BINGHAM FARMS, Mich., May 14 /PRNewswire-FirstCall/ -- Malan Realty
Investors, Inc. (NYSE: MAL), a self-administered real estate investment trust
(REIT), announced that net assets in liquidation for the first quarter ended
March 31, 2004, decreased by $506,000 from the fourth quarter ended
December 31, 2003, to $27.4 million.
The estimated fair value on the remaining properties held for sale
decreased approximately $224,000 based on updated analysis. The reserve for
estimated liquidation costs increased approximated $337,000, primarily due to
increases in actual other professional fees over what was previously projected
and an increase in the estimated cost for insurance during the liquidation
period. These decreases were offset by net operating income from the
properties of approximately $1.6 million during the period. A distribution of
$1.5 million was made to shareholders on January 26, 2004.
As a result of the approval of a plan of complete liquidation by its
shareholders, the company adopted the liquidation basis of accounting for all
periods beginning after September 30, 2002. On September 30, 2002, in
accordance with the liquidation basis of accounting, assets were adjusted to
estimated net realizable value and liabilities were adjusted to estimated
settlement amounts, including estimated costs associated with carrying out the
liquidation. Accordingly, Malan no longer reports net income or funds from
operations.
Malan closed on the sales of three properties and a vacant land parcel
during the quarter and three additional properties subsequent to March 31,
2004, at contract prices totaling $18.5 million. The company currently has 14
operating properties under contract.
"The year to date has been very successful, with proceeds from property
sales of approximately $18 million and the final redemption of the convertible
subordinated debentures scheduled for next month," said Jeffrey Lewis,
president and chief executive officer of Malan Realty Investors. "A majority
of our properties are currently under contract for sale, which will allow us
to reduce debt further and meet our principal obligations."
The company also announced during the quarter that it would complete the
redemption of its convertible subordinated debentures on June 1, 2004. The
aggregate principal balance of its 9.5 percent Convertible Subordinated
Debentures due July 15, 2004, is currently $7.1 million.
Malan Realty Investors, Inc. is continuing to liquidate its assets and
currently expects that no later than August 28, 2004, any then remaining
assets and liabilities will be transferred to a liquidating trust. Each
shareholder of Malan will automatically become the holder of one unit of
beneficial interest in the trust for each share of Malan common stock, and all
outstanding shares of Malan common stock will automatically be deemed
cancelled. Malan Realty Investors, Inc. will seek relief for the trust from
registering the units under Section 12(g) of the Securities Exchange Act of
1934, as amended, and its obligation to file periodic reports.
Subject to limited exceptions related to transfer by will, intestate
succession or operation of law, the units will not be transferable nor will a
unit holder have authority, opportunity or power to sell or in any other
manner dispose of any units. As a result, the beneficial interests in the
liquidating trust will not be listed on any securities exchange or quoted on
any automated quotation system of a registered securities association.
Shareholders who may need or wish liquidity with respect to their company
common stock before the liquidating trust makes liquidating distributions
should look into selling their shares while the common stock is still traded
on an established market.
Malan Realty Investors, Inc. owns and manages properties that are leased
primarily to national and regional retail companies. In August 2002, the
company's shareholders approved a plan of complete liquidation. The company
owns a portfolio of 21 properties located in seven states that contains an
aggregate of approximately 1.5 million square feet of gross leasable area.
Safe Harbor Statement: This news release may contain forward-looking
statements. Although the company believes that the statements and projections
are based on reasonable assumptions, actual results may differ from those
projected. Key factors that could cause actual results to differ materially
include uncertainties regarding the length of time required to sell the
company's properties and execute its plan of liquidation and expenses incurred
during the liquidation period, changing market conditions affecting the sales
price of the company's properties, the effect of changes in proceeds from
property sales on liquidating distributions due to the company's capital
structure, bankruptcies and other financial difficulties of tenants, the cost
of addressing environmental concerns, unforeseen contingent liabilities, and
other risks associated with the commercial real estate business, as detailed
in the company's filings from time to time with the Securities and Exchange
Commission. Many of these factors are beyond the control of the company.
Malan does not undertake to update these forward-looking statements.
News releases for Malan Realty Investors are available on the company's
Web site at http://www.malanreit.com or in the Company News section on the
PR Newswire Web site at http://www.prnewswire.com .
SOURCE Malan Realty Investors, Inc.
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Related links:
http://www.malanreit.com
CONTACT:
John Roberson, Media Relations of Malan
Realty Investors, Inc., +1-248-644-7110, or Fred Nachman of
Marjan Communications Inc., +1-312-867-1771
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