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Taubman Realty Group Ltd Partnership – ‘8-K’ for 12/4/97

As of: Thursday, 12/18/97 · For: 12/4/97 · Accession #: 917473-97-28 · File #: 33-73988

  As Of                Filer                Filing    For·On·As Docs:Size

12/18/97  Taubman Realty Group LP           8-K:2,7    12/04/97    3:116K

Current Report — Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report on Form 8-K                            15     51K 
 2: EX-2        Purchase and Sale Agreement                           35    115K 
 3: EX-23       Consent of Auditors                                    1      5K

8-K — Current Report on Form 8-K
Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Acquisition or Disposition of Assets Financial Statements and Exhibits
1	1st Page - Filing Submission
2	Item 2. Acquisition or Disposition of Assets
"	Item 7. Financial Statements and Exhibits

8-K 1st Page of 15 TOC ↑Top Previous Next ↓Bottom Just 1st
 
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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 4, 1997

THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP
(Exact Name of Registrant as Specified in its Charter)

DELAWARE
(State or Other Jurisdiction of Incorporation)

33-73988                                            38-3097317    
 (Commission File Number)                (I.R.S. Employer Identification Number)

200 East Long Lake Road, Suite 300, P.O. Box 200, Bloomfield Hills, Michigan
                                                                  48303-0200
(Address of Principal Executive Office)                           (Zip Code)

(248) 258-6800
(Registrant's Telephone Number, Including Area Code)

None
 (Former Name or Former Address, if Changed Since Last Report)

8-K 2nd Page of 15 TOC 1st Previous Next ↓Bottom Just 2nd
Item 2. Acquisition or Disposition of Assets.                                   

On  December  4, 1997,  The  Taubman  Realty  Group  Limited  Partnership  (TRG)
completed the acquisition of The Falls shopping center.  Taubman  Centers,  Inc.
(TCO) is the  managing  general  partner of TRG.  The Center was  acquired  from
Heitman Capital  Management  Corp. on behalf of The Falls Partners  Limited L.P.
(the Seller) for $156 million in cash. The Seller is  unaffiliated  with TRG and
TCO and the  transaction  was  negotiated at arm's length.  In  negotiating  the
purchase price, TRG considered, among other factors, the Center's historical and
anticipated  cash  flows,  the  nature  and terms of the  leases,  the  physical
condition of the property,  expansion possibilities,  and market conditions. TRG
borrowed  under  an  existing  revolving  credit  facility  with  Union  Bank of
Switzerland (New York Branch) to fund the purchase price.                       

The Falls is an 824 thousand  square foot regional  shopping  center  located in
Dade County,  Florida.  The Center is anchored by Bloomingdale's and Macy's. The
Center was originally built in 1980 and was completely  redeveloped and expanded
in 1996.                                                                        

Item 7. Financial Statements and Exhibits.                                      

The following financial  statements and pro forma information are being supplied
as supplementary information to this filing on Form 8-K.                        

a-b Financial Statements and Pro Forma Information.             

Independent Auditors' Report.                           

            The Falls,  Historical  Summary  of  Revenues  and Direct  Operating
Expenses for the Year Ended December 31, 1996.          

            The Taubman Realty Group Limited  Partnership,  Pro Forma  Condensed
   Consolidated Balance Sheet, September 30, 1997 (unaudited).

            The Taubman Realty Group Limited  Partnership,  Pro Forma  Condensed
            Consolidated  Statement of Operations,  Year Ended December 31, 1996
(unaudited).                                            

            The Taubman Realty Group Limited  Partnership,  Pro Forma  Condensed
            Consolidated  Statement of Operations,  Nine Months Ended  September
30, 1997 (unaudited).                                   

c  Exhibits                                                   

            No. 2 -  Agreement of Purchase  and Sale By and  Between  The  Falls
            Limited L.P. and The Taubman Realty Group Limited Partnership  dated
            December  4,  1997  (without  exhibits  or  schedules, which will be
            supplementally provided to the  Securities  and Exchange  Commission
upon its request).                                      

No. 23 - Consent of Deloitte & Touche LLP.              

