notes of Wells Real Estate Investment Trust, Inc., a Maryland Corporation (the “Wells REIT”), included in its annual report
on Form 10-K for the year ended December 31, 2001 and quarterly report on Form 10-Q/A for the period ended September 30, 2002. In addition, this pro forma information should be read in conjunction with the financial statements and notes of certain
acquired properties included in various Form 8-Ks previously filed.
The following unaudited pro forma balance sheet as of September 30,
2002 has been prepared to give effect to the fourth quarter 2002 acquisitions of the NASA Buildings by Wells REIT-Independence Square, LLC, of which Wells REIT is the sole member, the Caterpillar Nashville Building, the Capital One Richmond
Buildings by Wells Operating Partnership, L.P. (“Wells OP”), the John Wiley Indianapolis Building by Wells XIII-REIT Joint Venture, a joint venture partnership between Wells Real Estate Fund XIII, L.P. and Wells OP (collectively, the
“Other Recent Acquisitions”) and the Nestle Building by the Wells REIT-Glendale, CA, LLC, of which Wells OP is the sole member, and the first quarter 2003 acquisition of the East Point Buildings (collectively, the “Recent
Acquisitions”) by Wells OP as if the acquisitions occurred on September 30, 2002.
Wells OP is a Delaware limited partnership that
was organized to own and operate properties on behalf of Wells REIT. As the sole general partner of Wells OP, Wells REIT possesses full legal control and authority over the operations of Wells OP. Accordingly, the accounts of Wells OP are
consolidated with the accompanying pro forma financial statements of Wells REIT.
The following unaudited pro forma statement of income
for the nine months ended September 30, 2002 has been prepared to give effect to the first, second and third quarter 2002 acquisitions of the Vertex Sarasota Building (formerly, the Arthur Andersen Building), the Transocean Houston Building, the
Novartis Atlanta Building, the Dana Corporation Buildings, the Travelers Express Denver Buildings, the Agilent Atlanta Building, the BellSouth Ft. Lauderdale Building, the Experian/TRW Buildings, the Agilent Boston Building, the TRW Denver Building,
the MFS Phoenix Building, the ISS Atlanta Buildings, the PacifiCare San Antonio Building, the BMG Greenville Buildings, the Kraft Atlanta Building, the Nokia Dallas Buildings, the Harcourt Austin Building, the IRS Long Island Buildings, the KeyBank
Parsippany Building, the Allstate Indianapolis Building, the Federal Express Colorado Springs Building, the EDS Des Moines Building, the Intuit Dallas Building, the Daimler Chrysler Dallas Building (collectively, the “2002 Acquisitions”)
and the Recent Acquisitions as if the acquisitions occurred on January 1, 2001. The Kerr McGee Property and the AmeriCredit Phoenix Property had no operations during the nine months ended September 30, 2002.
The following unaudited pro forma statement of income for the year ended December 31, 2001 has been prepared to give effect to the 2001 acquisitions of the
Comdata Building, the AmeriCredit Building, the State Street Bank Building, the IKON Buildings, the Ingram Micro Building, the Lucent Building, the ADIC Buildings, the Convergys Building, the Windy Point Buildings (collectively, the “2001
Acquisitions”), the 2002 Acquisitions and the Recent Acquisitions as if the acquisitions occurred on January 1, 2001. The Nissan Property, the Travelers Express Denver Buildings, the Kerr McGee Property, the AmeriCredit Phoenix Property and the
EDS Des Moines Building had no operations during 2001.
These unaudited pro forma financial statements are prepared for informational
purposes only and are not necessarily indicative of future results or of actual results that would have been achieved had the acquisitions of the 2001 Acquisitions, 2002 Acquisitions and the Recent Acquisitions been consummated as of January 1,
2001. In addition, the Pro Forma balance sheet includes allocations of the purchase price for certain acquisitions based upon preliminary estimates of the fair value of the assets and liabilities acquired. Therefore, these allocations may be
adjusted in the future upon finalization of these preliminary estimates.
F-5
WELLS REAL ESTATE INVESTMENT TRUST, INC.
