SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 24, 2003
ONE LIBERTY PROPERTIES, INC.
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(Exact name of registrant as specified in charter)
Maryland 0-11083 13-3147497
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(State or other (Commission file No.) (IRS Employer
jurisdiction of I.D. No.)
incorporation)
60 Cutter Mill Road, Suite 303, Great Neck, New York 11021
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code 516-466-3100
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant hereby amends the following items, financial statements, exhibits
or other portions of its Current Report on Form 8-K, dated July 24, 2003 (filed
with the Securities and Exchange Commission on August 7, 2003), as set forth in
the pages attached hereto.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) and (b) Financial Statements of Property Acquired and Pro Forma
Financial Statements
Report of Independent Auditors 1
Statement of Revenues and Certain Expenses 2
Notes to Statement of Revenues and Certain Expenses 3-4
One Liberty Pro Forma Consolidated Financial Statements (Unaudited)
Pro Forma Consolidated Financial Statements (Unaudited) 5
Pro Forma Consolidated Balance Sheet (Unaudited) 6
Pro Forma Consolidated Income Statements (Unaudited) 7-8
Notes to Pro Forma Consolidated Balance Sheet and Income Statements (Unaudited) 9-10
(c) Exhibits
None
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ONE LIBERTY PROPERTIES, INC.
Dated: Great Neck, NY By: /s/ David W. Kalish
September 11, 2003 --------------------------------
David W. Kalish
Senior Vice President and
Chief Financial Officer
Report of Independent Auditors
Board of Directors and Stockholders
One Liberty Properties, Inc.
We have audited the statement of revenues and certain expenses of Andrita Stages
("Andrita Stages") as described in Note 1 to be acquired by OLP Los Angeles,
Inc., a wholly owned subsidiary of One Liberty Properties, Inc. (the "Company")
and Andrita GERP LLC as tenants in common, for the period from September 15,
2002 (commencement of operations) to December 31, 2002. The statement of
revenues and certain expenses is the responsibility of Andrita Stages'
management. Our responsibility is to express an opinion on this statement of
revenues and certain expenses 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 and
certain 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 and certain expenses. An audit also includes assessing the
accounting principles used and the significant estimates made by management, as
well as evaluating the overall statement of revenues and certain expenses
presentation. We believe that our audit provides a reasonable basis for our
opinion.
The accompanying statement of revenues and certain expenses was prepared for the
purpose of complying with Rule 3-14 of Regulation S-X of the Securities and
Exchange Commission for inclusion in Form 8-K of One Liberty Properties, Inc.
and is not intended to be a complete presentation of Andrita Stages' revenues
and expenses.
In our opinion, the statement of revenues and certain expenses referred to above
presents fairly, in all material respects, the revenues and certain expenses of
Andrita Stages as described in Note 2 for the period from September 15, 2002
(commencement of operations) to December 31, 2002, in conformity with accounting
principles generally accepted in the United States.
New York, New York
July 11, 2003
Andrita Stages
Statement of Revenues and Certain Expenses
Period from
September 15, 2002
(commencement
Six months ended of operations) to
June 30, December 31,
2003 2002
---------------- ----------------
(unaudited)
Revenues:
Base rents $1,320,327 $ 770,191
Fee revenues 12,500 170,511
------ -------
Total rental revenue 1,332,827 940,702
--------- -------
Certain expenses:
Property operating expenses 141,288 172,586
------- -------
Total certain expenses 141,288 172,586
------- -------
Revenues in excess of certain expenses $1,191,539 $ 768,116
========== ==========
See accompanying notes.
Andrita Stages
Notes to Statement of Revenues and Certain Expenses
1. Organization and Basis of Presentation
Presented herein is the statement of revenues and certain expenses related to
the operation of Andrita Stages (the "Property"), a studio and office building
in Los Angeles, California. Andrita Stages has approximately 109,000 square feet
of leasable space. The Property, which is currently owned by Kingston-Andrita,
LLC, is not a legal entity, but rather a property which is under contract for
purchase by OLP Los Angeles, Inc., a wholly owned subsidiary of One Liberty
Properties, Inc. (the "Company").
The accompanying statement of revenues and certain expenses has been prepared in
accordance with the applicable rules and regulations of the Securities and
Exchange Commission for the acquisition of real estate properties. Accordingly,
the statement of revenues and certain expenses exclude certain expenses that may
not be comparable to those expected to be incurred in the future operations of
the aforementioned property. Items excluded consist of interest, depreciation,
and amortization.
