FORM 10-QSB—QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d) OF

-----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, LrQicYAQru3OF51Ite/xY/d10RXu0VcC+LoMGRkf8YRJSqG1A/W6qyvcgA/2xCJI Drs9MUH/7iVRVz9swZKymg== 0000711642-08-000393.txt : 20080814 0000711642-08-000393.hdr.sgml : 20080814 20080814170313 ACCESSION NUMBER: 0000711642-08-000393 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20080630 FILED AS OF DATE: 20080814 DATE AS OF CHANGE: 20080814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES CENTRAL INDEX KEY: 0000352983 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 942744492 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-10831 FILM NUMBER: 081020215 BUSINESS ADDRESS: STREET 1: 55 BEATTIE PLACE STREET 2: PO BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 3037578101 MAIL ADDRESS: STREET 1: 1873 SOUTH BELLAIRE STREET 17TH FLOOR STREET 2: PO BOX 1089 CITY: DENVER STATE: CO ZIP: 80222 10-Q 1 ccip608.htm 10Q FORM 10-QSB—QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d) OF

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

[X]

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2008

[ ]

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________to _________

Commission file number 0-10831

CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

(Exact name of registrant as specified in its charter)


Delaware	94-2744492
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

55 Beattie Place, PO Box 1089

Greenville, South Carolina 29602

(Address of principal executive offices)

(864) 239-1000

(Registrant’s telephone number, including area code)

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 filing requirements for the past 90 days. [X] Yes [ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]

Accelerated filer [ ]

Non-accelerated filer [ ]

(Do not check if a smaller reporting company)

Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ ] Yes [X] No

PART I – FINANCIAL INFORMATION

Item 1.

Financial Statements.

CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

CONSOLIDATED BALANCE SHEETS

(in thousands, except unit data)


	June 30,	December 31,
	2008	2007
	(Unaudited)	(Note)
		(Restated)
Assets
Cash and cash equivalents	$ 620	$ 2,961
Receivables and deposits	865	815
Deferred tax asset (Note G)	391	361
Other assets	2,660	1,782
Investment in affiliated partnerships (Note C)	619	627

Investment properties:
Land	15,392	15,392
Buildings and related personal property	110,934	108,844
	126,326	124,236
Less accumulated depreciation	(42,894)	(39,130)
	83,432	85,106
Assets held for sale (Note A)	2,606	2,557
	$ 91,193	$ 94,209
Liabilities and Partners' Capital (Deficiency)
Liabilities
Accounts payable	$ 509	$ 781
Tenant security deposit liabilities	997	914
Accrued property taxes	514	61
Other liabilities	1,289	1,404
Due to affiliates	117	--
Mortgage notes payable	129,032	130,130
Liabilities related to assets held for sale (Note A)	4,509	4,486
	136,967	137,776
Partners' Capital (Deficiency)
General partner	151	166
Limited partners (199,041.2 units issued and
outstanding)	(45,925)	(43,733)
	(45,774)	(43,567)
	$ 91,193	$ 94,209

Note:

The consolidated balance sheet at December 31, 2007 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by generally accepted accounting principles for complete financial statements.

See Accompanying Notes to Consolidated Financial Statements

CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in thousands, except per unit data)


	Three Months Ended		Six Months Ended
	June 30,		June 30,
	2008	2007	2008	2007
		(Restated)		(Restated)
Revenues:
Rental income	$ 5,761	$ 5,592	$11,529	$11,147
Other income	618	562	1,193	1,093
Total revenues	6,379	6,154	12,722	12,240
Expenses:
Operating	2,720	2,478	5,392	5,079
General and administrative	171	200	336	371
Depreciation	1,893	1,612	3,764	3,341
Interest	1,959	1,095	3,933	2,182
Property taxes	438	470	908	938
Total expenses	7,181	5,855	14,333	11,911

(Loss) income before income taxes,
discontinued operations, casualty gain
and equity in loss from investment	(802)	299	(1,611)	329
Income taxes (expense) benefit (Note G):
Current	(27)	(26)	(52)	(52)
Deferred	30	--	30	333
(Loss) income before discontinued
operations, casualty gain and equity in
loss from investment	(799)	273	(1,633)	610
Casualty gain (Note E)	--	27	--	27
Equity in loss from investment (Note C)	(2)	(3)	(8)	(3)
(Loss) income before discontinued operations	(801)	297	(1,641)	634
Income from discontinued operations (Note A)	165	12	184	35
Net (loss) income	$ (636)	$ 309	$(1,457)	$ 669
Net (loss) income allocated to general
partner	$ (7)	$ 3	$ (15)	$ 7
Net (loss) income allocated to limited
partners	(282)	306	(1,095)	662
(Series A) (Note A)	(96)	--	(96)	--
(Series B) (Note A)	(212)	--	(212)	--
(Series C) (Note A)	(39)	--	(39)	--
	$ (636)	$ 309	$(1,457)	$ 669

Per limited partnership unit:
(Loss) income before discontinued operations	$ (1.71)	$ 1.48	$ (5.88)	$ 3.15
(Series A) (Note A)	(1.00)	--	(1.00)	--
(Series B) (Note A)	(1.07)	--	(1.07)	--
(Series C) (Note A)	(0.20)	--	(0.20)	--
Income from discontinued operations	0.30	0.06	0.39	0.18
Income from discontinued operations (Series A)	0.52	--	0.52	--
Net (loss) income	$ (3.16)	$ 1.54	$ (7.24)	$ 3.33
Distribution per limited partnership unit
	$ --	$ --	$ 3.77	$ --

See Accompanying Notes to Consolidated Financial Statements

CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIENCY)

(Unaudited)

(in thousands, except unit data)


	Limited			Limited	Limited	Limited	Subtotal
	Partnership	General	Limited	Partners	Partners	Partners	Limited
	Units	Partner	Partners	(Series A)	(Series B)	(Series C)	Partners	Total


Partners’ capital
(deficiency) at
December 31, 2007	199,041.2	$ 166	$(43,733)	$ --	--	--	$(43,733)	$(43,567)

Distribution to partners	--	--	(750)	--	--	--	(750)	(750)

Net loss for the period
January 1, 2008 through
April 30, 2008	--	(11)	(1,095)	--	--	--	(1,095)	(1,106)

Partners’ capital
(deficiency) at
April 30, 2008	199,041.2	155	(45,578)	--	--	--	(45,578)	(45,423)

Transfer of interest
(Note A)	--	--	45,578	(25,985)	(16,722)	(2,871)	--	--

Net loss for the period
May 1, 2008 through
June 30, 2008	--	(4)	--	(96)	(212)	(39)	(347)	(351)

Partners’ capital
(deficiency) at
June 30, 2008	199,041.2	$ 151	$ --	$(26,081)	$(16,934)	$(2,910)	$(45,925)	$(45,774)

See Accompanying Notes to Consolidated Financial Statements

CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)


