-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, E7nJiYDaJLfmw77G06F5jOvD9O0Vo0zC9uwiXr18bpqVEFqOXEit5p98VpxMU4A/ a7xWm5by3Ry7BCciPS/Kkg== 0000024148-99-000010.txt : 19990629 0000024148-99-000010.hdr.sgml : 19990629 ACCESSION NUMBER: 0000024148-99-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19990628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONTINENTAL REAL ESTATE PARTNERS LTD CENTRAL INDEX KEY: 0000024148 STANDARD INDUSTRIAL CLASSIFICATION: OPERATORS OF NONRESIDENTIAL BUILDINGS [6512] IRS NUMBER: 042523977 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-07752 FILM NUMBER: 99653315 BUSINESS ADDRESS: STREET 1: WOOD RIDGE RD CITY: GLEN ARBOR STATE: MI ZIP: 49636 BUSINESS PHONE: 6163345000 MAIL ADDRESS: STREET 1: P O BOX 947 CITY: TRAVERSE CITY STATE: MI ZIP: 49685-0947 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended June 30, 1998 Commission file number 0-7752 CONTINENTAL REAL ESTATE PARTNERS, LTD. (Exact name of Registrant as Specified in its Certificate of Limited Partnership) Massachusetts 04-2523977 (State of organization) (Internal Revenue Service Employer Identification Number) Wood Ridge Road Glen Arbor, Michigan 49636 (Address of principal executive (Zip code) offices) (616) 334-5000 Registrants' telephone number Including area code Not applicable Former name, former address and former fiscal year, 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 and Exchange Act of 1934 during the preceding 12 months (or such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No The number of limited partnership interests outstanding as of June 30, 1998: Limited partnership units, $500 per unit - 30,004 units Index CONTINENTAL REAL ESTATE PARTNERS, LTD. Page PART I. FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) Statements of assets, liabilities and partners' capital - June 30, 1998 and December 31, 1997 3 Statements of operations - quarter ended and six months ended June 30, 1998 and 1997 4 Statements of changes in partners' capital - six months ended June 30, 1998 and 1997 5 Statements of cash flows - six months ended June 30, 1998 and 1997 6 Notes to financial statements - June 30, 1998 7 Report of Independent Certified Public Accountants on Interim Financial Information 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 PART II. OTHER INFORMATION Item 6. Exhibits and reports on Form 8-K 10 SIGNATURES 11 PART I. FINANCIAL INFORMATION Continental Real Estate Partners, Ltd. STATEMENTS OF ASSETS, LIABILITIES AND PARTNERS' CAPITAL
June 30, December 31, 1997 1996 ASSETS (Unaudited) (Note B) Investments in real estate Land $ - $ 183,581 Land improvements - 1,877,263 Buildings and equipment - 11,932,804 - 13,993,648 Less accumulated depreciation - 11,601,241 - 2,392,407 Cash 306,127 1,222,223 Other assets 12,366 264,343 $ 318,493 $ 3,878,973 LIABILITIES AND PARTNERS' CAPITAL LIABILITIES Unclaimed distribution checks $ - $ 170,164 Accounts payable and accrued expenses 288,046 48,073 Liabilities to general partner - 2,143,209 288,046 2,361,446 PARTNERS' CAPITAL General partner 1,527 368,257 Limited partners - 30,004 units of limited partnership interest 28,920 1,149,270 30,447 1,517,527 $ 318,493 $ 3,878,973 See Notes to Financial Statements. -3-
Continental Real Estate Partners, Ltd. STATEMENTS OF OPERATIONS (UNAUDITED)