PRO FORMA BALANCE SHEET
SEPTEMBER 30, 2002
(Unaudited)
ASSETS
| Wells Real Estate Investment Trust, Inc. (j) |
Pro Forma Adjustments |
Pro Forma Subtotal |
Pro Forma Adjustments |
Pro Forma Total | |||||||||||||||||
| Recent Acquisitions |
Recent Acquisitions |
||||||||||||||||||||
| East Point |
|||||||||||||||||||||
| Other |
Nestle |
||||||||||||||||||||
| REAL ESTATE ASSETS, at cost: |
|||||||||||||||||||||
| Land |
$ |
164,190,412 |
$ |
87,755,000 |
(c) |
$ |
23,200,000 |
(c) |
$ |
278,033,153 |
$ |
2,163,000 |
(c) |
$ |
280,284,706 | ||||||
| |
1,888,098 |
(d) |
|
404,941 |
(e) |
|
88,553 |
(e) |
|||||||||||||
| |
594,702 |
(e) |
|||||||||||||||||||
| Buildings, less accumulated depreciation of $47,999,655 |
|
1,171,793,037 |
|
351,806,121 |
(c) |
|
134,446,731 |
(c) |
|
1,668,808,027 |
|
19,916,138 |
(c) |
|
1,689,539,532 | ||||||
| |
8,415,460 |
(e) |
|
2,346,678 |
(e) |
|
815,367 |
(e) |
|||||||||||||
| Construction in progress |
|
28,500,195 |
|
0 |
|
|
0 |
|
|
28,500,195 |
|
0 |
|
|
28,500,195 | ||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
| Total real estate assets |
|
1,364,483,644 |
|
450,459,381 |
|
|
160,398,350 |
|
|
1,975,341,375 |
|
22,983,058 |
|
|
1,998,324,433 | ||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
| CASH AND CASH EQUIVALENTS |
|
143,911,852 |
|
(275,407,446 |
)(c) |
|
(67,646,731 |
)(c) |
|
88,124,028 |
|
(22,079,138 |
)(c) |
|
144,624,892 | ||||||
| |
81,430,054 |
(h) |
|||||||||||||||||||
| |
297,685,340 |
(a) |
|
(2,850,052 |
)(i) |
||||||||||||||||
| |
(10,418,987 |
)(b) |
|||||||||||||||||||
| INVESTMENT IN JOINT VENTURES |
|
75,388,348 |
|
9,294,465 |
(f) |
|
0 |
|
|
84,682,813 |
|
0 |
|
|
84,682,813 | ||||||
| INVESTMENT IN BONDS |
|
54,500,000 |
|
0 |
|
|
0 |
|
|
54,500,000 |
|
0 |
|
|
54,500,000 | ||||||
| ACCOUNTS RECEIVABLE |
|
12,018,601 |
|
0 |
|
|
0 |
|
|
12,018,601 |
|
0 |
|
|
12,018,601 | ||||||
| DEFERRED LEASE ACQUISITION COSTS, NET |
|
1,712,541 |
|
0 |
|
|
0 |
|
|
1,712,541 |
|
0 |
|
|
1,712,541 | ||||||
| DEFERRED PROJECT COSTS |
|
5,963,370 |
|
(1,895,611 |
)(d) |
|
(2,751,619 |
)(e) |
|
2,366,928 |
|
(903,920 |
)(e) |
|
4,313,060 | ||||||
| |
(9,002,649 |
)(e) |
|
2,850,052 |
(i) |
||||||||||||||||
| |
(365,550 |
)(g) |
|||||||||||||||||||
| |
10,418,987 |
(b) |
|||||||||||||||||||
| DEFERRED OFFERING COSTS |
|
3,537,361 |
|
0 |
|
|
0 |
|
|
3,537,361 |
|
0 |
|
|
3,537,361 | ||||||
| DUE FROM AFFILIATES |
|
2,185,436 |
|
0 |
|
|
0 |
|
|
2,185,436 |
|
0 |
|
|
2,185,436 | ||||||
| NOTE RECEIVABLE |
|
4,965,838 |
|
0 |
|
|
0 |
|
|
4,965,838 |
|
0 |
|
|
4,965,838 | ||||||
| PREPAID EXPENSES AND OTHER ASSETS, NET |
|
2,597,110 |
|
37,764 |
(c) |
|
0 |
|
|
2,634,874 |
|
0 |
|
|
2,634,874 | ||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
| Total assets |
$ |
1,671,264,101 |
$ |
470,805,694 |
|
$ |
90,000,000 |
|
$ |
2,232,069,795 |
$ |
81,430,054 |
|
$ |
2,313,499,849 | ||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||
F-6
LIABILITIES AND SHAREHOLDERS’ EQUITY
| Wells Real Estate Investment Trust, Inc.