 2

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--------------------------------------------------------------------------------

The Falls                                                                       

Historical Summary of Revenues and Direct                                       
Operating Expenses for                                                          
the Year Ended December 31, 1996, and                                           
Independent Auditors' Report                                                    

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INDEPENDENT AUDITORS' REPORT                                                    

Partners                                                                        
The Taubman Realty Group Limited Partnership                                    
Bloomfield Hills, Michigan                                                      

We have  audited the  accompanying  Historical  Summary of  Revenues  and Direct
Operating Expenses of The Falls (the "Historical  Summary"),  for the year ended
December 31, 1996. This Historical  Summary is the  responsibility of The Falls'
management.  Our  responsibility  is to express  an  opinion  on the  Historical
Summary based on our audit.                                                     

We conducted our audit in accordance with generally accepted auditing standards.
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  (for
inclusion in a Form 8-K of The Taubman  Realty  Group  Limited  Partnership)  as
described  in  Note 1 to the  Historical  Summary  and is not  intended  to be a
complete presentation of The Falls' revenues and expenses.                      

In our  opinion,  such  Historical  Summary  presents  fairly,  in all  material
respects,  the revenues and direct operating expenses described in Note 1 to the
Historical  Summary  of The  Falls  for the  year  ended  December  31,  1996 in
conformity with generally accepted accounting principles.                       

Deloitte & Touche LLP                                                           
Detroit, Michigan                                                               
November 3, 1997                                                                

 4

8-K 5th Page of 15 TOC 1st Previous Next ↓Bottom Just 5th
THE FALLS                                                                       

HISTORICAL SUMMARY OF REVENUES AND DIRECT OPERATING EXPENSES                    
FOR THE YEAR ENDED DECEMBER 31, 1996                                            
--------------------------------------------------------------------------------

REVENUES:                                                                       
Minimum rents                                                 $5,215,686    
Percentage rents                                                 527,485    
Recoveries from tenants                                        2,546,689    
Other                                                            449,023    
                                                          ----------
                                                          $8,738,883

DIRECT OPERATING EXPENSES:                                                      
Recoverable from tenants                                      $2,793,997    
Other                                                            803,185    
                                                          ----------
                                                          $3,597,182
                                                          ----------

EXCESS OF REVENUES OVER DIRECT                                                  
OPERATING EXPENSES                                            $5,141,701    
                                                          ==========

See notes to historical summary.                                                

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8-K 6th Page of 15 TOC 1st Previous Next ↓Bottom Just 6th
THE FALLS                                                                       

NOTES TO HISTORICAL SUMMARY OF REVENUES AND DIRECT OPERATING                    
EXPENSES FOR THE YEAR ENDED DECEMBER 31, 1996                                   
--------------------------------------------------------------------------------

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                   

   General - The Falls is a regional shopping center located in Miami,  Florida,
   which was owned by The Falls  Partners  Limited L.P. (the  Partnership).  All
   authority to conduct the business affairs of the Partnership (other than sale
   or  mortgaging  of the  property)  was vested in Heitman  Capital  Management
   Company. The Center, originally built in 1980, was completely redeveloped and
   expanded in 1996. The expansion  opened on October 5, 1996.  Shopping  center
   space is  generally  leased  to  specialty  retail  tenants  under  short and
   intermediate term leases which are accounted for as operating leases.  Leases
   typically  provide for guaranteed  minimum rent,  percentage  rent, and other
charges to cover certain operating costs.                                 

   Basis of presentation - The accompanying  historical  summary of revenues and
   direct operating expenses has been prepared for the purpose of complying with
   the rules and  regulations  of the  Securities  and Exchange  Commission  for
   inclusion in a current report on Form 8-K of The Taubman Realty Group Limited
   Partnership (TRG). The accompanying  historical summary is not representative
   of the actual  operations  of the  shopping  center for the period  presented
   since  material  revenues and  expenses  which may not be  comparable  to the
   proposed  future  operation of The Falls by TRG have been excluded.  Revenues
   and expenses excluded consist of interest income,  property  management fees,
interest expense and depreciation and amortization.                       

