8-K/A - Investors Real Estate Trust - March 15, 2002

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 FORM 8-K/A

AMENDMENT NO. 1 TO CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934

March 15, 2002
(Date of Report)

January 2, 2002
(Date of earliest event reported)

 INVESTORS REAL ESTATE TRUST
(Exact name of registrant as specified in its charter)

 

North Dakota

0-14851

45-0311232

(State or other jurisdiction of incorporation)

(Commission File Number)

(IRS Employer Identification Number)

12 South Main Street, Suite 100, Minot, ND

58701

(Address of principal executive offices)

(Zip Code)

 

(701) 837-4738

(Registrant’s telephone number, including area code)

Page 1

The undersigned Registrant hereby amends its Current Report on Form 8-K dated January 2, 2002,  which was filed with the Securities and Exchange Commission on January 17, 2002, to include the financial statements required by Item 7 (a) of Form 8-K and the pro forma financial information required by Item 7 (b) of Form 8-K.

ITEM 7.      FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS

(a)     Financial Statements:  See Index to Financial Statements and Pro Forma Financial Information appearing on Page F-1 of  this Form 8-K/A.

(b)     Pro Forma Financial Information:  See Index to Financial Statements and Pro Forma Financial Information appearing on page F-1 of this Form 8-K/A.

(c)     Exhibits
         None

 Page 2

 SIGNATURES

      Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

INVESTORS REAL ESTATE TRUST

  

By: /s/ Thomas A. Wentz, Sr.________________
      Thomas A. Wentz, Sr.
      President

 

March 15, 2002

Page 3

INDEX TO FINANCIAL STATEMENTS AND PRO FORMA FINANCIAL INFORMATION

 

APPLEWOOD ON THE GREEN APARTMENTS

 

      Independent Auditor's Report..........................................................................

F-2

      Historical Summary of Gross Income and Direct Operating Expenses
            for the Year Ended December 31, 2000....................................................

F-3

      Notes to Historical Summary of Gross Income and Direct Operating
            Expenses for the Year Ended December 31, 2000.....................................

F-4

      Unaudited Interim Financial Statement for the Period January 1, 2001,
            through October 31, 2001.........................................................................

F-5

      Unaudited Estimated Taxable Operating Results...............................................

F-5

BLOOMINGTON BUSINESS PLAZA

 

      Independent Auditor's Report..........................................................................

F-6

      Historical Summary of Gross Income and Direct Operating Expenses
            for the Years Ended December 31, 2000, 1999, and 1998........................

F-7

      Notes to Historical Summary of Gross Income and Direct Operating
            Expenses for the Years Ended December 31, 2000, 1999, and 1998.........

F-8

      Unaudited Interim Financial Statement for the Period January 1, 2001,
            through September 30, 2001.....................................................................

F-9

      Unaudited Estimated Taxable Operating Results...............................................

F-9

STONE CONTAINER PLANT

 

      Independent Auditor's Report..........................................................................

F-10

      Historical Summary of Gross Income and Direct Operating Expenses
            for the Year Ended December 31, 2001....................................................

F-11

      Notes to Historical Summary of Gross Income and Direct Operating
            Expenses for the Years Ended December 31, 2001....................................

F-12

      Unaudited Estimated Taxable Operating Results...............................................

F-13

THRESHER SQUARE

 

      Independent Auditor's Report..........................................................................

F-14

      Historical Summary of Gross Income and Direct Operating Expenses
            For the Years Ended December 31, 2001, 2000 and 1999........................

F-15

      Notes to Historical Summary of Gross Income and Direct Operating
            Expenses For the Years Ended December 31, 2001, 2000, and 1999........

F-16

      Unaudited Estimated Taxable Operating Results...............................................

F-17

F-1

Independent Auditor’s Report

To the Board of Trustees of Investors Real Estate Trust

      We have audited the accompanying Historical Summary of Gross Income and Direct Operating Expenses of Applewood Apartments ("Historical Summary") for the year ended December 31, 2000.  This Historical Summary is the responsibility of the management.  Our responsibility is to express an opinion on the Historical Summary based on our audit.

      We conducted our audit in accordance with auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Historical Summary is free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Historical Summary.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the Historical Summary.  We believe that our audit provides a reasonable basis for our opinion.

      The accompanying Historical Summary 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 Applewood Apartment’s revenue and expenses.

