UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
/X/ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the Quarterly Period Ended September 30, 1997
/ / Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
------------------------
Commission File Number 0-20047
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ROYALE INVESTMENTS, INC.
(Exact name of Registrant as specified in its Charter)
Minnesota 41-1691930
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
ONE LOGAN SQUARE, SUITE 1105, PHILADELPHIA, PA 19103
(Address of principal executive offices)
TELEPHONE: (215) 567-1800
(Registrant's telephone number, including area code)
3430 List Place, Minneapolis, Minnesota 55416
(Former name or former address, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
requirements for the past 90 days. Yes X No
The number of shares outstanding of the Registrant's stock as of November 4,
1997 was 2,266,083 Shares of Common Stock.
ROYALE INVESTMENTS, INC.
FORM 10-QSB
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1997
INDEX
PAGE
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements:
Balance Sheets as of September 30, 1997 (unaudited) and December 31, 1996........... 3
Statements of Operations for the Three Months Ended September 30, 1997 (unaudited)
and September 30, 1996 (unaudited).................................................. 4
Statements of Operations for the Nine Months Ended September 30, 1997 (unaudited)
and September 30, 1996 (unaudited).................................................. 4
Statements of Cash Flows for the Nine Months Ended September 30, 1997 (unaudited)
and September 30, 1996 (unaudited).................................................. 5
Notes to Financial Statements....................................................... 6
Item 2: Management's Discussion and Analysis of Financial Condition and Results of
Operations..................................................................... 8
PART II: OTHER INFORMATION
Item 1. Legal Proceedings.............................................................. 11
Item 2. Changes in Securities.......................................................... 11
Item 3. Defaults Upon Senior Securities................................................ 11
Item 4. Submission of matters to a Vote of Security Holders............................ 11
Item 5. Other Information.............................................................. 11
Item 6. Exhibits and Reports on Form 8-K............................................... 11
SIGNATURES................................................................................ 13
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ROYALE INVESTMENTS, INC.
BALANCE SHEETS
SEPTEMBER 30, DECEMBER 31,
1997 1996
------------- -------------
(UNAUDITED)
ASSETS
Assets:
Investments in real estate:
Land and buildings............................................................. $ 25,027,358 $ 25,027,358
Less: accumulated depreciation................................................. 2,373,269 1,957,448
------------- -------------
Net investments in real estate............................................... 22,654,089 23,069,910
Cash and cash equivalents........................................................ 496,956 258,275
Marketable securities............................................................ -- 479,379
Deferred costs and other assets.................................................. 535,113 389,517
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Total Assets................................................................. $ 23,686,158 $ 24,197,081
------------- -------------
------------- -------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes payable........................................................... $ 14,448,265 $ 14,658,250
Dividends payable................................................................ 177,500 177,500
Accounts payable and other liabilities........................................... 158,431 189,977
------------- -------------
Total Liabilities............................................................ 14,784,196 15,025,727
------------- -------------
------------- -------------
Stockholders' Equity:
Common stock--$.01 par value per share
Authorized--50,000,000 shares
Issued and outstanding--1,420,000 shares....................................... 14,200 14,200
Additional paid-in capital....................................................... 12,353,398 12,353,398
Distributions in excess of accumulated earnings.................................. (3,465,636) (3,196,244)
------------- -------------
Total Stockholders' Equity................................................... 8,901,962 9,171,354
------------- -------------
Total Liabilities and Stockholders' Equity................................... $ 23,686,158 $ 24,197,081
------------- -------------
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The accompanying notes are an integral part of these financial statements.