   Revenue  recognition  - Minimum  rents are  recognized on an accrual basis as
   earned,  which  does  not  materially  differ  from a  straight-line  method.
   Percentage  rents are  recognized  on an  accrual  basis as  earned.  Expense
   recoveries, which include an administrative fee, are recognized as revenue in
the period applicable costs are chargeable to tenants.                    

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THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
September 30, 1997
 (unaudited)
(in thousands)

  This unaudited Pro Forma Condensed  Consolidated Balance Sheet is presented as
if (i) TRG's  acquisition of The Falls shopping center (ii) TRG's use of the net
proceeds  from the issuance of Series A Preferred  Equity to pay down short term
debt, and (iii) TRG's  acquisition  of interests in The Mall at Tuttle  Crossing
had occurred on September 30, 1997. In  management's  opinion,  all  adjustments
necessary  to reflect the  effects of these  transactions  have been made.  This
unaudited Pro Forma  Condensed  Consolidated  Balance  Sheet is not  necessarily
indicative of what the actual  financial  position  would have been at September
30, 1997, nor does it purport to represent the future financial position of TRG.

                                                        [Enlarge/Download Table]

                                              Adjustments                  Adjustments                   
                                                  for                         for                        
                                              Acquisition         Pro         Other          Pro         
                                Historical   of The Falls(A)     Forma     Transactions     Forma        
                                ----------   ---------------     -----     ------------     -----        
                                                                                                         
Assets:                                                                                                  
 Properties, net                $1,121,653      $156,700      $1,278,353   $  20,948(B)       $1,299,301 
 Other assets                       67,359                        67,359                          67,359 
                                ----------      --------      ----------   ---------          ---------- 
                                $1,189,012      $156,700      $1,345,712   $  20,948          $1,366,660 
                                ==========      ========      ==========   =========          ========== 
Liabilities:                                                                                             
 Debt                           $1,190,983      $156,000      $1,346,983   $(116,732)(B),(C)  $1,230,251 
 Capital lease obligation           55,320                        55,320     (55,320)(B)                 
 Accounts payable and                                                                                    
  other liabilities                117,132           700         117,832                         117,832 
 Distributions in excess of                                                                              
  net income of unconsolidated                                                                           
  Joint Ventures                   144,571                       144,571                         144,571 
                                ----------      --------      ----------   ---------          ---------- 
                                $1,508,006      $156,700      $1,664,706   $(172,052)         $1,492,654 

Series A Preferred Equity                                                    193,000(C)          193,000 

Accumulated deficiency                                                                                   
   in assets                      (318,994)                     (318,994)                       (318,994)
                                ----------      --------      ----------   ---------          ---------- 
                                $1,189,012      $156,700      $1,345,712   $  20,948          $1,366,660 
                                ==========      ========      ==========   =========          ========== 
Allocation of accumulated                                                                                
 deficiency in assets:                                                                                   
  General Partners              $ (247,064)                   $ (247,064)                      $(247,064)
  Limited Partners                 (71,930)                      (71,930)                        (71,930)
                                ----------                    ----------                      ---------- 
                                $ (318,994)                   $ (318,994)                     $ (318,994)
                                ==========                    ==========                      ========== 

See the accompanying Notes and Significant Assumptions

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THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP
 NOTES AND SIGNIFICANT ASSUMPTIONS
September 30, 1997

(A)  Represents TRG's December 1997 acquisition of The Falls shopping center for
     $156  million.  Transaction  costs were  approximately  $0.7  million.  The
     purchase  price  was  allocated  primarily  to  land,  buildings  and  site
     improvements.  TRG borrowed under an existing  revolving credit facility to
fund the acquisition.                                                 