	Six Months Ended
	June 30,
	2008	2007
Cash flows from operating activities:
Net (loss) income	$ (1,457)	$ 669
Adjustments to reconcile net (loss) income to net cash
provided by operating activities:
Depreciation	3,867	3,547
Amortization of loan costs, lease commissions and
mortgage premiums	15	(74)
Equity in loss from investment	8	3
Casualty gain	--	(27)
Change in accounts:
Receivables and deposits	(58)	(922)
Deferred tax asset	(30)	(333)
Other assets	(906)	(832)
Accounts payable	6	101
Tenant security deposit liabilities	92	72
Accrued property taxes	504	505
Other liabilities	(115)	46
Due to affiliates	117	454
Net cash provided by operating activities	2,043	3,209

Cash flows from investing activities:
Net receipts from restricted escrows	--	32
Property improvements and replacements	(2,517)	(3,130)
Insurance proceeds received	--	1,242
Net cash used in investing activities	(2,517)	(1,856)

Cash flows from financing activities:
Payments on mortgage notes payable	(1,067)	(819)
Lease commissions paid	(50)	--
Distribution to partners	(750)	--
Repayment of advances from affiliate	--	(245)
Net cash used in financing activities	(1,867)	(1,064)

Net (decrease) increase in cash and cash equivalents	(2,341)	289
Cash and cash equivalents at beginning of period	2,961	1,138
Cash and cash equivalents at end of period	$ 620	$ 1,427

Supplemental disclosure of cash flow information:
Cash paid for interest, net of capitalized interest	$ 4,060	$ 1,948
Supplemental disclosure of non-cash activity:
Property improvements and replacements included in
accounts payable	$ 211	$ 233

Included in property improvements and replacements for the six months ended June 30, 2008 and 2007 are approximately $489,000 and $736,000 of property improvements and replacements which were included in accounts payable at December 31, 2007 and 2006, respectively.

See Accompanying Notes to Consolidated Financial Statements

CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note A – Basis of Presentation

The accompanying unaudited consolidated financial statements of Consolidated Capital Institutional Properties, LP (the "Partnership" or "Registrant") have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8-03 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 ConCap Equities, Inc. (the "General Partner"), which is ultimately owned by Apartment Investment and Management Company ("AIMCO"), a publicly traded real estate investment trust, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six month periods ended June 30, 2008 are not necess arily indicative of the results that may be expected for the fiscal year ending December 31, 2008. For further information, refer to the consolidated financial statements and footnotes thereto included in the Partnership's Annual Report on Form 10-K for the fiscal year ended December 31, 2007.

In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, the accompanying consolidated statements of operations for the three and six months ended June 30, 2008 and 2007 reflect the operations of The Loft Apartments as income from discontinued operations. The Partnership has been actively marketing the property for sale during 2008, and the Partnership entered into a sale contract on July 15, 2008 to sell the Loft Apartments to a third party. The contract was subsequently terminated on August 13, 2008. Included in income from discontinued operations for the three months ended June 30, 2008 and 2007 are results of the property’s operations of approximately $165,000 and $12,000, respectively, including revenues of approximately $418,000 and $403,000, respectively. Included in income from discontinued operations for the six months ended J une 30, 2008 and 2007 are results of the property’s operations of approximately $184,000 and $35,000, respectively, including revenues of approximately $814,000 and $795,000, respectively. As a result of The Loft Apartments being held for sale, its assets and liabilities are classified as held for sale as of June 30, 2008 and December 31, 2007.

Organization: On April 25, 2008, the Partnership changed its domicile from California to Delaware by merging with and into Consolidated Capital Institutional Properties, LP, a Delaware limited partnership, with the Delaware partnership as the surviving entity in the merger. The merger was undertaken pursuant to an Agreement and Plan of Merger, dated as of March 19, 2008, by and between the California partnership and the Delaware partnership.

Under the merger agreement, each unit of limited partnership interest in the California partnership was converted into an identical unit of limited partnership in the Delaware partnership and the general partnership interest in the California partnership previously held by the general partner was converted into a general partnership interest in the Delaware partnership. All interests in the Delaware partnership outstanding immediately prior to the merger were cancelled in the merger.

The voting and other rights of the limited partners provided for in the partnership agreement were not changed as a result of the merger. In the merger, the partnership agreement of the California partnership was adopted as the partnership agreement of the Delaware partnership, with the following changes: (i) references therein to the California Uniform Limited Partnership Act were amended to refer to the Delaware Revised Uniform Limited Partnership Act; (ii) a description of the merger was added; (iii) the name of the partnership was changed to “Consolidated Capital Institutional Properties, LP” and (iv) a provision was added that gives the general partner authority to establish different designated series of limited partnership interests that have separate rights with respect to specified partnership property, and profits and losses associated with such specified property.

On April 30, 2008, the General Partner amended the Partnership Agreement to establish, and convert existing limited partnership interests into, different designated series of limited partnership interests that have separate rights with respect to specified partnership property. Effective as of the close of business on April 30, 2008 (the “Establishment Date”), each then outstanding Unit of limited partnership interest in the Partnership was converted into one Series A Unit, one Series B Unit and one Series C Unit. Except as described below, the Series A Units, Series B Units and Series C Units entitle the holders thereof to the same rights as the holders of Units of limited partnership interests had prior to the Establishment Date.

From and after the Establishment Date, the Series A Units will be entitled to all of the Partnership’s interests in any entity in which the Partnership owns an interest, other than the Series B Subsidiary and Series C Subsidiary (as defined below), including, but not limited to, all profits, losses and distributions from such entities.

From and after the Establishment Date, the Series B Units will be entitled to all of the Partnership’s membership interest in CCIP Knolls, L.L.C., a Delaware limited liability company (the “Series B Subsidiary”), including, but not limited to, all profits, losses and distributions from The Knolls Apartments.

From and after the Establishment Date, the Series C Units will be entitled to all of the Partnership’s membership interest in CCIP Society Park East, L.L.C., a Delaware limited liability company (the “Series C Subsidiary”), including, but not limited to, all profits, losses and distributions from The Dunes Apartments.

Reclassifications: Certain reclassifications have been made to the 2007 balances to conform to the 2008 presentation.

Segment Reporting: SFAS No. 131, "Disclosure about Segments of an Enterprise and Related Information" established standards for the way that public business enterprises report information about operating segments in annual financial statements and requires that those enterprises report selected information about operating segments in interim financial reports. SFAS No. 131 also established standards for related disclosures about products and services, geographic areas, and major customers. (See "Note D" for detailed disclosure of the Partnership's segments).

Note B – Transactions with Affiliated Parties

The Partnership has no employees and depends on the General Partner and its affiliates for the management and administration of all Partnership activities. The Partnership Agreement provides for certain payments to affiliates for services and reimbursement of certain expenses incurred by affiliates on behalf of the Partnership.

Affiliates of the General Partner receive 5% of gross receipts from all of the Partnership's properties as compensation for providing property management services. The Partnership paid to such affiliates approximately $660,000 and $638,000 for the six months ended June 30, 2008 and 2007, respectively, which are included in operating expenses and income from discontinued operations.