      In our opinion, the Historical Summary referred to above presents fairly, in all material respects, the gross income and direct operating expenses described in Note 2 of Applewood Apartments for the year ended December 31, 2000, in conformity with accounting principles generally accepted in the United States of America.

/S/ Brady, Martz and Associates, P.C.
Brady, Martz, and Associates, P.C.

Minot, North Dakota

March 12, 2002

F-2

Applewood Apartments Historical Summary of Gross Income and Direct Operating Expenses for the Year Ended December 31, 2000

GROSS INCOME

 

      Real estate rentals

       $          1,421,771

      Other rental income

                      61,062

      Total Gross Income

       $          1,482,833

DIRECT OPERATING EXPENSES

 

      Utilities

       $             134,710

      Repairs & Maintenance

                   181,222

      Real Estate Taxes

                    129,914

      Insurance

                      18,098

       Total Direct Operating Expenses

       $             463,944

 

      

EXCESS OF GROSS INCOME OVER DIRECT OPERATING EXPENSES

       $          1,018,889

       The Notes to Historical Summary of Gross Income and Direct Operating Expenses are an integral part of this summary.

F-3

Applewood Apartments Notes to Historical Summary of Gross Income and Direct Operating  Expenses for the Year Ended December 31, 2000

Note 1.

Nature of Business
Applewood Apartments is a 234-unit, multi-tenant apartment community located in Omaha, Nebraska.  The operations of Applewood consists of leasing residential units to various tenants.  Leases are generally for terms of one year or less.

Note 2.

Basis of Presentation
IRET Properties purchased Applewood Apartments on November 1, 2001.  The historical summary has been prepared for the purpose of complying with Regulation S-X, Rule 3-14 of the Securities and Exchange Commission (“SEC”), which requires certain information with respect to real estate operations acquired to be included with certain filings with the SEC.  This historical summary includes the historical gross income and direct operating expenses of Olympic Village, exclusive of the following expenses which may not be comparable to the proposed future operations:

        (a)  interest expense on existing mortgage and borrowings
        (b)  depreciation of property and equipment
        (c)   certain administrative expenses
        (d)  management fees

Note 3.

Summary of Significant Accounting Policies
Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Capitalization Policy - Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized.  Expenditures for maintenance and repairs which do not add to the value or extend useful lives are charged to expense as incurred.

 F-4

Applewood Apartments Unaudited Interim Financial Statement for the Period January 1, 2001 through October 31, 2001

GROSS INCOME

 

      Real estate rentals

       $          1,072,775

      Other rental income

                      45,223

      Total Gross Income

       $          1,117,998

DIRECT OPERATING EXPENSES

 

      Utilities

       $             120,129

      Repairs & Maintenance

                    206,068

      Real Estate Taxes

                    108,262

      Insurance

                      15,082

      Total Direct Operating Expenses

       $             449,541

 

      

EXCESS OF GROSS INCOME OVER DIRECT OPERATING EXPENSES

       $             668,457

Unaudited Estimated Taxable Operating Results

      The table below represents estimated taxable operating results of Applewood Apartments in Omaha, Nebraska for the first twelve-month period of the acquisition.  Said property is a 234-unit apartment community, of which assumptions of 8% annual vacancy.

 

Cash Flow Projections

 

 

Rental Revenue

                        $      1,501,444

Other Revenue

                               100,000

Interest Expense

                              -511,723

Operating Expenses

                              -710,000

Principle Mortgage Reduction

                                -104,285

OPERATING CASH FLOW

                        $         275,436

F-5

Independent Auditor’s Report

 To the Board of Trustees of Investors Real Estate Trust

       We have audited the accompanying Historical Summary of Gross Income and Direct Operating Expenses of Bloomington Business Center ("Historical Summary") for the years ended December 31, 2000, 1999 and 1998.  This Historical Summary is the responsibility of the management.  Our responsibility is to express an opinion on the Historical Summary based on our audit.

       We conducted our audits in accordance with auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Historical Summary is free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Historical Summary.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the Historical Summary.  We believe that our audits provide a reasonable basis for our opinion.

      The accompanying Historical Summary 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 Bloomington Business Center’s revenue and expenses.

      In our opinion, the Historical Summary referred to above presents fairly, in all material respects, the gross income and direct operating expenses described in Note 2 of Bloomington Business Center for the years ended December 31, 2000, 1999, and 1998 in conformity with accounting principles generally accepted in the United States of America.

 

/S/ Brady, Martz and Associates, P.C.
Brady, Martz, and Associates, P.C.
 