(B)  In December  1997,  TRG acquired  interests in The Mall at Tuttle  Crossing
     from Tuttle  Crossing  Holding Co., a subsidiary of The Limited,  Inc. (The
     Limited).  TRG's  ownership  interest  in The Mall at Tuttle  Crossing  was
     subject to a  long-term  participating  lease with The Limited for land and
     leasehold improvements.  TRG purchased The Limited's interests in the lease
     for $76.3 million in cash and took fee simple title to the underlying  land
     and  buildings.  The lease had been  accounted  for as a capital lease with
     capital  lease assets and a capital  lease  obligation  of $55.3 million at
     September 30, 1997. TRG used an existing  revolving credit facility to fund
the acquisition.                                                      

(C)  In October  1997,  TCO  completed a $200 million  public  offering of eight
     million  shares of  Series A  Preferred  Stock.  TCO used the  proceeds  to
     acquire a Series A Preferred  Equity  interest in TRG that  entitles TCO to
     distributions (in the form of guaranteed  payments) in amounts equal to the
     dividends  payable  on TCO's  Series A  Preferred  Stock.  The costs of the
     offering were paid by TRG. TRG used the net proceeds to pay down short term
     debt under TRG's existing revolving credit and commercial paper facilities.

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THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Year Ended December 31, 1996
 (unaudited)
(in thousands, except unit data)

  This unaudited Pro Forma Condensed  Statement of Operations is presented as if
(i) TRG's  acquisition of The Falls shopping center;  (ii) TRG's  acquisition of
interests in Regency Square, The Mall at Tuttle Crossing,  Paseo Nuevo, Fairlane
Town  Center  and La Cumbre  shopping  centers;  and (iii)  TRG's use of the net
proceeds from issuances of units of partnership  interest and Series A Preferred
Equity to pay down  floating  rate debt had  occurred as of January 1, 1996.  In
management's  opinion, all adjustments necessary to reflect the effects of these
transactions  have been made.  This unaudited Pro Forma  Condensed  Statement of
Operations is not  necessarily  indicative of what actual  results of operations
would have been had these transactions  occurred on January 1, 1996, nor does it
purport to represent the results of operations for future periods.              

                                                        [Enlarge/Download Table]

                                                Adjustments                Adjustments              
                                                    for                       for                   
                                                Acquisition        Pro        Other          Pro    
                                   Historical  of The Falls(A)    Forma    Transactions     Forma   
                                   ----------  ---------------    -----    ------------     -----   
                                                                                                    
Revenues                           $262,729       $ 8,739       $271,468    $36,052(B)     $307,520 
                                   --------       -------       --------    -------        -------- 

Operating Costs:                                                                                    
Recoverable expenses               $ 72,093       $ 2,794       $ 74,887    $11,503(B)     $ 86,390 
Other operating                      26,518           990         27,508      3,608(B)       31,116 
Management, leasing and                                                                             
 development services                 4,212                        4,212                      4,212 
General and administrative           21,803                       21,803                     21,803 
Interest                             70,454         6,545         76,999     (5,496)(B),(C)  71,503 
Depreciation and amortization        35,770         2,811         38,581      6,571(B)       45,152 
                                   --------       -------       --------    -------        -------- 
                                   $230,850       $13,140       $243,990    $16,186        $260,176 
                                   --------       -------       --------    -------        -------- 

Income before equity in income                                                                      
 of unconsolidated Joint Ventures                                                                   
 and before extraordinary items    $ 31,879       $(4,401)      $ 27,478    $19,866        $ 47,344 
Equity in income before extra-                                                                      
 ordinary items of unconsolidated                                                                   
 Joint Ventures                      52,215                       52,215     (1,029)(B)      51,186 
                                   --------       -------       --------    -------        -------- 
Income before                                                                                       
  extraordinary items              $ 84,094       $(4,401)      $ 79,693    $18,837        $ 98,530 
Preferred distributions                                                     (16,600)(C)     (16,600)
                                   --------       --------      --------    -------        -------- 
Income before extraordinary                                                                         
  items allocable to unit holders  $ 84,094       $(4,401)      $ 79,693    $ 2,237        $ 81,930 
                                   ========       =======       ========    =======        ======== 