Quarter Ended Six Months Ended June 30, June 30, 1998 1997 1998 1997 Operating revenue Rental income $ 80,881 $ 120,572 $ 201,454 $ 242,600 Other, principally operating expense reimbursements 15,994 - 15,994 200 96,875 120,572 217,448 242,800 Operating expense Depreciation 68,293 101,102 170,733 201,489 Repairs and maintenance 8,020 10,187 17,084 23,870 Insurance 15,671 23,687 40,403 47,374 Real estate taxes 11,490 18,134 29,651 36,267 Utilities 9,330 6,216 11,098 12,522 Professional services 38,862 11,176 44,862 17,533 Property management fees 10,636 9,102 19,738 18,206 Commissions 2,018 3,027 5,045 6,054 Investor communications 1,080 1,080 2,520 2,160 Other 5,637 5,077 16,612 11,855 171,037 188,788 357,746 377,330 Operating loss (74,162) (68,216) (140,298) (134,530) Gain on sale of Lakeland Mall 6,097,358 - 6,097,358 - Incentive fee to general partner (849,631) - (849,631) - Liquidation expense (250,000) - (250,000) - Interest income 59,745 12,835 73,121 25,779 NET INCOME (LOSS) $4,983,310 $ (55,381) $4,930,550 $(108,751) Net loss allocated to General partner $ 249,165 $ (2,769) $ 246,528 $ (5,438) Limited partners - $156.11 and $(3.44) net income loss) per unit of limited partnership Interest outstanding for the six months ended June 30, 1998 and 1997, respectively 4,734,145 (52,612) 4,684,022 (103,313) $4,983,310 $ (55,381) $4,930,550 $(108,751) See Notes to Financial Statements. -4-
Continental Real Estate Partners, Ltd. STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (UNAUDITED) Six months ended June 30,
1998 1997 General Limited General Limited Partner Partner Partner Partner Beginning balance $368,257 $1,149,270 $380,796 $1,387,511 NET INCOME (LOSS) 246,528 4,684,022 (5,438) (103,313) Unclaimed distribution checks - 173,323 - - Partner distributions (613,258) (5,977,695) - - Ending balance $ 1,527 $ 28,920 $375,358 $1,284,198 Balance, June 30, 1998, and 1997, per unit of limited partnership interest $ 0.96 $ 42.80 See Notes to Financial Statements. -5-
Continental Real Estate Partners, Ltd. STATEMENTS OF CASH FLOWS (UNAUDITED) Six months ended June 30,
1998 1997 Operating activities Net income (loss) $4,930,550 $(108,751) Adjustments to reconcile net loss to cash provided by operating activities: Depreciation and amortization 175,778 207,543 Gain (loss) on sale of assets (5,247,727) - Decrease in other assets 69,654 55,803 Increase (decrease) in accounts payable and accrued expenses (25,668) 26,893 Deferred revenue - 42,602 Net cash flow provided (used) by operating activities (97,413) 224,090 Cash flows from investing activities Real estate redevelopment costs - (5,038) Proceeds from sale of fixed assets 7,646,679 - Net cash flow provided (used) by investing activities 7,646,679 (5,038) Cash flows from financing activities Liquidation reserve 250,000 - Unclaimed distribution checks 173,323 - Accrued general partner incentive fees paid (2,127,568) - Distributions to general partner (613,258) - Distributions to limited partner (5,977,695) - Net cash flow used by investing activities (8,295,198) - NET INCREASE (DECREASE) IN CASH (745,932) 219,052 Balance of cash, beginning of period 1,052,059 1,065,816 Balance of cash, end of period $ 306,127 $1,284,868 See Notes to Financial Statements. -6-
Continental Real Estate Partners, Ltd. NOTES TO FINANCIAL STATEMENTS (UNAUDITED) NOTE A - BASIS OF PRESENTATION The accompanying financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six month period ended June 30, 1998 are not necessarily indicative of the results that may be expected for the year ended December 31, 1998. For further information, refer to the financial statements and footnotes thereto included in the company's annual report on Form 10-K for the year ended December 31, 1997. NOTE B - DECEMBER 31, 1997 STATEMENT OF ASSETS, LIABILITIES AND PARTNERS' CAPITAL The statement of assets, liabilities and partners' capital at December 31, 1997 has been derived from the audited financial statements at that date. -7- REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ON INTERIM FINANCIAL INFORMATION The Bayberry Group, Inc. Sole General Partner of Continental Real Estate Partners, Ltd. The accompanying statement of assets, liabilities and partners' capital of Continental Real Estate Partners, Ltd. (a Massachusetts limited partnership) as