Minot, North Dakota

March 12, 2002

 F-6

Bloomington Business Plaza Historical Summary of Gross Income and Direct Operating Expenses for the Years Ended December 31, 2000, 1999, and 1998

GROSS INCOME

         12/31/00

             12/31/99

            12/31/98

      Real estate rentals

$              710,257

$              661,625

$              671,694

      Operating Expense Reimbursements

              363,052

              353,339

              360,045

      Total Gross Income

$           1,073,309

$           1,014,964

$           1,031,739

DIRECT OPERATING EXPENSES

 

      Utilities

$                16,760

$                15,795

$                24,266

      Repairs and Maintenance

                75,313

                91,365

                85,001

      Real Estate Taxes

              243,448

              238,443

              256,158

      Property Management

                54,031

                51,929

                53,662

      Insurance

                  9,113

                  8,042

                  9,444

   Total Direct Operating Expenses

 $              398,665

$              405,574

 $              428,531

EXCESS OF GROSS INCOME OVER DIRECT OPERATING EXPENSES

$              674,644

$              609,390

$              603,208

        The Notes to Historical Summary of Gross Income and Direct Operating Expenses are an integral part of this summary.

 F-7

Bloomington Business Center Notes to Historical Summary of Gross Income and Direct Operating Expenses for the Years Ended December 31, 2000, 1999, and 1998

Note 1.

Nature of Business
Bloomington Business Center is a multi-tenant commercial property located in Bloomington, Minnesota, containing 114,819 square feet of rentable space which was acquired on October 1, 2001.  The property was acquired from an entity controlled by Steven B. Hoyt who is a Trustee of IRET.  Therefore, Historical Summary of Gross Income and Direct Operating are being presented for three years.
 

Note 2.

Basis of Presentation
IRET Properties purchased Bloomington Business Center October 1, 2001.  The historical summary has been prepared for the purpose of complying with Regulation S-X, Rule 3-14 of the Securities and Exchange Commission (“SEC”), which requires certain information with respect to real estate operations acquired to be included with certain filings with the SEC.  This historical summary includes the historical gross income and direct operating expenses of Bloomington Business Center, exclusive of the following expenses which may not be comparable to the proposed future operations:

        (a)  interest expense on existing mortgage and borrowings
        (b)  depreciation of property and equipment
        (c)  professional expenses
       

Note 3.

Summary of Significant Accounting Policies
Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Capitalization Policy - Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized.  Expenditures for maintenance and repairs which do not add to the value or extend useful lives are charged to expense as incurred.

Revenue Recognition - Rental revenue is recognized on the straight-line basis, which averages minimum rents over the terms of the leases.  All leases are classified as operating leases and expire at various dates prior to December 31, 2007.  The following is a schedule by years of future minimum rents receivable on non-cancelable operating leases in effect as of December 31, 2000.

                                Year                                                         Amount
                                2001                                       $              737,933
                                2002                                                       614,826
                                2003                                                       488,894
                                2004                                                       402,650
                                2005                                                       310,996
                                Thereafter                             $              314,110
                                Total                                      $           2,869,409

 

Expense Reimbursement – Expense reimbursements represent operating expenses, including real estate taxes billed to the tenants and are recognized in the period the expenses are incurred.

 F-8

Bloomington Business Plaza Unaudited Interim Financial Statement  for the Period January 1, 2001 through September 30, 2001

GROSS INCOME

 

      Real estate rentals

       $              548,433

      Operating Expense Reimbursements

                     277,001

      Total Gross Income

       $              825,434

DIRECT OPERATING EXPENSES

 

      Utilities

       $                 9,658

      Repairs & Maintenance

                      60,912

      Real Estate Taxes

                    187,537

      Property Management Expense

                      41,931

      Insurance

                      10,598

      Total Direct Operating Expenses

       $             310,636

 

      

EXCESS OF GROSS INCOME OVER DIRECT OPERATING EXPENSES

       $             514,798

 Unaudited Estimated Taxable Operating Results

      The table below represents estimated taxable operating results of Bloomington Business Plaza, Bloomington, Minnesota for the first twelve-month period of the acquisition.  Said property is a net lease commercial structure consisting of 114,819 net rentable square footage, of which assumptions for net rent is based upon 7% vacancy.