Allocation of income before                                                                         
 extraordinary items:                                                                               
 General Partners                  $ 65,913                     $ 62,463                   $ 63,455 
 Limited Partners                    18,181                       17,230                     18,475 
                                   --------                     --------                   -------- 
                                   $ 84,094                     $ 79,693                   $ 81,930 
                                   ========                     ========                   ======== 
Income before extraordinary                                                                         
items per Unit of Partnership                                                                       
 Interest                          $    .65                     $    .62                   $    .59 
                                   ========                     ========                   ======== 

Weighted Average Number of                                                                          
 Units of Partnership Interest                                                                      
 Outstanding                    128,931,584                  128,931,584  9,330,263(C)  138,261,847 
                                ===========                  ===========  =========     =========== 

See the accompanying Notes and Significant Assumptions  

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THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP
 NOTES AND SIGNIFICANT ASSUMPTIONS
Year Ended December 31, 1996

(A) Acquisition of The Falls                                                    

In December  1997,  TRG acquired  The Falls  shopping  center for $156  million.
Transaction  costs  were  approximately  $0.7  million.  TRG  borrowed  under an
existing revolving credit facility to fund the acquisition (average rate of 6.6%
in 1996).  The purchase  price was allocated  primarily to land and to buildings
and site  improvements,  which will be  depreciated  over 40 years and 15 years,
respectively.  TRG's estimated  incremental  costs of managing The Falls of $0.2
million  are  included  in pro forma  other  operating  expenses.  The pro forma
adjustment to interest is net of $3.7 million of capitalized interest,  assuming
interest costs incurred  relating to assets under  construction  would have been
capitalized until the opening of the redeveloped and expanded Center. Similarly,
depreciation  would not have been  recognized  on  constructed  assets until the
opening of the Center.  Pro forma  revenues and  expenses,  other than  interest
expense,  depreciation, and management expense, represent the historical amounts
of The Falls.                                                                   

The Falls was  completely  redeveloped  and expanded  during 1996.  Prior to the
opening of the  expansion on October 5, 1996,  the Center's  average mall tenant
occupancy (based on the square footage of the expanded center) was approximately
46%. As a result, the historical revenues and expenses are not representative of
future operations.                                                              

(B) Acquisition of Interests in Centers                                         

In June 1996,  TRG acquired the Paseo Nuevo  shopping  center,  located in Santa
Barbara,  California,  for $37 million. TRG used unsecured debt (average rate of
7.4% in  1996) to fund the  acquisition.  The  Center  is owned  subject  to two
participating  ground leases with remaining terms of approximately 70 years. TRG
also assumed a $2.0 million  note  receivable  due from the lessor of one of the
ground leases.  The note accrues interest at an annual rate of 10%. The purchase
price was allocated primarily to the buildings and site improvements,  which are
being depreciated over 40 years and 15 years,  respectively.  Pro forma revenues
and expenses  other than interest,  depreciation  and management fee expense are
based on unaudited information provided by the seller of the property.          

In July 1996, TRG completed transactions that resulted in the acquisition of the
75%  interest in Fairlane  Town Center  (Fairlane),  previously  held by a joint
venture partner.  In connection with the  transactions,  TRG issued to the joint
venture partner units of partnership  interest,  exchangeable for  approximately
6.1 million shares of TCO common stock,  which had a closing price of $10.75 per
share on the day prior to the issuance date.  TRG also assumed  mortgage debt of
$26 million, representing the former joint venture partner's beneficial interest
in the $34.6 million mortgage encumbering the property.  TRG used unsecured debt
(average rate of 7.4% in 1996) to fund the  repayment of the 9.73%  mortgage and
the prepayment  penalty of approximately  $1.2 million.  The acquisition,  which
resulted in TRG owning 100% of Fairlane,  was accounted for at fair value. Prior
to the acquisition  date, TRG's interest in Fairlane was accounted for under the
equity  method.  The  purchase  price  was  allocated  primarily  to land and to
buildings and site  improvements,  which are being depreciated over 40 years and
15 years, respectively. Pro forma revenues and expenses, other than interest and
depreciation and amortization, represent the historical amounts of Fairlane.    

