| Tower Realty Trust, Inc. | |||
| Ticker: | TOW | 120 West 45th Street, 24th Floor | |
| Exchange: | New York Stock Exchange | New York, NY 10036 | |
| Industry: | Financial (SIC Code 6531) | (212) 768-9010 | |
| # of Employees: | 65 | ||
| Type of Shares: | Common Shares | Filing Date: | 8/6/97 | |
| U.S. Shares: | 12,015,000 | Offer Date: | 10/9/97 | |
| Non-U.S. Shares: | 0 | Filing Price: | $25.00 | |
| Primary Shares: | 12,015,000 | Offer Price: | $26.00 | |
| Secondary Shares: | 0 | Gross Spread: | $1.69 | |
| Offering Amount: | $300,375,000 | Selling: | $1.02 | |
| Expenses: | - | Reallowance: | $0.10 | |
| Shares Out After: | 13,961,743 |
| Manager | Tier | Phone |
| Merrill Lynch & Co. | Lead Manager | (212) 449-4600 |
| Legg Mason Wood Walker, Inc. | Co-manager | (410) 539-4038 |
| Prudential Securities Incorporated | Co-manager | (212) 778-5420 |
| Smith Barney Inc. | Co-manager | (212) 723-7300 |
| Issuer's Law Firm: | Battle Fowler |
| Bank's Law Firm: | Hogan & Hartson |
| Auditor: | Coopers & Lybrand |
| Registrar/Transfer Agent: | American Stock Transfer & Trust Co |
Dollar amounts in U.S. millions except for per share data | |||||
| 3 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 3/31/97 | 3/31/96 | 3/31/97 | ||
| Revenue: | $28.73 | $7.70 | $7.76 | Assets: | $409.19 |
| Net Income: | -$7.46 | -$1.24 | -$1.33 | Curr Assets: | |
| EPS: | Liabilities: | $150.96 | |||
| Prior EPS: | $1.88 | $0.54 | Curr Liabilities: | ||
| Cash Flow/Oper: | $0.95 | -$1.63 | -$0.26 | Equity: | $258.23 |
| Cash Flow/Fin: | $5.61 | -$0.39 | -$1.17 | Cash: | $4.12 |
| Cash Flow/Inv: | -$6.79 | -$0.39 | |||
| Business Description |
| The company was formed to continue the commercial real estate business of Tower Equities, which has been engaged in the developing, acquiring, owning, renovating, managing, and leasing office properties in the Manhattan, Phoenix/Tucson and Orlando markets The Company will also own or have options to acquire four parcels of land which can support approximately 2.2 million square feet of development. As of June 30, 1997, the Properties were approximately 94.7% leased to over 350 tenants, and approximately 76% of the Company's Escalated Rent from its portfolio was derived from Properties located in central business district locations, including 46% from Properties located in the Manhattan office market. Substantially all of the Properties are located in anhattan, Phoenix, Tucson, and Orlando.The Company will operate as a fully integrated, self-administered, and self-managed real estate company and expects to qualify as a real estate investment trust ("REIT") for federal income tax purposes. The Company will continue Tower Equities' turnaround strategy of acquiring office properties at a significant discount to replacement cost that are underperforming due to physical, leasing, and/or operational deficiencies. Consistent with this strategy, the Company will seek to acquire office properties that present an attractive opportunity to create value and enhance cash flow through the Company's hands-on approach to property repositioning, including the implementation of property specific renovation and refurbishment programs for underperforming assets. The Company believes that the significant experience of its management in property development, redevelopment, construction, management, and leasing provide it with the expertise necessary to identify, acquire, upgrade, renovate, and reposition underperforming office properties. |
| Competition |
| The Company may be competing with other owners and developers that have greater resources and more experience than the Company. Additionally, the number of competitive properties in any particular market in which the Company's Properties are located could have a material adverse effect on both the Company's ability to lease space at the Properties or any newly acquired property and on the rents charged at the Properties. The Company believes that the Offering, the Line of Credit and its access as a public company tothe capital markets to raise funds during periods when conventional sources of financing may be unavailable or prohibitively expensive will provide the Company with substantial competitive advantages. Further, the Company believes that the number of real estate developers has decreased as a result of the recessionary market conditions and tight credit markets during the early 1990s as well as the reluctance on the part of more conventional financing sources to fund development and acquisition projects. |
| Business Plan |
| The company's primary business objective is to maximize stockholder value through increases in cash available for distribution and appreciation in the value of the Common Stock. The company plans to achieve this objective by implementing the internal and external growth strategies described below: (I) Contractual Rental Rate Increases, (ii) Tenant Rollover and (iii) Leasing of Vacant Space. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used for prepayment of mortgage indebtedness and certain expenses related thereto; acquisition of interests in the properties; payment of certain expenses incurred in connection with the offering and the Formation Transactions; and initial working capital needs. |
| Officer Name | Title | Age |
| Lawrence H. Feldman | Chairman of the Board, Chief Executive Officer and President | 43 |
| Robert L. Cox | Executive Vice President and Chief Operating Officer and Director Nominee | 36 |
| Joseph D. Kasman | Senior Vice President and Chief Financial Officer | 39 |
| Reuben Friedberg | Vice President -- Finance | 70 |
| Erick S. Reimer | Vice President -- Leasing | 38 |