Affiliates of the General Partner charged the Partnership for reimbursement of accountable administrative expenses amounting to approximately $401,000 and $470,000 for the six months ended June 30, 2008 and 2007, respectively, which are included in general and administrative expenses, investment properties and assets held for sale. The portion of these reimbursements included in investment properties and assets held for sale for the six months ended June 30, 2008 and 2007 are construction management services provided by an affiliate of the General Partner of approximately $173,000 and $195,000, respectively. At June 30, 2008, approximately $117,000 of these expenses are outstanding and included in due to affiliates. There were no such expenses outstanding at December 31, 2007.

In accordance with the Partnership Agreement, AIMCO Properties, L.P., an affiliate of the General Partner, advanced the Partnership funds to cover expenses at the Partnership’s properties and redevelopment costs at The Sterling Apartment Homes and The Knolls Apartments prior to 2007. There were no such advances to the Partnership during the six months ended June 30, 2008 or 2007. Interest was charged at the prime rate plus 2% and interest expense was approximately $488,000 for the six months ended June 30, 2007. During the six months ended June 30, 2007, the Partnership made payments on the outstanding loans and accrued interest of approximately $274,000 from operations. During the third and fourth quarters of 2007, the Partnership made payments on the outstanding loans and accrued interest from operations and proceeds from the refinancing of the mortgages encumbering Plantation Gardens Apartments and Regency Oaks Apart ments. There were no such payments made during the six months ended June 30, 2008. At June 30, 2008 and December 31, 2007, there were no outstanding advances or accrued interest payable to AIMCO Properties, L.P. The Partnership may receive additional advances of funds from AIMCO Properties, L.P. although AIMCO Properties, L.P. is not obligated to provide such advances. For more information on AIMCO Properties, L.P., including copies of its audited balance sheet, please see its reports filed with the Securities and Exchange Commission.

The Partnership insures its properties up to certain limits through coverage provided by AIMCO which is generally self-insured for a portion of losses and liabilities related to workers’ compensation, property casualty, general liability and vehicle liability. The Partnership insures its properties above the AIMCO limits through insurance policies obtained by AIMCO from insurers unaffiliated with the General Partner. During the six months ended June 30, 2008, the Partnership was charged by AIMCO and its affiliates approximately $434,000 for hazard insurance coverage and fees associated with policy claims administration. Additional charges will be incurred by the Partnership during 2008 as other insurance policies renew later in the year. The Partnership was charged by AIMCO and its affiliates approximately $579,000 for insurance coverage and fees associated with policy claims administration during the year ended December 31, 2007.

Note C - Investment in Affiliated Partnerships


		Ownership	Investment Balance
Partnership	Type of Ownership	Percentage	June 30, 2008
			(in thousands)
Consolidated Capital	Special Limited
Growth Fund	Partner	0.40%	$ --
Consolidated Capital	Special Limited
Properties III	Partner	1.86%	8
Consolidated Capital	Special Limited
Properties IV	Partner	1.86%	611
			$ 619

These investments are accounted for using the equity method of accounting. Distributions from the affiliated partnerships are accounted for as a reduction of the investment balance until the investment balance is reduced to zero. When the investment balance has been reduced to zero, subsequent distributions received are recognized as income in the accompanying consolidated statements of operations. There were no distributions received during the six months ended June 30, 2008 and 2007. During the three and six months ended June 30, 2008, the Partnership recognized approximately $2,000 and $8,000, respectively, in equity in loss from investments related to its allocated share of the loss from one of the affiliated partnerships. During both the three and six months ended June 30, 2007, the Partnership recognized approximately $3,000 in equity in loss related to its allocated share of the loss from one of the affiliated partnerships.

Note D – Segment Reporting

Description of the types of products and services from which the reportable segment derives its revenues: The Partnership has two reportable segments: residential properties and commercial property. The Partnership’s property segments consist of six apartment complexes one in North Carolina, which is classified as held for sale, one in Colorado, four in Florida and one multiple use facility consisting of apartment units and commercial space in Pennsylvania. The Partnership rents apartment units to tenants for terms that are typically less than twelve months. The commercial property leases space to various medical offices, career service facilities, and retail shops at terms ranging from month to month to ten years.

Measurement of segment profit and loss: The Partnership evaluates performance based on segment profit (loss) before depreciation. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies included in the Partnership’s Annual Report on Form 10-K for the fiscal year ended December 31, 2007.

Factors management used to identify the Partnership's reportable segment: The Partnership’s reportable segments are business units (investment properties) that offer different products and services. The reportable segments are each managed separately because they provide distinct services with different types of products and customers.

Segment information for the three and six months ended June 30, 2008 and 2007 is shown in the tables below (in thousands). The "Other" column includes Partnership administration related items and income and expense not allocated to reportable segments.


For the three months ended
June 30, 2008	Residential	Commercial	Other	Totals
Rental income	$ 5,353	$ 408	$ --	$ 5,761
Other income	552	65	1	618
Income from discontinued operations	165	--	--	165
Equity in loss from investment	--	--	(2)	(2)
Interest expense	1,785	174	--	1,959
Depreciation	1,847	46	--	1,893
General and administrative
expenses	--	--	171	171
Current income tax expense	27	--	--	27
Deferred income tax benefit	(30)	--	--	(30)
Segment loss	(424)	(40)	(172)	(636)


For the six months ended
June 30, 2008	Residential	Commercial	Other	Totals
Rental income	$10,756	$ 773	$ --	$11,529
Other income	1,034	112	47	1,193
Income from discontinued operations	184	--	--	184
Equity in loss from investment	--	--	(8)	(8)
Interest expense	3,580	348	5	3,933
Depreciation	3,671	93	--	3,764
General and administrative
expenses	--	--	336	336
Current income tax expense	52	--	--	52
Deferred income tax benefit	(30)			(30)
Segment loss	(1,001)	(154)	(302)	(1,457)
Total assets	88,551	1,565	1,077	91,193
Capital expenditures for
investment properties	1,820	419	--	2,239


For the three months ended
June 30, 2007	Residential	Commercial	Other	Totals
	(Restated)			(Restated)
Rental income	$ 5,238	$ 354	$ --	$ 5,592
Other income	516	43	3	562
Casualty gain	27	--	--	27
Income from discontinued operations	12	--	--	12
Equity in loss from investment	--	--	(3)	(3)
Interest expense	798	52	245	1,095
Depreciation	1,563	49	--	1,612
General and administrative
expenses	--	--	200	200
Current income tax expense	26	--	--	26
Segment profit (loss)	711	43	(445)	309


For the six months ended
June 30, 2007	Residential	Commercial	Other	Totals
	(Restated)			(Restated)
Rental income	$10,441	$ 706	$ --	$11,147
Other income	1,010	78	5	1,093
Casualty gain	27	--	--	27
Income from discontinued operations	35	--	--	35
Equity in loss from investment	--	--	(3)	(3)
Interest expense	1,590	104	488	2,182
Depreciation	3,232	109	--	3,341
General and administrative
expenses	--	--	371	371
Current income tax expense	52	--	--	52
Deferred tax benefit	333	--	--	333
Segment profit (loss)	1,505	21	(857)	669
Total assets	91,683	1,307	937	93,927
Capital expenditures for
investment properties	2,623	4	--	2,627

Note E – Casualty Events

In April 2007, there was a fire at Palm Lake Apartments. The property incurred damages of approximately $38,000. During the third quarter of 2007, the Partnership recorded a casualty loss of approximately $2,000 as a result of the write off of undepreciated damaged assets of approximately $30,000 net of the receipt of insurance proceeds of approximately $28,000.