In December 1996, TRG acquired La Cumbre Plaza in Santa Barbara,  California for
$22.25  million in cash.  TRG used proceeds from an equity  offering (Note C) to
fund the  acquisition.  The Center is subject to four  ground  leases  (three of
which are  participating).  The leases  expire in 2028.  The purchase  price was
allocated  primarily  to  buildings  and  site  improvements,  which  are  being
depreciated  over 40 years and 15 years,  respectively.  Pro forma  revenues and
expenses other than interest, depreciation, and management fee expense are based
on unaudited information provided by the seller of the property.                

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In September 1997, TRG acquired Regency Square shopping center for approximately
$123.9 million. TRG borrowed under its existing commercial paper facility and an
existing revolving credit facility to fund the acquisition (average rate of 6.6%
in 1996).  The purchase  price was allocated  primarily to land and to buildings
and site  improvements,  which are being depreciated over 40 years and 15 years,
respectively.   Pro  forma  revenues  and  expenses,  other  than  interest  and
depreciation, represent the historical amounts of Regency Square.               

In December 1997, TRG acquired interests in The Mall at Tuttle Crossing from The
Limited.  TRG's ownership interest in The Mall at Tuttle Crossing was subject to
a  long-term  participating  lease  with The  Limited  for  land  and  leasehold
improvements.  TRG  purchased  The  Limited's  interest  in the  lease for $76.3
million in cash and took fee simple title to the underlying  land and buildings.
TRG used an existing  revolving  credit  facility to fund the  acquisition.  The
lease was previously  accounted for as a capital lease with capital lease assets
and a capital lease  obligation of $55.3 million at September 30, 1997. Prior to
the opening of the Center in July 1997,  all  interest  expense  would have been
capitalized.                                                                    

(C) Issuances of Units of Partnership Interest and Series A Preferred Equity    

In December 1996,  TRG issued units of  partnership  interest to TCO for the $75
million proceeds from TCO's December 1996 equity offering of 5.97 million shares
of common stock.  Also in December  1996,  TCO exchanged 652 thousand  shares of
common  stock for TRG units of  partnership  interest  newly  issued under TRG's
incentive option plan. TRG used the net proceeds totaling $82.3 million from the
issuance of units to pay down short term  floating  rate debt  (average  rate of
7.0%) and to acquire La Cumbre Plaza.                                           

In October 1997, TCO completed a $200 million  public  offering of eight million
shares of Series A Preferred  Stock. TCO used the proceeds to acquire a Series A
Preferred Equity interest in TRG that entitles TCO to distributions (in the form
of  guaranteed  payments)  in amounts  equal to the  dividends  payable on TCO's
Series A Preferred  Stock.  The costs of the offering were paid by TRG. TRG used
net  proceeds of  approximately  $193  million to pay down short term debt under
TRG's existing revolving credit and commercial paper facilities (average rate of
6.6% for 1996).                                                                 

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THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
Nine Months Ended September 30, 1997
 (unaudited)
(in thousands, except unit data)

  This  unaudited Pro Forma  Condensed  Consolidated  Statement of Operations is
presented as if (i) TRG's  acquisition of The Falls shopping center;  (ii) TRG's
use of the net proceeds  from the  issuance of Series A Preferred  Equity to pay
down short term debt;  and (iii)  TRG's  acquisitions  of  interests  in Regency
Center and The Mall at Tuttle  Crossing  had  occurred  on  January 1, 1996.  In
management's  opinion, all adjustments necessary to reflect the effects of these
transactions  have been made.  This unaudited Pro Forma  Condensed  Consolidated
Statement of Operations is not necessarily  indicative of what actual results of
operations would have been had these  transactions  been completed as of January
1, 1996,  nor does it purport to represent the results of operations  for future
periods.                                                                        