(j) |
Pro Forma Adjustments |
Pro Forma Subtotal |
Pro Forma Adjustments |
|||||||||||||||||||||||||||||
| Recent Acquisitions |
Recent Acquisitions |
|||||||||||||||||||||||||||||||
| Pro Forma Total |
||||||||||||||||||||||||||||||||
| Other |
Nestle |
East Point |
||||||||||||||||||||||||||||||
| LIABILITIES: |
||||||||||||||||||||||||||||||||
| Accounts payable and accrued expenses |
$ |
17,538,820 |
|
$ |
881,644 |
(c) |
$ |
0 |
|
$ |
18,420,464 |
|
$ |
0 |
|
$ |
18,420,464 |
| ||||||||||||||
| Notes payable |
|
35,829,293 |
|
|
172,238,710 |
(c) |
|
90,000,000 |
(c) |
|
298,068,003 |
|
|
0 |
|
|
298,068,003 |
| ||||||||||||||
| Obligations under capital lease |
|
54,500,000 |
|
|
0 |
|
|
0 |
|
|
54,500,000 |
|
|
0 |
|
|
54,500,000 |
| ||||||||||||||
| Dividends payable |
|
10,209,306 |
|
|
0 |
|
|
0 |
|
|
10,209,306 |
|
|
0 |
|
|
10,209,306 |
| ||||||||||||||
| Due to affiliates |
|
4,379,745 |
|
|
0 |
|
|
0 |
|
|
4,379,745 |
|
|
0 |
|
|
4,379,745 |
| ||||||||||||||
| Deferred rental income |
|
7,893,930 |
|
|
0 |
|
|
0 |
|
|
7,893,930 |
|
|
0 |
|
|
7,893,930 |
| ||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
| Total liabilities |
|
130,351,094 |
|
|
173,120,354 |
|
|
90,000,000 |
|
|
393,471,448 |
|
|
0 |
|
|
393,471,448 |
| ||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
| COMMITMENTS AND CONTINGENCIES |
||||||||||||||||||||||||||||||||
| MINORITY INTEREST OF UNIT HOLDER IN OPERATING PARTNERSHIP |
|
200,000 |
|
|
0 |
|
|
0 |
|
|
200,000 |
|
|
0 |
|
|
200,000 |
| ||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
| SHAREHOLDERS’ EQUITY: |
||||||||||||||||||||||||||||||||
| Common shares, $.01 par value; 750,000,000 shares authorized, 182,608,517 shares issued and 180,891,792 outstanding at
September 30, 2002 |
|
1,826,086 |
|
|
297,685 |
(a) |
|
0 |
|
|
2,123,771 |
|
|
81,430 |
(h) |
|
2,205,201 |
| ||||||||||||||
| Additional paid-in capital |
|
1,621,376,451 |
|
|
297,387,655 |
(a) |
|
0 |
|
|
1,918,764,106 |
|
|
81,348,624 |
(h) |
|
2,000,112,730 |
| ||||||||||||||
| Cumulative distributions in excess of earnings |
|
(64,907,241 |
) |
|
0 |
|
|
0 |
|
|
(64,907,241 |
) |
|
0 |
|
|
(64,907,241 |
) | ||||||||||||||
| Treasury stock, at cost, 1,716,725 shares |
|
(17,167,254 |
) |
|
0 |
|
|
0 |
|
|
(17,167,254 |
) |
|
0 |
|
|
(17,167,254 |
) | ||||||||||||||
| Other comprehensive loss |
|
(415,035 |
) |
|
0 |
|
|
0 |
|
|
(415,035 |
) |
|
0 |
|
|
(415,035 |
) | ||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
| Total shareholders’ equity |
|
1,540,713,007 |
|
|
297,685,340 |
|
|
0 |
|
|
1,838,398,347 |
|
|
81,430,054 |
|
|
1,919,828,401 |
| ||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
| Total liabilities and shareholders’ equity |
$ |
1,671,264,101 |
|
$ |
470,805,694 |
|
$ |
90,000,000 |
|
$ |
2,232,069,795 |
|
$ |
81,430,054 |
|
$ |
2,313,499,849 |
| ||||||||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
(a) |
Reflects capital raised through issuance of additional shares subsequent to September 30, 2002 through the Nestle acquisition date.