In September 2006, there was a fire at Plantation Gardens Apartments. The property incurred damages of approximately $82,000. During the three and six months ended June 30, 2007, the Partnership recorded a casualty gain of approximately $3,000 as a result of the receipt of insurance proceeds of approximately $71,000 net of the write off of undepreciated damaged assets of approximately $68,000.

During 2005, Plantation Gardens Apartments sustained damages from Hurricane Wilma. During 2006, the Partnership recognized a casualty loss as a result of the write off of undepreciated damaged assets, net of the receipt of insurance proceeds, approximately $1,171,000 of which was received by and held on deposit with the mortgage lender at December 31, 2006. These proceeds were released by the mortgage lender to the Partnership during the six months ended June 30, 2007. During the three and six months ended June 30, 2007, the Partnership recognized an additional casualty gain of approximately $24,000 as a result of the receipt of additional insurance proceeds of approximately $24,000. During the third quarter of 2007, the Partnership recognized an additional casualty gain of approximately $45,000 as a result of the receipt of additional insurance proceeds.

Note F – Redevelopment of Properties

During 2004, the General Partner began a major redevelopment project at The Sterling Apartment Homes. The property had difficulty staying competitive and needed to be updated. Therefore, in an effort to increase occupancy and become competitive with other properties in the area, a significant redevelopment project was completed in April 2007 at a total cost of approximately $11,587,000. During the construction period, certain expenses were capitalized and are being depreciated over the remaining life of the property. During the six months ended June 30, 2007, approximately $3,000 of interest, approximately $1,000 of real estate taxes and approximately $1,000 of other construction period costs were capitalized.

Note G – Partnership Income Taxes

An additional benefit of approximately $30,000 was recognized during the three months and six months ended June 30, 2008. During the three months ended June 30, 2008 and 2007, the Partnership recognized approximately $27,000 and $26,000, respectively, in current income tax expense related to local income taxes with respect to The Sterling Apartments Homes and Commerce Center. During each of the six months ended June 30, 2008 and 2007, the Partnership recognized approximately $52,000 in current income tax expense related to local income taxes with respect to The Sterling Apartments Homes and Commerce Center.

Note H – Contingencies

In March 1998, several putative unit holders of limited partnership units of the Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the State of California for the County of San Mateo. The plaintiffs named as defendants, among others, the Partnership, its General Partner and several of their affiliated partnerships and corporate entities. The action purported to assert claims on behalf of a class of limited partners and derivatively on behalf of a number of limited partnerships (including the Partnership) that are named as nominal defendants, challenging, among other things, the acquisition of interests in certain General Partner entities by Insignia Financial Group, Inc. ("Insignia") and entities that were, at one time, affiliates of Insignia; past tender offers by the Insignia affiliates to acquire limited partnership u nits; management of the partnerships by the Insignia affiliates; and the series of transactions which closed on October 1, 1998 and February 26, 1999 whereby Insignia and Insignia Properties Trust, respectively, were merged into AIMCO. The plaintiffs sought monetary damages and equitable relief, including judicial dissolution of the Partnership. In addition, during the third quarter of 2001, a complaint captioned Heller v. Insignia Financial Group (the "Heller action") was filed against the same defendants that are named in the Nuanes action. On or about August 6, 2001, plaintiffs filed a first amended complaint. The Heller action was brought as a purported derivative action, and asserted claims for, among other things, breach of fiduciary duty, unfair competition, conversion, unjust enrichment, and judicial dissolution. On January 28, 2002, the trial court granted defendants motion to strike the complaint. Plaintiffs took an appeal from this order.

On January 8, 2003, the parties filed a Stipulation of Settlement in proposed settlement of the Nuanes action and the Heller action. On June 13, 2003, the court granted final approval of the settlement and entered judgment in both the Nuanes and Heller actions. On August 12, 2003, an objector ("Objector") filed an appeal (the “Appeal”) seeking to vacate and/or reverse the order approving the settlement and entering judgment thereto. On May 4, 2004, the Objector filed a second appeal challenging the court’s use of a referee and its order requiring Objector to pay those fees.

On March 21, 2005, the Court of Appeals issued opinions in both pending appeals. With regard to the settlement and judgment entered thereto, the Court of Appeals vacated the trial court’s order and remanded to the trial court for further findings on the basis that the “state of the record is insufficient to permit meaningful appellate review”. The matter was transferred back to the trial court on June 21, 2005. With regard to the second appeal, the Court of Appeals reversed the order requiring the Objector to pay referee fees. With respect to the related Heller appeal, on July 28, 2005, the Court of Appeals reversed the trial court’s order striking the first amended complaint.

On August 18, 2005, Objector and his counsel filed a motion to disqualify the trial court based on a peremptory challenge and filed a motion to disqualify for cause on October 17, 2005, both of which were ultimately denied and/or struck by the trial court. On or about October 13, 2005 Objector filed a motion to intervene and on or about October 19, 2005 filed both a motion to take discovery relating to the adequacy of plaintiffs as derivative representatives and a motion to dissolve the anti-suit injunction in connection with settlement. On November 14, 2005, Plaintiffs filed a Motion For Further Findings pursuant to the remand ordered by the Court of Appeals. Defendants joined in that motion. On February 3, 2006, the Court held a hearing on the various matters pending before it and ordered additional briefing from the parties and Objector. On June 30, 2006, the trial court entered an order confirming its approval of the class act ion settlement and entering judgment thereto after the Court of Appeals had remanded the matter for further findings. The substantive terms of the settlement agreement remain unchanged. The trial court also entered supplemental orders on July 1, 2006, denying Objector’s Motion to File a Complaint in Intervention, Objector’s Motion for Leave of Discovery and Objector’s Motion to Dissolve the Anti-Suit Injunction. Notice of Entry of Judgment was served on July 10, 2006.

On August 31, 2006, the Objector filed a Notice of Appeal to the Court’s June 30, 2006 and July 1, 2006 orders. The matter was argued and submitted and the Court of Appeal issued an opinion on February 20, 2008 affirming the order approving the settlement and judgment entered thereto. On March 12, 2008, the Court of Appeal denied Appellant’s Petition for Re-Hearing. On May 21, 2008, the California Supreme Court denied Appellant’s Petition for Review. Objector has until August 19,2008 to file a petition for certiorari with the United States Supreme Court.

The General Partner does not anticipate that any costs to the Partnership, whether legal or settlement costs, associated with these cases will be material to the Partnership’s overall operations.

