ITEM 1. BUSINESS
The Registrant, Dean Witter Realty Income Partnership II, L.P. (the "Partnership"), is a limited partnership formed in September 1984 under the Uniform Limited Partnership Act of the State of Delaware for the purpose of investing primarily in income-producing office, industrial and retail properties.
The Managing General Partner of the Partnership is Dean Witter Realty Income Properties II Inc. (the "Managing General Partner"), a Delaware corporation which is wholly-owned by Dean Witter Realty Inc. ("Realty"). The Associate General Partner is Dean Witter Realty Income Associates II, L.P. (the "Associate General Partner"), a Delaware limited partnership, the general partner of which is Dean Witter Realty Income Associates II Inc., a wholly-owned subsidiary of the Managing General Partner. The Managing General Partner manages and controls all aspects of the business of the Partnership. The terms of transactions between the Partnership and its affiliates are set forth in Note 8 to the Consolidated Financial Statements in Item 8 and in Item 13 below.
The Partnership issued 177,023 units of limited partnership interest (the "Units") with gross proceeds from the offering of $177,023,000. The offering has been terminated and no additional Units will be sold.
The proceeds from the offering were used to make equity investments in five office properties and three retail properties (one was sold in 1993, and one sold in December 1995) which were acquired without mortgage debt. The properties are described in Item 2
ITEM 3. LEGAL PROCEEDINGS
On December 27, 1995, a purported class action lawsuit (the "Grigsby Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner and Associate General Partner), Realty, Dean Witter Reynolds Inc. ("DWR") and others as defendants was filed in Superior Court in California. The complaint alleged fraud, negligent misrepresentation, intentional and negligent breach of fiduciary duty, unjust enrichment and related claims and sought compensatory and punitive damages in unspecified amounts and injunctive and other equitable relief. The defendants removed the case to the United States District Court for the Southern District of California. Pursuant to an order of the U.S. District Court for the Southern District of California entered May 24, 1996, the Grigsby Action was transferred to the U.S. District Court for the Southern District of New York.
On February 14, 1996, a purported class action lawsuit (the "Schectman Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner), Realty, Dean Witter, Discover & Co. ("DWD") and DWR as defendants was filed in the Chancery Court of Delaware for New Castle County (the "Delaware Chancery Court"). On February 23, 1996, a purported class action lawsuit (the "Dosky Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner), Realty, DWD, DWR and others as defendants was filed in the Delaware Chancery Court. On February 29, 1996, a purported class action lawsuit (the "Segal Action") naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner), Realty, DWR, DWD and others as defendants was filed in the Delaware Chancery Court. On March 13, 1996, a purported class action lawsuit (the "Young Action") naming the partnership, other unidentified limited partnerships, DWD, DWR and others as defendants was filed in the Circuit Court for Baltimore City in Baltimore, Maryland. The defendants removed the Young Action to the United States District Court for the District of Maryland.
Thereafter, the Schectman Action, the Dosky Action and the Segal Action were consolidated in a single action (the "Consolidated Action") in the Delaware Chancery Court. The Young Action was dismissed without prejudice. The plaintiffs in the Young Action and the Grigsby Action joined the Consolidated Action. The Grigsby Action remains stayed indefinitely subject to being reopened for good cause.
On October 7, 1996, the plaintiffs in the Consolidated Action filed a First Consolidated and Amended Class Action Complaint naming various public real estate partnerships sponsored by Realty (including the Partnership and its Managing General Partner), Realty, DWD, DWR and others as defendants. This complaint alleges breach of fiduciary duty and seeks an accounting of profits, compensatory damages in an unspecified amount, possible liquidation of the Partnership under a receiver's supervision and other equitable relief. The defendants filed a motion to dismiss this complaint on December 10, 1996.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted during the fourth quarter of the fiscal year to a vote of Unit holders.
PART II.
ITEM 5.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
An established public trading market for the Units does not exist, and it is not anticipated that such a market will develop in the future. Accordingly, information as to the market value of a Unit at any given date is not available. However, the Partnership does allow its limited partners (the "Limited Partners") to transfer their units if a suitable buyer can be located.