2. Use of Estimates
The preparation of the statement of revenues and certain expenses in conformity
with accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the amounts reported in
the statement of revenues and certain expenses and accompanying notes. Actual
results could differ from those estimates.
3. Revenue Recognition
The lease with the tenant is accounted for as an operating lease. Base rent is
recognized on a straight-line basis over the lease term. The excess of the
amount so recognized over the contractual amount due pursuant to the underlying
lease amounted to approximately $142,000 for the period from September 15, 2002
(commencement of operations) to December 31, 2002.
4. Risks and Uncertainties
The Property is leased to a single tenant, Playboy Entertainment Group ("the
Tenant"), which occupies 100% of the Property's total gross leasable area.
Therefore, the Property's results of operations are significantly dependent on
the overall health of the Tenant and the entertainment industry.
Andrita Stages
Notes to Statement of Revenues and Certain Expenses (Continued)
5. Base Rents
On September 20, 2001, Playboy entered into a 15-year lease agreement (the
"Lease") to lease the Property. The Lease provides for annual base rent, as well
as the payment of applicable expenses associated with the Property. The Lease
also provides for rent to commence upon the earlier of (i) possession of the
Property (ii) upon the date of which the Property becomes operational, as
defined or (iii) at the date the Property is substantially completed as defined.
Subsequent to the completion of the renovations Playboy commenced operations in
September 2002. Accordingly, the Lease commenced in September 2002 with annual
base rent ranging from $1.9 million to $3.0 million through 2017.
6. Future Minimum Rents
Future minimum lease payments to be received by the Property as of December 31,
2002 under a noncancellable operating lease are as follows:
2003 $ 1,946,358
2004 2,234,022
2005 2,298,553
2006 2,365,019
2007 2,433,479
Thereafter 27,704,352
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$ 38,981,783
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7. Interim Unaudited Financial Information
The statement of revenues and certain expenses for the six months ended June 30,
2003 is unaudited, however, in the opinion of management, all adjustments
(consisting solely of normal, recurring adjustments) necessary for the fair
presentation of the statement of revenues and certain expenses 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.
One Liberty Properties, Inc.
Pro Forma Consolidated Financial Statements
(Unaudited)
On July 24, 2003, OLP Los Angeles, Inc., a wholly-owned subsidiary of One
Liberty Properties, Inc. (the "Company") acquired in an arms length transaction
a 50% tenancy in common interest in Andrita Stages (the "Property") located in
Los Angeles, California.
The unaudited pro forma consolidated balance sheet of One Liberty Properties,
Inc. as of June 30, 2003, has been prepared as if the Company's acquisition of
the Property had been consummated on June 30, 2003. The unaudited pro forma
consolidated income statements for the year ended December 31, 2002 and for the
six months ended June 30, 2003, are presented as if the Company's acquisition of
the Property occurred on September 15, 2002 (commencement of operations). The
effect was carried forward through the year ended December 31, 2002 and six
month period ended June 30, 2003.
The pro forma consolidated financial statements do not purport to represent what
the Company's financial position or results of operations would have been
assuming the completion of the Company's acquisition of the Property had
occurred on September 15, 2002 (commencement of operations), and for the year
and six months indicated, nor do they purport to project the Company's financial
position or results of operations at any future date or for any future period.
These pro forma consolidated financial statements should be read in conjunction
with the Company's 2002 annual report on Form 10-K and the Company's Quarterly
Form 10-Q for the period ended June 30, 2003.
One Liberty Properties, Inc.