|
(b) |
Reflects deferred project costs capitalized as a result of additional capital raised described in note (a) above. |
(c) |
Reflects Wells Real Estate Investment Trust, Inc.’s purchase price for the land, building and liabilities assumed. |
(d) |
Reflects deferred project costs applied to the land and building at approximately 4.07% of the cash paid for purchase. |
(e) |
Reflects deferred project costs applied to the land and building at approximately 4.094% of the cash paid for purchase. |
(f) |
Reflects Wells Real Estate Investment Trust, Inc.’s contribution to the Wells XIII-REIT Joint Venture, which decreased its interest in the joint venture
from 68.29% to 61.28%. |
(g) |
Reflects deferred project costs contributed to the Wells Fund XIII-REIT Joint Venture at approximately 4.094% of purchase price.
|
(h) |
Reflects capital raised through issuance of additional shares subsequent to the Nestle acquisition date through the East Point acquisition date.
|
(i) |
Reflects deferred project costs capitalized as a result of additional capital raised described in note (h) above. |
(j) |
Historical financial information derived from quarterly report on Form 10-Q. |
The accompanying notes are an integral part of this statement.
F-7
WELLS REAL ESTATE INVESTMENT TRUST, INC.
PRO FORMA STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 2001
(Unaudited)
| Wells Real Estate Investment Trust,
Inc. (h) |
Pro
Forma Adjustments |
Pro Forma Subtotal |
Pro Forma Adjustments |
Pro Forma Total | |||||||||||||||||||||||||
| Recent Acquisitions |
Recent Acquisitions |
||||||||||||||||||||||||||||
| 2001 Acquisitions |
2002 Acquisitions |
Other |
Nestle |
East Point |
|||||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||||||
| Rental income |
$ |
44,204,279 |
$ |
11,349,076 |
(a) |
$ |
54,615,521 |
(a) |
$ |
45,317,526 |
(a) |
$ |
16,657,346 |
(a) |
$ |
172,143,748 |
$ |
1,059,426 |
(a) |
$ |
173,203,174 | ||||||||
| Equity in income of joint ventures |
|
3,720,959 |
|
1,111,850 |
(b) |
|
0 |
|
|
638,552 |
(b) |
|
0 |
|
|
5,471,361 |
|
0 |
|
|
5,471,361 | ||||||||
| Interest income |
|
1,246,064 |
|
0 |
|
|
0 |
|
|
0 |
|
|
0 |
|
|
1,246,064 |
|
0 |
|
|
1,246,064 | ||||||||
| Take out fee |
|
137,500 |
|
0 |
|
|
0 |
|
|
0 |
|
|
0 |
|
|
137,500 |
|
0 |
|
|
137,500 | ||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
| |
49,308,802 |
|
12,460,926 |
|
|
54,615,521 |
|
|
45,956,078 |
|
|
16,657,346 |
|
|
178,998,673 |
|
1,059,426 |
|
|
180,058,099 | |||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
| EXPENSES: |
|||||||||||||||||||||||||||||
| Depreciation |
|
15,344,801 |
|
5,772,761 |
(c) |
|
22,487,278 |
(c) |
|
14,408,864 |
(c) |
|
5,471,736 |
(c) |
|
63,485,440 |
|
829,260 |
(c) |
|
64,314,700 | ||||||||