 

Cash Flow Projections

 

 

Rental Revenue

                        $        694,021

Interest Expense

                              -352,500

Principle Mortgage Reduction

                                 -74,400

OPERATING CASH FLOW

                        $        267,121

 F-9
 Independent Auditor’s Report

To the Board of Trustees of Investors Real Estate Trust
 

      We have audited the accompanying Historical Summary of Gross Income and Direct Operating Expenses of Stone Container ("Historical Summary") for the year ended December 31, 2001.  This Historical Summary is the responsibility of the management.  Our responsibility is to express an opinion on the Historical Summary based on our audit.

       We conducted our audit in accordance with auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Historical Summary is free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Historical Summary.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the Historical Summary.  We believe that our audit provides a reasonable basis for our opinion.
 
      The accompanying Historical Summary 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 Stone Container’s revenue and expenses. 

      In our opinion, the Historical Summary referred to above presents fairly, in all material respects, the gross income and direct operating expenses described in Note 2 of Stone Container for the year ended December 31, 2001, in conformity with accounting principles generally accepted in the United States of America.

 
 
/S/ Brady, Martz and Associates, P.C.
Brady, Martz, and Associates, P.C.
 
Minot, North Dakota

March 12, 2002

 F-10

Stone Container Historical Summary of Gross Income and Direct Operating Expenses for the Year Ended December 31, 2001

GROSS INCOME

 

      Real estate rentals

       $             916,135

DIRECT OPERATING EXPENSES

                             0

 

EXCESS OF GROSS INCOME OVER DIRECT OPERATING EXPENSES

       $             916,135

               The Notes to Historical Summary of Gross Income and Direct Operating Expenses are an integral part of this summary.

 F-11

Stone Container Notes to Historical Summary of Gross Income and Direct Operating Expenses for the Year Ended December 31, 2001

Note 1.

Nature of Business
Stone Container is a single-tenant commercial property located in Roseville, Minnesota, containing 229,072 square feet of rentable space which was acquired on December 20, 2001.  The tenant is responsible for all costs and expenses.  Therefore, direct operating expenses have been excluded from the Historical Summary for the year ended December 31, 2001.
 

Note 2.

Basis of Presentation
IRET Properties purchased the Stone Container building December 20, 2001.  The historical summary has been prepared for the purpose of complying with Regulation S-X, Rule 3-14 of the Securities and Exchange Commission (“SEC”), which requires certain information with respect to real estate operations acquired to be included with certain filings with the SEC.  This historical summary includes the historical gross income and direct operating expenses of Stone Container, exclusive of the following expenses which may not be comparable to the proposed future operations:

        (a)  interest expense on existing mortgage and borrowings
        (b)  depreciation of property and equipment
        (c)  management and leasing  fees
        (d)  certain administrative and professional  expenses
        (e)  provision for income taxes
        (f) operating expenses such as utilities, real estate taxes, insurance, etc.
 

Note 3.

Summary of Significant Accounting Policies
Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Capitalization Policy - Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized.  Expenditures for maintenance and repairs which do not add to the value or extend useful lives are charged to expense as incurred.

Revenue Recognition - Rental revenue is recognized on the straight-line basis, which averages minimum rents over the terms of the leases.  The lease is classified as a triple-net lease, and will expire on December 31st 2010.  The following is a schedule by years of future minimum rents receivable on operating lease in effect as of December 31, 2001.

                                 Year                                                        Amount
                                2002                                       $              817,787
                                2003                                                       849,857
                                2004                                                       868,183
                                2005                                                       888,799
                                2006                                                       923,160
                                Thereafter                             $           4,100,388
                                Total                                      $           8,448,175

 F-12

Stone Container Unaudited Estimated Taxable Operating Results

    The table below represents estimated taxable operating results of Stone Container in Roseville, Minnesota for the first twelve-month period of the acquisition.  Said property is a net lease commercial structure consisting of 229,072 rentable square footage, of which assumptions for net rent is based upon 100% occupancy.

 

Cash Flow Projections

     

 

Rental Revenue

                        $        817,787

Interest Expense

                              -355,100

Principle Mortgage Reduction

                               -126,825

 OPERATING CASH FLOW

                        $        335,862

 F-13
 

Independent Auditor’s Report

To the Board of Trustees of Investors Real Estate Trust

       We have audited the accompanying Historical Summary of Gross Income and Direct Operating Expenses of Thresher Square ("Historical Summary") for the years ended December 31, 2001, 2000 and 1999.  This Historical Summary is the responsibility of the management.  Our responsibility is to express an opinion on the Historical Summary based on our audit.