Page 3
ROYALE INVESTMENTS, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
---------------------- --------------------------
1997 1996 1997 1996
---------- ---------- ------------ ------------
Revenues:
Rental income............................................. $ 628,441 $ 616,525 $ 1,880,805 $ 1,844,187
Interest income........................................... 5,082 7,858 18,045 25,120
---------- ---------- ------------ ------------
Total Revenue........................................... 633,523 624,383 1,898,850 1,869,307
Expenses:
Operations and management................................. 93,366 79,153 254,858 269,276
Mortgage interest......................................... 305,302 310,941 920,237 936,812
Depreciation and amortization............................. 141,770 141,771 425,312 425,312
Administrative and general................................ 8,035 3,715 35,335 23,987
---------- ---------- ------------ ------------
Total Expenses.......................................... 548,473 535,580 1,635,742 1,655,387
---------- ---------- ------------ ------------
Net Income.................................................. $ 85,050 $ 88,803 $ 263,108 $ 213,920
---------- ---------- ------------ ------------
---------- ---------- ------------ ------------
Per Common Share:
Net income................................................ $ 0.06 $ 0.06 $ 0.19 $ 0.15
---------- ---------- ------------ ------------
---------- ---------- ------------ ------------
Dividends declared........................................ $ 0.13 $ 0.13 $ 0.38 $ 0.38
---------- ---------- ------------ ------------
---------- ---------- ------------ ------------
Weighted Average Number of Common Shares Outstanding........ 1,422,297 1,420,000 1,420,314 1,420,000
---------- ---------- ------------ ------------
---------- ---------- ------------ ------------
The accompanying notes are an integral part of these financial statements.
Page 4
ROYALE INVESTMENTS, INC.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
NINE MONTHS ENDED
SEPTEMBER 30,
----------------------
1997 1996
---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.............................................................................. $ 263,108 $ 213,920
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization......................................................... 425,312 425,312
Amortization of marketable securities................................................. (7,621) (20,842)
Changes in assets and liabilities:
(Increase) decrease in accounts receivable.......................................... (38,582) (54,290)
(Increase) decrease in other assets................................................. 2,426 (407)
Increase (decrease) in accounts payable and other liabilities....................... (31,546) (11,899)
---------- ----------
Net cash provided by operating activities......................................... 613,097 551,794
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of marketable securities............................................ 487,000 588,000
Purchase of marketable securities....................................................... -- (524,272)
Costs associated with new ventures...................................................... (118,931) --
---------- ----------
Net cash provided by investing activities......................................... 368,069 63,728
---------- ----------
CASH FLOW FROM FINANCING ACTIVITIES:
Principal payments on mortgage loans.................................................... (209,985) (197,193)
Dividends paid to shareholders.......................................................... (532,500) (532,500)
---------- ----------
Net cash used in financing activities................................................. (742,485) (729,693)
---------- ----------
NET INCREASE (DECREASE) IN CASH........................................................... 238,681 (114,171)
CASH AND CASH EQUIVALENTS:
Beginning of period..................................................................... 258,275 257,970
---------- ----------
End of period........................................................................... $ 496,956 $ 143,799
---------- ----------
---------- ----------
SUPPLEMENTARY DATA:
Income taxes paid....................................................................... $ 3,100 $ 4,542
---------- ----------
---------- ----------
Interest paid........................................................................... $ 921,558 $ 944,952
---------- ----------
---------- ----------
The accompanying notes are an integral part of these financial statements.
Page 5
ROYALE INVESTMENTS, INC.
NOTES TO FINANCIAL STATEMENTS
Nine Months Ended September 30, 1997
(Unaudited)
1. Organization and Nature of Operations
Royale Investments, Inc. (the "Company"), a Minnesota corporation, was
formed in 1988, to acquire a portfolio of income-producing commercial real
estate properties. The Company has elected to qualify as a real estate
investment trust ("REIT") under Sections 856-860 of the Internal Revenue
Code and intends to remain so qualified.
As of September 30, 1997, the Company's portfolio was comprised of seven
properties leased to operators of seven major retail food stores under
long-term operating lease agreements. The leases have initial terms of 17
to 20 years and expire between 2006 and 2014.
Subsequent to September 30, 1997, the Company closed on the acquisition
of a portfolio of 10 properties, representing the Mid-Atlantic suburban
office operations of The Shidler Group, a national real estate
investment firm (the "Shidler Acquisition Properties"). In the
transactions (the "Shidler Transactions"), the Company became the sole
general partner of and obtained a 20.6946% interest in FCO, L.P.