As previously disclosed, AIMCO Properties, L.P. and NHP Management Company, both affiliates of the General Partner, were defendants in a lawsuit, filed as a collective action in August 2003 in the United States District Court for the District of Columbia, alleging that they willfully violated the Fair Labor Standards Act (“FLSA”) by failing to pay maintenance workers overtime for time worked in excess of 40 hours per week (“overtime claims”). The plaintiffs also contended that AIMCO Properties, L.P. and NHP Management Company failed to compensate maintenance workers for time that they were required to be "on-call" (“on-call claims”). In March 2007, the court in the District of Columbia decertified the collective action. In July 2007, plaintiffs’ counsel filed individual cases in Federal court in 22 jurisdictions. In the second quarter 2008, AIMCO Properties, L.P. settled the overt ime cases involving 652 plaintiffs and established a framework for resolving the 88 remaining “on-call” claims and the attorneys’ fees claimed by plaintiffs’ counsel. As a result, the lawsuits asserted in the 22 Federal courts will be dismissed. At this time, affiliates of the General Partner are attempting to obtain additional information to determine the most equitable allocation of settlement amounts and attorneys’ fees. The General Partner is uncertain as to the amount of loss, if any, allocable to the Partnership. Therefore, the Partnership cannot estimate whether a loss will occur or a potential range of loss.

The Partnership is unaware of any other pending or outstanding litigation matters involving it or its investment properties that are not of a routine nature arising in the ordinary course of business.

Environmental

Various Federal, state and local laws subject property owners or operators to liability for management, and the costs of removal or remediation, of certain hazardous substances present on a property. Such laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release or presence of the hazardous substances. The presence of, or the failure to manage or remedy properly, hazardous substances may adversely affect occupancy at affected apartment communities and the ability to sell or finance affected properties. In addition to the costs associated with investigation and remediation actions brought by government agencies, and potential fines or penalties imposed by such agencies in connection therewith, the presence of hazardous substances on a property could result in claims by private plaintiffs for personal injury, disease, disability or other infirmities. Various laws also impose liability for the cost of removal, remediation or disposal of hazardous substances through a licensed disposal or treatment facility. Anyone who arranges for the disposal or treatment of hazardous substances is potentially liable under such laws. These laws often impose liability whether or not the person arranging for the disposal ever owned or operated the disposal facility. In connection with the ownership, operation and management of its properties, the Partnership could potentially be liable for environmental liabilities or costs associated with its properties.

Mold

The Partnership is aware of lawsuits against owners and managers of multifamily properties asserting claims of personal injury and property damage caused by the presence of mold, some of which have resulted in substantial monetary judgments or settlements. The Partnership has only limited insurance coverage for property damage loss claims arising from the presence of mold and for personal injury claims related to mold exposure. Affiliates of the General Partner have implemented policies, procedures, third-party audits and training and the General Partner believes that these measures will prevent or eliminate mold exposure and will minimize the effects that mold may have on residents. To date, the Partnership has not incurred any material costs or liabilities relating to claims of mold exposure or to abate mold conditions. Because the law regarding mold is unsettled and subject to change the General Partner can make no assura nce that liabilities resulting from the presence of or exposure to mold will not have a material adverse effect on the Partnership’s consolidated financial condition or results of operations.

ITEM 2.

Management's Discussion and Analysis Of Financial Condition and Results of Operations

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements in certain circumstances. Certain information included in this Report contains or may contain information that is forward-looking, including, without limitation, statements regarding the effect of redevelopments, the Partnership’s future financial performance, including the Partnership’s ability to maintain current or meet projected occupancy and rent levels, and the effect of government regulations. Actual results may differ materially from those described in the forward-looking statements and, in addition, will be affected by a variety of risks and factors that are beyond the Partnership’s control including, without limitation: natural disasters such as hurricanes; national and local economic conditions; the general level of interest rates; energy costs; the terms of governmental regulations that affect the Partner ship’s properties and interpretations of those regulations; the competitive environment in which the Partnership operates; financing risks, including the risk that the Partnership’s cash flows from operations may be insufficient to meet required payments of principal and interest; real estate risks, including fluctuations in real estate values and the general economic climate in local markets and competition for tenants in such markets; insurance risks; development risks; litigation, including costs associated with prosecuting or defending claims and any adverse outcomes; and possible environmental liabilities, including costs, fines or penalties that may be incurred due to necessary remediation of contamination of properties presently owned or previously owned by the Partnership. Readers should carefully review the Partnership’s consolidated financial statements and the notes thereto and the other documents the Partnership files from time to time with the Securities and Exchange Commission.

The Partnership's investment properties consist of six properties and one property which is classified as held for sale at June 30, 2008. The Sterling is a multiple-use facility which consists of an apartment complex and commercial space. The following table sets forth the average occupancy of the properties for the six months ended June 30, 2008 and 2007:


	Average Occupancy
Property	2008	2007

The Sterling Apartment Homes	97%	96%
The Sterling Commerce Center	80%	79%
Philadelphia, Pennsylvania
The Knolls Apartments (1)	96%	85%
Colorado Springs, Colorado
Plantation Gardens Apartments	97%	98%
Plantation, Florida
Palm Lake Apartments	93%	93%
Tampa, Florida
The Dunes Apartments (2)	87%	83%
Indian Harbor, Florida
Regency Oaks Apartments (2)	94%	89%
Fern Park, Florida

(1)

The General Partner attributes the increase in occupancy at The Knolls Apartments to the completion of the redevelopment project in July 2006; the project began during the fourth quarter of 2004.

(2)

The General Partner attributes the increase in occupancy at The Dunes Apartments and Regency Oaks Apartments to increased marketing efforts.

The Partnership’s financial results depend upon a number of factors including the ability to attract and maintain tenants at the investment properties, interest rates on mortgage loans, costs incurred to operate the investment properties, general economic conditions and weather. As part of the ongoing business plan of the Partnership, the General Partner monitors the rental market environment of its investment properties to assess the feasibility of increasing rents, maintaining or increasing occupancy levels and protecting the Partnership from increases in expenses. As part of this plan, the General Partner attempts to protect the Partnership from the burden of inflation-related increases in expenses by increasing rents and maintaining a high overall occupancy level. However, the General Partner may use rental concessions and rental rate reductions to offset softening market conditions; accordingly, there is no guarantee that the General Part ner will be able to sustain such a plan. Further, a number of factors that are outside the control of the Partnership, such as the local economic climate and weather, can adversely or positively affect the Partnership’s financial results.

Results of Operations

The Partnership recognized a net loss of approximately $636,000 and $1,457,000 for the three and six months ended June 30, 2008, respectively, compared to net income of approximately $309,000 and $669,000 for the three and six months ended June 30, 2007, respectively. In accordance with Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, the accompanying consolidated statements of operations for the three and six months ended June 30, 2008 and 2007 reflect the operations of The Loft Apartments as income from discontinued operations. The Partnership entered into a sale contract on July 15, 2008 to sell The Loft Apartments to a third party. The contract was subsequently terminated on August 13, 2008. Included in income from discontinued operations for the three months ended June 30, 2008 and 2007 are results of the property’s operations of approximately $165,000 and $12,000, respectively, including revenues of approximately $418,000 and $403,000, respectively. Included in income from discontinued operations for the six months ended June 30, 2008 and 2007 are results of the property’s operations of approximately $184,000 and $35,000, respectively, including revenues of approximately $814,000 and $795,000, respectively. As a result of The Loft Apartments being held for sale, its assets and liabilities are classified as held for sale as of June 30, 2008 and December 31, 2007.

