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NEWS ANALYSIS OF SECURITIES OF REAL ESTATE INVESTMENT TRUSTS 

® 

December 8, 1978 ©1978 Audit Investment Research, Inc. VOL. IX, No. 23 


RELATIVE APPEAL PvANKING AND ADVISORY ISSUE 

General Growth’s move to go private makes property trusts attractive 1 

Ranking changes stress values, resistance to rising interest rates 2 

Mergers/acquisitions: Investors Pvealty agrees to acquire Summit Props 2 

Tenders / exchanges : QIR Properties and Institutional Investors begin offers 2 

Bi-monthly RELATIVE APPEAL RANKINGS and comment on 130 trusts ................ 3^16 



GENERAL GROWTH’S MOVE TO GO PRIVATE MAKES 

PROPERTY TRUSTS HIGH ON YOUR BUY LISTS 

For months now we’ve been pointing out 
the enormous disparity between market value 
of real estate stocks and the market value 
of their underlying properties. The real 
estate market, fueled by a flood of for- 
eign and tax-motivated buyers, has been 
willing to pay extremely high prices by 
historical standards, for property simply 
to own a much prized asset, U.S. real es- 
tate. That property is generally supposed 
to provide a superior inflation hedge be- 
cause of this country’s stable economic 
and political climate. 

But stocks of companies owning this 
same type of real estate have lagged on 
Wall Street for many reasons, mainly the 
difficulty investors have in understanding 
the underlying values under accounting 
rules designed to give the most conserva- 
tive view of value and earnings. 

This impelled several large companies 
— Tishman Realty and Monumental Proper- 
ties — to liquidate or go private because 
investors didn’t give them a high enough 
multiple to make it worthwhile to stay 
public. 

Now General Growth Properties , by all 
odds the most successful REIT by a wide 
margin, has surprised everyone by seeking 
to go private also. This time the problem 


isn’t price (GGP has always sold far above 
book value) but appears more related 
to the fact that principal shareholders 
see the risks of real estate development 
rising sharply and have no desire to heap 
that load upon public shareholders. 

Specifically, Martin and Matthew 
Buclcsbaum, whose families own directly or 
indirectly about 15% of GGP’s shares, are 
proposing to buy all other public shares 
at either $28 cash or $30 in promissory 
notes designed to qualify for installment 
sale treatment for Federal income tax pur- 
poses. 

GGP’s trustees will investigate the 
proposal, including hiring an independent 
investment banking firm to advise them, 
and take action. Completion of the offer 
depends upon numerous actions, including 
obtaining of financing, completion of a 
definitive merger agreement, approval by 
GGP shareholders, and processing of an 
offering circular to make the offer. 

Realistically we expect those actions 
to be completed, because shareholders have 
approved breaking up of several other real 
estate companies the past two years. For 
example. Monumental Properties Trust was 
carved out of life insurance holding com- 
pany Monumental Corp. to liquidate the 
shopping center and apartment holdings 
of that company. And stock market action 
has been very favorable to the break-up 


KENNETH D. CAMPBELL. EDITOR AND PUBLISHER 


AUDIT INVESTMENT RESEARCH, INC , 230 PARK AVENUE, NEW YORK 1001 7 


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2 


December 8, 1978 


so far. 

Early this year. Monumental Corp, 
traded between 16-3/4 and 21, Today the 
shares still trade about 20^ — but hold- 
ers also received a unit in the liquidat- 
ing trust now selling for 39^, In other 
words, holders tripled their money because 
the stock market v/ill pay up for real es- 
tate dead as a stock if it thinks it will 
get a big payoff fairly quickly. 

News of the GGP proposal now should 
focus your attention on shares of other 

property trusts with good quality assets 

suitable for a liquidation, either as a 

management or third-party proposal. 

Already there’s been strong market 
interest in some candidates: B.F. Saul 
REIT and Canal Randolph , an operating real 
estate company, were strong NYSE gainers 
following the GGP news. San Francisco 
Real Estate was a standout on the ASE. 


BankAmerica Realty ; Continental Illinois 
Properties ; Federal Realty ; First Union RE ; 
Florida Gulf Realty ; GPdllT Realty ; Investors 
Realty ; H enry S. Miller Realty ; New Plan Real- 
ty ; Pennsylvania REIT . 

Moved to No. 2 because of less-compelling 
fundamentals or price moves already are Baird 
& Warner Mtg . , Franklin Realty , Growth Realty , 
and B.F. Saul REIT . 

Some of these trusts are already active 
in the deal market: Federal Realty seeks to 
acquire a string of shopping centers from 
liquidating Amterre Devel.; Investors Realty 
seeks Summit Props , (below) . A nex^^ manager 
has taken over as president of GREIT and 
could change that situation. Insiders have 
been buying B.F. Saul and now State Farm In- 
surance has bought a big block. Wall Street’s 
Icahn & Co. has bought a block in Baird & 
Warner . \^ere there’s smoke, there’s fire. 

Other changes: American Realty to 3N on 
a debt restructuring; Cousins Mtg . on a price 
decline; Builders Inv . and First Newport on 


But many other trusts fit into the , 

general category so we’ve upgraded several, improving operations. 

One word of caution: nothing may happen 

for many of these trusts for months or MERGERS /ACQUISITIONS; INVESTORS REALTY AGREES 

years, because we're entering an adverse TO ACQUIRE SUMMIT PROPERTIES IN SHARE SWAP 
money market cycle. So financing any deals 

will be very difficult. But there's some Investors Realty of Atlanta has agreed 

evidence that stocks in general can get to issue up to 850,532 sh. to acquire all 

^ ...... — shares of Summit Properties , based in Akron. 

The exchange would work out to about 0.55 
sh. IRT with market value of about $4.25 
for Summit shares trading at "3% bid, Ih, asked. 
About 106,076 sh. would be put in escrow a- 
gainst settlement of two court actions against 
Summit. 


a higher multiple and if that's true, then 
these trusts should be satisfying even if 
no spectacular develops, 

RELATIVE APPEAL RANKING CHANGES STRESS 

writ, pos^itioned property trusts 


We've upgraded 17 trusts this issue 
because market conditions appear ripe for 
some major changes during 1979. Now is 
the time to get positioned, especially if 
year-end tax selling moves prices down. 


TENDERS /EXCHANGES; GRM PROPERTIES AND 

INSTITUTIONAL INVESTORS MAKE OFFERE' 


These two trusts have begun long-pending 
offers to exchange new debentures for old 
ones coming due in a few years. Terms of 
both are shown in their Ranking entry. 


In line with the strategy above, ten 
property trusts are moved to No, 1 ranking. 

Nearly all have been ranked No. 2-above aver- 
age so you may already hold positions. All 
are property trusts, although some have 
small mortgage holdings. Their properties 
appear to be the types that could be sold We've added quarterly earnings tables 

readily and market prices don't appear to ^o each Ranking entry to let you follow 
discount potentials. They are; trusts easier. And we show both Earnings 

and Net Cash Flow (as EPS/CFS) if relevant. 


RELATIVE APPEAL RANKINGS ADDS 

QUARTERLY EARNINGS TABLES" 


3 


December 8, 1978 

RELATIVE APPEAL RANKINGS AND LATEST RESULTS 

Relative Appeal (RA) Rankings , shown at extreme left, give Audit Investment Research’s 
current view of relative attractiveness of new share purchases. All trusts are ranked from No, 1 
to 5 based on individual dividend and earnings outlook compared to the overall market. Non- 
dividend paying trusts are shown with an *'N’* beside their rankings. Each summary contains brief 
advice and comment . Changes in rankings are indicated by ^ UP and ▼ DOWN, Relative Appeal 
Rankings mean: 

1 — Highest appeal with lowest market risk; Dividend and earnings outlook stable to up, 

2 — Above average appeal, higher market risk; Dividend increases or resumptions possible, 

3 — Average appeal and market risk; Dividend fluctuates or resumption possible long-term, 

4 — Below average appeal, high market risk; Dividend cuts or omissions possible, 

5 — Least general appeal; Special problems suitable for sophisticated investors only, 

NON-DIVIDEND PAYING trusts are not recommended for income investors but may have trading 

appeal as speculations upon quick or large price moves on asset swaps, money market or other news. 

All numbers are amounts per share except those denoted "M" or for million and thousands 
respectively, E or Est ,=Estimates for current or next years, EPS=Earnings per share, CFS=Net 
cash flow per share as computed by Audit Inv, Res, d=Deficit, Data, rankings and advice 
reviewed bimonthly. See footnotes at end of Rankings on Page 16, 


3N-ALAMAND CORP: $2.13 (ALAM-OTC) Comment : 
Spec, on diversification; now at break- 
even. (Shs : 1355T; Book 62q). Converts : 
Spec, yield. Intangibles : Loss res, $6. 52; 
Taxless: $14. 76. Assets : $51M, 40% non- 
earn; 70% forecl; Mix: 20% land, 19% 
apts. Financing : $38M debt is 47X $0.8M 
net equity; $26M bank debt to 12/78 ac- 
cruing at 125%/prime; 1% prime rate rise 
costs about 4c/sh. qtr. Recent 
EPS : Oct , Jan , Apr , July Year 

FY’78.. d6c 25c 22c 2c 43ca 

a-Incl, 69c swap gains, taxless 
benefits & interest forgiveness. 
(NON-QUAL CORP; Self-adm.) 

3N-AMER CENT: $3.00 (ACT-NYS) Comment : Hold, 
recovery & improving props. ( Shs : 2677T, 
Book $5.29). Bonds : Speculative yield. 
Intangibles : Loss res. $5. 99; Taxloss:$8.94. 
Assets : $103M, 18% non, 37% low-eam; 70% 
forecl,; Mix: 33% office, 19% hotel, most 
Wash.D.C. Financing : $75M debt is 5.6X 
$14M equity. $56M bank debt extended to 
12/81 @ prime to 10% maximum. Recent 
EPS : Sept . Dec. Mar . June Year 

FY’78.. dl9c dl3c d7c 9Ca d28ca 
FY’79.. d7c 

a-Incl. 9c asset swaps. 

Higher interest may widen FY’79 loss. 

(CAN END REIT: Life co. advisor) 

5N-AMER FLETCHER: $1.75 (AFM-OTC) Comment : 

No auditor’s opinion ’78; Boosted book 
but still risky. (Sh : 1352T; Book 31c) . In- 
tangibles : Loss res. $12. 20; Taxless : $15. 50. 
Assets : $48M, 82% nonearn; 71% forecl. 

Mix: 48% land/ dev, , heavy Fla. Financing : 
$28M bank debt is 68X $0.4M equity. Re- 
paying banks & debt extended to 11/30/78 
for new pact; accruing 6% inter, & swaps. 
EPS : Apr . July Oct. Jan. Year 

FY’78 d74c d66c d69c 1.06a dl.03a 

FY’79 67cb 42cb 

a-89c interest forgiveness, b- Asset 
swaps. & NOL totaling $1.76 in 6 mos. 
(NON-QUAL TRUST; Indiana bank advisor) 


3N-AMER REALTY; $1.88 (ARB-OTC) Comment : Re- 
covery or buyout. ( Sh ; 2222T; Book $3.37) 

Bonds ; Missed 5/78 int, on 7% converts & 
seeking permission to pay. Intangibles ; 
Depr.$3,62; Loss Res: 52c; Taxless: $3.55. 

Assets : $40M, 36^% nonearn. Mix; 74% prop, 
incl, 40% hotels Wash.D.C. area, 29% land. 
Financing ; $28%M debt is 3.8X $7^ equity; 
Converted $4.8M demand debt to mtg; Remaining 
$4M being restructured. Interest exposure now 
low. Earnings ; June Q 3c. Sept. Q to incl. 

48c asset sale gain. (FY Sept.; NON-QUAL 
TRUST: Self-administered) 

3N-API TRUST: $2.50 (APITS-OTC) Comment ; Selling 
assets to pay debt; recovery spec.; Investor 
sold 19%, (^: 1012T, Book $7.30) 

Intangibles ; Loss res: $3,76; Taxless NR. 

Assets ; $40M, E18% nonearn. Mix: 53% prop, 
most shop, ctrs; 11% financing leases, 36% 
mtgs. Sold 7 shop, ctrs,, to sell 10 more. 
Financing ; $28M debt is 3.8X $7,4M equity; 

Debt is $19M mtgs. & $8.6M bank debt. 

EPS ; June Sept . Dec. Mar . Year 

FY’78 3C d7c d47c d55C dl.07a 

FY’79 32cb 

a-Incl. 65c loss on asset sales. b-32c 
gains on asset sales. 

(Advised by Sub. of Arlen Realty) 

2N-ATLANTA NAT: $42.5 (ATNAS-OTC) Comment ; 

Still room at 53% below book; Group w/17% 
took board seats in Oct. (Sh; 1273T, Book $8.99) 
Intangibles ; Loss res: $3.93; Taxless $7.86. 
Assets ; $24M, 52% nonearn, 34% fore., rest mtgs. 
Mix: 26% apts., 16% land, 17% condo; 34% TX, 

36% Fla, Financing ; $6M debt (all bank) is 
0.5X $11^ equity; Bank debt at 115% of 
prime; Assets pledged, 

EPS ; Nov . Feb . May Aug . Year 

FY’78 dl2c d4c 24Ca dlC 6Ca 
a-Incl. lie inter, reversal & 2c taxless. 

Est ; Small profit FY’79. (NON-QUAL TRUST; 
Atlanta mtg. banker adviser) 

2N-BAIRD & WAR: $7.25 (BAIDS-OTC) Comment ; Div. 
omitted but hold for recovery to book. Broker 


4 


December 8, 1978 


bought 11% of sh. (Sh: 1043T, Book $15.86) 
Converts ; LT yield. Intangibles ; Loss res. 
$2.88; Depr. $1.17. Assets ; $49M, 24% non- 
earn, 7% forecl. Making new commitments. 

Mix; 37% investment prop, mostly apts., & 

53% const, loans; Most near Chicago. Fin- 
ancing ; $30M debt is 1.8X $16^ equity; 
Borrows $16M at prime under $28M bank lines; 
1% prime rise = 4d/sh. per qtr. 