| Interest |
|
3,411,210 |
|
0 |
|
|
0 |
|
|
9,452,460 |
(f) |
|
4,399,200 |
(g) |
|
17,262,870 |
|
0 |
|
|
17,262,870 | ||||||||
| Operating costs, net of reimbursements |
|
4,128,883 |
|
2,854,275 |
(d) |
|
3,668,343 |
(d) |
|
9,628,878 |
(d) |
|
4,114,321 |
(d) |
|
24,394,700 |
|
926,011 |
(d) |
|
25,320,711 | ||||||||
| Management and leasing fees |
|
2,507,188 |
|
510,708 |
(e) |
|
2,250,455 |
(e) |
|
482,139 |
(e) |
|
711,379 |
(e) |
|
6,461,869 |
|
47,674 |
(e) |
|
6,509,543 | ||||||||
| General and administrative |
|
973,785 |
|
0 |
|
|
0 |
|
|
0 |
|
|
0 |
|
|
973,785 |
|
0 |
|
|
973,785 | ||||||||
| Amortization of deferred financing costs |
|
770,192 |
|
0 |
|
|
0 |
|
|
0 |
|
|
0 |
|
|
770,192 |
|
0 |
|
|
770,192 | ||||||||
| Legal and accounting |
|
448,776 |
|
0 |
|
|
0 |
|
|
0 |
|
|
0 |
|
|
448,776 |
|
0 |
|
|
448,776 | ||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
| |
27,584,835 |
|
9,137,744 |
|
|
28,406,076 |
|
|
33,972,341 |
|
|
14,696,636 |
|
|
113,797,632 |
|
1,802,945 |
|
|
115,600,577 | |||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
| NET INCOME |
$ |
21,723,967 |
$ |
3,323,182 |
|
$ |
26,209,445 |
|
$ |
11,983,737 |
|
$ |
1,960,710 |
|
$ |
65,201,041 |
$ |
(743,519 |
) |
$ |
64,457,522 | ||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
| EARNINGS PER SHARE, basic and diluted |
$ |
0.43 |
$ |
0.21 | |||||||||||||||||||||||||
| |
|
|
| ||||||||||||||||||||||||||
| WEIGHTED AVERAGE SHARES, basic and diluted |
|
50,520,853 |
|
303,171,546 | |||||||||||||||||||||||||
| |
|
|
| ||||||||||||||||||||||||||
(a) |
Rental income is recognized on a straight-line basis. |
(b) |
Reflects Wells Real Estate Investment Trust, Inc.’s equity in income of Wells XII-REIT Joint Venture related to the acquisition of the Comdata Building and
equity in income of Wells XIII-REIT Joint Venture related to the acquisition of the AmeriCredit Building, the ADIC Buildings and the John Wiley Indianapolis Building. |
(c) |
Depreciation expense on the buildings is recognized using the straight-line method and a 25-year life. |
(d) |
Consists of operating expenses, net of reimbursements. |
(e) |
Management and leasing fees are calculated at 4.5% of rental income. |
(f) |
Represents interest expense on lines of credit used to acquire assets, which bear interest at approximately 5.488% for the year ended December 31, 2001.
|
(g) |
Represents interest expense on mortgage assumed as part of the Nestle Building acquisition, which bears interest at approximately 4.888% for the year ended
December 31, 2001. |
(h) |
Historical financial information derived from annual report on Form 10-K. |
The accompanying notes are an integral part of this statement.
F-8
WELLS REAL ESTATE INVESTMENT TRUST, INC.
