Item 1. Business
United Dominion Realty Trust, Inc. (the "Trust"), a Virginia corporation, is a self-administered equity real estate investment trust ("REIT"), formed in 1972, whose business is devoted to one industry segment, the ownership and operation of income-producing real estate, primarily apartment communities in the Southeast. The Trust is a fully integrated real estate company with acquisition, construction and management capabilities. The Trust acquires, upgrades and operates its properties with the goals of maximizing its funds from operations ("FFO") (defined as income before gains [losses] on investments and extraordinary items adjusted for certain non-cash items, primarily real estate depreciation) and quarterly distributions to shareholders, while building equity primarily through real estate appreciation. Prior to 1991, the Trust's investment policy was to emphasize the acquisition of under-leased, under-managed, and/or under-maintained properties that could be physically or otherwise upgraded and could be acquired at significant discounts from replacement costs. At the beginning of 1991, changed economic conditions and the Trust's financial strength enabled it to embark on a major expansion of its apartment portfolio by taking advantage of unique buying opportunities resulting from the real estate credit crisis. This has enabled the Trust to (i) acquire more stable apartment properties having high occupancy levels and not requiring substantial renovation, and (ii) enter into new markets including the Baltimore/Washington area, central and south Florida, and Nashville and Memphis, Tennessee. During 1994, the Trust also made acquisitions for the first time in Delaware and Alabama. The properties have been acquired generally at significant discounts from replacement cost and at current yields believed to be attractive. The sellers have included financially distressed real estate limited partnerships, the RTC, the FDIC, lenders who had foreclosed and insurance companies seeking to reduce their real estate exposure. During the three years prior to 1994, the Trust purchased 36 apartment communities with 9,237 units for approximately $250 million. In 1994, the Trust purchased 47 apartment communities with 11,433 units for approximately $404 million. This includes 26 apartment communities with 5,318 units acquired in a portfolio purchase for $171 million, including closing costs. One of the portfolio properties containing 65 units at a cost of $1.6 million was subsequently resold. As of March 28, 1995, the Trust's portfolio of income-producing real estate consisted of 138 properties including 121 apartment complexes, 13 shopping centers, and 4 other properties. (See Item 2.
Item 2. Properties (continued) December 31, 1994
(1) Two anchor tenants occupying more than 60,000 square feet at this center filed for bankruptcy in 1993. Subsequently, 56,000 square feet has been leased.
(2) An achor tenant occupying more than 53,000 square feet at this center filed for bankruptcy in 1993.
(3) An anchor tenant occupying more than 34,800 square feet vacated in May 1992. This property was sold in February 1995.
(4) The Trust has experienced vacancies at this property over the past several years and has not leased the vacant space.
(5) Building was vacated by anchor tenant on 1993.
Item 3.
Item 3. Legal proceedings
None
Item 4.
Item 4. Submission of matters to a vote of security holders
No matters were submitted to a vote of the Trust's shareholders during the last quarter of its fiscal year ended December 31, 1994.
Executive Officers of the Registrant
The executive officers of the Trust, listed below, serve in their respective capacities for approximate one year terms and are subject to re-election annually by the Board of Directors, normally in May of each year.
Mr. McCann, a Director, has been the Trust's managing officer since 1974, serving as its President since 1979, its Secretary from 1974 to 1980, and its Treasurer from 1982 to 1985.
Mr. Dolphin, a Director, was first employed by the Trust in May, 1979 as Controller and served as Corporate Secretary from 1980 to January, 1994. He was elected Vice President of Finance in 1985 and Senior Vice President in 1987. Prior to joining the Trust, Mr. Dolphin was employed by Arthur Young and Company, Certified Public Accountants.
Mr. Kornblau, a Director, joined the Trust in 1991 as Senior Vice President and Director of Apartment Operations. From 1985 through 1990, he was President and Chief Executive Officer of Summit Realty Group, Inc. which managed the Trust's apartment properties during that period. He is a licensed real estate broker and a C.P.M.
Mr. Chess joined the Trust in October, 1987 as Director of Acquisitions. He was elected Assistant Vice President in 1988 and Vice President in 1989. From 1984 to 1987 he was employed by Manufacturers Life Insurance Company as Senior Analyst - Real Estate Syndications. He previously served in the Pennsylvania General Assembly and is admitted to the practice of law in Virginia and Pennsylvania.
Mr. Giannotti joined the Trust as Director of Development and Construction in September, 1985. He was elected Assistant Vice President in 1988 and Vice President in 1989. Prior to joining the Trust he was employed as Project Manager by Vaughan Associates, Architects and by Beckstoffer and Associates, Architects, both of Richmond, Virginia. He is a registered architect.
Ms. Surface joined the Trust in 1992 as Assistant Vice President and Legal Counsel and in 1994 was elected General Counsel, Corporate Secretary and Vice President. From 1986 to 1992, she was an attorney with the law firm of Hunton and Williams, the Trust's outside counsel.
Mr. Davis joined the Trust in March, 1989 as Controller and was subsequently elected Assistant Secretary. In 1991 he was elected Vice President. From 1986 to 1989, he was employed by Crestar Bank, Richmond, Virginia, as an officer and financial analyst. He was previously employed by Arthur Young & Company, Certified Public Accountants, Richmond, Virginia. He is a certified public accountant.
Part II
Item 5.
Item 5. Market for registrant's common equity and related stockholder matters
Incorporated herein by reference from the captions "Common Stock Price" and "Shareholders" appearing on the inside back cover of the Trust's 1994 Annual Report to Shareholders. Information regarding the Trust's dividend policy is included in Item 7.