The Partnership recognized loss before discontinued operations of approximately $801,000 and $1,641,000 for the three and six months ended June 30, 2008, respectively, compared to income before discontinued operations of approximately $297,000 and $634,000 for the three and six months ended June 30, 2007, respectively. The increase in loss before discontinued operations for the three months ended June 30, 2008 is due to an increase in total expenses and a decrease in casualty gains, partially offset by an increase in total revenues, the recognition of a deferred tax benefit in 2008 and a decrease in equity in loss from investment. The increase in loss before discontinued operations for the six months ended June 30, 2008, is due to an increase in total expenses, a decrease in the recognition of a deferred tax benefit, a decrease in casualty gains and an increase in equity in loss from investment, partially offset by an increase in total revenues.

The increase in total expenses for the three and six months ended June 30, 2008 is due to increases in operating, depreciation and interest expenses, partially offset by a decrease in general and administrative expenses. Property tax expenses remained relatively constant for the comparable periods. The increase in operating expenses for both periods is primarily due to increases in hazard insurance premiums at five of the Partnership’s residential properties and the commercial property, salaries and related benefits at five of the Partnership’s residential properties and the commercial property, partially offset by a decrease in salaries and related benefits at one of the Partnership’s residential properties and an increase in payroll costs capitalized at all of the Partnership’s residential properties. Depreciation expense increased for both periods primarily due to property improvements and replacements placed into service at five of the Partnership’s residential properties during the past twelve months. The increase in interest expense for both periods is primarily due to an increase in the carrying balance of the mortgage notes as a result of the refinancings of the mortgages encumbering The Sterling Apartment Homes, Plantation Gardens Apartments and Regency Oaks Apartments in 2007, partially offset by a decrease in interest incurred on advances from an affiliate of the General Partner.

General and administrative expenses decreased for both the three and six months ended June 30, 2008 primarily due to a decrease in reimbursements to the General Partner as allowed under the Partnership Agreement. Also included in general and administrative expenses are costs associated with the quarterly and annual communications with investors and regulatory agencies and the annual audit required by the Partnership Agreement.

The increase in total revenues for the three and six months ended June 30, 2008 is due to increases in both rental and other income. The increase in rental income for both periods is primarily due to increases in occupancy and average rental rate at three of the Partnership’s residential properties and the commercial property, partially offset by decreases in the average rental rate at three of the Partnership’s residential properties, and an increase in bad debt expense at four of the Partnership’s residential properties. The increase in other income for both periods is primarily due to increases in late charges at three of the Partnership’s residential properties and common area maintenance reimbursements at the Partnership’s commercial property. The increase in other income for the six months ended June 30, 2008 is also due to an increase in interest income as a result of higher average cash balances.

In conjunction with the payment of local income taxes with respect to The Sterling Apartment Homes and Commerce Center, the Partnership has recorded a deferred tax asset in the amount of approximately $391,000. The deferred tax asset consists primarily of temporary differences related to land, buildings and accumulated depreciation. In a prior year, the Partnership had established a valuation allowance in the amount of approximately $333,000 against the deferred tax asset, as the Partnership believed it was more likely than not that the deferred tax asset would not be realized. During the six months ended June 30, 2007, the Partnership reconsidered its assessment of whether the deferred tax asset would be realized. As a result of the completion of the redevelopment project at The Sterling Apartment Homes, the Partnership now believes that it is more likely than not that the full value of the deferred tax asset will be realized thr ough future taxable income of the property. Accordingly, the reduction of the valuation allowance of approximately $333,000 is reflected as a deferred income tax benefit on the consolidated statement of operations for the six months ended June 30, 2007. An additional benefit of approximately $28,000 was recognized during the third and fourth quarters of 2007. An additional benefit of approximately $30,000 was recognized during the three and six months ended June 30, 2008. During the three months ended June 30, 2008 and 2007, the Partnership recognized approximately $27,000 and $26,000, respectively, in current income tax expense related to local income taxes with respect to The Sterling Apartments Homes and Commerce Center. During each of the six months ended June 30, 2008 and 2007, the Partnership recognized approximately $52,000 in current income tax expense related to local income taxes with respect to The Sterling Apartment Homes and Commerce Center.

During the three and six months ended June 30, 2008, the Partnership recognized approximately $2,000 and $8,000, respectively, in equity in loss from investments related to its allocated share of the loss from one of the affiliated partnerships. During both the three and six months ended June 30, 2007, the Partnership recognized approximately $3,000 in equity in loss related to its allocated share of the loss from one of the affiliated partnerships. These investments are accounted for using the equity method of accounting. Distributions from the affiliated partnerships are accounted for as a reduction of the investment balance until the investment balance is reduced to zero. When the investment balance has been reduced to zero, subsequent distributions received are recognized as income in the accompanying consolidated statements of operations. There were no distributions received during the six months ended June 30, 2008 and 2007.

Liquidity and Capital Resources

At June 30, 2008, the Partnership had cash and cash equivalents of approximately $620,000, compared to approximately $1,427,000 at June 30, 2007. Cash and cash equivalents decreased approximately $2,341,000, from December 31, 2007, due to approximately $2,517,000 and $1,867,000 of cash used in investing and financing activities, respectively, partially offset by approximately $2,043,000 of cash provided by operating activities. Cash used in investing activities consisted of property improvements and replacements. Cash used in financing activities consisted of principal payments made on the mortgages encumbering the Partnership's properties, a distribution to partners and lease commissions paid. The Partnership invests its working capital reserves in interest bearing accounts.

The sufficiency of existing liquid assets to meet future liquidity and capital expenditure requirements is directly related to the level of capital expenditures required at the properties to adequately maintain the physical assets and other operating needs of the Partnership and to comply with Federal, state, and local legal and regulatory requirements. The General Partner monitors developments in the area of legal and regulatory compliance. Capital improvements planned for each of the Partnership’s properties are detailed below.

The Loft Apartments

During the six months ended June 30, 2008, the Partnership completed approximately $149,000 of capital improvements at the property, consisting primarily of heating and air conditioning unit upgrades and floor covering replacement. These improvements were funded from operating cash flow. This property is classified as held for sale at June 30, 2008.