As of January 22, 1997, there were 26,548 holders of limited partnership interests.
The Partnership is a limited partnership and, accordingly, does not pay dividends. It does, however, make quarterly distributions of cash to its partners. Pursuant to the partnership agreement, distributable cash, as defined, is paid 90% to the Limited Partners and 10% to the general partners (the "General Partners").
The Partnership paid quarterly cash distributions during the year ended October 31, 1996 aggregating $99.24 per Unit (including $60.65 per Unit from proceeds from the sale of the Wallkill Plaza property). The total distribution amounted to $18,326,385, with $17,567,356 distributed to the Limited Partners and $759,029 distributed to the General Partners. The distribution from the proceeds of the sale of the Wallkill Plaza shopping center was paid 100% to the Limited Parters. The Partnership paid quarterly cash distributions during the year ended October 31, 1995 aggregating $40.00 per Unit. The total distribution amounted to $7,867,688, with $7,080,920 distributed to the Limited Partners and $786,768 distributed to the General Partners. Additionally, in fiscal 1995, the Partnership repaid $2,784,417 of deferred distributions owed to the General Partners.
On November 27, 1996, the Partnership paid a cash distribution of $10.34 per Unit. The cash distribution aggregated $2,033,798 with $1,830,418 distributed to the Limited Partners and $203,380 distributed to the General Partners.
The Partnership anticipates making regular distributions to its partners in the future.
Sale or financing proceeds will be distributed, to the extent available, first, to each Limited Partner, until there has been a return of the Limited Partner's capital contribution plus cumulative distributions of distributable cash and sale or financing proceeds in an amount sufficient to provide a 9% cumulative annual return on the Limited Partner's adjusted capital contribution. Thereafter, any remaining sale or financing proceeds will be distributed 85% to the Limited Partners and 15% to the General Partners after the Managing General Partner receives a brokerage fee, if earned, of up to 3% of the selling price of any equity investment.
Taxable income generally is allocated in the same proportions as distributions of distributable cash or sale or financing proceeds (except that the General Partners must be allocated at least 1% of taxable income from sales or financings). In the event there is no distributable cash or sale or financing proceeds, taxable income is allocated 90% to the Limited Partners and 10% to the General Partners. Any tax loss will be allocated 90% to the Limited Partners and 10% to the General Partners.
1. Includes $11.9 million loss on impairment recorded for the Framingham Corporate Center, Glenhardie Corporate Center I and II and Pavilions at East Lake properties. See Item 7
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Partnership raised $177,023,000 in a public offering which was terminated in 1985. The Partnership has no plans to raise additional capital.
The Partnership has purchased five properties (one sold in May 1993, one sold in December 1995, and one under contract to be sold in 1997) and made three investments in partnerships on an all-cash basis. The Partnership's acquisition program has been completed. No additional investments are planned.
In most regions of the country, continued restraint of new office construction and steady leasing have reduced office supply in office markets, and, in certain areas, rental rates are rising. Some office markets are faring better than others. For example, vacancy is approximately 5% in the Boston suburban market, the location of Framingham Corporate Center, and Bellevue, Washington, the location of the United Services Life Building. Although vacancy in the office market in suburban Philadelphia, the location of the Glenhardie Corporate Center buildings, increased to 16% in 1996, the Partnership expects that this market will improve. Vacancy in the overall office market in Westchester County, New York, the location of Taxter Corporate Park, is approximately 24%. Office properties in the West are benefiting from expansion by the entertainment, high-technology and telecommunications industries; however, Pasadena, California, the location of the Century Square building, continues to be negatively impacted by corporate mergers and consolidations. Office construction remains primarily on a build- to-suit basis as current rental rates do not justify speculative investment. In the retail sector, a changing tenant base caused by the domination of certain power center tenants coupled with bankruptcies and major restructuring of other tenants and reduced consumer spending have resulted in higher vacancies and stagnant rents at many retail properties.