("FCO"), an operating partnership formed to acquire and hold the Shidler
Acquisition Properties (See Note 5).
2. General
Basis of Presentation
The financial statements have been prepared by the Company without audit,
pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included
in the financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules
and regulations, although the Company believes that the disclosures are
adequate to make the information presented not misleading. In the opinion
of the Company, all adjustments (consisting solely of normal recurring
matters) necessary to fairly present the financial position of the Company
as of September 30, 1997, and the results of its operations and its cash
flows for the three and nine months ended September 30, 1997 and 1996 have
been included. The results of operations for such interim periods are not
necessarily indicative of the results for a full year. For further
information refer to the Company's financial statements and footnotes
thereto included in the Annual Report on Form 10-K (as amended by Form
10-K/A) for the year ended December 31, 1996.
Capitalization of Costs
As of September 30, 1997, the Company had incurred $118,931 in costs
associated with its pursuit of the Shidler Acquisition Properties. Such
costs are included in deferred costs and other assets on the Company's
balance sheet as of September 30, 1997.
Net Income Per Common Share
Net income per common share is based on the weighted average number of
common shares ("Common Shares") outstanding adjusted to give effect to
common share equivalents. In February, 1997, the Financial Accounting
Standards Board issued Statement No. 128, "Earnings per Share", which is
effective for financial statements for periods ending after December 15,
1997. At that time, the Company will be required to change the method
currently used to compute and disclose earnings per share and to restate
all prior periods. The impact of Statement No. 128 on the calculation of
primary and fully diluted earnings per share for the interim periods
presented is not expected to be material.
Page 6
NOTES TO FINANCIAL STATEMENTS
Nine Months Ended September 30, 1997
(Unaudited)
Reclassifications
Certain previously reported amounts have been reclassified to conform to
the current presentation.
3. Line of Credit
On April 10, 1997, the Company obtained a revolving credit agreement
with a bank whereby the Company can borrow up to $100,000 at an annual
interest rate equal to prime. Interest is payable monthly with the
principal due April 10, 1998. At September 30, 1997, no amounts were
borrowed against the note.
4. Dividends
On September 25, 1997, the Company declared a cash dividend of $.125
per common share payable on October 17, 1997, to stockholders of record
as of September 30, 1997.
5. Subsequent Events
On October 14, 1997, the Company closed on the acquisition of the Shidler
Acquisition Properties. As a result of the Shidler Transactions, the
Company became the sole general partner of and obtained a 20.6946% interest
in FCO, an operating partnership formed to acquire and hold the Shidler
Acquisition Properties.
The Shidler Acquisition Properties were acquired subject to mortgage
indebtedness of $100 million. The loan is a non-recourse mortgage loan
collateralized by the real estate assets of the Shidler Acquisition
Properties. The loan provides for monthly payments of interest only at
a fixed rate of 7.5% per annum. The loan matures on October 13, 2000
and provides for two one-year extension options, subject to certain
conditions.
In connection with the Shidler Transactions, the Company issued 600,000
Common Shares (valued at $5.50 per share, aggregate of $3.3 million) and
FCO issued approximately 3.2 million common partnership units ("Common
Units") (valued at $5.50 per unit, aggregate of $17.5 million) and 2.1
million preferred partnership units ("Preferred Units") (valued at
$25.00 per unit, aggregate of $52.5 million). The Preferred Units may
be converted, on or after, October 1, 1999, into 3.5714 Common Units for
each Preferred Unit. Subject to certain conditions, beginning on
September 1, 1998, Common Units are convertible into one Common Share
(or an equivalent cash value, at the sole discretion of the Company) for
each Common Unit. Certain Common Units and Preferred Units contain
certain restrictions through November 2000.
Concurrently with the Shidler Transactions, the Company issued 273,729
Common Shares (valued at $5.50 per share, aggregate of $1.5 million) in
exchange for the assets of Crown Advisors, Inc. ("Crown"), an affiliate of
the Company, previously acting as investment advisor to the Company and
assisting in the management operations. The contract between Crown and the
Company was terminated and the Company entered into a property management
agreement with Glacier Realty, LLC ("Glacier"), all of the interests in
which are owned by two current officers of the Company, one of whom is also
a current director. Further, the Company retired 27,646 Common Shares
previously held by Crown at the time it was acquired.