The Sterling Apartment Homes and Commerce Center

During the six months ended June 30, 2008, the Partnership completed approximately $657,000 of capital improvements at the property consisting primarily of tenant improvements, heating and swimming pool upgrades, structural improvements and floor covering replacement. These improvements were funded from operating cash flow. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during the remainder of 2008. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

The Knolls Apartments

During the six months ended June 30, 2008, the Partnership completed approximately $147,000 of capital improvements at the property consisting primarily of kitchen and bath upgrades and window and floor covering replacements. These improvements were funded from operating cash flow. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during the remainder of 2008. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

Plantation Gardens Apartments

During the six months ended June 30, 2008, the Partnership completed approximately $320,000 of capital improvements at the property consisting primarily of electrical, elevator, air conditioning unit and kitchen and bath upgrades and floor covering replacement. These improvements were funded from operating cash flow. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during the remainder of 2008. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

Palm Lake Apartments

During the six months ended June 30, 2008, the Partnership completed approximately $413,000 of capital improvements at the property consisting primarily of kitchen and bath upgrades, air conditioning unit upgrades, electrical upgrades and cabinet, appliance and floor covering replacements. These improvements were funded from operating cash flow. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during the remainder of 2008. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

The Dunes Apartments

During the six months ended June 30, 2008, the Partnership completed approximately $244,000 of capital improvements at the property consisting primarily of interior improvements, kitchen and bath upgrades, swimming pool upgrades, and appliance and floor covering replacements. These improvements were funded from operating cash flow. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during the remainder of 2008. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

Regency Oaks Apartments

During the six months ended June 30, 2008, the Partnership completed approximately $309,000 of capital improvements at the property consisting primarily of air conditioning unit and lighting upgrades, roof replacement, major landscaping, signage and floor covering replacement. These improvements were funded from operating cash flow. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during the remainder of 2008. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property.

Capital expenditures will be incurred only to the extent of cash available from operations or from Partnership reserves. To the extent that capital improvements are completed, the Partnership's distributable cash flow, if any, may be adversely affected, at least in the short term.

The Partnership's assets are thought to be sufficient for any near-term needs (exclusive of capital improvements) of the Partnership. The mortgage indebtedness encumbering the Partnership’s properties of approximately $129,032,000 requires monthly payments of principal and interest and balloon payments of approximately $12,223,000 and $97,297,000 during 2010 and 2017, respectively. The General Partner will attempt to refinance such indebtedness and/or sell the properties prior to such maturity dates. If the properties cannot be refinanced or sold for a sufficient amount, the Partnership will risk losing such properties through foreclosure.

The Partnership distributed the following amounts during the six months ended June 30, 2008 and 2007 (in thousands, except per unit data):


	Six Months	Per Limited	Six Months
	Ended	Partnership	Ended	Per Limited
	June 30,	Unit	June 30,	Partnership
	2008	(Series A)	2007	Unit

Refinance (1)	$ 750	$ 3.77	$ --	$ --

(1)

Distribution consists of refinance proceeds from the November 2007 refinance of The Sterling Apartment Homes.

Future cash distributions will depend on the levels of net cash generated from operations, the timing of debt maturities, property sales and/or refinancings. The Partnership's cash available for distribution is reviewed on a monthly basis. There can be no assurance, however, that the Partnership will generate sufficient funds from operations, after planned capital improvement expenditures, to permit additional distributions to its partners in 2008 or subsequent periods.

Other

In addition to its indirect ownership of the general partner interests in the Partnership, AIMCO and its affiliates owned 152,648.05 limited partnership units (the "Units") in the Partnership representing 76.69% of the outstanding Units at June 30, 2008. A number of these Units were acquired pursuant to tender offers made by AIMCO or its affiliates. It is possible that AIMCO or its affiliates will acquire additional Units in exchange for cash or a combination of cash and units in AIMCO Properties, L.P., the operating partnership of AIMCO, either through private purchases or tender offers. Pursuant to the Partnership Agreement, unitholders holding a majority of the Units are entitled to take action with respect to a variety of matters that would include, but are not limited to, voting on certain amendments to the Partnership Agreement and voting to remove the General Partner. As a result of its ownership of 76.69% of the outstanding Units, AIMCO and its affiliates are in a position to control all such voting decisions with respect to the Partnership. Although the General Partner owes fiduciary duties to the limited partners of the Partnership, the General Partner also owes fiduciary duties to AIMCO as its sole stockholder. As a result, the duties of the General Partner, as general partner, to the Partnership and its limited partners may come into conflict with the duties of the General Partner to AIMCO as its sole stockholder.

Critical Accounting Policies and Estimates

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States, which require the Partnership to make estimates and assumptions. The Partnership believes that of its significant accounting policies, the following may involve a higher degree of judgment and complexity.

Impairment of Long-Lived Assets

Investment properties are recorded at cost less accumulated depreciation, unless the carrying amount of the asset is not recoverable, and the investment properties foreclosed upon in the third quarter of 2002 and fourth quarter of 2003 were recorded at fair market value at the time of the foreclosures. If events or circumstances indicate that the carrying amount of a property may not be recoverable, the Partnership will make an assessment of its recoverability by comparing the carrying amount to the Partnership’s estimate of the undiscounted future cash flows, excluding interest charges, of the property. If the carrying amount exceeds the aggregate undiscounted future cash flows, the Partnership would recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property.

Real property investment is subject to varying degrees of risk. Several factors may adversely affect the economic performance and value of the Partnership’s investment properties. These factors include, but are not limited to, general economic climate; competition from other apartment communities and other housing options; local conditions, such as loss of jobs or an increase in the supply of apartments that might adversely affect apartment occupancy or rental rates; changes in governmental regulations and the related cost of compliance; increases in operating costs (including real estate taxes) due to inflation and other factors, which may not be offset by increased rents; and changes in tax laws and housing laws, including the enactment of rent control laws or other laws regulating multi-family housing. Any adverse changes in these factors could cause impairment of the Partnership’s assets.

Capitalized Costs Related to Redevelopment and Construction Projects

The Partnership capitalizes costs incurred in connection with capital expenditure activities, including redevelopment and construction projects. Costs including interest, property taxes and operating costs associated with redevelopment and construction projects are capitalized during periods in which redevelopment and construction projects are in progress in accordance with SFAS No. 34, “Capitalization of Interest Costs”, and SFAS No. 67, “Accounting for Costs and the Initial Rental Operations of Real Estate Properties.” Included in these capitalized costs are payroll costs associated with time spent by site employees in connection with the planning, execution and control of all capital expenditure activities at the property level.

Revenue Recognition

The Partnership generally leases apartment units for twelve-month terms or less. The Partnership will offer rental concessions during particularly slow months or in response to heavy competition from other similar complexes in the area. Rental income attributable to leases, net of any concessions, is recognized on a straight-line basis over the term of the lease. The Partnership evaluates all accounts receivable from residents and establishes an allowance, after the application of security deposits, for accounts greater than 30 days past due on current tenants and all receivables due from former tenants.

The Partnership leases certain commercial space to tenants under various lease terms. The leases are accounted for as operating leases in accordance with SFAS No. 13, "Accounting for Leases". Some of the leases contain stated rental increases during their term. For leases with fixed rental increases, rents are recognized on a straight-line basis over the terms of the leases. For all other leases, minimum rents are recognized over the terms of the leases.

Item 4T.

Controls and Procedures.

(a)

Disclosure Controls and Procedures.

The Partnership’s management, with the participation of the principal executive officer and principal financial officer of the General Partner, who are the equivalent of the Partnership’s principal executive officer and principal financial officer, respectively, has evaluated the effectiveness of the Partnership’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the principal executive officer and principal financial officer of the General Partner, who are the equivalent of the Partnership’s principal executive officer and principal financial officer, respectively, have concluded that, as of the end of such period, the Partnership’s disclosure controls and procedures are effective.

(b)

Changes in Internal Control Over Financial Reporting.