The closing of the sale of the Wallkill Plaza shopping center occurred on December 11, 1995. The Partnership received $10.8 million. In accordance with the provisions of the Partnership Agreement, the net sales proceeds (approximately $60.65 per Unit) were distributed 100% to the Limited Partners in March 1996, representing a return of invested capital. See Note 5 to the consolidated financial statements. In 1996, the Partnership's cash flow from operations decreased when compared to 1995 by approximately $1,057,000 as a result of the sale of the shopping center.
Barring a change in circumstances, the Managing General Partner currently expects to market for sale the Partnership's office properties and the Pavilions at East Lake shopping center during fiscal 1997 and 1998, with the objective of completing sales of all of the Partnership's properties by the end of fiscal year 1998. However, there is no assurance that the Partnership will be able to achieve these objectives.
In the fourth quarter of fiscal 1996, the Partnership engaged brokers to market the Century Square and United Services Life office buildings. In December, the Partnership agreed to sell the United Services Life building for $33.75 million; see Note 10 to the consolidated financial statements in Item 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
All schedules other than that indicated above have been omitted because either the required information is not applicable or the information is shown in the consolidated financial statements or notes thereto.
Independent Auditors' Report
To The Partners of Dean Witter Realty Income Partnership II, L.P.:
We have audited the accompanying consolidated balance sheets of Dean Witter Realty Income Partnership II, L.P. and consolidated partnerships (the "Partnership") as of October 31, 1996 and 1995 and the related consolidated statements of operations, partners' capital, and cash flows for each of the three years in the period ended October 31, 1996. Our audits also included the financial statement schedule listed in the Index at Item 8. These financial statements and financial statement schedule are the responsibility of the Partnership's management. Our responsibility is to express an opinion on the financial statements and the financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Dean Witter Realty Income Partnership II, L.P. and consolidated partnerships as of October 31, 1996 and 1995, and the results of their operations and their cash flows for each of the three years in the period ended October 31, 1996 in conformity with generally accepted accounting principles. Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein.
/s/Deloitte & Touche LLP DELOITTE & TOUCHE LLP
New York, New York January 24, 1997
In the first quarter of fiscal 1996, in accordance with the impairment evaluation policy described in Note 2, the Partnership evaluated the recoverability of its investments in real estate and concluded that, based on revised expectations as to the holding periods of the properties, the Partnership will be unable to recover its investments in the Framingham Corporate Center, Glenhardie Corporate Center I and II and Pavilions at East Lake properties. Accordingly, the Partnership wrote these properties down to their estimated fair values (based on independent appraisals) and recorded losses on impairment of $2,323,000, $3,550,000 and $5,997,000, respectively.
5. Sale of Real Estate
In the fourth quarter of fiscal 1995, the Partnership determined to sell the Wallkill Plaza shopping center, and in October entered into an agreement with New Plan Realty Trust, an unaffiliated party, to do so. As part of the agreement, two affiliated public partnerships, Dean Witter Realty Income Partnership III, L.P. and
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Dean Witter Realty Yield Plus L.P., also agreed to sell certain shopping centers owned by them.
The closing of the sale of the Wallkill Plaza shopping center, for a negotiated sale price of approximately $12.2 million, took place on December 11, 1995.
At closing, a contingent promissory note for $1.2 million of the purchase price was issued by the Purchaser to the Partnership. A portion of the space in the Wallkill Plaza Shopping Center is leased to The Stop & Shop Companies, Inc. ("S&S") and assigned to Bradlees, which is in bankruptcy. If, in the bankruptcy proceedings, the lease is assumed by Bradlees, the note will be payable in full, plus interest at 4.5%. If, at December 11, 2000, the lease has neither been assumed nor rejected nor deemed rejected by Bradlees, an amount equal to one half of the promissory note, plus interest on such half will be payable, and the remaining amount of the promissory note will be forgiven. If the lease is rejected or deemed rejected by Bradlees but, until December 11, 2000, S&S makes all payments due under the lease, the note will be payable in full, plus interest. If, however, the lease is rejected or deemed rejected by Bradlees and S&S does not make all payments due under the lease during the five-year period ending December 11, 2005, the promissory note will be forgiven and the Purchaser shall have no obligation to pay the Partnership any portion of the $1.2 million.