EPS ; Oct . Jan . Apr . July Year 

FY’77 d3c d59<;: d8o d23da d93Ca 

FY'78 die 

a-Incl. 5e asset sale gains. 

Est . FY’79 better. (Chgo. mtg. banker adv.) 

1 -BANKAMER RL; $11.13 (BRLTS-OTC) Comment ; 
Buy/hold for 34% recovery to book. (Sh ; 
3547T, Book $16.92) Converts ; Yield. Intan- 
gibles ; Loss res. 97e; Depr. 86e. Assets ; 
$168M, 18% nonearn. Mix; 38% prop, 26% apts, 
32% shop.ctr. Combines land/ lease & LT mtgs. 
Financing ; $110M debt is 1.8X $60M equity. 
Debt; $46M cornel, paper, 142M bank short. 

EPS ; Oct . Jan . Apr . July Year 

FY’78 1.41a 18e 31e 37e 2.27a 

FY’79 32c E1.00+ 

a-Incl. $1.46 gain on asset sale. 

Dlv . Oct. Q 25c; $1.00 ann. rate; *78 pay- 
out 78% cap. gain. (Advised by sub. of 
largest U.S. bank) 

3N-BARNES MTG; $2.00 (BARNS-OTC) Comment ; Av- 
erage recovery spec.; book eroding by high 
costs of selling condos. (Sh ; 1910T, Book 
$11.10) Intangibles ; Loss res:$1.26; Taxloss 
$6.60. Assets ; $76M, 75% nonearn, 45% ford. 
Mix; 43% condos, 18% land/constr. ; 44% Fla., 
33% Puerto Rico. Financing ; $52M debt (all 
bank) is 2.5X $21M equity. Debt at 125% of 
prime to 12/80; Missed repayments & talking. 
EPS ; Dec . Mar . June Sept . Year 

FY’77 d31C d26c d30c d60c dl.47 

FY’78 dl9Ca d20ca d23Ca 

a-Incl. 62c asset sale gains + 21c swap 
gains in 9 mo. to June. 

See more losses. (NON-QUAL TRUST; Detroit 
mtg. banker adviser) 

2N-BARNETT-WIN; $1.13 (BWITS-OTC) Comment ; New 
name; Compass Inv. ; Bonds restructured but 
sh. high-risk spec.; Large potential dilu- 
tion. (Sh ; 1663T out; Book $5.43) Intangi- 
bles ; Loss res. $4.64; Taxloss$11.35 on sh. 
out. Assets ; $44M, 66% nonearn, 56% ford. 
Mix; 38% apts., 31% land, most Fla. & Ga. 
Financing ; $40M debt over d$0.5M tangible 
neg. equity (6/78) ; Repaid all bank debt in 
Aug. ’78. 8^% Bonds ; Paying back interest; 
$18. IM convt. into 13,413T sh. at $1.35 af- 
ter 12/78 adjustment. 

EPS ; Dec . Mar . June Sept . Year 
FY’78 3C d77c 55Ca 2.99a 3.40a 

a-Incl. $2.48 asset swap gains; EPS on 
primary sh. ; Yr. $2.99 diluted. 
(NON-QUAL TRUST; Self-administered) 


2N-BAY COLONY; $3.75 (BAY-NYSE) Comment : Long- 
er-term recovery spec.; Sold $59M assets in 
Nov. Q. ( Sh ; 3315T, Book $6.16) Bonds ; Hold. 
Intangibles ; Loss res. $6. 08; Taxloss $8.20. 
Assets ; E$143M, 59% non-earn after sale. 

57% forecl.; Mix; 38% apts., 31% land; 
Financing ; $166M debt is 8.2X $20M equity. 

In June’ 78 restructured bank debt into $23M 
at 3% due 2/81 & $68M at 8^% due 5/86. 

EPS ; Aug . Nov . Feb . May Year 
FY’78 die d7c 7c d7c d8ca 
FY’79 7cb 

a-18c swap gains; b-26c asset sale gain. 

Nov. Q to incl. 55C asset sale gain. (NON- 
QUAL TRUST; Self-administered) 

3N-BRT RLTY; $1.50 (BRT-ASE) Comment : Long re- 
covery, limited interest. ( Sh ; 1400T, Book 
$2.70) Intangibles ; Loss res. $2. 49; Tax- 
loss $2.72. Assets ; $22M, 71% nonearn; 44% 
hotel. Financing ; $15M debt is 4. OX $3.8M 
equity. $9M bank debt ^% over prime to 7/81. 

EPS ; Feb . May Aug * Nov . Year 
FY’^78 d5c 26c 31C 

(NJ realty broker adviser) 

3N-BT MTG INV: $1.38 (BTM-NYS) Comment : Spec, 
on more swap gains. (Sh ; 2116T, Book d$2.94) 
Bonds ; Risky hope assets recover by ’82. 
Intangibles ; Loss res. $9. 58; Taxloss$7. 04. 
Assets ; $124M, 68% nonearn, 35% foreclosed. 

Mix: 31% apts., 14% land, 10% nursing home. 
Financing ; $109M debt over d$6M neg. equity. 
$90M bank credit expired 11/30 & seeking ex- 
tension; Paying 6%; Sponsor lends 55% of credit. 
EPS ; Dec . Mar . June Sept . Year 
FY’77 OC d21C d26c d31C d78Ca 

FY’78 d5Cb 31cb dl4cb 

a-15c asset sale gains. b-84c asset swap 
gains + 26c asset sale gains in 9 mos. 

(CAN END REIT: Advised by sub. of Bankers 
Trust, NYC bank) 

4N-BUILDERS INV: $2.13 (BULDS-OTC) Comment ; For 
A believers; long recovery. ( Sh ; 2929T, Book 
I 23C) Intangibles ; Loss res. $13.83; Taxloss 
$12.12. Assets ; $193M, 54% non, 27% lowearn; 

29% condos, 24% land. Financing : $150M debt 
is 213X $0.7M net equity. $110M bank debt at 
2% to 9/79; 3% & higher after to ’83. Assets 
pledged; Seeks stretch of ’79 repayments & 
will swap more assets. Earnings ; June Q d39c» 
(FY Sept.; NON-QUAL TRUST; Self-adm.) 

2N-CAMER0N-BR; $2.63 (CB-NYSE) Comment ; Trading 
or LT recovery spec. ; Clean balance sheet & 

63% below book; Asset swaps may halt bleeding. 
( Sh ; 2016T, Book $7.14) Intangibles ; Loss 
res. $6.09; Taxloss $2.38. Assets ; $84M, 50% 
non- & 31% low-earn; 71% ford. Mostly resid. 
in Southeast; 35% apts., 30c land & devel. 
Financing ; $61M debt is 4.3X $14M equity; 

$53M bank debt at 3% or net income to 12/79; 

No sub. debt; $7M interest notes. 

EPS; Mar . June Sept . Dec . Year 

1977 d34c d33c d38c d48c dl.58 

1978 d25ca dllCa 9ca 

a-Incl. 1.49/sh. swap gains thru Sept. 


December 8, 1978 


5 


Sold apt. in Oct. for 55C gain & cut bank 
debt to $47M. (NON-QUAL TRUST: Advised by N. 
Carolina bank.) 

3N-CAPITAL MTG: 75c (CMU-PH) Comment : Trading/ 
recovery. Seeking merger. (^: 1675T common, 
Book d$1.27) Pfd . : 420T sh. issued to banks. 
Converts ; Spec. yld. Intangibles : Loss res. 
$10.75; Taxless $13.01. Assets : $60M, 53% 
nonearn, 42% for eel. Mix: 36% land (being 
developed), 19% hotel/motel, 29% LT mtgs. 

55% Wash.D.C. area. Finances : $46^ debt 
over d$2M net equity; $32M bank debt at 1% 
to 12/31/78, 3% after; 

EPS ; Mar . June Sept . Dec . Year 

1977 d79<;: 40d dl.78 llq d2.06a 

1978 49ca d55Ca dlqb 

a-Swap gains; $1.52 in ^77; $1.05 in ’78 
to date. b-Sale gains: 21c to date ’78. 
(NON-QUAL TRUST; Independent) 

2N-CENTRAL MI: $5.13 (CMRTS-OTC) Comment ; Buy/ 
hold at 60% below book; operating breakeven 
& selling land; Rejected one merger over- 
ture but still buyout. (Sh : 775T, Book 
$12.81) Intangibles ; Loss res. $1.03. 

Assets : $17M, 22% non- & 18% low-earn; 34% 
forecl. 38% apts., 31% land; most Midwest. 
Financing : $7M debt (93% bank) is 0.7X 
$10M equity. $9M bank credit to 4/79 at 
117% of prime permits new loans; No subor. 
EPS : June Sept. Dec. Mar. Year 

FY’78 d390 dl5d 4d 3d d47d 

FY’79 26da 54da 

a-Incl. 54d asset sale gains in 6 mo. 
(Advised by Minneapolis mtg. banker) 

5N-CHASE MAN: 75d (CMR-OTC) Comment : Avoid, 
Massive dilution under proposed CH. XI plan 
or long court battle. (Sh : 4886T, Bk d$5.15) 
Bankruptcy ; To seek subor. debt approval of 
Ch. XI plan to exchange new Ser. A pfd. w/ 
$33 liquidating value per $50 face amt. of 
subor. debt & convt. into 27 sh. or poten- 
tial 38. 9M new sh. Would repay defaulted 
7-7/8% sr. notes at par & swap assets for 
$150M bank debt, issuing 4.9M new sh. to 
banks. New voting lineup; Subor. debt 80%; 
banks 10%; current shares 10%. Filing proxy 
& expects vote early 1979. If Oked, trust 
would keep 2,700-acre Palmas del Mar re- 
sort in Puerto Rico & 3 other assets w/ 

$48M value (or $l/sh. on potential sh.) 
Intangibles on current sh. : Taxless 
$8.90; Loss res. $5.59. 

BPS ; Aug. Nov. Feb. May Year 

FY’78 39d dl.69 dl.37 dl.26 d3.93a 

FY’79 d97b 

a-Incl . $1.83 swap & extra gains. b-16d 
asset sale gains. 

(NON-QUAL; Sponsor Chase Bank walking) 

4N-CI MTG GR: $2.88 (CI-PH) Comment ; Trading 
spec, on banks restoring positive equity 
by completing pending swaps; else bank- 
ruptcy. (^: 4812T, Book d$3.32) Intan- 


gibles ; Loss res. $9.30; Taxless p$5.00. 
Assets : $244M, 84% nonearn, 60% forecl. 48% 
apts., most Northeast. Financing ; $229M debt 
over d$16M neg. equity. $222M bank debt & 
inter, notes accruing at 5% to 10/82, con- 
tingent on $100M prin. payment via swaps & 
positive net worth; received $156. 7M swap 
bids in Sept, for $100M net book value of 
assets. No auditor’s opinion ’77. 

EPS ; Jan . Apr. July Oct. Year 

FY’77 23da d31d d39d dl.50 dl.97a 

FY’78 d350 d24d d23q 

a-49<;: asset swap & taxless gain. 

(NON-QUAL; advised by sub. of City Investing) 

2 -Cl REALTY: $11.80 (CIX-NYSE) Comment ; Re- 
sumed dividend at lOq; Merger and/or liquida- 
tion spec, on improving NYC offices; 12% 
of stock bought by outsiders (Tamco) & 15.6% 
by adviser. (^. 2609T, Book $16.58) 
Intangibles ; Depr. $5.06; Taxless $2.53. 
Assets ; $103M, 4% nonearn; 93% props. Mix; 

48% NYC offices, 41% apts. Financing ; $67M 
mtg. debt is 1.6X $43M equity. Mortgaged 
offices & repaid banks. No int. rate exposure. 
EPS/CFS May Aug . Nov. Feb. Year 

FY’78 dl4/+2q dl3/+2 d8/+7 13/27a d22/38a 

FY’79 d8/+8 d9/+12 

a-Incl. 23c prop, sales gain. 

(NON-QUAL: Advised by sub. of City Investing) 

NR-CITINAT DEV: $7.75 (OTC) Comment ; Intends to 
dispose of assets and distribute proceeds to 
shareholders. (Sh: 600T, Book $13.33) 

3N-CIT & SO RL: $1.00 (CZS-NYSE) Comment ; Re- 
covery spec.; swaps & restructuring gave 
positive equity. (Sh: 3829T, Book $1.89; 

3597T reserved for wts.) Intangibles : Loss 
res. $8.75; Taxless $17.41. Assets ; $179M, 

32% nonearn; Swapped $75M to banks. Mix: 26% 
apts., 17% land, 17% shop, ctrs.; 36% GA, 24% 
FL. Financing ; Swaps cut bank debt to $76. 6M 
at Sept. 30 over positive equity; Bank cre- 
dit at 1% cash inter, to 9/82. 

EPS ; Sept . Dec . Mar. June Year 
FY’78 d3c 16c d20c d21c 33cb 
FY’79 1.77a 

a-After $1.86 swap gains. b-After 45c swap 
gains; Quarterly figures do not add. All 
share amts, on primary shares, which vary 
widely with market price. 

(NON-QUAL: Adv. by largest Atlanta bank) 

3N-CIT GROWTH: $3.25 (CITGS-OTC) Comment ; Hold 
for moderate recovery; Broker group now owns 
23% of sh. (Sh ; 811T, Book $6.82) Intangibles ; 
Loss res. $2.22; Taxless $7.68. Assets ; $8M, 

55% nonearn, 24% foreclosed. Mix: Heaviest 
motels & land. Financing : $2.2M debt is 0.4X 
$5.5M equity. $1.2M bank credit to 7/80 at 
5%; Assets pledged & swapping. Earnings ; 

July Q 7C after special items. (FY Jan.; NON- 
QUAL; Adv. by independent Cleveland group) 

5N-CITIZENS MI: 15c (CZM-OTC) Comment ; Avoid; 


6 


December 8, 1978 


in Ch. X. (^; 1421T, Book d$17.02) Note^ t 
8^s of ’80 sophisticated play on possible 
ruling that sponsor must pay in full; other- 
wise not much left if banks get full payment 
under Ch. X "absolute priority" rule. 
Bankruptcy ; Filed Ch. X Oct. 5, 1978^ after 
note trustee Chemical Bank called 8h% notes; 
8^s were in default since 10/15/76. 