The property management agreement with Glacier provides for Glacier to
manage the seven net lease retail assets of Royale for a term of five years
with a minimum fee of $250,000 per annum.
Page 7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
This Form 10-QSB contains forward looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. The words "believe", "expect", anticipate", "intend",
"estimate" and other expressions which are predictions of or indicate future
events and trends and which do not relate to historical matters identify
forward-looking statements. The Company's actual results could differ materially
from those set forth in the forward-looking statements. Certain factors that
might cause such a difference include the following: real estate investment
considerations, such as the effect of economic and other conditions in the
market area on cash flows and values; the need to renew leases or relet space
upon the expiration of current leases; the ability of a property to generate
revenues sufficient to meet debt service payments and other operating expenses;
and risks associated with borrowings, such as the possibility that the Company
will not have sufficient funds available to make principal payments on
outstanding debt or outstanding debt may be refinanced at higher interest rates
or otherwise on terms less favorable to the Company.
The following discussion and analysis of the financial condition and results of
operations should be read in conjunction with the accompanying financial
statements and notes thereto.
Results of Operations
Comparison of Three and Nine Months Ended September 30, 1997 and September 30,
1996
During the three and nine month periods ended September 30, 1997 and 1996, the
Company owned and leased seven properties in five states to operators of retail
food stores.
Net income for the three and nine months ended September 30, 1997, was $85,050
and $263,108 respectively, as compared to net income of $88,803 and $213,920 for
the corresponding periods in 1996. The increase in net income for the nine
month period is primarily due to improved operating results of the Company's
properties as a result of scheduled rent increases and reduced mortgage interest
as a result of declining principal balances.
Revenues for the three and nine month periods ended September 30, 1997,
increased by 1.5% and 1.6%, respectively, over the comparable periods of 1996,
due to scheduled increases in rental income, which was partially offset by
decreases in interest income. The impact of the straight-line rent adjustment
increased revenues by $49,915 for the nine months ended September 30, 1997, and
by $49,915 for the nine months ended September 30, 1996.
Expenses during the quarter ended September 30, 1997, increased by 2.4%, as
compared to the corresponding period in 1996. Expenses for the nine months
ended September 30, 1997, decreased by 1.2%, compared to the corresponding
period in 1996. The decrease in expenses for the nine month period is primarily
the result of decreased mortgage interest due to declining principal balances
and decreased operations and management expenses primarily due to the
reimbursement of certain fees which the Company is obligated to make in
connection with its lease guarantees on two of the Company's properties. This
decrease in expenses was offset, in part, by an increase in administrative and
general expenses primarily attributable to public filing costs.
Statement of Cash Flows
During the nine months ended September 30, 1997, and September 30, 1996, the
Company generated $613,097 and $551,794, respectively, in cash flow from
operating activities. The increase is primarily the result of scheduled
increases in rental income and timing differences in receipts and disbursements
from year to year.
Net cash provided by investing activities increased to $368,069 for the nine
months ended September 30, 1997, as compared to $63,728 for the nine months
ended September 30, 1996. This increase is primarily a result of the Company's
change from investing excess cash balances in U.S. Treasury Bills with
maturities of six months, to investing excess cash balances in cash equivalents
with maturities of 30 days or less.
Net cash used in financing activities totaled $742,485 and $729,693 for the nine
months ended September 30, 1997,
Page 8
and September 30, 1996, respectively. The increased use is wholly due to
increased mortgage amortization.
Liquidity and Capital Resources
The Company believes that its cash flow from operations is adequate to fund its
short-term liquidity requirements for the foreseeable future. The Company's
properties are all leased on a triple-net basis, which places the risk of rising
property costs, such as maintenance, insurance and property taxes, on the
tenant. The leases generally provide that the tenant is also responsible for
roof and structural repairs. Cash flow from operations is generated primarily
from rental revenues and operating expense reimbursements from tenants and
interest income earned on the Company's cash investments. The Company intends
to use its cash funds to meet its principal short-term liquidity needs which are
to fund operations and management, and general and administrative expenses, debt
service requirements and the minimum distribution to shareholders required to
maintain the Company's REIT qualifications under the Internal Revenue Code.