Item 6.
Item 6. Selected financial data
Incorporated herein by reference from the caption "Selected Financial Information" appearing on page 21 of the Trust's 1994 Annual Report to Shareholders.
Item 7.
Item 7. Management's discussion and analysis of financial condition and results of operations.
Incorporated herein by reference from the caption "Management's Discussion of Financial Condition and Operations" appearing on pages 22 through 24 of the Trust's 1994 Annual Report to Shareholders, exclusive of graphs and related captions appearing therein.
Item 8.
Item 8. Financial statements and supplementary data
The Trust's consolidated financial statements at December 31, 1994 and 1993 and for each of the three years in the period ended December 31, 1994, and the independent auditor's report thereon and the Trust's unaudited quarterly financial data for the two-year period ended December 31, 1994 are incorporated herein by reference from pages 25 through 36 of the Trust's 1994 Annual Report to Shareholders.
Item 9.
Item 9. Changes in and disagreements with accountants on accounting and financial disclosure None
Part III
Item 10.
Item 10. Directors and executive officers of the registrant
Incorporated herein by reference from the Trust's definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders to be held on May 2, 1995.
Information required by this item regarding the executive officers of the Trust is included in Part I of this Form 10-K in the section entitled "Executive Officers of the Registrant".
Item 11.
Item 11. Executive compensation
Incorporated herein by reference from the Trust's definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders to be held on May 2, 1995.
Item 12.
Item 12. Security ownership of certain beneficial owners and management
Incorporated herein by reference from the Trust's definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders to be held on May 2, 1995.
Item 13.
Item 13. Certain relationships and related transactions
Incorporated herein by reference from the Trust's definitive proxy statement to be filed with respect to its Annual Meeting of Shareholders to be held on May 2, 1995.
Part IV
Item 14.
Item 14. Exhibits, financial statement schedules, and reports on Form 8-K
(a) The following documents are filed as a part of this report and are hereby incorporated by reference:
2. Financial Statement Schedules
Schedule II - Valuation and Qualifying Accounts 22
Schedule III - Summary of Real Estate Owned 23 - 25
All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the financial statements and notes thereto.
3. Exhibits
The exhibits listed on the accompanying exhibit index are filed as part of this annual report. See pages 18 - 20.
(b) Reports on Form 8-K
(i) A Form 8-K dated October 14, 1994 was filed with the Securities and Exchange Commission on October 31, 1994 and amended by a Form 8-K/A dated December 29, 1994. The filing reported the acquisition of certain properties which in the aggregate were deemed to be significant. The financial statements filed as a part of this report are statements of rental operations of Copperfield Apartments, Mediterranean Village Apartments, Briar Club Apartments, Covington Crossing Apartments and Hunters Trace Apartments.
UNITED DOMINION REALTY TRUST, INC.
EXHIBIT INDEX
Item 14 (a)
References to pages under the caption "Location" are to sequentially numbered pages of the manually signed original of this Form 10-K, and references to exhibits, forms, or other filings indicate that the form or other filing has been filed, that the indexed exhibit and the exhibit referred to are the same and that the exhibit referred to is incorporated by reference.
Exhibit Description Location
The Trust agrees to furnish to the Commission on request a copy of any instrument with respect to long-term debt of the Trust or its subsidiary the total amount of securities authorized under which does not exceed 10% of the total assets of the Trust.
23 Consent of Independent Page 44 Auditors
ITEM 14(a)(1) and (2), (c) and (d)
FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
CERTAIN EXHIBITS
FINANCIAL STATEMENT SCHEDULES
YEAR ENDED DECEMBER 31, 1994
UNITED DOMINION REALTY TRUST, INC.
RICHMOND, VIRGINIA
Schedule II
UNITED DOMINION REALTY TRUST, INC. VALUATION AND QUALIFYING ACCOUNTS For the years ended December 31, 1994 and 1993
(1) The balance is netted against the cost of real estate owned on the balance sheet
SCHEDULE III. Summary of Real Estate Owned
SCHEDULE III. Summary of Real Estate Owned (continued)
SCHEDULE III. Summary of Real Estate Owned (continued)
(a) The aggregate cost for federal income tax purposes was approximately $987 million at December 31, 1994 and $563 million at December 31, 1993.
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized.
United Dominion Realty Trust, Inc. (registrant)
By /s/ James Dolphin James Dolphin Senior Vice President, and Chief Financial Officer March 30, 1995
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on March 30, 1995 by the following persons on behalf of the registrant and in the capacities indicated.
/s/ John P. McCann /s/ R. Toms Dalton, Jr. John P. McCann R. Toms Dalton, Jr. Director, President and Chief Director Executive Officer
/s/ James Dolphin /s/ Jeff C. Bane James Dolphin Jeff C. Bane Director, Senior Vice President, Director Secretary and Chief Financial Officer
/s/ Jerry A. Davis /s/ John C. Lanford Jerry A. Davis John C. Lanford Vice President, Controller-Corporate Accounting Director and Chief Accounting Officer
/s/ C. Harmon Williams, Jr. /s/ H. Franklin Minor C. Harmon Williams, Jr. H. Franklin Minor Chairman of the Board of Directors Director
/s/ Barry M. Kornblau /s/ Robert P. Buford Barry M. Kornblau Robert P. Buford Director, Senior Vice President and Director Director of Apartments