Because of the sale, the net carrying value of the property was reclassified to real estate held for sale at October 31, 1995, and its carrying value was reduced to approximately $10.8 million, resulting in a loss of approximately $4.9 million. In accordance with the Partnership Agreement, 100% of the loss was allocated to the Limited Partners in 1995. The reduced carrying value represented the cash portion of the sale price, net of closing costs. The portion of the sale price represented by the $1.2 million promissory note has not been recognized in revenue because of the uncertainty of its realization.
The net income from the Wallkill Plaza Shopping Center included in the Partnership's statement of operations in fiscal 1995 was approximately $752,000.
6. Investment in Joint Venture
Taxter Corporate Park, Westchester County, New York
In 1986, the Partnership purchased a 14.8% general partnership interest in the partnership which owns the property. Affiliates of
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
the Partnership, Dean Witter Realty Income Partnership III, L.P. and Dean Witter Realty Income Partnership IV, L.P. purchased the remaining 44.6% and 40.6% general partnership interests, respectively.
The partners receive cash flow and profits and losses according to their interests.
Summarized balance sheet information of the joint venture are as follows:
The accounting policies of the joint venture are the same as those of the Partnership.
7. Leases
Minimum future rental income under noncancellable operating leases (excluding the leases of real estate held for sale) as of October 31, 1996 is as follows:
The Partnership has determined that all leases relating to its properties are operating leases. The lease terms range from two to twenty years, and generally provide for fixed minimum rents with rental escalation and/or expense reimbursement clauses.
8. Related Party Transactions
An affiliate of the Managing General Partner provided property management services for four properties in 1996, 1995 and 1994. The Partnership paid the affiliate management fees (included in property operating expenses) of approximately $243,000, $296,000 and $295,000 for the years ended October 31, 1996, 1995 and 1994, respectively.
Another affiliate of the Managing General Partner performs administrative functions and processes certain investor and tax information on behalf of the Partnership. For the years ended October 31, 1996, 1995 and 1994, the affiliate was reimbursed approximately $489,000, $522,000 and $523,000, respectively, for
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
these services. These amounts have been recorded in general and administrative expenses.
As of October 31, 1996, the affiliates were owed approximately $132,000 for these services.
Through October 31, 1993, the General Partners had deferred receipt of distributions to which they were entitled totaling $3,712,556. Amounts deferred were charged against partners' capital and recorded as liabilities to the General Partners. In fiscal 1995 and 1994, the Partnership repaid $2,784,417 and $928,139, respectively, of these deferred distributions.
9. Litigation
Various public partnerships sponsored by Dean Witter Realty Inc. (including the Partnership and its Managing General Partner) are defendants in purported class action lawsuits pending in state and federal courts. The complaints allege a number of claims, including breach of fiduciary duty, fraud and misrepresentation, and seek an accounting of profits, compensatory and other damages in an unspecified amount, possible liquidation of the Partnership under a receiver's supervision and other equitable relief. The defendants are vigorously defending these actions. It is impossible to predict the effect, if any, the outcome of these actions might have on the Partnership's financial statements.
10. Subsequent Events
On November 27, 1996, the Partnership paid a cash distribution of $10.34 per Unit. The cash distribution aggregated $2,033,798 with $1,830,418 distributed to the Limited Partners and $203,380 distributed to the General Partners.
In December 1996, the Partnership agreed to sell the United Services Life Building for $33.75 million. Closing of the sale is expected to occur in the second quarter of fiscal 1997. The carrying value of the property has been reclassified to real estate held for sale at October 31, 1996.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None. PART III.
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The Partnership is a limited partnership which has no directors or officers.
The directors and executive officers of the Managing General Partner are as follows: Position with the Name Managing General Partner
William B. Smith Chairman of the Board of Directors E. Davisson Hardman, Jr. President and Director Lawrence Volpe Controller and Director Ronald T. Carman Secretary and Director
All of the directors have been elected to serve until the next annual meeting of the shareholder of the Managing General Partner or until their successors are elected and qualify. Each of the executive officers has been elected to serve until his successor is elected and qualifies.