       We conducted our audits in accordance with auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the Historical Summary is free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the Historical Summary.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the Historical Summary.  We believe that our audits provide a reasonable basis for our opinion.

       The accompanying Historical Summary 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 Thresher Square’s revenue and expenses.

       In our opinion, the Historical Summary referred to above presents fairly, in all material respects, the gross income and direct operating expenses described in Note 2 of Thresher Square for the years ended December 31, 2001, 2000, and 1999 in conformity with accounting principles generally accepted in the United States of America.

 
/S/ Brady, Martz and Associates, P.C.
Brady, Martz, and Associates, P.C.
 
Minot, North Dakota

March 12, 2002

 F-14

Thresher Square Historical Summary of Gross Income and Direct Operating Expenses for the Years Ended December 31, 2001, 2000 and 1999

GROSS INCOME

         12/31/01

             12/31/00

            12/31/99

      Real estate rentals

$           1,145,294

$           1,113,778

$           1,081,460

      Operating Expense Reimbursements

              936,287

              866,369

              820,621

      Other Income

                34,408

                33,052

                30,881

      Total Gross Income

$           2,115,989

$           2,013,199

$           1,932,962

DIRECT OPERATING EXPENSES

 

 

      Utilities

$              175,256

$              151,905

$              155,854

      Repairs and Maintenance

              457,100

              393,358

              380,893

      Real Estate Taxes

              351,410

              318,571

              320,450

      Property Management

              106,439

              100,570

                95,166

      Insurance

                13,740

                10,997

                10,144

   Total Direct Operating Expenses

 $           1,103,945

$              975,401

$              962,507

EXCESS OF GROSS INCOME OVER DIRECT OPERATING EXPENSES

$           1,012,044

$           1,037,798

$              970,455

                      The Notes to Historical Summary of Gross Income and Direct Operating Expenses are an integral part of this summary.

  F-15

Thresher Square Notes To Historical Summary of Gross Income and Direct Operating Expenses For The Years Ended December 31, 2001, 2000 and 1999.

Note 1.

Nature of Business
Thresher Square is a multi-tenant commercial property located in Minneapolis, Minnesota, containing 113,736 square feet of rentable space which was acquired on January 2, 2002.  The property was acquired from an entity controlled by Steven B. Hoyt who is a Trustee of IRET.  Therefore, Historical Summary of Gross Income and Direct Operating are being presented for three years.
 

Note 2.

Basis of Presentation
IRET Properties purchased Thresher Square January 2, 2002.  The historical summary has been prepared for the purpose of complying with Regulation S-X, Rule 3-14 of the Securities and Exchange Commission (“SEC”), which requires certain information with respect to real estate operations acquired to be included with certain filings with the SEC.  This historical summary includes the historical gross income and direct operating expenses of Thresher Square, exclusive of the following expenses which may not be comparable to the proposed future operations:

        (a)  interest expense on existing mortgage and borrowings
        (b)  depreciation of property and equipment
        (c)   professional expenses        
 

Note 3.

Summary of Significant Accounting Policies
Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.  Actual results could differ from those estimates.

Capitalization Policy - Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized.  Expenditures for maintenance and repairs which do not add to the value or extend useful lives are charged to expense as incurred.

Revenue Recognition - Rental revenue is recognized on the straight-line basis, which averages minimum rents over the terms of the leases.  All leases are classified as operating leases and expire at various dates prior to January 31, 2009.  The following is a schedule by years of future minimum rents receivable on non-cancelable operating leases in effect as of December 31, 2001.

                                 Year                                                            Amount
                                2002                                       $                 904,916
                                2003                                                          752,891
                                2004                                                          700,612
                                2005                                                          700,612
                                Thereafter                             $              1,817,916
                                Total                                      $              4,876,947

 

Expense Reimbursement – Expense reimbursements represent operating expenses, including real estate taxes billed to the tenants and are recognized in the period the expenses are incurred.

 F-16

Thresher Square Unaudited Estimated Taxable Operating Results

      The table below represents estimated taxable operating results of Thresher Square in Minneapolis, Minnesota for the first twelve-month period of the acquisition.  Said property is a net lease commercial structure consisting of 113,736 rentable square footage, of which assumptions for net rent is based upon 93% occupancy.

 

Cash Flow Projections

 

 

Rental Revenue

                        $    1,120,000

Interest Expense

                             -452,221

Principle Mortgage Reduction

                              -370,000

OPERATING CASH FLOW

                        $       297,779

 F-17