£PS: Mar . June Sept . Dec . Year 

1978 d56c d45C 

No auditor’s opinion ’77. Intangibles ; Loss 
res. $14.93; Taxless $11.68. (NON-QUAL TRUST: 
Advised by Detroit mtg. banker sub. of Manu- 
facturers Hanover, NYC bank) 

2N-CLEVETRUST: $4.13 (CTRIS-OTC) Comment: Buy/ 
hold long-term recovery; No inter, exposure; 
See 44c gain on land sale in Sept. (Sh: 2525T, 
Book $10.38) Intangibles ; Loss res. $3. 04; 
Depr. $1.80; Taxless $3.52. Assets ; $91M, 

44% non, 15% low-earn; 55% forecl. Mix: 69% 
props, incl. forecl; 27% apts., 27% cornel., 
18% land. Financing ; $57M debt is 2.2X $26M 
equity. $33M bank debt to 12/78 at prime, 
not over 7^%. 

EPS ; Dec . Mar, June Sept . Year 

FY’77 dl8c dl4c d20c d69c dl.20 

FY’78 dlca 73Ca dl7c 

a-$1.03 asset sales gains & 47c taxless 
benefits in 9 mos. to June. 

(NON-QUAL TRUST; Adv. by Cleveland bank sub.) 

2N-C0LWELL MTG; $1.88 (CLMTS-OTC) Comment ; 

Buy/hold for moderate LT recovery; New pfd. 
favored, has $7.50 liquidate value. ( Sh ; 

2030T com.+ 2149T pfd.. Book $2.90 combined) 
Bankruptcy ; Pre-approved Ch. XI approved 
Apr. ’78 paying cash & pfd. for old subor. 
debt; Banks get 8% inter. & asset pledge. 
Intangibles on total sh: Loss res. $4. 56; 
Taxless $7.90. Assets ; $124M, 24% non-, 

18% low-earn; 41% foreclosed & refinance; 

35% apts., 19% hotel/motel, 21% shop.ctr. 
Financing ; $97M debt is 8. OX combined 
$12M equity. $95M secured bank debt 08%. 
EPS ; Mar . June Sept . Dec . Year 
1978 d25c 6.12a d20c 

a- Incl. $5.92 gain on bankruptcy stlmt. 
Est ; Elimination of subor. debt interest 
to aid results. (Adv. by LA mtg. banker) 

1 -CONN GEN: $18.75 (CGM-NYSE) Comment ; Buy/ 
hold long-term for equity buildup. (Sh ; 
5720T, Book $18.86) Converts ; Safe yld. 
Intangibles ; Loss res. 92c; Deprec. $1.61. 
Assets ; $330M, 3% non-, 10% low-earn; 5% 
foreclosed; Expanding properties, now 41%. 
Mix; 37% regional shop.ctrs., 31% resid. 
Financing ; $225M debt is 2. IX $108M equity. 
Only $2M short-term debt; $90M term debt 
mostly at 8.75%, plus $56M mtgs; $78M convt. 
EPS/CFS; June Sep^. Dec . Mar . 

FY’78 46/55C 39/52C 32/44C 33/44C 

FY’79 30/50ca 29/52ca Yr; El. 30/2.00 

a-Asset sale gains: 6c in June; 6C Sept. 
^Div ; Sept. Q 45C, up 13% to $1.80 ann. rate. 
(Major life ins. co. adviser) 


4 -CONSOL CAP; $27.50 (CCPLS-OTC) Comment ; For 
speculative income, over book; ’77 div. 25% 
cap. gains & 75% taxfree cap. return. ( Sh ; 

1989T, Book $17.29) Intangibles ; Deprec. 

$7.46. Assets ; $130M, all properties, 0.8% 
nonoperating. Mix: 82% apts. w/8,440 units; 

16% shop, ctrs.; 51% Texas. Financing ; 

$94M debt is 2.7X $34M equity. Debt; $92M 
secured mtgs., $2.3M bank. 

EPS/CFS Feb. May Aug . Nov . 

FY’78 d24/29c d9/45d 93/1. 44a d7c/45c 

FY’79 3/56qa d7/42c dl9/31c 

a-Asset sale gains: $1.20 Aug’ 77; bq 
Feb ’78. 

Div ; Nov. mon. 17.17q or $2.06 ann rate. 

(Managed by Oakland, Cal. realty group) 

1 -CONT ILL PR: $14.75 (CIE-NYSE) Comment ; 

Cash flow rising on bigger assets; Buy/hold 
I for yield & LT gains. (Sh ; 4808T, Book $19.66) 

I Intangibles ; Deprec. $3.82. Assets ; $283M, 

0.2% nonearn; Mix; 95% property, 5% mtg; 

40% apts., 28% shop ctrs., 23% offices. 
Financing ; $188M debt is 2. OX $95M equity. 

Debt; $176M mtgs. & $12M bank loans. 

EPS/CFS Jan. Apr. July Oct . 

FY’77 20/36ca 16/30C 9/30C lOTTbq 

FY’78 14/36db 7/37d 7/34db 

a-7d cap. gain. b-5c option redemption 
gain & 2c mtg. refinancing charge. 

Est ; $1.30 CFS FY’78. Div ; 32c Q, $1.28 ann. 

(Adv. by sub. of Cont. 111. Bank, Chicago) 

3N-C0NT ILL RLTY; $2.63 (CIR-NYSE) Comment ; 

Speculative hold if sponsor buys $35M assets 
in ’79 to let trust repay bonds maturing 12/79; 
Success requires major asset liquidation. 

(Sh: 2797T, Book $2.28) Intangibles ; Loss res. 
$12.34; Taxless NR. Assets ; $134M, 53% ford.; 
53% non & 22% low-earn; Mix; 31% land. Finance ; 
$91M debt is 14X $6.4M equity. $56M bank 
debt at 5% min. interest to 130% of prime 
to 11/79; Pledging assets; Sponsor agrees 
to buy $35M assets if trust can repay $55M 
to other banks by 11/79. Bonds ; Speculation 
on fast liquidation. 

EPS ; June Sept . Dec . Mar . Year 

FY’78 Oq 1.31a 66ca d9<;: 1.87a 

Fy’79 d37d 610a 

a-$2.83 swap gains in ’78 & 96c in ’79. 

(SEEK NON-REIT STATUS; Advised by Cont. 111. 

Bank , Chicago , sub . ) 

4N-C0NTL MTG; 20c (CMI-OTC) Comment ; Shares & 
bonds high risk speculation that viable en- 
tity emerges from bankruptcy; creditors & 
mgmt. seem at impasse. ( Sh ; 20838T, Bk d$6.65) 
Intangibles ; Loss res. $6.38; Taxless $7.68. 
Bankruptcy ; Filed Ch. XI 3/8/76 & liquidation 
ordered but stayed by Ch. X filing 10/22/76; 

Ch. X filing denied & liquidation order over- 
turned on appeal; Subor. noteholders organizing. 
Assets ; $570M, 93% troubled; selling con- 
dos & developing land. Finances ; Owes $561M 
& d$139M negative equity; Earnings ; Audited 
d$2.78 in FY’78 after $2.40 addition to loss 
res.; 9q in 4 mon. to 7/31/78. (FY Mar.; NON- 
QUAL; Independent) 


December 8, 1978 


7 


3N-C0USINS M&E: $2.38 (CUZ-NYSE) Comment ; 

A Hold/sell sh. & bonds for possible benefits 

1 from pending diversification via holding 
company. (Sh: 3845T, Book 99c) 

Intangibles ; Loss res. $9. 55; Taxless $12.90. 
Assets ; $146M, 74% nonearn; 61% forecl. 

Mix: 45% land/develop., 20% apts., 18% 
lodgings. Financing ; $107M debt is 28X 
$3.8M net equity. $77M bank debt at income 
or 2%, plus contingent, to 12/79. 

EPS ; Nov . Feb . May Aug. Year 

FY*78 dlOq dl7d d5c dlq d33Ca 
a-Asset swap gains: 73o. 

See $1M gain Feb. Q on hotel sale; also 
$1.5M gain on agreed Tex. & FL land swap. 
(NON-QUAL TRUST; Self- administered) 

2 -DENVER RE; $10.50 (DENVS-OTC) Comment ; Buy/ 

hold for income & possible buyout; ^78 cash 
flow better. (Sh: IIQIT, Book $8.35) 
Intangibles ; Deprec. E$7.73. Assets ; $54M. 
Mix by revenues; 48% of f ice/comcl. , 22% 
shop, ctrs., 14% motel, 12% apts. 

Financing ; $44M debt is 4.7X $9M equity. 
Debt; $38M mtgs., $5M debentures. 

EPS/CFS Mar . June Sept. Dec. 

1977 d9/0d d7/10c 18/320 4l766oa 

1978 d5/21C 20/450 25/510 

a-Prop. sales gain: llo in 1977. 

D^: June 18o; ’77 approx. 50% taxfree. 
(Independent management) 

2N-DI VERSIFIED: $3.13 (DMG-NYSE) Comment ; Buy 
under $4 as merger or recovery spec. ; con- 
verted to corp.; MEI Corp. bought 7.4% of 
sh. (Sh : 7327T, Book $8.46) Intangibles ; 

Loss res. $4.47; Taxless $4.94. Assets ; 

$137M, 81% nonearn, 26% ford. Mix: 67% sec- 
ondary & 7% primary homesites, 11% raw land. 
Financing ; $47M debt is 0.7X $62M equity. 
Borrowed $45M from Cont. 111. Bank to buy 
all other bank debt at discount. Interest 
geared to prime & hurts EPS. 

EPS ; Mar . June Sep t . Dec. Year 

1977 d390a 170a dl6oa 2T8Ta 2T^a 

1978 16ob d3o d2o 

^“$^•28 asset swap, NOL & refinancing 
gains. b-25o bank refinancing gain + 

90 NOL. 

(NON-QUAL CORP; Self-administered) 

5N-D0MINI0N MR; 63o (DMRTS-OTC) Comment ; Shs. 

& bonds high-risk spec. ; Proposed bankrupt- 
cy plan would give bond holders 71% of sh. 
(Eh ; 639T, Bk d$10.86) Bankruptcy ; Filed Ch. 
XI 6/28/77. Plan pending. SEC seeks CH. X. 
Intangibles ; Loss res. $5.88; Depr.$2.29; 
Taxless $16.27. 

2N— EASTOVER CP; $8.00 (EASTS-OTC) Comment; 
Speculation on more aggressive workout , 
merger deals under new mgmt. Bought 12^^% 
of Texas First Mtg. stock & 7% of ICM. 

(Sli; 1034T, Book $11.86) Intangibles ; Loss 
res. $5.48; Taxless $9.77. Assets ; $19M, 

64% non-& 14% low-earn; 61% foreclosed. 

Mix; 68% land; 49% La., 51% other South. 


Financing ; $3M debt (all fixed rate mtgs.) 
is 0.2X $11%M equity. 

EPS ; Mar . June Sept . Dec. Year 

1977 d^3(^ d32c d20q 2d d93c 

1978 dbq 46<;:a 53qa 

a-Loss res. credit: 82d to Sept. ’78. 
(NON-QUAL TRUST: Jackson, MS broker Leland 
Speed heads new mgmt. group) 

3 -EQUIT LF MTG: $18.38 (EQ-NYSE) Comment ; 
Hold, EPS vulnerable; 1% prime=5d/sh. qtr. 
(Eh ; 5663T, Book $23.43) Intangibles ; Loss 
res. 33d. Assets ; $388M, 8% nonearn; 33% 
long-term mtgs., 54% short-term const. & 
devel. loans; Expanding ST. Mix; 29% shop, 
ctrs., 18% tracts & land. Est. $120M or 34% 
floats with prime. Financing ; $252M debt is 
2. OX $133M equity. Debt is $232M short-term 
tied to prime & incl. $123M cornel, paper. 
Bank lines $200M. 

EPS ; Jan . Apr . July Oct. Year 
FY’77 59d 59d 60d TSda 2 . 26a 

FY»78 48d 46d 54db 51d 1.99b 

a-19d prepaymt. fee; b-5d sale gain. 

FY»79 EPS $1.80. Div . : $2.00 rate held. 
(Major life company adviser) 


1 —FEDERAL RLTY: $16.50 (FRT— ASE) Comment; Buy/ 

. hold for income & modest growth from prop, 
y purchases; Plans buying 8 shop. ctrs. from 
Amterre Dev. if Food Fair bankruptcy doesn't 
upset deal; High operating return on prop. 

( Sh : 1450T; Book $9.77) Intangibles : Depr. 
$3.57. Assets : $39M, no nonearn; 99% props, 
w/cash flow: 74% shop, ctrs., 25% apts.; 
most Wash. DC area but diversifying. 

Financing ; $22. 8M debt is 1.6X $14M equity. 
Debt; 88% mtgs., 12% bank loans; Will borrow 
$2M for Amterre deal. 

EPS/CFS Mar . June Sept . Dec . Year 

1977 30/ 32c 29/31C 27/29C 43744c $1729/1.36 

1978 35/39ca 29/31c 19/25C El. 25/1. 25 

a-Prop. sale gain 6c. 

Div.. $1.36 ann. rate. (Independent mgmt.) 


4N-FIDELC0 GROW: $3.75 (FGI-ASE) Comment: Spec, 
on sponsor aid. (^: 1580T, Book $5.32) 
Intangibles ; Loss res. $10.25; Taxless 
$5.41. Assets ; $90M, 79% nonearn; 64% ford. 
Mix; 31% land (developed & raw), 31% condos; 
31% Penn. , 25% Fla. Financing ; $67M debt 
is 7.9X $8M equity. $60M bank credit to 
11/30/79 at 1% cash + earnings; Swapping. 