William B. Smith, age 53, is a Managing Director of Dean Witter Realty Inc. and has been with Dean Witter Realty Inc. since 1982. He is an Executive Vice President of Dean Witter Reynolds Inc.
E. Davisson Hardman, Jr., age 47, is a Managing Director of Dean Witter Realty Inc. and has been with Dean Witter Realty Inc. since 1982.
Lawrence Volpe, age 49, is a Director and the Controller of Dean Witter Realty Inc. He is a Senior Vice President and Controller of Dean Witter Reynolds Inc., which he joined in 1983.
Ronald T. Carman, age 45, is a Director and the Secretary of Dean Witter Realty Inc. He is a Senior Vice President and Associate General Counsel of Dean Witter Discover & Co. and Dean Witter Reynolds Inc., which he joined in 1984.
There is no family relationship among any of the foregoing persons.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION
The General Partners are entitled to receive cash distributions, when and as cash distributions are made to the Limited Partners, and a share of taxable income or tax loss. Descriptions of such distributions and allocations are in Item 5 above. The General Partners received cash distributions of $759,029, $786,768 and $590,076 for the years ended October 31, 1996, 1995 and 1994, respectively. In fiscal 1995 and 1994, the Partnership repaid $2,784,417 and $928,139, respectively, of previously deferred distributions owed to the General Partners.
The General Partners and their affiliates were paid certain fees and reimbursed for certain expenses. Information concerning such fees and reimbursements is contained in Note 8 to the consolidated financial statements in Item 8 above.
The directors and officers of the Partnership's Managing General Partner received no remuneration from the Partnership.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) No person is known to the Partnership to be the beneficial owner of more than five percent of the Units.
(b) The directors and executive officers of the Managing General Partner own the following Units as of January 1, 1997:
(1) (2) (3) Amount and Title of Name of Nature of Class Beneficial Owner Beneficial Ownership
Limited All directors and executive * Partnership officers of the Managing General Interests Partner, as a group
* Own, by virtue of ownership of Limited Partnership interests in the Associate General Partner, less than 1% of the Units of the Partnership.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
As a result of their being partners of a limited partnership which is the limited partner of the Associate General Partner, certain current and former officers and directors of the Managing General Partner also own indirect general partnership interests in the Partnership. The Partnership Agreement of the Partnership provides that cash distributions and allocations of income and loss to the general partners be distributed or allocated 50% to the Managing General Partner and 50% to the Associate General Partner. The General Partners' share of cash distributions and income or loss is described in Item 5 above.
All of the outstanding shares of common stock of the Managing General Partner are owned by Realty, a Delaware corporation which is a wholly-owned subsidiary of Dean Witter, Discover & Co. The general partner of the Associate General Partner is Dean Witter Realty Income Associates II Inc., which is a wholly-owned subsidiary of the Managing General Partner. The limited partner of the Associate General Partner is LSA 84 II L.P., a Delaware limited partnership. Realty and certain current and former officers and directors of Realty are partners of LSA 84 II L.P. Additional information with respect to the directors and officers and compensation of the Managing General Partner and affiliates is contained in Items 10 and 11 above.
The General Partners and their affiliates were paid certain fees and reimbursed for certain expenses. Information concerning such fees and reimbursements is contained in Note 8 to the Consolidated Financial Statements in Item 8 above. The Partnership believes that the payment of fees and the reimbursement of expenses to the General Partners and their affiliates are on terms as favorable as would be obtained from unrelated third parties.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
PART IV
ITEM 14.
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this Annual Report:
1. Financial Statements (see Index to Financial Statements filed as part of Item 8 of this Annual Report).
2. Financial Statement Schedules (see Index to Financial Statements filed as part of Item 8 of this Annual Report).
3. Exhibits (3)(a) Amended and Restated Agreement of Limited Partnership dated as of September 6, 1984 set forth in Exhibit A to the Prospectus included in Registration Statement Number 2-93207 is incorporated herein by reference.
(b) Certificate of Limited Partnership included in Registration Statement Number 2-93207 is incorporated herein by reference.