                                                        [Enlarge/Download Table]

                                                Adjustments               Adjustments                  
                                                    for                      for                       
                                                Acquisition        Pro       Other             Pro     
                                   Historical  of The Falls(A)    Forma   Transactions        Forma    
                                   ----------  ---------------    -----   ------------        -----    
                                                                                                       
Revenues                           $223,961       $11,378       $235,339  $  9,540(B)         $244,879 
                                   --------       -------       --------  --------            -------- 

Operating Costs:                                                                                       
Recoverable expenses               $ 60,223       $ 3,594       $ 63,817  $  2,438(B)         $ 66,255 
Other operating                      26,218           911         27,129       308(B)           27,437 
Management, leasing and                                                                                
 development services                 3,553                        3,553                         3,553 
General and administrative           18,657                       18,657                        18,657 
Interest                             54,002         7,620         61,622    (3,682)(B),(C),(D)  57,940 
Depreciation and amortization        31,386         3,546         34,932     2,538(B)           37,470 
                                   --------       -------       --------  --------            -------- 
                                   $194,039       $15,671       $209,710  $  1,602            $211,312 
                                   --------       -------       --------  --------            -------- 

Income before equity in income                                                                         
 of unconsolidated Joint                                                                               
 Ventures                          $ 29,922       $(4,293)      $ 25,629  $  7,938            $ 33,567 
Equity in income of                                                                                    
 unconsolidated Joint Ventures       38,873                       38,873                        38,873 
                                   --------       -------       --------  --------            -------- 
Net income                         $ 68,795       $(4,293)      $ 64,502  $  7,938            $ 72,440 
Preferred Distributions                                                    (12,450)(C)         (12,450)
                                   --------       -------       --------  --------            -------- 
Net Income available to                                                                                
  unit holders                     $ 68,795       $(4,293)      $ 64,502  $ (4,512)           $ 59,990 
                                   ========       =======       ========  ========            ======== 

Allocation of net income:                                                                              
 General Partners                  $ 53,278                     $ 49,953                      $ 46,463 
 Limited Partners                    15,517                       14,549                        13,527 
                                   --------                     --------                      -------- 
                                   $ 68,795                     $ 64,502                      $ 59,990 
                                   ========                     ========                      ======== 

Net income per unit of                                                                                 
 Partnership Interest              $    .50                     $    .47                      $    .43 
                                   ========                     ========                      ======== 

Weighted Average Number of                                                                             
 Units of Partnership                                                                                  
 Interest Outstanding           138,261,847                  138,261,847                   138,261,847 
                                ===========                  ===========                   =========== 

See the accompanying Notes and Significant Assumptions

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THE TAUBMAN REALTY GROUP LIMITED PARTNERSHIP
 NOTES AND SIGNIFICANT ASSUMPTIONS
Nine Months Ended September 30, 1997

(A) Acquisition of The Falls                                                    

In December  1997,  TRG acquired  The Falls  shopping  center for $156  million.
Transaction  costs  were  approximately  $0.7  million.  TRG  borrowed  under an
existing revolving credit facility to fund the acquisition (average rate of 6.5%
for the nine months ended September 30, 1997).  The purchase price was allocated
primarily  to  land  and to  buildings  and  site  improvements,  which  will be
depreciated  over  40  years  and  15  years,   respectively.   TRG's  estimated
incremental  costs of managing  The Falls of $0.1  million  are  included in pro
forma other  operating  expenses.  Pro forma  revenues and expenses,  other than
interest  expense,  depreciation  and management  expense are based on unaudited
information provided by the seller of the property.                             