EPS ; Feb . May Aug . Nov. Year 
FY'77 dl.52 dl.55 d2.33 d3.94 d9T34 
PY'78 76ca 19Ca 1.59a 

a-Swap gains + Int. forgive: $3.73 to Aug. 
(NON-QUAL TRUST; Adv. by mtg. banker sub. 
of Phil, bank) 

2 -FIRST CONT'L: $7.50 (FCRES-OTC) Comment: 

Hold for spec, income & incr. in 10% return 
on book. (^: 2106T, Book $10.32) 

; Loss res. 44c. Assets ; $46M, 

7h% nonearn, 5% foreclosed. Mix: Mostly 
mtg. loans; 57% constr. , 29% devel., 8% 


8 


December 8, 1978 


land; 88% Texas. Financing ; $29M debt (all 
bank) is 1.4X $22M equity. Borrows under 
$33^M bank lines at %% over prime plus corn- 
pens. balances; 1% prime=^c/sh.Q. Must 
pledge assets equal to debt if demanded. 

EPS ; May Aug . Nov . Feb . Year 

FY'78 220 22d 23d 23d 0.90 

FY*79 25d 26d El. 03 

Div : Aug. Q 25d; up to $1.00 ann. rate. 
(Advised by Houston mortgage banker) 

2N-FIRST DENVER MI: $2.00 (FDENS-OCT) Comment ; 
Recovery spec, at 68% below book. (Sh ; 

1621T, Bk $6.27) Intangibles ; Loss res. $4. 21; 
Taxless $9.87. Assets ; $54M, 38% nonearn; 

27% foreclosed. Mix: 18% land, 19% condo- 
secondary home, 11% condo-primary, 14% 
motels. Financing ; $38M debt (all bank) 
is 3.8X $10M equity. Bank debt to 5/81 
at 3% in ’78, 6^% in ’79; Assets pledged. 

EPS : Dec . Mar . June Sept . Year 

FY’77 dl9d d27d d4d 3.08a 2.58a 

FY’78 2.56a 16da d27da 

a-Asset swap gains: $2.76 in ’77; $2.42 
in Dec. ’ 77 , b-Prop. sale gains: 22d 
total in ’78 to date. 

(NON-QUAL TRUST; Adv. by Denver bank sub.) 

2N-FIRST MEMPHIS: $2.50 (FMEMS-OTC) Comment ; 
Spec, on loss reserve recovery at 46% below 
hard book; Group bought 6^%. (Sh ; 1156T, 

Book $5.14) Intangibles ; Loss res. $4.25; 
Depr. $2.20; Taxless $5.77. Assets ; $40M, 

54% non-, 8% low-earn; 88% ford. Mix: 30% 
land, 22% offices, 20% apts. ; 34% Tenn. 
Financing ; $29M debt is 4.9X $6M equity. 

$20M bank debt at 2% + contingent inter. ; 
Swapping assets. 

EPS: Feb . May Aug . Nov. Year 

FY’77 d27d d25d dl8d Id d69da 

FY’78 70da 18dab 55dab 

a- Swap gain: 33d FY’77; $1.82 thru Aug. 
’78. b-Prop. sale gains: 64d in ’78. 
(NON-QUAL TRUST: Adv. by Memphis bank) 

5N-FIRST MTG: 50d (FMTGS-OTC) Comment : Avoid, 
high risk, bankruptcy possible. (Sh : 8495T 
com.; Book d$5.98 net) Bonds : For swaps. 

Pfd; 141T Ser. A & 450T Ser.B held by 
lenders. Intangibles ; Loss res. $1.68; 

Taxless $9.65. Assets ; $261M, 17% non- 
& 47% low-earn; Mix: 31% lodgings, 28% 
apts., 17% office. Financing ; $245M debt 
over $59M liquidating value pfd. & d$51M 
negative common; $192M bank credit ex- 
pired 8/31/78 & negotiating to avert 
bankruptcy. Earnings ; July Q Id after Id 
swap gain. (FY Jan.; NON-QUAL TRUST; In- 
dependent management) 

3N-FIRST NEWPORT: $1.13 (FNRIS-OTC) Comment ; 

f Long recovery, making progress. (^; 2339T, 

Bk $3.44) Bonds ; Hold; Trust buying in mkt. 
Intangibles ; Loss res. $10. 69; Taxless $24.80. 
Assets ; $107M, 46% non, 14% low-earn; 37% 
ford. Mix: 30% condos, 24% lodgings. Finan- 
cing ; $79M debt is 9.8X $8M equity. $61M bk. 
credit repayable by 10/82 at 5% interest 


in FY’79; Lets trust repay $7.4M of 8.75% 
subor. notes due 5/15/79 if conditions met. 

EPS ; Jan . Apr . July Oct . Year 

FY’78 d38d d43d 14d 

(NON-QUAL; Independent) 

3N-FIRST PENN MI: $1.75 (FPM-NYSE) Comment ; 
Trading spec., pending swaps may add $1.50/ 
sh. book value. ( Sh : 2916T, Book $2.48) 
Intangibles ; Loss res. $8, 11; Taxless $9.94, 
Assets : $141M, 74% nonearn, 62% foreclosed. 
Mix: Heavy condo, comcl/indus. land; 21% FL 
Financing ; $107M debt is 27. 4X $4M equity. 

$93M bank debt accruing at prime w/interest 
forgiveness; Swapping. 

EPS ; Oct . Jan . Apr . July Year 
FY’78 dl.44 d2da d64da 24d d2.08a 

FY’79 1.17b 

a-Incl. asset swap gains $1.43 
b-Incl. asset swap gains $2.30 
(NON-QUAL TRUST; Advised by sub. of First 
Penn. Bank, Philadelphia) 

1 -FIRST UNION; $11.75 (FUR-NYSE) Comment ; Shs. 

& bonds: Buy for quality income; New mtg. debt 
I cut rate risk. (Sh : 4270T com.. Book $8.63) 
Intangibles ; Deprec. $7.89. Assets : $197M, 

E7% low-earn. Mix: 70% offices, 25% shop. 
Financing ; $154M debt is 3.3X $47M total 
equity ($10M pfd., $37M common). Debt is: 

78% secured mtgs., 13% short-term, 9% cvt. 
Closed new $11M mtgs. in Aug. 

EPS/CFS Jan . Apr . July Oct . 

FY’77 20/29C 24/31d 21/29d 21/29d 

FY’78 21/29da 23/30ca 45/52da 

a-Prop. sale gains: Jan. 5d; Apr. 20; 

July 23d 

Est ; $1.40 CFS FY’78. Div : Upped latest Q 
to 27c;: or $1.08 ann. rate. (Independent mgmt.) 

3N-FIRST VIRGINIA; $1.75 (FVM-OTC) Comment ; Shs . 

& Bonds ; Hold for modest recovery. ( Sh ; 1208T; 
Book $6.89) Intangibles ; Loss res. $8.05; 
Taxless $10.51. Assets : $59M, 35% non, 1% 
low-earn; 37% foreclosed. Mix 28% land; 37% 

Va. , 34% Fla. Financing : $45M debt is 3. OX 
$8M equity. $25M bank, credit to 12/79 at 4% 

+ contingent inter.; Pledged assets. 

EPS ; Sept . Dec . Mar . June Year 
FY’78 bd 2.85a 22d 41d 3.54ab 

FY’79 47db 

a-Incld. $1.52 taxless ben. + $2.90 bond 
recovery. b-20d asset sales & 24d taxless. 
(NON-QUAL TR; Independent mgmt. tied to bank) 

3N-FIRST Wise MT: $2.50 (FWMTS-OTC) Comment ; 

For long recovery, some dilution. ( Sh ; 1988T, 
Book $5.37) Intangibles ; Loss res. $8.26; 
Taxless $20.12. Assets ; $104M, 34% non- & 

43% low-earn; 70% foreclosed. Mix: 31% apts., 
29% land; 36% FL, 25% Midwest. Financing ; 

$80M debt is 7.5X $11M equity. $63M bank debt 
at 1% or net income to 5/80; Banks provided 
$6^ secured standing loans on props. 

EPS ; Mar . June Sept . Dec . Year 

1978 Oda Qda d20d 

a- After 89d loss prov. thru June. 

(NON-QUAL TR: Adv. by Milwaukee bank sub.) 


December 8, 1978 


9 


2 -FLATLEY: $4.00 Unit (FLTLS-OTC) Comment ; 

Buy for recovery toward book. (Sh: lOOOT, 
Book $7.04) Intangibles ; Depr. $2.19; Tax- 
loss 27c« Assets : $24M, Mix: 40% apts, 52% 
shop, ctrs.; 92% Mass. Making new property 
investments. 94% prop., 6% loans. Financing ; 
$17. 4M debt is 2.5X $7M equity; 85% mtgs. 
EPS; Sept . Dec . Mar . June Year 

FY’78 3C lie d3e 12e 23e 

FY’79 lOe E50e 

Div ; Resumed 20e 9/78 (Self-Adm. ) 

1 -FLA GULF: $12.50 (FGLFS-OTC) Comment ; Buy 
▲ for yield & modest growth in overage rents 
I and new properties. (Sh ; 995T, Book $14.59) 
Intangibles ; Depr. $5.27. Assets : $32M. 

Mix: Over 93% shop. ctrs. (strip); 92% FL. 
Most Grants filled. Financing : $18M debt 
is 1.3X $14^M equity; $18M mtgs. on prop. 
EPS/CFS July Oct . Jan . Apr . 

FY’78 15/34e 17/36e 20/38e 14/33e 

FY*79 20/37ea 16/ 

a- 2e prop, sale gain. 

Est ; FY’79 EPS 65e; CFS $1.40. Div : 32e/Q, 
55% tax-free. (Adv. by sub. of Loeb Rhoads) 

2N-FRANKLIN: $4.88 (FR-ASE) Comment : Hold for 
earnings improvement, expanding real estate 
A services. (Sh : 999T, Book $7.91) Converts : 

I Hold. Intangibles : Depr. $10.97; Taxless 
$1.74. Assets ; $32M. Mix: 77% prop, owned, 
23% mtgs. & joint vent. Prop: 19 offices 
midwest & FL, 5 apts., 2 motels, 1 land 
tract. Vacancies falling. Financing : 

$25M debt is 3.2X $8M equity. Debt is: 

65% secured, 15% short, 20% convt. 

EPS ; Sept . Dec . Mar . June Year 
FY’78 iq 24d 9c 48oa 

FY’79 iq 

a-Incl. 20^ sale gains & 19q taxless. 
(NON-QUAL: Mgmt. by independ. Phil, rlty gp) 

3 -FRASER: $10.75 (FRASS-OTE) Comment : EPS 

vulnerable but hold for recovery; Block of 
I 8% bought by broker. (^: 1038T, Bk $16.64) 

^ Intangibles : Loss Res. 54c. Assets : $48M, 

8% nonearn; 7% foreclosed. Mix: 37% LT; 

31% Ohio, 25% FI. Making new investment. 
Financing : $38M bank debt is 2.2X $17M 
equity. 1% prime= 4c/sh. qtr. 

EPS : Aug . Nov . Feb . May Year 

FY’78 25c 25c 26c 50ca 1.26a 

FY’79 El. 15 

a-Incl. 43c asset sale gain. 

Div : 27c, up Ic to $1.08 ann. rate. 

(Adv. by Cleveland mtg. banker) 

3 -GEN GROWTH: $26.88 (GGP-NYSE) Comment : 

I Bucksbaum family, now 15% owners, to tender 
for all sh. at $28 cash or $30 notes. Offer 
expected in Mar. Q. (Sh ; 6202T, Book $6.38) 
Intangibles : Depr. $4.10. Assets ; $325M, no 
problems; high quality. Mix: 76% shop. ctrs. 
(major Midwestern malls), 14% apts. 
Financing ; $288M debt is 7.3X $39^ equity. 
Debt is 91% secured mtgs. & $25M 9-1/8% 
notes to 4/97. Earnings ; Sep. Q EPS 40c 


after 2c gain & June CFS 44c after Ic gain. 
Sept. FY $1.48 after 15c gain. Div ; Sept. 

39c, up 2c, about 60% taxfree. (FY Sept.) 

2N-GMR PROP: $1.88 (GMR-NYSE) Comment ; Re- 
covery speculation on benefits of bond re- 
structuring. (^; 2210T, Book $3.73) Bonds ; 
Tender for $1,025 prin. of new 8^% debs. 

+ 50 sh. for 7 7/8s. Intangibles ; Loss res. 
$7.23. Taxless $12.20 to FY’77. Assets: 

$81M, 39% non-& 22% low-earn; 53% ford. 

Mix; 24% apts., 26% land; 79% Southeast. 
Financing ; $53M debt is 6.4X $8M net equity; 
If exch. succeeds, $27M bank term debt to 
9/83 accruing first at 6^%, pay at 4% cash; 
Requires 75% acceptance of subor. debt re- 
structuring. 

EPS ; May Aug . Nov . Feb . Year 

FY’78 d48c dl8c dl8c 50c d34ca 

FY’79 dl2c -Oca 

a- Asset swap gains; 90c in ’78; 16c Aug Q. 
(NON-QUAL TRUST, Adv. by life insur. co.) 

2 -GOULD INV; $9.00 (GTR-ASE) Comment ; Spec, 
income, above average yield. ( Sh ; 1174T, 

Bk $6.97) Intangibles ; Loss Res. 35C; Depr. 
$10.10. Assets ; $39M, 2% nonearn; 86% prop, 
owned. Mix: 19% NYC office, 5 apts, 15 strip 
ctrs. Financing ; $31M debt is 3.8X $8M equi- 
ty. 91% secured mtgs. 

EPS /CFS Dec . Mar . June Sept . 

FY’77 22/34C 30/27Ca 12/22C 7/17Ca 

FY’78 37/47ca 15/26C 18/30C 

a-Incl. prop, sale gains: 24c in FY’77, 

16c in Dec’ 77. 

Div ; Sept. 22c, up 2c, to 88c ann. rate. 
(Managed by NY realty family) 

1 -GREIT: $7.00 (GRT-ASE) Comment ; Hold for 
A new mgmt. & re-leasing of vacant Dayton of- 
I fice space. Renovation to cause drain from 
this bldg. Shares 38% below book. ( Sh ; 998T, 
Book $11.31) Intangibles ; Depr. $14.22; Loss 
Res. 8c. Assets ; $35M, several vacancies. 