of June 30, 1998 and the related statements of operations for the three and six month period ended June 30, 1998 and the statement of cash flows and changes in partners' capital for the six month periods ended June 30, 1998 and 1997 were not audited by us and, accordingly, we do not express an opinion on them. The accompanying statement of assets and liabilities for the year ended December 31, 1997 was audited by us, and we expressed an unqualified opinion on it in our report dated January 16, 1998, but we have not performed any auditing procedures since that date. Traverse City, Michigan August 25, 1998 -8- The Bayberry Companies September, 1998 To Our Partners: Please excuse our delay in sending additional information for the six months ended June 30, 1998 to you. During the quarter, we achieved what we had long sought to achieve -- the sale of the Partnership's last property. We are pleased to have achieved that milestone, as the market conditions in downtown Lakeland, until recently, seemed to make it an impossible task. We are also pleased to know that the renovation of the Partnership's former property will further the revitalization of Lakeland and benefit its people. As a result of operations, the Partnership had an operating loss for the quarter of $74,162, which compared to a year prior loss of $68,216. As a result of operations and the sale, the Partnership had net income of $4,983,310. More detailed information was contained in the special report we sent to you before the sale and is contained in the statements accompanying this report. Since the time we sent our special report and distribution, several partners have contacted us with inquiries as to the prospective tax treatment of the sale. For that reason, we asked the Partnership's accountants to include a note entitled "1998 Preliminary Income Tax Information" with the statements. We believe that note, with your own records, should allow you to plan for taxes now. We will, of course, send detailed year-end information to you. On a personal note, we wish to extend our thanks to those of you who have called or written to offer a congratulatory note. Your thoughtfulness was and is appreciated. Sincerely, Robert A. Kuras Shirley K. Debelack PLANNING, BUILDING AND MANAGING WITH NATURE Wood Ridge Road - Glen Arbor - Michigan - 49636 - 616-334-6400 CONTINENTAL REAL ESTATE PARTNERS, LTD. PART II. OTHER INFORMATION Item 6. Exhibits and reports on Form 8-K The company did not file any reports on Form 8-K during the three months ended June 30, 1998. -10- CONTINENTAL REAL ESTATE PARTNERS, LTD. SIGNATURES Pursuant to the requirements 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. CONTINENTAL REAL ESTATE PARTNERS, LTD. Date Robert A. Kuras, Principal Financial Officer and President of The Bayberry Group, Inc. Sole General Partner -11- EX-25 2 [ARTICLE] 5 [CIK] 0000024148 [NAME] CONTINENTAL REAL ESTATE PARTNERS LTD [PERIOD-TYPE] 3-MOS 6-MOS [FISCAL-YEAR-END] DEC-31-1998 DEC-31-1998 [PERIOD-END] JUN-30-1998 JUN-30-1998 [CASH] 306127 306127 [SECURITIES] 0 0 [RECEIVABLES] 0 0 [ALLOWANCES] 0 0 [INVENTORY] 0 0 [CURRENT-ASSETS] 12366 12366 [PP&E] 0 0 [DEPRECIATION] 0 0 [TOTAL-ASSETS] 318493 318493 [CURRENT-LIABILITIES] 288046 288046 [BONDS] 0 0 [PREFERRED-MANDATORY] 0 0 [PREFERRED] 0 0 [COMMON] 0 0 [OTHER-SE] 30447 30447 [TOTAL-LIABILITY-AND-EQUITY] 318493 318493 [SALES] 5404347 5538296 [TOTAL-REVENUES] 5404347 5538296 [CGS] 0 0 [TOTAL-COSTS] 171037 357746 [OTHER-EXPENSES] 250000 250000 [LOSS-PROVISION] 0 0 [INTEREST-EXPENSE] 0 0 [INCOME-PRETAX] 4983310 4930550 [INCOME-TAX] 0 0 [INCOME-CONTINUING] 4983310 4930550 [DISCONTINUED] 0 0 [EXTRAORDINARY] 0 0 [CHANGES] 0 0 [NET-INCOME] 4983310 4930550 [EPS-BASIC] 157.78 156.11 [EPS-DILUTED] 157.78 156.11
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