For the quarter ended September 30, 1997, the Company declared distributions
totaling $0.125 per Common Share amounting to $177,500.
Funds From Operations
Management generally considers Funds from Operations ("FFO") as one measure of
REIT performance. The Company has adopted the NAREIT definition of FFO and has
used this definition for all periods presented in the financial statements
included herein. FFO is calculated as net income (loss) adjusted for
depreciation expense attributable to real property, amortization expense
attributable to capitalized leasing costs, gains on sales of real estate
investments and extraordinary and non-recurring items. FFO should not be
considered an alternative to net income as an indication of the Company's
performance or to cash flows as a measure of liquidity.
FFO for the three and nine months ended September 30, 1997, and September 30,
1996, is summarized in the following table:
Three Months Nine Months
Ended Ended
September 30, September 30,
--------------------- ----------------------
1997 1996 1997 1996
--------- --------- ---------- ---------
Net Income $ 85,050 $ 88,803 $ 263,108 $ 213,920
Add:
Depreciation attributable
to real property 138,606 138,607 415,821 415,821
--------- --------- ---------- ---------
Funds from Operations $223,656 $227,410 $ 678,929 $ 629,741
--------- --------- ---------- ---------
--------- --------- ---------- ---------
Weighted Average Number of
Common Shares Outstanding 1,422,297 1,420,000 1,420,314 1,420,000
--------- --------- ---------- ---------
--------- --------- ---------- ---------
Funds from Operations
per share $ 0.16 $ 0.16 $ 0.48 $ 0.44
--------- --------- ---------- ---------
--------- --------- ---------- ---------
Subsequent Events
As reported on Current Form 8-K dated October 28, 1997, on October 14,
1997, the Company closed on the acquisition of the Shidler Acquisition
Properties. As a result of the Shidler Transactions, the Company became the
sole general partner of and obtained a 20.6946% interest in FCO, an operating
partnership formed to acquire and hold the Shidler Acquisition Properties.
Page 9
The Shidler Acquisition Properties were acquired subject to mortgage
indebtedness of $100 million. The loan is a non-recourse mortgage loan
collateralized by the real estate assets of the Shidler Acquisition
Properties. The loan provides for monthly payments of interest only at a
fixed rate of 7.5% per annum. The loan matures on October 13, 2000 and
provides for two one-year extension options, subject to certain conditions.
In connection with the Shidler Transactions, the Company issued 600,000
Common Shares (valued at $5.50 per share, aggregate of $3.3 million) and FCO
issued approximately 3.2 million Common Units (valued at $5.50 per unit,
aggregate of $17.5 million) and 2.1 million Preferred Units (valued at $25.00
per unit, aggregate of $52.5 million). The Preferred Units may be converted,
on or after, October 1, 1999, into 3.5714 Common Units for each Preferred
Unit. Subject to certain conditions, beginning on September 1, 1998, Common
Units are convertible into one Common Share (or an equivalent cash value, at
the sole discretion of the Company) for each Common Unit. Certain Common
Units and Preferred Units contain certain restrictions through November 2000.
Concurrently with the Shidler Transactions, the Company issued 273,729 Common
Shares (valued at $5.50 per share, aggregate of $1.5 million) in exchange for
the assets of Crown, an affiliate of the Company, previously acting as
investment advisor to the Company and assisting in the management operations.
The contract between Crown and the Company was terminated and the Company
entered into a property management agreement with Glacier, all of the
interests in which are owned by two current officers of the Company, one of
whom is also a current director. Further, the Company retired 27,646 Common
Shares previously held by Crown at the time it was acquired.
The property management agreement with Glacier provides for Glacier to manage
the seven net lease retail assets of Royale for a term of five years with a
minimum fee of $250,000 per annum.