Mix: 61% shop, ctrs., 29% offices & urban 
stores, 2% mtgs. Financing ; $24M debt is 
2. IX $11. 3M equity; all secured mtgs. 

EPS/CFS Jan . Apr . July Oct . 

FY’77 15/25C 11/21C 21/39C 22/30ca 

FY’78 14/23C 10/18C 14/22C 

a-Incl. prop, sale gains: 7c. 

Div : Oct. lOc, 40c ann. (Independent Phil, mgt) 

5N-GRT AMER: 38c (GAA-OTC) Comment ; Filed Ch. 

XI 3/77. SEC Ch. X motion still in progress. 
Still risky. (Sh: 4456T, Book d$12.99) Bonds ; 
Hold. Intangibles ; Loss Res. $13.22; Depr. 
$3.45; Taxless $15.93. Assets ; $315M, 90% 
nonearn; 83% ford. Mix: 42% apts., 21% 
land. Financing ; $321M debt over $58M 
negative equity. Proposed plan: secure 
assets for sr. creditors + equity for 
cash int.; deben. exchange. Earnings ; Apr. Q 
9C; foreclosures now positive cash flow. 

(FY July; NON-QUAL TRUST; Self-adm.) 


10 


December 8, 1978 


2N-GROWTH RL: $3.75 (GRW-NYSE) Comment ; Im- 
proved spec.; Mgmt. seeks acquisitions & 

I claims $4/sh. unrealized appreciation. 

* (^: 2059T, Book $7.66) Bonds ; Risky yld. 
Intangibles ; Loss Res. $4.18; Taxless 
$10.93. Assets ; $104M, 40% non-& 12% low- 
earn; 48% ford. Mix: 40% apts., 18% shop, 
ctrs. Financing : $82M debt is 5.2X $16M 
equity; $56M bank debt to 12/81 w/int. ac- 
crued at prime to 9% max. ; pledging assets. 
EPS ; Sept . Dec . Mar . June Year 

FY'78 d65(? 3.77a d22<: 1.15a 4.03a 

FY'79 d39C 

a-$4.01 interest forgiven in FY'78. 

(To incorporate; Self-adm.) 

5N-GUARDIAN: 44d (GMI-PHSE) Comment ; Filed Ch. 

XI 3/78. SEC seeks Ch. X. Hold; Avoid new 
buys. (^: 3000T, Book d$13.81) Bonds ; In- 
terest default 6/77; Hold. Intangibles ; Loss 
res. $8.74; Taxless $32.67. Proposal : $204M 
princ. w/o inter, thru 1990 & sh. for 3/8 
of equity; Subor. debt; 7^s, $260 cash + 179 
sh; 6 3Ms 5. 8s, $210 cash + 131 sh. (would 
give sub. debt 3/8 of equity). Assets ; $202M, 
55% non-& lowearn; 35% ford. Mix: 35% land 
owned & in develop, 28% income— prod. prop. 
Financing ; $238M debt over $41M negative 
equity. Debt is $204M bank, $34M deben. 
Earnings: Aug. Q 59<? after 28<: taxless & 30c 
sale gain. (FY Feb.; NON-QUAL TR; Self-adm.) 

2N-HAMILT0N: $1.63 (HAMTS-OTC) Comment ; Recov- 
ery spec, at 70% below book (Sh ; 2133T, 

Book p$5.43) Intangibles ; Loss Res. $6.64; 
Taxless $3.26. Assets ; $79M, 27% non-& E19% 
low-earn; 39% ford. Mix: 59% apts., 15% of- 
fice, 13% land, 37% OK, 16% FL. Financing ; 
$52M debt is 4.9X $10. 7M equity; $49M bank 
credit to 6/78 at 3^5%. Renege, to cure de- 
fault. $8M repay, overdue. 

EPS ; Mar. June Sept . Dec . Year 

1977 dl8c d21<:a 20(?a d35(;a d55ca 

1978 d8<; d8o 40<:b 

a-Asset swap gain $1.44 in 1977. b-Asset 
swap gains 77<? in Sept. '78. 

(NON-QUAL TRUST: Self-adm.) 

2N-HAN0VER SQ: $5.63 (HSQ-ASE) Comment : Buy/ 
hold for recovery. Merger potential. (Sh : 
946T, Book $11.25) Converts ; Spec, income 
buy. Intangibles ; Loss Res. $2.22; Depr. 

24<?; Taxless $4.55 as of 8/76. Assets ; 

$32M, 21% non-£i 10% low-earn; 23% ford. 

Mix: 68% resid. , 17% shop, ctrs.; 48% 
Northeast. Stopped new commitments. 

Financing ; $19M debt is 1.8X $10. 7M 
equity; $16M bank credit at 124% prime. 

EPS : Nov . Feb . May Aug . Year 

FY'78 Slqa d2cb 12<:ab 5<: 460ab 

a-Incl. 38q asset sale gains, w/37c in 
Nov. '77. b-Incl. 33<; gain on deben. repur. 
(Adv. by W.R. Grace sub.) 

4N-HEITMAN MTG: $1.25 (HTM-ASE) Comment ; 

1 Rising rates pinch earnings. ( Sh ; 3292T, 

Book p$2.01) Converts ; Higher risk hold. 


Intangibles ; Loss Res. $4.81; Taxless E$4.50. 
Assets; $112M, 50% non— & 15% low-earn; 19% 
foreclosed. Mix: 31% shop, ctrs., 12% hotels, 

18% offices, 21% land; 25% 111, 16% CA, 22% 
other West. Financing ; $90M debt is 12X $7.5M 
equity; $53M bank debt to 4/79 at prime, 

$20M to 4/79 at Js% over prime. 

EPS : Mar . June Sept . Dec . Year 

1977 die dlle d50e d4e d66e 

1978 IC d28e d27e 

(Adv. by Chicago mtg. group) 

3 -HOSPITAL MTG: $8.88 (HMG-ASE) Comment : Hold/ 

I avoid. 1% prime=l%c/sh. Qtr. Some recovery at 
^ 60% below book. ( Sh ; 1178T, Book $22.54) 

Intangibles ; Loss Res. 20e; Depr. 54e. 

Assets ; $36M, 36% nonearn; 1% foreclosed. 

Mix; 34% medical, 31% land, 18% apts; 2/3 FL. 
Swapped 2 participations for 133 ac. in 
Houston. Financing ; $12M debt is 0.5X $26. 6M 
equity; $9M bank debt; $3M mtgs. 

EPS/CFS May A^. Nov . Feb . 

FY'78 ll/14e 15/18e 13/19e 10/16e 

FY'79 10/16C 7/15e 

Repaying $2M to banks & taking $6M term 
loan at 1%% over prime. Div: 60e ann. rate. 

(Adv. by Miami hosp. mgmt. co.) 

3 -HOTEL INV: $16.88 (HOT-ASE) Comment ; Sh . & 
Bonds: Buy /hold for income. Occupancy & room 
rates up. (^: 1565T, Book $16.90) 

Intangibles ; Loss Res. 68<:; Depr. $2.98. 

Assets ; $77M, 4% nonearn; 49% prop./46% LT 
mtgs. All hotels /motels, most nat'l fran- 
chises; cornel, business travel oriented. 
Financing ; $53M debt is 2. OX $26!sM equity; 

Debt is $14M secured mtgs., $15M secured @ 

9 3/4% for 15 yrs., $16M converts., $6M bank 
at prime. 

EPS/CFS Nov. F^. May^ Aug . 

FY'77 32/45d 28/44C 32/45<: 28/38C 
FY'78 40/530 34/500 37/500 29/430 
Div ; $1.90/yr. (Self-adm.) 

2 -HUBBARD: $17.00 (HRE-NYSE) Comment : Buy for 
modest dividend increase prospects. (SH ; 

4004T, Book $22.84) Intangibles ; Loss res. 

44o; Depr. $3.65. Assets; $85M, E4% nonearn 
due to Grant vacancies. Most net leased retail 
& food stores. Net lessees: 20% Safeway, 17% 
Ashland Oil, 17% Chrysler. Financing ; $3M mtg. 
debt is 0.03X $91. 5M equity. 

EPS ; Jan . Apr . July Oct . Year 

FY'77 350 350 36o 820a 1.88a 

FY'78 380 410 ^30 

a-Incl. 440 loss reserve reversal. 

Est : FY'78 $1.70 on new lease acetg. Div : 

38o for Oct. Qtr., upt 6%. (Advised by 
Merrill Lynch sub . ) 

2 -ICM RLTY; $8.13 (ICM-ASE) Comment ; EPS 

vulnerable. Long term recovery + poss. take- 
over. Eastover Corp. bought 7%%. (Sh; 3011T, 
Book $15.13) Intangibles ; Loss Res. $5.12; 
Depr. 280. Assets ; $91M, 53% non-& lowearn; 

32% foreclosed. Mix: 50% apts., 26% shop. ctrs, 
15% land; 40% land/leasebacks. Financing : $31M 


December 8 , 1978 


11 


debt is 0.7X $45^M equity; Debt is 49% se- 
cured mtgs., $15M bank credit to 2/79 at 
120 % prime. 1 % prime=lc/sh. qtr, 

EPS : Feb . May Aug . Nov . Year 
FY’77 22ca lOq 15c 37qa 84oa 
FY»78 ISqb 28db 24d 

a-Incl. 25d prop, sales. b-Incld. 16c 
prop, sales thru Aug. ’78. 

Est : FY’78 EPS 85C-90C. Div: Annual div. 
30-40C avail, if no further losses taken. 
Div : Paying annually from taxable income. 
Paid 23.6c in 3/78 from FY’77 income. 

(Adv. by NYC mtg. group) 

4N-IDS RLTY: $1.38 (IDR-OTC) Comment : High 
risk spec. (Sh : 2409T, Book $3.73) Bonds : 
Risky hold; tender at 80% of par for $65M 
face completed 8/78. Intangibles : Loss Res. 
$7.06; Taxless $16.84 before recent gain. 
Assets ; $129M, 49% nonearn; 39% ford., 
after 8/78 sale to IDS, Inc. Financing : 

$112M debt is 12. 4X $9M equity; $99M subor. 
deben. Earnings ; Oct. Q $7.23 after $7.26 
extra, gains & 27c loss res. recovery. 

(FY Jan.; NON-QUAL TRUST) 

5N-INDEPEND MTG: $1.25 (IMTGS-OTC) Comment : 
Avoid. (Sh ; 2500T, Book d$3.92) Intangibles ; 
Loss Res. $11.80; Taxless $12.80. Assets ; 
$119M, 87% non-& low-earn; 65% foreclosed. 
Mix: 23% condos, 26% devel; 16% FL. 
Financing ; $96M debt over $10M negative 
equity; Debt is $76M bank term, $10M 
subor., $10M mtgs. Earnings : June Q llC 
after 14c sale gain; FY dlq. (FY June, 
NON-QUAL TRUST: Adv. by Phil, bank) 

2N-INDIANA MTG: $4.13 (INDMS-OTC) Comment ; 

Hold for improvement, operating at approx, 
break-even ex reserve changes. (Sh ; 1154T, 
Book $8.87) Intangibles : Loss Res. $2.30; 
Depr. $2.72; Taxless $6.50. Assets ; $54M, 
25^% nonearn; 8 % ford. Mtgs. 50% (most 
land & cornel.) Prop. 41% (most offices & 
apts.) Financing ; $41M debt is 4. OX $10M 
equity; $30M bank credit to 10/79 :$18M at 
8 ^ 4 % & $13^ at 8 % min., 10 % max. 

EPS : Sept . Dec . Mar , June Year 

FY’78 +0ca d2Ca ICa 37Ca 36ca 
FY*79 9ca 

a-Loss res. credits of 72c in FY’78; 

7c in Sept. ’78. 

(Advised by Indiana bank) 

2N-INSTITI0NAL IN: $1.38 (INV-NYSE) Comment ; 
Trading on restructuring (Sh ; 6074T, Book 
$2.98) Bonds ; Offering $1,050 of new 8 ^% 
sr. notes + 50 shs. for old 7 7/8s; Needs 
80% acceptance. Intangibles : Loss Res. 
$1.28; Depr. 14c; Taxless $6.71. Assets ; 
$ 88 M, 62% non-& 21% low-earn; 61% fore- 
closed. Mix: 15% apts., 50% land; 18% 

Fla. Financing : $63M debt is 3.5X $18M 
equity; $33M bank credit to 1/79 + exten. 

EPS ; Apr . July Oct . Jan . Year 

FY’78 d36c d41ca d29ca dl.41a d2.47a 

FY’79 d35Cb 33cb 

a-36c sales gain & 31c swap gain. 
b-39c gain debt extinguishment. 

(NON-QUAL TRUST: Self-adm.) 


1 -INVESTORS RL: $7.75 (IRT-ASE) Comment ; 

A Interesting long-term recovery buy at 30% 

1 below book. Proposes exchanging 850,532 sh. 
for Summit Props. ( SH ; 1479T, Book $11.11) 
Intangibles ; Loss Res. 62c; Depr. $3.13. 
Assets ; $36M, 17% nonearn. Mix: 54% apts., 

15% shop, ctrs.; 77% property. 

Financing ; $17M debt is l.OX $16M equity; 
$1.8M bank debt, $15M mtgs. 

EPS/CFS Feb . May Aug . Nov . 

FY'77 3/18<? dl/14(? dlA/Oc 51/64ca 

FY'78 8/19<: 30/37(? 12/19C 

a-Prop. sales gain 90c. 

Div : Paying 60c/yr. (CAN END REIT; Self-adm.) 

2 -JMB RLTY: $16.00 Unit (JMBRS-OTC) Comment ; 

Buy /hold for spec, yield. ( Sh ; 510T, Book 
$19.53) Intangibles : Depr. $1.35. Assets ; 
$36M, no nonearn. Mix: 49% apts., 17% office, 
17% shop, ctrs.; 67% wraparound mtgs., 9% 
land leasebacks. Financing ; $25M debt is 2.5X 
$10M equity; $20M mtgs., $5M bank debt. 