PRO FORMA STATEMENT OF INCOME
FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 2002
(Unaudited)
| Wells Real Estate Investment Trust, Inc. (i) |
Pro Forma Adjustments |
Pro Forma Subtotal |
Pro Forma Adjustments |
Pro Forma Total | |||||||||||||||||||||
| 2002 Acquisitions |
Recent Acquisitions |
Recent Acquisitions |
|||||||||||||||||||||||
| Other |
Nestle |
East Point |
|||||||||||||||||||||||
| REVENUES: |
|||||||||||||||||||||||||
| Rental income |
$ |
66,120,992 |
$ |
42,103,180 |
(a) |
$ |
33,939,001 |
(a) |
$ |
12,473,951 |
(a) |
$ |
154,637,124 |
$ |
1,112,123 |
(a) |
$ |
155,749,247 | |||||||
| Operating cost reimbursements |
|
12,853,717 |
|
5,976,734 |
(h) |
|
3,062,835 |
(h) |
|
698,210 |
(h) |
|
22,591,496 |
|
47,499 |
(h) |
|
22,638,995 | |||||||
| Equity in income of joint ventures |
|
3,738,046 |
|
0 |
|
|
487,970 |
(f) |
|
0 |
|
|
4,226,016 |
|
0 |
|
|
4,226,016 | |||||||
| Interest income |
|
5,075,165 |
|
0 |
|
|
0 |
|
|
0 |
|
|
5,075,165 |
|
0 |
|
|
5,075,165 | |||||||
| Take out fee |
|
134,666 |
|
0 |
|
|
0 |
|
|
0 |
|
|
134,666 |
|
0 |
|
|
134,666 | |||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
| |
87,922,586 |
|
48,079,914 |
|
|
37,489,806 |
|
|
13,172,161 |
|
|
186,664,467 |
|
1,159,622 |
|
|
187,824,089 | ||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
| EXPENSES: |
|||||||||||||||||||||||||
| Depreciation |
|
23,185,201 |
|
15,039,449 |
(b) |
|
10,806,647 |
(b) |
|
4,103,802 |
(b) |
|
53,135,099 |
|
621,945 |
(b) |
|
53,757,044 | |||||||
| Operating costs |
|
17,108,599 |
|
10,179,532 |
|
|
10,532,575 |
(c) |
|
3,914,726 |
(c) |
|
41,735,432 |
|
742,490 |
(c) |
|
42,477,922 | |||||||
| Interest |
|
2,006,458 |
|
0 |
|
|
5,310,551 |
(e) |
|
2,369,925 |
(g) |
|
9,686,934 |
|
0 |
|
|
9,686,934 | |||||||
| Management and leasing fees |
|
3,348,210 |
|
1,697,775 |
(d) |
|
361,605 |
(d) |
|
533,548 |
(d) |
|
5,941,138 |
|
50,046 |
(d) |
|
5,991,184 | |||||||
| General and administrative |
|
1,866,042 |
|
0 |
|
|
0 |
|
|
0 |
|
|
1,866,042 |
|
0 |
|
|
1,866,042 | |||||||
| Amortization of deferred financing costs |
|
586,715 |
|
0 |
|
|
0 |
|
|
0 |
|
|
586,715 |
|
0 |
|
|
586,715 | |||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
| |
48,101,225 |
|
26,916,756 |
|
|
27,011,378 |
|
|
10,922,001 |
|
|
112,951,360 |
|
1,414,481 |
|
|
114,365,841 | ||||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
| NET INCOME |
$ |
39,821,361 |
$ |
21,163,158 |
|
$ |
10,478,428 |
|
$ |
2,250,160 |
|
$ |
73,713,107 |
$ |
(254,859 |
) |
$ |
73,458,248 | |||||||
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
| EARNINGS PER SHARE, basic and diluted |
$ |
0.31 |
$ |
0.24 | |||||||||||||||||||||
| |
|
|
| ||||||||||||||||||||||
| WEIGHTED AVERAGE SHARES, basic and diluted |
|
128,541,432 |
|
303,171,546 | |||||||||||||||||||||
| |
|
|
| ||||||||||||||||||||||
(a) |
Rental income is recognized on a straight-line basis. |
(b) |
Depreciation expense on the buildings is recognized using the straight-line method and a 25-year life. |
(c) |
Consists of operating expenses. |
(d) |
Management and leasing fees are calculated at 4.5% of rental income. |
(e) |
Represents interest expense on lines of credits used to acquire assets, which bear interest at approximately 4.111% for the nine months ended September 30,
2002. |
(f) |
Reflects Wells Real Estate Investment Trust, Inc.’s equity in income of the Wells Fund XIII-REIT Joint Venture related to the John Wiley Indianapolis
Building. The pro forma adjustment results from rental revenues less operating expenses, management fees and depreciation. |
(g) |
Represents interest expense on mortgage assumed as part of the Nestle Building acquisition, which bears interest at approximately 3.511% for the nine months
ended September 30, 2002. |
(h) |
Consists of operating cost reimbursements. |
(i) |
Historical financial information derived from quarterly report on Form 10-Q/A. |
The accompanying notes are an integral part of this statement.
F-9