(4)(a) Amended and Restated Agreement of Limited Partnership dated as of September 6, 1984 set forth in Exhibit A to the Prospectus included in Registration Statement Number 2-93207 is incorporated herein by reference.
(b) Certificate of Limited Partnership included in Registration Statement Number 2-93207 is incorporated herein by reference.
(10)(a) Purchase and Sale Agreements for properties purchased were filed as Exhibits to Form 8-K on May 24, 1985, July 15, 1985, October 29, 1985, November 15, 1985, February 27, 1986, August 29, 1986, September 4, 1986, December 18, 1986 and December 30, 1986 and are incorporated herein by reference.
(b) Purchase and Sale Agreement, dated as of October 19, 1995, between Dean Witter Income Partnership II, L.P., Midway Crossing Limited Partnership, Dean Witter Income Partnership III, L.P., Genesee Crossing Limited Partnership, Farmington/9 Mile Associates, a Michigan Limited Partnership, Hampton Crossing Associates, Rochester Hills Limited Partnership, Dean Witter Realty Yield Plus, L.P. and New Plan Realty Trust (including Exhibit J thereto) was filed as an exhibit to Form 8-K on December 11, 1995 and is incorporated herein by reference.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
(c) First Amendment to Purchase and Sale Agreement, dated as of October 19, 1995, between Dean Witter Income Partnership II, L.P., Midway Crossing Limited Partnership, Dean Witter Income Partnership III, L.P., Genesee Crossing Limited Partnership, Farmington/9 Mile Associates, a Michigan Limited Partnership, Hampton Crossing Associates, Rochester Hills Limited Partnership, Dean Witter Realty Yield Plus, L.P. and New Plan Realty Trust was filed as an exhibit to Form 8-K on December 11, 1995 and is incorporated herein by reference.
(21) Subsidiaries: Century Square Venture, a California general partnership; Framingham Corporate Center LP, a Massachusetts limited partnership.
(27) Financial Data Schedule.
(b) Reports on Form 8-K - No Forms 8-K were filed by the Partnership during the last quarter of the period covered by this report.
(B) Reconciliation of real estate owned at October 31: 1996 1995 1994
Balance at beginning of period $ 145,974,086 $164,357,368 $162,989,118
Additions (deletions) during period: Improvements 6,112,900 1,314,951 2,367,774 Cost recovery on capital improvements - (27,114) (835,000) Loss on impairment of real estate (11,870,000) - - Write-offs due to lease expirations - - (164,524) Reclassified to real estate held for sale (34,270,457) (19,671,119) - Balance at end of period $ 105,946,529 $145,974,086 $164,357,368
(C) Reconciliation of accumulated depreciation: Balance at beginning of period $ 45,806,137 $ 43,775,258 $ 37,630,627 Additions (deletions) during period: Depreciation expense 5,011,419 6,053,280 6,309,155 Write-offs due to lease expirations - - (164,524) Reclassified to real estate held for sale (11,852,787) (4,022,401) - Balance end of period $ 38,964,769 $ 45,806,137 $ 43,775,258
(D) In December 1996, the Partnership agreed to sell this building. Carrying value reclassified as real estate held for sale. /TABLE
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
By: Dean Witter Realty Income Properties II Inc. Managing General Partner
By: /s/E. Davisson Hardman, Jr. Date: January 29, 1997 E. Davisson Hardman, Jr. President
By: /s/Lawrence Volpe Date: January 29, 1997 Lawrence Volpe Controller (Principal Financial and Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
DEAN WITTER REALTY INCOME PROPERTIES II INC. Managing General Partner
/s/William B. Smith Date: January 29, 1997 William B. Smith Chairman of the Board of Directors
/s/E. Davisson Hardman, Jr. Date: January 29, 1997 E. Davisson Hardman, Jr. Director
/s/Lawrence Volpe Date: January 29, 1997 Lawrence Volpe Director
/s/Ronald T. Carman Date: January 29, 1997 Ronald T. Carman Director DEAN WITTER REALTY INCOME PARTNERSHIP II, L.P.
Year Ended October 31, 1996
Exhibit Index
Exhibit No. Description
27 Financial Data Schedule
E1