EPS: Nov. Feb. May Aug. Year 

FY’78 46c 46c 77ca 

a-Incl. 13c prop, sale gain. 

Div ; 1.80/yr. rate. (Adv. by Chicago rlty gp) 

2N-KENTUCKY PROP; $1.63 (KMTGS-OTC) Comment : 
Situation improving; broker bought 9% of shs. 
(Sh ; HOOT, Book $2.61) Intangibles ; Loss 
Res. $2.27; Taxless $4.44. Assets ; $15M, 88% 

non-& low-earn; 80% foreclosed. Mix: 23% apts, 
25% land & devel., 17% condo; 54% Ky. 
Financing ; $9^M debt is 3.2X $3M equity; $8M 
bank debt to 5/80 at 8%, 4% cash, balance 
deferred. 

EPS: Feb. May Aug. Nov. Year 

FY’78 d6c 1.05a d6c 

a-69c asset swap gain. 

(NON-QUAL TRUST; Self-adm.) 

5N-LIFETIME COM; 75c (LFTMS-OTC) Comment ; High 
risk. (Sh : 6632T, Book $2.67) Intangibles ; 

Loss Res. $7.97; Taxless $9.38. Assets ; $141M, 
75% non-& low-earn; 59% ford. Settlement : 

Ch. XI emergence 1/78; Banks get 65% of $163M 
debt over 6 yrs. + 47% of stock; sub. debt 
gets 10% + 15% of par + 5.2% of stock. 
Financing ; $80M debt is 4.5X $17. 7M equity. 
Earnings : July Q 17c after 8c tax benefit & 

9c gain. (FY Oct.; Corporation) 

2N-LINC0LN: $2.00 (LNMGS-OTC) Comment ; Shs . & 
Bonds : Spec, that new mgmt. can rebuild e- 
roded book value. (Sh; 1155T, Book 85c) 
Intangibles ; Loss Res. $2.16; Depr. $1.02; 
Taxless $3.56. Assets ; $13^M, 61% non-& 
low-earn & foreclosed. Mix; 70% apts. 
Financing ; $11M debt after $6M bank repaid 
7/78 is IIX $1M equity. Earnings ; Sep. Q 
d4c after 21c gain. (FY Mar.; NON-QUAL TRUST; 
Self-adm. ; Five large holders elected trustees 
in Oct. ’78 + replaced old mgmt.) 

2 -LOMAS & NET MTG: $16.13 (LOM-NYSE) Comment ; 

Buy /hold, shares depressed 42% below book by 
rate fear but exposure to 1% prime chng.= 2c/ 
sh. qtr. (Sh ; 3700T, Book $27.83) Intangibles ; 
Loss Res. $3.02. Assets ; $276M, 15% nonearn; 
16% ford. Making new loans. Mix: 42% r.on^t. - 


12 


December 8, 1978 


loans, 29% land acq. & devel,; 55% Texas. 
Financing ; $173M debt is 1.7X 103M equity; 
$100M credit to 5/83 permits $50M more 
cornel, paper. All debt floats. 

EPS ; Sept . Dec . Mar . June Year 

FYV8 40d 42c 43c 45C 1.70 

FY’79 48c El. 80 

Div ; Sept. 48c qtr. 36c cap. ret. in ’78. 
(Advised by largest U.S. mtg. banker) 

2 -M&T MTG: $9.63 (MTMIS-OTC) Comment : Buy 
for stable yield, good relative value. 

(Sh ; 1428T, Book $10.32) Intangibles : 

Loss Res. 55c. Assets : $52M, 0.5% nonearn. 

& ford* All mtgs. in Texas, most 1-family 
1- family constr. & devel. ; making new 
commitments. Financing ; $39M debt (all 
bank) is 2.5X $15M equity; All bank debt 
secured; sponsor provides compens. bal. 

EPS ; Nov. Feb . May Aug . Year 

FY’78 28c 26c 28c 31C 1.13 

Div ; 30c + 5C extra. in Aug. qtr. (Adv. 
by Houston mtg. banker) 

2N-MARYLAND RL: $3.13 (MDRTS-OTC) Comment ; 
Recovery spec, but small; Federated Reins, 
bought 11.8%. (Sh: 760T, Book $8.59) 
Intangibles ; Loss Res. $2.88; Taxless 
$4.70. Assets ; $19M, 29% non-& 8% low-earn; 
37% foreclosed. Mix: All Ga. & Fla; 32% 
apts., 32% land. Financing ; $10.72 bank 
debt is 1.6X $6.5M equity. Assets pledged. 
Earnings ; Aug. Q EPS 16c alter 6c taxless 
& 21c sale gain. (FY Nov.; NON-QUAL TRUST) 

1 -MASSMUT M&R: $14.13 (MML-NYSE) Comment ; 
Buy/hold at 28% below book. (Sh ; 4670T, 

Book $19.63) Converts ; Safe yield. Intan- 
gibles ; Loss Res. 44c. Assets ; $187M, 6% 
non-& 6% low-earn; 11% ford. Mix: 37% 
shop. ctr. & retail, 33% apts.; 82% LT 
mtgs. New commitments. Financing ; $96M 
debt is l.OX $92M equity. Small interest 
rate exposure. $70M convert, debs. 

EPS ; Jan . Apr . July Oct . Year 

FY’78 36c 38c 37c 36c 1.47a 

a-Incl. lie deben. repurchase gains. 

Div : $1.36/yr. rate. (Major life co. adv.) 

5N-METR0PLEX; 50c (JMI-OTC) Comment ; Bonds 
& Shares ; Avoid. Filed Ch. XI 12/77; must 
solve complex litigation to emerge. (Sh ; 
1184T, Book 5C on going concern basis) 
Intangibles ; Loss Res. $9.51; Taxless 
$16.47. Assets ; $27M, 100% nonearn; 50% 
ford. Mix: land & lots. Financing ; $13M 
debt over nominal equity. Debt is $2M banks 
+ $9.6M sub. debs. Earnings ; Mar. Q dl7c. 
(FY Sept.; NON-QUAL TRUST) 

2N-MIDLAND MTG; $1.50 (MMT-NYSE) Comment ; 

Spec, on developing/selling 2 large tracts. 
One broker bought 16.8% of shs. ( Sh ; 2382T, 
Book 18c) Bonds ; Spec, yield. Plans exch. 
offer of new convertible. Intangibles ; 

Loss Res. $3.78; Taxless $9.26. Assets ; 
$35M, 70% non-& lowearn; 50% ford. Mix: 


11% motel, 17% condo, 48% land. Financing ; 
$26M debt is 58X $0.4M net equity. Swaps 
repaid all bank debt 8/78. 

EPS: Sept. Dec. Mar. June Year 

FY’78 d4c d9c dl8c 18c dl4ca 

FY’79 5C 

a-Incl . $2.98 asset swap gains. 

(CAN END REIT: Okla. mtg. banker adviser) 

1- MILLER (HEN. S); $12.75 (HSTMS-OTC) Comment ; 

Buy for LT recovery; Operating trend up. ( Sh ; 
T 560T, Book $16.95) Intangibles ; Loss Res. 

' $1.74; Depr. $3.17. Assets ; $25M, 10% non- 

earn & foreclosed. Mix: 60% shop. ctrs. 
owned, 18^% land; mostly Texas. Sold 2 
offices, Kansas shop. ctr. & Tx. warehouse. 
Financing ; $16M debt is 1.7X $9.5M equity. 

$4M bank borrowings at ^% over prime; 

$11. 8M mtgs. on prop. 


EPS: 

May 

Aug. 

Nov. Feb. Year 

FY'78 

16c 

15 C 

4c 17c 52c 

FY'79 

30c 

2.34a 


a- 

Incl. 

$2.13 prop 

. sale & insur. gains. 


Div : Oct. 25c, $1.00/yr rate. (Dallas 
realty group adviser) 

2N-MISSI0N: $2.88 (MIT-ASE) Comment : Trading/ 
very long recovery; book value stablizing. 
Merger offer spurned. (^; 1812T, Book $4.87) 
Intangibles ; Loss Res. $2.41; Taxless $5.35. 
Assets ; $26M, 40% non-& 22% low-earn; 51% 
ford. Mix: 42% land & devel., 19% resid. , 

39% cornel. Financing ; $13M bank debt is 1.5X 
$9M equity. Bank debt at prime (max. 8%% 
to 11/79; Cut bank debt to $7M 10/31. Assets 
pledged. 

EPS ; Feb . May Aug . Nov . Year 
FY’77 dl6c d9c d5c 13c d43c 
FY*78 15Ca 5Ca dlC 

a- Inc. 29c asset sale gains. 

(CAN END REIT; Self-adm.) 

2 -MONY MTG: $8.13 (MYM-NYSE) Comment ; Hold; 

1%" prime rise would cost l^c/sh. qtr. ( Sh : 

T 8935T, Book $9.82) Converts ; Safe yield. 

• Intangibles ; Loss Res. lOc; Depr. 21c. 

Assets ; $252M, 8% non-& low-earn; 5% ford. 
Mix: 29% office, 26% multi-fam. , 32% shop, 
ctrs.; 47% ST mtgs., 36% LT mtgs. Making new 
ST commitments. Financing ; $171M debt is 1.9X 
$88M equiy. $122M ST debt, most $96M cornel, 
paper. 

EPS : Aug . Nov . Feb . May Year 

FY’78 16c 16c 16c 38ca 86ca 

FY’79 17c 

a-Incl. 26c borrower restructure gain. 

Div : 23c/qtr. (Major life co. adviser) 

1 -MTG GROWTH: $6.88 (MTG-ASE) Comment ; Spec, 
buy/hold for LT recovery and 9.3% yield. 

(Sh;, 2627T, Book $10.65) Intangibles ; Loss 
Res. 31c; Depr. $1.06. Assets ; $45M, 4% non- 
& 3% low-earn; 4% held for sale. Mix: 61% 
apts., 26% offices; 34% Cal. Financing ; $16. 8M 
debt is 0.6X $28M equity; Debt; $7.7M converts 
held privately, $3M banks, $6M mtgs. 


December 8, 1978 


13 


EPS/CFS Feb. May Aug . Nov . 

FY»77 5/llC 5/13C 5/13c 8/16C 

FY»78 10/18C 12/20C 13/210 
Est : FY'78 EPS 50o; CFS 800. Aug. 16o, 

up lo. (Advised by independent group) 

3N-MTG INV WASH: $1.75 (MINVS-OTC) Comment : 
Trading, recovery potential. ( Sh : 2146T, 

Book $4.13) Bonds ; Risky yield. Intan- 
gibles : Loss Res. $2.17; Taxless $4.43. 

Assets : $55M, 42% non-& 15% low-earn; 

42% foreclosed. Mix: 21% apts., 15% shop, 
ctr.; 15% mobile home. Financing : $43M 
debt is 4.8X $8.9M equity. $15M sr. bank 
debt at 112^% of hX over prime, to 12/15/79. 
EPS ; June Sept . Dec . Mar. Year 

FY*78 Iloa dl5o dl.l4 d54o dl.72a 

FY’79 250b d22o 

a-Incl. 14o sale gains; b-38o sale gains. 
(NON-QUAL TRUST) 

IN-MTG TR AM: $5.88 (MT-NYSE) Comment : Buy/ 

t hold for recovery at 58% below book. ( Sh : 
3860T, Book $12.91) Intangibles : Loss Res. 
$2.80; Taxless $2.05. Assets : $87M, 38% 
non-& 9% low-earn; 31% foreclosed. Mix: 

24% land & devel., 17% condos, 19% apts.; 

17% Calif. Financing : $34M debt is 0.6X 
$50M equity. $20M bank debt at full-rate 
inter. New $20M credit permits new invstmt. 
EPS ; Feb . May Aug . Nov . Year 
FY»77 dl30 dl70 dl9o 24oa d250a 
FY’78 18oa 48ob 14o 

a-Incl. 9o prop, sales in Nov. ’77; 27o 
in Feb. ’78. b-42o interest recovery. 
(Advised by sub. of Transamerica Corp.) 

4N-NATL MTG: 88o (NMF-OTC) Comment : Moderating 
risk that land holdings will be difficult 
to market. (^: 3707T, Book $2.03) 

Intangibles : Loss Res. $3.55; Taxless $2.51. 
Assets : $36M, 81% non-& 11% low-eam; 65% 
foreclosed. Mix: 61% land, 16% cornel; 43% 

FL. Financing : $12M debt is 1.6X $7.5M 
equity; $8.5M secured bank credit; Ch. XI 
settlement confirmed & deb. holders got 
cash, new notes & shares. Earnings : Aug. 

Q 3o on big revenue gains. (FY Feb.; NON-QUAL) 

2 -NATIONWIDE EE: $13.00 (NRELS-OTC) Comment : 
Agreement in principle w/Buckeye Fed. S&L, 

Max. $20, min. $18. Buy/hold for merger. 

(Sh : 1047T, Book $24.36) Converts : High 
yield. Intangibles : Loss Res. $1.22. 

Assets : $31M, 49% non-earn; 35% foreclosed; 
Halted new loans. Mix: 25% medical, 14% 
condos, 11% land; 30% Ohio, 17% Ind. 

Financing : $6^ sub. deben. debt is 0.3X 
$25^ equity; Earnings : Sep. Q 13q. (FY Mar.) 

1 -NEW PLAN RL: $9.50 (NPLNS-OTC) Comment : 

Split 3-for-2 11/78. Buy/hold for good 
4 quality yield and improving income. (Sh : 

I 2357T; Book $2.67) Intangibles ; Depr. 

$2.56. Assets ; $20M, no nonearn. Mix: 71% 
shop. ctrs. owned, 14% resid. Bought HOT 
sf NY shop, ctr. Financing ; $17M debt is 
2.5X $7M equity; Debt: 80% mtgs., 18% subor. 


EPS/CFS Oct. Jan. Apr . 

FY’77A 11/12C 21/21qa 15/16q 

FY’78A 25/25db 25/25qb 18/17 

A-Adjusted for 3/2 stock split 11/78. 
a-Incl. 4d sale gain. b-Incl. 5c sale. 