Pro Forma Consolidated Balance Sheet (Unaudited)
As of June 30, 2003
(Amounts in thousands)
The
The Company Purchase Company
Historical of Pro Forma
(A) Property as Adjusted
----------- -------- -----------
Assets
Real estate investments, at cost:
Land $ 32,050 $ 4,300(B) $ 36,350
Buildings 127,463 17,200(B) 144,663
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159,513 21,500 181,013
Less accumulated depreciation 12,333 - 12,333
------ --- ------
147,180 21,500 168,680
Investment in unconsolidated joint ventures 16,630 - 16,630
Mortgage receivable - 7,000(C) 7,000
Cash and cash equivalents 4,969 - 4,969
Unbilled rent receivable 3,839 - 3,839
Rent, interest, deposits and other receivables 3,326 - 3,326
Note receivable - officer 162 - 162
Investment in BRT Realty Trust (related party) 478 - 478
Deferred financing costs 1,634 - 1,634
Other 687 - 687
------ ------ -----
$ 178,905 $ 28,500 $ 207,405
========== ========== ==========
Liabilities and stockholders' equity
Mortgages payable $ 82,642 $ - $ 82,642
Line of credit 3,000 17,750(D) 20,750
Dividends payable 2,136 - 2,136
Accrued expenses and other liabilities 1,510 - 1,510
----- ----- -----
Total liabilities 89,288 17,750 107,038
------ ------ -------
Commitments and contingencies - - -
Minority interest - 10,750(E) 10,750
Stockholders' equity:
Redeemable convertible preferred stock 10,693 - 10,693
Common stock 5,687 - 5,687
Paid-in capital 66,465 - 66,465
Accumulated other comprehensive income 411 - 411
Accumulated undistributed net income 6,361 - 6,361
----- ----- -----
Total stockholders' equity 89,617 - 89,617
------ ----- ------
$ 178,905 $ 28,500 $ 207,405
========== =========== ==========
See accompanying notes.
One Liberty Properties, Inc.
Pro Forma Consolidated Income Statement (Unaudited)
For the Year Ended December 31, 2002
(Amounts in thousands, except per share data)
The
The Company Purchase of Company
Historical Property Pro Forma Pro Forma
(A) (B) Adjustments as Adjusted
----------- ----------- ----------- -----------
Revenues:
Rental income $ 14,879 $ 941 $ - $ 15,820
Interest and other income (including
231 from an affiliated joint venture) 826 - 184 (C) 1,010
--- --- --- -----
15,705 941 184 16,830
------ ----- --- ------
Expenses:
Depreciation and amortization 2,876 - 125 (D) 3,001
Interest - mortgages payable 5,964 - - 5,964
Interest - line of credit 54 - 224 (E) 278
Leasehold rent 24 - - 24
General and administrative 1,675 - - 1,675
Public offering expenses 125 - - 125
Real estate expenses 174 173 - 347
--- --- --- ---
10,892 173 349 11,414
------ --- --- ------
Earnings before equity in earnings of
unconsolidated joint ventures, loss
on sale and minority interest 4,813 768 (165) 5,416
Equity in earnings of unconsolidated
joint ventures 1,078 - - 1,078
Loss on sale of real estate and
available-for-sale securities (11) - - (11)
--- ---- ---- -----
Net income before minority interest 5,880 768 (165) 6,483
Minority interest - (384) (F) 63 (F) (321)
--- ---- -- ----
Net income $ 5,880 $ 384 $ (102) $ 6,162
========== ========= ========== ==========
Calculation of net income applicable
to common stockholders:
Net income $ 5,880 $ 384 $ (102) $ 6,162
Less dividends on preferred stock 1,037 - - 1,037
----- --- --- -----
Net income applicable to
common stockholders $ 4,843 $ 384 $ (102) $ 5,125
========== ========= ========== ==========
Net income per common share
Basic (G) $ 1.05 $ 1.11
========== ==========
Diluted (G) $ 1.04 $ 1.10
========== ==========
See accompanying notes.
One Liberty Properties, Inc.
Pro Forma Consolidated Income Statement (Unaudited)
For the Six Months
Ended June 30, 2003
(Amounts in thousands,
except per share data)
The
The Company Purchase of Company
Historical Property Pro Forma Pro Forma
(A) (B) Adjustments as Adjusted
----------- ----------- ----------- -----------
Revenues:
Rental income $ 8,990 $ 1,333 $ - $ 10,323
Interest and other income (including
194 from an affiliated joint venture) 236 - 315(C) 551
--- --- ---- --- ---
9,226 1,333 315 10,874
----- ----- --- ------
Expenses:
Depreciation and amortization 1,553 - 215(D) 1,768
Interest - mortgages payable 3,172 - - 3,172
Interest - line of credit 210 - 351(E) 561
General and administrative 1,065 - - 1,065
Real estate expenses 276 141 - 417
--- --- --- ---
6,276 141 566 6,983
----- --- --- -----
Earnings before equity in earnings of
unconsolidated joint ventures, gain
on sale and minority interest 2,950 1,192 (251) 3,891
Equity in earnings of unconsolidated
joint ventures 1,243 - - 1,243
Gain on sale of real estate 14 - - 14
-- --- --- --
Net income before minority interest 4,207 1,192 (251) 5,148
Minority interest - (596) (F) 108(F) (488)
--- ---- --- ----
Net income $ 4,207 $ 596 $ (143) $ 4,660
=========== ========== ========== ===========
Calculation of net income applicable
to common stockholders:
Net income $ 4,207 $ 596 $ (143) $ 4,660
Less dividends on preferred stock 518 - - 518
--- --- --- ---
Net income applicable to
common stockholders $ 3,689 $ 596 $ (143) $ 4,142
=========== ========== ========== ===========
Net income per common share
Basic (G) $ .65 $ .73
=========== ===========
Diluted (G) $ .65 $ .73
=========== ===========
See accompanying notes.