Page 10
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not currently involved (nor was it involved at September 30,
1997) in any material legal proceedings nor, to the Company's knowledge, is
any material legal proceeding currently threatened against the Company (other
than routine litigation arising in the ordinary course of business,
substantially all of which is expected to be covered by liability insurance).
Item 2. Changes in Securities
(a) Not applicable.
(b) Not applicable
(c) On October 14, 1997, in connection with the Shidler Transactions, the
Company issued 600,000 Common Shares in connection with the
formation of FCO and issued 273,729 Common Shares in connection
with the Company's acquisition of Crown. Further, the Company
retired 27,646 Common Shares.
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable
Item 5. Other Information
Not applicable
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits filed with Form 10-QSB
Exhibit Number Description
2.1* Formation/Contribution Agreement dated September 7,
1997, as amended, by and among Royale Investments,
Inc., H/SIC Corporation, a Delaware corporation,
Strategic Facility Investors, Inc., a Delaware
corporation, the sole general partner of Blue Bell
Investment Company, L.P., a Delaware limited
partnership, South Brunswick Investment Company,
LLC, a New Jersey limited liability company, a
general partner of South Brunswick Investors,
L.P., a Delaware limited partnership, ComCourt
Investment Corporation, a Pennsylvania
corporation, the sole general partner of ComCourt
Investors, L.P., a Delaware limited partnership,
and Gateway Shannon Development Corporation, a
Pennsylvania corporation , the sole general
partner of 6385 Flank Drive, L.P., a Pennsylvania
limited partnership, with exhibits, as amended by
the Amendment thereto dated October 13, 1997.
2.2* Agreement and Plan of Reorganization between the
Company and Crown Advisors, Inc.
2.3* FCO, L.P. Partnership Agreement dated October 14,
1997.
2.4* Amended and Restated Partnership Agreement of Blue
Bell Investment Company, L.P.
Page 11
2.5* Amended and Restated Partnership Agreement of South
Brunswick Investors, L.P.
2.6* Amended and Restated Partnership Agreement of
ComCourt Investors, L.P.
2.7* Amended and Restated Partnership Agreement of 6385
Flank Drive, L.P.
10.1* Clay W. Hamlin, III Employment Agreement dated
October 14, 1997 with FCO, L.P.
10.2* Registration Rights Agreement dated October 14, 1997
for the benefit of certain shareholders of the
Company.
10.3* Management Agreement between the Company and Glacier
Realty, LLC.
10.4* Senior Secured Credit Agreement dated October 13,
1997 (Exhibits and Schedules have been omitted
pursuant to Rule 6.01(b) (2) of Regulation S-K.
Such Exhibits and Schedules are listed and
described in the Credit Agreement. The Company
hereby agrees to furnish to the Securities and
Exchange Commission, upon its request, any or all
such omitted Exhibits and Schedules.)
20.* Press Release dated October 14, 1997.
27.1 Financial Data Schedule
- -------------------------------------------------------------------------------
* Incorporated by reference to the same numbered Exhibit to the
Company's Current Report on Form 8-K dated October 28, 1997.
b) Reports on Form 8-K.
During the three months ended September 30, 1997, and through November 6, 1997,
the Company filed the following:
(i) a Current Report on Form 8-K dated October 28, 1997, (reporting
under Items 1, 2, and 7) regarding the Company's acquisition of
the Shidler Acquisition Properties, a portfolio of 10
properties, representing the Mid-Atlantic suburban office
operations of The Shidler Group, a national real estate
investment firm.
(ii) a Current Report on Form 8-K dated November 6, 1997 (reporting
under Item 4) regarding the Company's change in certifying
accountant.
Page 12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused the report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ROYALE INVESTMENTS, INC.
Date: November 6, 1997 By: /s/ Clay W. Hamlin III
----------------------------
Name: Clay W. Hamlin, III
Title: President and Chief Executive Officer
(Principal Executive Officer)
By: /s/ Thomas D. Cassel
----------------------------
Name: Thomas D. Cassel
Title: Vice President Finance
(Principal Financial and
Accounting Officer)
Page 13