Div ; 72d/yr paid monthly. (Self-adm.) 

5N-NJB PRIME: $1.25 (NJB-OTC) Comment : Avoid, 

Ch. XI filed 9/78. (Sh: 1330T, Book d$7.15) 
Intangibles ; Loss Res. $17.98; Taxless $12.00. 
Assets ; $65M, 71% nonearn; 53% ford. Mix: 

43^% motor lodges/restaurants, 27^% condos. 
Financing ; $48^M debt over $9^ neg. equity. 
Filed Ch. XI plan 9/14/78 proposing: Exch. of 
$20 cash for $100 subor. deb. or $15 + 

$35 in new conv. deb., or $15 + 20 sh. 

Earnings ; Aug. Q d55C after 13d loss prov. 

(FY Nov.; NON-QUAL: Self-adm.) 

3N-N0. AMER: $2.88 (NAM-NYSE) Comment ; Re- 
covery potential from large apt. holdings but 
progress slower than expected; about 61% 
discount from est. $7.50 hard book value. 

(^: 4401T, Book $8.17) Bonds ; Hold 8^s; 

5^s won’t be repaid 3/15/79. Intangibles ; 

Loss Res. $2.57; Taxless NA. Assets ; $136M, 

48% non-& 45% low-earn; 61% ford. Mix: 50% 
apts., 10% land; 34% FL. Financing : $95M debt 
is 2.6X $37M equity; $33M demand bank notes. 
EPS ; Mar . June Sept . Dec . Year 

1977 d32d dl.04 d35d d26da dl.97a 

1978 d34d d37d d32d 

a-Incl. 12d debt restructuring gain. 
(Self-adm. ) 

2N-N0WSTRN FIN: $8.00 (NFINS-OTC) Comment ; 
Recovery and/or liquidation spec. Broker 
bought 13%. Seeking taxless use. ( Sh ; 1510T, 
Book $14.35) Intangibles : Loss Res. $1.99; 
Taxless $3.64. Assets ; $33M, 37% nonearn; 23% 
ford. Mix: 7% apts., 6% offices, 7% land, 44% 
inter-long; 50% N. Caro. Financing : $9M bank 
debt is 0.4X $21^M equity; $9M bank lines w/2 
banks at ^% over prime. 

EPS; Mar . June Sept . Dec . Year 

1978 8d 4d 12da 

a-6d tax benefit & lOq loss res. credit. 
(NON-QUAL TRUST) 

3 -NOWSTRN MUT: $9.88 (NML-NYSE) Comment ; Hold, 

1% prime = 2d/sh. qtr, but difficulties appear 
discounted. (^; 4758T, Book $19.12) Converts ; 
Safe. Intangibles ; Loss Res. 65d. Assets ; 
$240M, 8% non-& 5% low-earn; 13% ford. Mix: 
25% office, 27% shop, ctr., 10% apts; 59% 

LT mtgs. Financing ; $152M debt is 1.7X $91M 
equity. $77%M open bank lines; $17M cornel, 
paper. 

EPS ; June Sept . Dec . Mar . Year 
FY’78 22d 30da 17q 22c 91(;:a 

FY’79 49qb 17d 

a-150 sale gain; b-33o sale gain. 

Div ; 25d. Being helped by^ cap. gains & est. 

$1 rate payout. (Major life co. adviser) 

1 -PACIFIC SO: $7.50 (PSMTS-OTC) Comment ; LT 

recovery or buyout candidate plus spec, yield; 
President bought 5^% of shares. ( Sh ; 800T, 


July 

16/15d 

O/EOqb 


14 


December 8, 1978 


Book $11,99) Intangibles ; Loss Res. $1.38. 
Assets ; $9M, 11% nonearn & ford. Mix: 84% 
cornel. LT loans, 11% ford, condo under 
sale contract. Bought commercial prop. 
Financing : No debt over $9^ equity. 

EPS: June Sept. Dec. Mar . Year 

FY’78 13c 17c 15C 13C 58c 

FY'79 15c 19c 

Div : Up 20% to 72c/yr. rate. (Self-adm.) 

2 -PENN RE: $15.00 (PEI-ASE) Comment : Buy /hold 

LT for yield & gains. ( Sh : 1516T, Bk $13.17) 
Intangibles : Depr. $12.99. Assets ; $63M. 

Mix: 38% apts., 36% shop. ctrs. Financing ; 
$52M debt is 2.6X $20M equity. Debt: 93% 
mtgs.; borrows under $6^ bank lines. 

EPS/CFS Nov. Feb. M^ Aug . 

FY»78 82/95cb 24/36C 37/50C 87/1. 03b 

h-Incl. 88c sale gains. 

Div ; 62^C semi-annually. (Phil. rlty. mgt) 

5N-PLAZA RL: $1.00 (PRISS-OTC) Comment ; Avoid 
or trade only. (Sh ; 1114T, Book 68c) 
Intangibles ; Loss Res. $4.15; Taxless $7.54. 
Assets : $30M, 72% noneam & ford. Mix: 89% 
prop, owned. Financing ; $24M debt is 32X 
$760T equity. Debt: $16M mtgs.; $9M credit 
at 1% cash or earnings to 1983 up to prime. 
Earnings ; June Q 12c. No audit opinion ’77. 
(FY Dec.; NON-QUAL TRUST: Self-adm.) 

3 -PNB MTG: $8.50 (PNI-NYSE) Comment ; Hold for 

1 LT recovery; 1% prime=2^C/sh. Q EPS. ( Sh ; 

I 2437T, Bk $18.77) Intangibles ; Loss Res. 55C. 
Assets ; $114M, 11% non-& low-earn & ford. 
Mix: 32% LT mtgs., 18% prop, owned; 34% 
apts., 24% office & indust. Adding assets. 
Financing : $72M debt is 1.6X $46M equity; 
$29M cornel, paper. 

EPS ; Dec . Mar . June Sept . Year 

FY’78 22c 16c 23c 24ca 85ca 

a-Incl. 5C prop, sale gains. 

Est ; FY’79 EPS rising. D^: Sept. 22c, up 
10%. (Adv. Phil bank subsidiary) 

3 -PROP CAP: $10.75 (PCL-ASE) Comment ; Buy/ 
hold for yield & LT recovery; int. exposure 
minimal. (Sh: 2065T, Book $13.68) Intangi- 
bles ; Loss res. 53c* Assets ; $50M, 5% non- 
earn. Mix: 39% apts., 28% office, 21% shop, 
ctrs.; 63% leasebacks, 37% LT mtgs. Seek 
new investments. Financing ; $22M debt is 
0.8X $28M equity; Bank lines $7M at ^ 
over prime. 

EPS ; Oct . Jan . Apr . July Year 

FY’78 30c 30c 30C 30c 1.20 

FY’79 30c El. 20 

Div ; 30c/qtr. (Independent mgmt) 

2 -PROP TR AM: $4.75 (PTRAS-OTC) Comment : 

Hold for recovery; (^: 2338T, Bk $7.37) 
Intangibles ; Depr. $1.67. Assets ; $32M, 

13% nonearn; 8% ford. Mix: 15% mtgs; 77% 
invstmt prop; 81% Tex. Financing ; $16M 
debt is 0.9X $15. 3M equity; $15M mtgs. 
EPS/CFS Mar . June Sept . Dec . 

1977 1/3C 7/lOc 2/5C 16/17a 

1978 2/6C 2/5C 

adncl. lie prop, sale gain. 


2 -BL i MTG PAC: $12.38 (RPACS-OTC) Comment : 

Sh . & Converts ; Hold, moderately vulnerable 
to interest rates. ( Sh ; 1890T, Bk $18.00) 
Intangibles : Loss Res. 20c. Assets ; $92M, 

1% non-& E10% low-earn; E15% ford. Mix; 64% 
mtgs: 26% hotel/motel, 18% office; 31% 
prop.; 47% Calif., 19% Hawaii. Financing ; 

$58^M debt is 1.7X $34M equity; Upped bank 
credit to $60M to 11/82: $30M cornel, paper 
backing & $30M line to 9^% max., up ^%. 

EPS ; Feb . May Aug . Nov. Year 

FY’77 25c 27c 32c 29C 1.13 

FY’78 24c 21C 29c E1.12-.15 

Div ; $1.28/yr. incl. not less than 20c/sh. 
depr. (Bank of Hawaii adviser) 

3 -REIT AMER: $15.50 (REI-ASE) Comment : Hold 

LT improvement of prop. yld. (Sh ; 1633T, Bk 
$21.59) Intangibles ; Depr. $7.89. Assets ; $44Mj 
prop. 9% vacant overall. Mix; 42% shop, ctrs., 
24% office, 21% indust.; 45% Cal., 13% Mass. 
Financing ; $12M mtg. debt is 0.3X $35M equity. 
EPS ; Feb . May Aug . Nov . Year 

FY’78 67ca 31C 28c El. 50 

a-Prop sale gains; 40c in Feb. ’78. 

Div ; $1.20/yr rate; paid since 1888. (Self- 
adm.; Is oldest U.S. trust) 

3 -RLTY INCOME; $12.25 (RIT-ASE) Comment ; Hold 
LT for portfolio upgrading benefits, problem 
property being eliminated. European group 
bought 20% of shares. (^: 1573T, Book $9.43) 
Converts ; Yield. Intangibles ; Loss res. 77c« 
Assets ; $69M, 35% non-& 15% low-earn; 44% 
ford. Mix; 19% apts., 27% offices. Closed 
10/78 sale of large Cal. tract at $3.66/sh. 
gain. Financing ; $58M debt is 3.9X $15M equity; 
$17M under $23-^ bank lines at prime; $20M 
term at 1^% over prime to ’80. 

EPS ; July Oct . Jan . Apr . Year 
FY’79 0.32B E3. 50-70 

B-Incl. IC sale gain. 

Div ; 35c/qtr. , paying cap. gains. (Self-axim) 

3 -RLTY REFUND; $13.13 (RRF-NYSE) Comment ; Hold; 
EPS partly sensitive to prime. ( Sh ; 1377T, Bk 
$18.01) Bonds ; Attractive for yield. Intangi- 
bles ; No reserve. Assets ; $62M, no problems; 
Mix: 80% wraparound mtgs., 20% LT mtgs; 43% 
apts., 21^% office, 19% industrial. Financing ; 
$'38M debt is 1.6X $24M equity; $9M bank debt 
at 3/4% over prime to 5/79; Sold $20M of 
11 3/8% sr. deben. 

EPS ; Apr . July Oct . Jan . Year 

FY’79 51C 47c 42c E40c El. 80 

Div ; Oct. Q 42c, down 11%. (Adv. Independent 
realty group) 

3N-REPUBLIC MTG: $1.50 (RMI-NYSE) Comment ; 

Trading, spec, on recovery, still in red. ( Sh ; 
2107T, Book p$3.90) Intangibles ; Loss Res. 
$4.99; Taxless $11.51. Assets : $48M, 56% non-& 
22% low-earn; 77% ford. Mix: 28% land acq. & 
devel. , 19% condos, 62% Fla. Financing ; $28M 
debt is 3.4X $8.2M equity. $25M bank credit to 
12/78 at 3% cash or net cash income, + conting. 
EPS : Mar . June Sept . Dec. Year 

FY’78 d30c ‘►OCa dlOc 

a- Asset swap gains: 20c in June ’78. 

/nT^u-r r^TTAT rnT»TTf«rri. T— J J \ 



December 8, 1978 


15 


NR-RIVIERE RL: $5.75 (RIVI6-0TC) Comment : Lim- 
ited interest. (Sh ; 783T, Book $8.57) Intang : 
Depr. $5.01. Assets : $22M, 2% ford. & NE. 
Financing : $15M debt is 2.3X $6.7M equity. 

$9M mtgs. on prop. Earnings : Sep. Q EPS 18c; 

June CFS 24c. D^: Sept. 15c, up lC.(FY Dec.) 

2 -SAN FRAN RE: $18.25 (SFI-ASE) Comment : Buy/ 
hold at 8% below book. (Sh : 1376T, Bk $19.90) 
Intangibles : Loss Res. $1.59; Depr. $4.78. 

Assets : E$63M, 5% ford. & non-earn. Sold 2 
ford, tracts 11/78. Financing : $36M debt is 
1.3X $27M equity; 93% mtgs. 

EPS/CFS Mar. June Sept. Dec. 

FY'77 20/26? 13/19? 10/18? 27735? 

FY'78 23/28? 25/33? 29/35? 

Est : FY'78 EPS $1.05; CFS $1.30. Dlv : Sept. 

Up 17% to $1.40/yr. rate. (Self-adm.) 

2N-SAUL RE: $6.50 (BFS-NYSE) Comment : Buyout 
candidate; Insiders buying + State Farm buys 
14% of sh. (Sh: 5859T, Book p$4.88) Bonds 
& converts : For yield. Intangibles : Loss Res. 

58c; Depr. $3.23; Taxless $6.66. Assets : $258M, 
11% non-& 9% lowearn. Mix: 87% prop. Financing : 
$225M debt is 7.6X $38M equity; $103M bank re- 
volver at 125% of prime to 4/30/79. 

EPS: Dec . Mar . June Sept . Year 

IT*"78 d29c d20cb dl6cb d20cb d84cb 

b-Incl. 25c gain on asset sales in year. 
(NON-QUAL TRUST: Wash. rlty. group advisor) 

3N-SECURITY MTG: $2.88 (SMO-ASE) Comment : Trading/ 
recovery. (Sh : 6487T, Book $5.88) Bonds : Mod- 
erately attractive. Intangibles : Loss Res. $2.16; 
Taxless $2.80. Assets : $130M, 27% non-earn; 21% 
ford. Financing : $78M debt is 2. IX $38M net 
equity; $10M bank debt at 125% prime to 3/30/79. 
EPS: Dec . Mar . June Sept . Year 

FY^78 d2c dlca dl3ca d3Ca dl8ca 

a-Incl. 4c debt extinguishment gain. 

(CAN END REIT: Smith Barney affil. is adv.) 