One Liberty Properties, Inc.
Notes to Pro Forma Consolidated Financial Statements
(Unaudited)
1. Notes to Pro Forma Consolidated Balance Sheet as of June 30, 2003
(A) To reflect the unaudited consolidated balance sheet of One Liberty
Properties, Inc. (the "Company") as of June 30, 2003, as reported on
the Company's Quarterly Report on Form 10-Q.
(B) To reflect the July 24, 2003 purchase allocation of the Company's
acquisition of the property located in Los Angeles, California (the
"Property"), as of June 30, 2003, for approximately $21.5 million.
There was no independent valuation performed on the Property. The
Company intends to account for the acquisition in accordance with SFAS
141 and 142. We are currently in the process of analyzing the fair
value of the in-place lease; and, consequently, no value has yet been
assigned to the lease in the accompanying pro forma balance sheet.
Therefore, the purchase price allocation is preliminary and subject to
change.
(C) To reflect the short-term secured financing that the Company provided
to the other 50% tenant in common pending completion of permanent
financing secured by this Property.
(D) To reflect the funds borrowed under the Company's line of credit used
to purchase the Property.
(E) To reflect the minority owner's 50% tenancy in common.
2. Notes to Pro Forma Consolidated Income Statement for the Year Ended
December 31, 2002
(A) To reflect the consolidated income statement of the Company for the
year ended December 31, 2002, as reported on the Company's Form 10-K.
(B) To reflect the historical operations of the Property for the period
from September 15, 2002 (commencement of operations of
the Property) to December 31, 2002.
(C) To reflect interest income on the $7 million mortgage at 9% for the
period from September 15, 2002 to December 31, 2002.
..
(D) To reflect straight line depreciation for the Property based on
an estimated useful life of 40 years for the period from
September 15, 2002 to December 31, 2002.
One Liberty Properties, Inc.
Notes to Pro Forma Consolidated Financial Statements
(Unaudited) - Continued
(E) To reflect the interest expense for the period from September 15, 2002
to December 31, 2002 for borrowings under the revolving line of credit
($17.75 million at approximately 4.3%) used to fund substantially all
of the Company's 50% interest in the Property plus the $7 million it
provided the other 50% tenant in common as short-term financing.
(F) To reflect the minority owner's 50% tenancy in common share of
depreciation expense associated with the Property.
(G) Basic net income per common share is calculated based on approximately
4,614,000 weighted average common shares outstanding and diluted net
income per common share is calculated based on approximately 4,644,000
weighted average common shares and common share equivalents
outstanding.
3. Notes to Pro Forma Consolidated Income Statement for the Six Months
Ended June 30, 2003
(A) To reflect the consolidated income statement of the Company for the six
months ended June 30, 2003, as reported on the Company's Quarterly
Report on Form 10-Q.
(B) To reflect the historical operations of the Property for the six months
ended June 30, 2003.
(C) To reflect interest income on the $7 million mortgage at 9%.
(D) To reflect straight line depreciation for the Property based on an
estimated useful life of 40 years.
(E) To reflect the interest expense for borrowings under the revolving line
of credit ($17.75 million at approximately 4%) used to fund
substantially all of the Company's 50% interest in the Property plus
the $7 million it provided the other 50% tenant in common as short-term
financing.
(F) To reflect the minority owner's 50% tenancy in common share of
depreciation expense associated with the Property.
(G) Basic net income per common share is calculated based on approximately
5,660,000 weighted average common shares outstanding and diluted net
income per common share is calculated based on approximately 5,691,000
weighted average common shares and common share equivalents
outstanding.