The Falls was  completely  redeveloped  and expanded  during 1996.  The expanded
Center's  mall  tenant  occupancy  was  approximately  80% at the opening of the
expansion on October 5, 1996 and was approximately 84% for the nine months ended
September  30,  1997.  Mall  tenant  occupancy  as of the  acquisition  date was
approximately  90%. As a result,  the  historical  revenues and expenses are not
representative of future operations.                                            

(B) Acquisition of Regency Square                                               

In September 1997, TRG acquired Regency Square shopping center for approximately
$123.9 million. TRG borrowed under its existing commercial paper facility and an
existing revolving credit facility to fund the acquisition (average rate of 6.5%
for the nine months ended September 30, 1997).  The purchase price was allocated
primarily  to land and to  buildings  and site  improvements,  which  are  being
depreciated  over 40 years and 15 years,  respectively.  Pro forma  revenues and
expenses,  other  than  interest  and  depreciation,   are  based  on  unaudited
information provided by the seller of the property.                             

(C) Series A Preferred Equity                                                   

In October 1997, TCO completed a $200 million  public  offering of eight million
shares of Series A Preferred  Stock. TCO used the proceeds to acquire a Series A
Preferred Equity interest in TRG that entitles TCO to distributions (in the form
of  guaranteed  payments)  in amounts  equal to the  dividends  payable on TCO's
Series A Preferred  Stock.  The costs of the offering were paid by TRG. TRG used
the net  proceeds  to pay down short term debt under  TRG's  existing  revolving
credit and commercial paper facilities (average rate of 6.5% for the nine months
ended September 30, 1997).                                                      

(D) Acquisition of Interests in The Mall at Tuttle Crossing                     

In December 1997, TRG acquired interests in The Mall at Tuttle Crossing from The
Limited.  TRG's ownership interest in The Mall at Tuttle Crossing was subject to
a  long-term  participating  lease  with The  Limited  for  land  and  leasehold
improvements.  TRG  purchased  The  Limited's  interest  in the  lease for $76.3
million in cash and took fee simple title to the underlying  land and buildings.
TRG used an existing revolving credit facility to fund the acquisition  (average
rate of 6.5% for the nine  months  ended  September  30,  1997).  The  lease was
previously  accounted  for as a capital  lease with  capital  lease assets and a
capital lease  obligation of $55.3 million at September 30, 1997. Lease payments
of $0.6 million were recognized as interest expense subsequent to the opening of
the Center in July 1997.  Prior to the opening all interest  expense  would have
been capitalized.                                                               

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SIGNATURES

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

                                        THE TAUBMAN REALTY GROUP
                                   LIMITED PARTNERSHIP

Date:   December 18, 1997                       By: /s/ Lisa A. Payne           
                                                    ----------------------------
                                     Lisa A. Payne
                                                    Executive Vice President and
                                               Chief Financial Officer

14

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 EXHIBIT INDEX

Exhibit Number                         Description                  

            2                                Agreement  of Purchase  and Sale By
                                             and Between The Falls  Limited L.P.
                                             and  The   Taubman   Realty   Group
                                             Limited Partnership, dated December
                                             4,  1997   (without   exhibits   or
                                             schedules,     which     will    be
                                             supplementally   provided   to  the
                                             Securities and Exchange  Commission
                            upon its request).

          23                               Consent of Deloitte & Touche LLP.

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘8-K’ Filing	Date	First	Last	Other Filings

Filed on:	12/18/97	14
For Period End:	12/4/97	1	15
	11/3/97	4
	9/30/97	2	13	10-Q
	12/31/96	2	10	10-K, 11-K
	10/5/96	6	13
	1/1/96	9	12
				List all Filings

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Filing Submission 0000917473-97-000028 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Taubman Realty Group Ltd Partnership – ‘8-K’ for 12/4/97

As of: Thursday, 12/18/97 · For: 12/4/97 · Accession #: 917473-97-28 · File #: 33-73988

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