3N-S0 ATLANTIC: $3.00 (SAT-NYSE) Comment : Better 
spec, value after recent price fall. (Sh : 2706T, 
Book $2.93) Bonds : Spec, yield. Intangibles : 

Loss Res. $5.28; Taxless $8.72. Assets : $120M, 

67% non-& 20% low-earn, 83% foreclosed. 

Financing : $89M debt is 11. 3X $7.9M equity. 

$69M bank credit accruing at prime. 

EPS: Jan . Apr . July Oct . Year 

FY^78 d57c d46c 8ca 

a-83c loss reserve credit. 

(NON-QUAL TRUST: Self-adm.) 

3N-STATE MUT: $4.38 (SMU-NYSE) Comment : Inter- 
esting spec, on further recovery at 46% be- 
low book. (Sh: 2786T, Book $8.08) Bonds: 

Hold. Intangibles : Loss Res. $3.4/; Taxless 

E$5.90. Assets : $56M, 67% non-& low-earn; 
Financing ; $25M debt is I.IX $23M equity; 

Sr. debt $17M at 2% to 7/79. 

EPS : June Sept . Dec . Mar . Year 

FY»78 dl6c dl5c 9.62a 4c 9.35a 
FY»79 6cb 23cb 

a-$8.39 debt restructuring gain. b-Taxloss 
benefit 14c & asset sales 8c in 6 mos. 
(NON-QUAL TRUST: Major life co. adv.) 

2N-SUMMIT PROP: $3.25 (SMMTS-OTC) Comment : Agrees 
to exchange all sh. for 850,532 sh. Investors 
Rlty. (or abt. 0.55/RT sh.) & merge, provided 
all approvals given. (Sh : 1543T, Book $6.73) 
Intangibles ; Loss Res. 60c; Depr. $5.85. (FY 
Oct.; NON-QUAL; Self-adm) 

2 -SUTRO MTG: $8.75 (SUT-NYSE) Comment ; Buy for 
LT recovery at 44% below book value; Funding 


new loans & hedging rate risk. (Sh ; 2322T, 

Book $15.56) Converts ; Safe yield. Intangibles ; 
Loss Res. $1.68. Assets ; $65M, 12% non- & 7% 
low-earn; 13% ford. Financing : $25M debt is 
0.7X $36M equity; Debt: 82% converts. 

EPS ; June Sept . Dec . Mar. Year 
FY'78 19? 32? 12? 20? 82?a 

FY'79 26?b 32?b El. Oof 

a-Incl. 31c asset sale gains. 
b-Incl. 37c asset sales thru 9/78. 

Div ; Sept. 25c, up 11%. (Advised by Los 
Angeles mortgage banker) 

IN-TEXAS FIRST: $3.00 (TFMRS-OTC) Comment ; Spec, 
on recovery at 63% below book or favorable 
merger. Eastover bought 12^% of sh. (Sh ; 

1055T, Book $8.03) Intangibles ; Loss Res. 

$3.03; Taxless E$8.25. Assets ; $78M, 69% non- 
earn; 55% ford. Financing ; $6M bank debt (at 
8% to 9/79) is 0.7X $8.5M equity; assets pledged. 
Earnings : Sep. Q 3c. (FY June; NON-QUAL; Self-adm) 

2N-TIERC0: $2.13 (TIERS-OTC) Comment ; Spec, at 
68% below book on operating improvement & debt 
pa 5 nnent (Sh : 1170T, Book $6.62) Intangibles : 

Loss Res. $2.65. Taxless $9.61. Assets ; $29M, 

38% non-& 32% low-earn; Financing : $17. 8M debt 
is 2.3X $7.8M equity; $4M bank debt accrual to 
Sh7o or prime, to 6/80. Earnings ; Sept. Q 12c 
after 31c loss res. credit. (FY Dec.; NON- 
QUAL TRUST; Self-adm.) 

4N-TREC0; $1.25 (TRECS-OTC) . Comment ; Some spec, 
interest on restructuring but future still 
clouded. (Comm.Sh.; 2238T, Book 99c) Bonds : 

Inter, paid on old bonds 10/78. Old Shs & new 
pfd. now convertible at $1.62/sh. or 5.39M 
poss. sh. Two blocks bought. Intangibles ; Loss 
Res. $11. 68; Taxless $24.53. Assets ; $113M, 88% 
non-& low-earn; 81% ford. Financing ; $80M 
debt is 36X $2M equity; $65M six-year bank 
credit at 1% inter. + partial asset pledge. 
Earnings ; Sep. Q 4c. (FY Mar.; PLANS CORP. 

FORM; Self-adm.) 

3N-TRI-S0UTH MTG: $2.50 (TRI-NYSE). Comment ; 

Interesting after recent price fall. (Sh ; 2270T, 
Book $3.29) Bonds ; 53% took new 10% sr. convert 
(3 $2^; Old bonds now current. Intangibles ; Loss 
Res. $11.50; Taxless $17.05. Assets ; $86M, 85% 
nonearn; 66% foreclosed. Financing : $57M debt 
is 7.7X $7.5M equity; $16M bank debt at 1% 
inter, to 12/78, then 6%. 

EPS Mar . June Sept . Dec . Year 

1977 dl7ca d69ca d65ca d61ca d74ca 

1978 d23 d 5b 1.34b 

a-$2.71 extra gains. b-$1.33 restructure 
gains. (NON-QUAL; Adv. by 3 SE banks) 

4N-UMET TRUST: $1.25 (UAT-NYSE) . Comment : Spec.; 
operating loss widening to dim outlook. Max. 
$3.66/sh. interest forgiveness possible *79. 

( Sh ; 2109T, Book $d3.46). Intangibles : Loss 
Res. $8.85; Taxless $9.96; Depr. $1.45. 

Assets ; $121M, 21% nonearn; 80% foreclosedo 
Financing ; $105M debt over $7.3M negative equity; 
equity; $71M bank credit to 8/79 at 6% + 
contingent inter. 

EPS ; Feb . May Aug . Nov. Year 
FY*78 d50ca d2.16a d72Ca 
a-Incl. 94c asset sale & swap gains in *78. 
(NON-QUAL TRUST; Self administered) 

1 -UNITED RLTY: $8.13 (URT-ASE) . Comment ; Buy at 
54% below book value for benefits of problem 
loan solution; Low interest exposure. (Sh ; 

3610T, Book $17.61). Intangibles ; Loss res. $1.26. 
Assets ; $81M, 36% non-& 4% low-earn; 30% ford. 


16 


December 8, 1978 


Mix: 17% GNMAs (pledged), 24% office, 20% apts. 
Financing : $13M debt is 0.2X $63^M equity* 
Pledged GNMAs to repay banks $10M. 

EPS : Feb . May Aug . Nov. Year 

1977 18c 19c 20c 20c 77c 

1978 20 20a 21a 

a-2c sale gain in May, 2c prepay, in Aug. 

Div. : Aug. qtr. 21c> up 5% to 84c rate. 


-US BANCORP TR: $14.13 (UBT-ASE) . Comment : LT 
recovery, good equity base, positive cash flow. 
Problems down. (Sh : 8401, Book $17.03) Intang : 
Loss Res. 59c; Taxless $5.24. Assets : $45M, 8% 
nonearn; 4% foreclosed. Mix: 65% prop, owned or 
under construction, most industrial, rest office. 
Financing: $30M debt is 2. IX $14M equity. $15M 
bank credit to 2/28/79 at 120% prime. 


EPS/CFS: Aug. Nov . Feb . 
FY»78“ 4/23C 107^ 11/27C 
FY’79 28/44 

a-29c loss reserve credit. 
Div.: Resumed w/20c in Aug. 


May 

48/65Ca 53/1. 23a 


Year 


(Oregon bank adv.) 


2N-US REALTY: $4.75 (UTY-NYSE) . Comment : Buy /hold 
for long-term recovery; In strong uptrend; re- 
ducing mtgs. & increasing property. Insiders 
buying. (Sh : 3434T, Book $3.98) Converts : OK 
for risk income. Intangibles : Loss Res. $1.93; 
Depr. $9.60. Assets : $88M, E17% non- & 16% 
low-earn. Mix: 37% mtgs., 63% owned & joint 
venture property. Financing : $69M debt is 5. IX 
$13. 7M equity; $16M at 125% of prime (lower 
cash payment) . 

EPS/CFS: Mar. June Sept . Dec . Year 

1977 dl2/lC 4/17C 8/21C 5/23C 5/62ca 

1978 d 6/7 d5/8 d6/ 

a-22c asset sale gains & 16c debenture re- 
pur. gains. (NON-QUAL; Cleveland rlty. mgmt.) 

2 -VIRGINIA REIT: $10.00 (VARES-OTC) . Comment : 
Hold/buy for long-term. (Sh : 1251T, Book 
$10.02). Intangibles : Loss Res. $1.12; 

Depr. $4.03. Assets : $36M, 17% foreclosed 
& nonearn. Mix: 95% property. Financing : 

$24M debt (all secured mtgs.) is 1.9X $12. 5M 
equity. EPS/CFS : Mar . June Sept . Dec . Yr . 

1977 dl2/lc 4/17C 8/21C 5/23C 5/62ca 

1978 d 6/7 d5/8 d6/ 

a- After 20c mtg. prepayment penalty. 

Div , ; Incr. to 80c/yt. rate in Dec. (Self-adm. ) 

2N-WACH0VIA RLty: $3.88 (WRI-NYSE) . Comment : Spec, 
on LT recovery & asset disposition; 60% below 
book. iSh: 3335T, Book $9.81). Intangibles : 

Loss Res. $3.59; Taxless $4.62. Assets : $91M 
52% non-& 8% low-earn; 34% foreclosed. Mix: 47% 
mtgs.. Financing : $46M debt is 1.4X $33M equity; 
$46M bank debt to 7/79 at prime + contingent. 
EPS : Nov . Feb . May Aug . Year 

FY^78 dl8q d28<: dl8d dlOq d74c 
(Seeks NON-REIT POWER; S. Car. bank adv.) 


3N-WALTER RLTY: $4.63 (WALJS-OTC) . Comment : 

Modest potential after fallback; Hold for re- 
covery. (Sh : 1035T, Book $7.47). Intangibles : 

Loss Res. $2.99; Taxless $9.71. Assets : $25M, 

40% nonearn; 44% foreclosed; 19% property. 

Financing : $14M debt is 1.9X $7.7M equity. 

$1M bank debt to 10/79 at 117% of prime; Euro- 
debt extended to 10/81. 

EPS : Oct . Jan . Apr . July Year 

FY’78 dJJq dl.l7 d40d +67(;:a dl.24a 
FY’79 27a 

a-Asset sales: $1.01 in ’78; 420 in Oct. ’78. 

(NON-QUAL TRUST; Bldg. mtls. co. adviser) 

2 -WASHINGTON REIT: $21.25 (WRE-ASE) . Comment : 

Buy /hold for income, quality assets, condo 
potential in apts. (Sh : 1518T, Book $11.41) 
Intangibles : Depr. $6.49. Assets : $32M, no non- 
eam. Mix: All property, 98% in Wash. DC area; 
Financing : $16M debt is 0.9X $17M equity. Debt 
is $16M mtgs. + $0.2M converts. 

EPS/CFS: Mar. Jun^ Sept . Dec . Year 

1977 38/44d 1.48/1. 55a 38/44 48/55 2.72/2.97 

1978 34/38 47/52 38/E43 

a-Incl. $1.08 prop, sale gains. Div . : Raised 
to $1.88/yr. rate in Dec. (Independent) 

3 -WELLS FARGO M&E: $11.88 (WFM-NYSE) . Comment : 

Hold for recovery at 33% below book; 1% prime 
cuts 3<;: off qtr. EPS. (Sh: 3919T, Book $17.60) 
Intangibles : Loss Res. $1.42; Depr. 87c. Assets : 

$219M, 4% -non-& 17% low-earn; 5% foreclosed. 

Financing : $143M debt is 2. IX $6.9M equity. 

Has $144M open bank lines backing $126^ 
comc’l. paper rated A-2. Making new commit. 

EPS : Sept . Dec . Mar . June Year 

FY’78 31ca 39<;:a 30qa 34ca $1.34a 
FY’79 42a 

a-Asset sale gains: 24c in’ 78; 150 in 9/78. 

Div . : $1.20/yr. rate. (W. Coast bank adv.) 

2N-WESTERN MTG: $3.13 (WMTGS-Bos). Comment : Spec, 
buy for recovery & benefits of new prop. (Sh : 

1003T, Book $7.77). Intangibles : Loss Res. 76c. 

Assets : $19M, 13% non-& 7% low-earn. Financing : 

$11M debt 1.4X $7.8M equity. Earnings : May Q 
2c. (FY Feb., Independent mgmt.) 

2N-WESTP0RT CO: $2.25 (WSPTS-OTC) . Comment : Spec, 
buy. (Sh : 2388T, Book $4.22). Converts : Possible 
tender. Intangibles : Loss Res. $6.00; Taxless 
$7.16. Assets : $80M, 48% non-& 16% low-eam; 50% 
forecl. 16% operating & held for investment. 

Financing : $56M debt is 5.6X $10M equity. $53M 
bank debt to 8/79 at 2^-5% or net income w/conting. 
int. to 8%; Earnings : 27c in Oct. ’78 FY w/22c credits. 
(NON-QUAL; Self-adm.) 


REIT STATUS: All trusts listed except those noted qualify as real estate investment trusts and are 
exempt from Federal income taxes to extent they distribute 90% of income to shareholders. Qualified 
trusts may use taxless carryforwards to shelter future profits and rebuild capital. Non— qualified 
trusts have no dividend distribution required and three stages in transition are shown: VOTING POWER 
TO END REIT STATUS when a proposal is pending before shareholders to give trustees discretion over 
whether to continue to qualify; CAN END REIT STATUS, when shareholders have given trustees power to end 
qualification; and NON-QUAL TRUST, when trustees have ended qualification and the entity operates as 
a business trust taxed as a corporation. Trustees of these entities generally have made no decision 
on whether to requalify and investors should not assume they will requalify and pay dividends even if 
profits are restored. The 1976 Tax Reform Act restricts requalification.