There have not been any changes in the Partnership’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Partnership’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1.

Legal Proceedings.

The General Partner does not anticipate that any costs to the Partnership, whether legal or settlement costs, associated with these cases will be material to the Partnership’s overall operations.

Item 6.

Exhibits.

See Exhibit Index Attached.

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.


	CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

	By: ConCap Equities, Inc.
	General Partner

Date: August 14, 2008	By: /s/Martha L. Long
	Martha L. Long
	Senior Vice President

Date: August 14, 2008	By: /s/Stephen B. Waters
	Stephen B. Waters
	Vice President

CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES, LP

EXHIBIT INDEX

Exhibit

Number

Description

Certificates of Limited Partnership, as amended to date. (Incorporated by reference to the Annual Report on Form 10-K for the fiscal year ended December 31, 1991 ("1991 Annual Report")).

3.1

Certificate of Limited Partnership of Registrant, dated March 19, 2008 (incorporated herein by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, dated April 30, 2008).

3.2

Amendment to Certificate of Limited Partnership of Registrant, dated April 30, 2008 (incorporated herein by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K, dated April 30, 2008).

3.3

Limited Partnership Agreement of Registrant, dated April 28, 1981 (incorporated herein by reference to Appendix A to the Prospectus included in the Registrant’s Registration Statement on Form S-11 (Reg. No. 2-72384)).

3.4

First Amendment to the Limited Partnership Agreement of Registrant, dated July 11, 1985.

3.5

Second Amendment to the Limited Partnership Agreement of Registrant, dated October 23, 1990.

3.6

Third Amendment to the Limited Partnership Agreement of Registrant, dated October 17, 2000 (incorporated herein by reference to Exhibit 10.23 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001).

3.7

Fourth Amendment to the Limited Partnership Agreement of Registrant, dated May 25, 2001 (incorporated herein by reference to Exhibit 10.24 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 2001).

3.8

Fifth Amendment to the Limited Partnership Agreement of Registrant, dated March 19, 2008 (incorporated herein by reference to Exhibit 3.3 to the Registrant’s Current Report on Form 8-K, dated April 30, 2008).

3.9

Sixth Amendment to the Limited Partnership Agreement of Registrant, dated April 30, 2008 (incorporated herein by reference to Exhibit 3.4 to the Registrant’s Current Report on Form 8-K, dated April 30, 2008).

10.28

Form of Amended Order Setting Foreclosure Sale Date pursuant to amending the foreclosure date filed on September 25, 2003.*

10.29

Form of Certificate of Sale as to Property "1" pursuant to sale of Palm Lake Apartments to CCIP Palm Lake, L.L.C. filed October 28, 2003.*

10.30

Form of Certificate of Sale as to Property "2" pursuant to sale of Regency Oaks Apartments to CCIP Regency Oaks, L.L.C. filed October 28, 2003.*

10.31

Form of Certificate of Sale as to Property "3" pursuant to sale of The Dunes Apartments (formerly known as Society Park East Apartments) to CCIP Society Park East, L.L.C. filed October 28, 2003.*

10.32

Form of Certificate of Sale as to Property "4" pursuant to sale of Plantation Gardens Apartments to CCIP Plantation Gardens, L.L.C. filed October 28, 2003.*

10.38

Deed of Trust, Assignment of Leases and Rents and Security Agreement dated August 31, 2005 between CCIP Loft, LLC, a Delaware limited liability company and New York Life Insurance Company, filed as exhibit 10.38, to the Current Report on Form 8-K filed on September 7, 2005 and incorporated herein by reference.

10.39

Promissory Note dated August 31, 2005 between CCIP Loft, LLC, a Delaware limited liability company and New York Life Insurance Company, filed as exhibit 10.39 to the Current Report on Form 8-K filed on September 7, 2005 and incorporated herein by reference.

10.40

Guaranty dated August 31, 2005 between AIMCO Properties, L.P., for the benefit of New York Life Insurance Company, filed as exhibit 10.40 to the Current Report on Form 8-K filed on September 7, 2005 and incorporated herein by reference.

10.45

Multifamily Note dated September 28, 2000 between Consolidated Capital Equity Partners, a California Limited Partnership, and GMAC Commercial Mortgage Corporation, incorporated herein by reference to Current Report on Form 8-K dated September 29, 2000.

10.47

10.51

Multifamily Note dated October 6, 2000 between Consolidated Capital Equity Partners, a California Limited Partnership, and GMAC Commercial Mortgage Corporation, incorporated herein by reference to Current Report on Form 8-K dated September 29, 2000.

10.53

Amended and Restated Multifamily Note, dated September 28, 2007 between CCIP Plantation Gardens, L.L.C., a Delaware limited liability company, and Capmark Bank, a Utah industrial bank. Filed on Current Report on Form 8-K dated September 28, 2007 and incorporated herein by reference.

10.54

Amended and Restated Multifamily Mortgage, Assignment of Rents and Security Agreement, dated September 28, 2007 between CCIP Plantation Gardens, L.L.C., a Delaware limited liability company, and Capmark Bank, a Utah industrial bank. Filed on Current Report on Form 8-K dated September 28, 2007 and incorporated herein by reference.

10.55

Amended and Restated Multifamily Note, dated September 28, 2007 between CCIP Regency Oaks, L.L.C., a Delaware limited liability company, and Capmark Bank, a Utah industrial bank. Filed on Current Report dated September 28, 2007 and incorporated herein by reference.

10.56

Amended and Restated Multifamily Mortgage, Assignment of Rents and Security Agreement, dated September 28, 2007 between CCIP Regency Oaks, L.L.C., a Delaware limited liability company, and Capmark Bank, a Utah industrial bank. Filed on Current Report on Form 8-K dated September 28, 2007 and incorporated herein by reference.

10.57

Multifamily Note, dated November 30, 2007 between CCIP Sterling, L.P., a Pennsylvania limited partnership, and Wachovia Multifamily Capital, Inc., a Delaware corporation. Filed on Current Report on Form 8-K dated November 30, 2007 and incorporated herein by reference.

10.58

Multifamily Mortgage, Assignment of Rents and Security Agreement, dated November 30, 2007 between CCIP Sterling, L.P., a Pennsylvania limited partnership, and Wachovia Multifamily Capital, Inc., a Delaware corporation. Filed on Current Report on Form 8-K dated November 30, 2007 and incorporated herein by reference.

10.62

Purchase and Sale Contract between CCIP Loft, L.L.C., a Delaware limited liability company, and GMC Property Management, L.C. a Florida limited liability company, dated July 15, 2008. Incorporated by reference to the Partnership’s Current Report on Form 8-K dated July 15, 2008.

31.1

Certification of equivalent of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of equivalent of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

Certification of the equivalent of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*Filed as exhibits 10.28 through 10.32 in the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2003 incorporated herein by reference.

EX-31 2 ccipexhibit311.htm EX 31.1 Exhibit 31

Exhibit 31.1

CERTIFICATION

I, Martha L. Long, certify that:

I have reviewed this quarterly report on Form 10-Q of Consolidated Capital Institutional Properties, LP;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)), for the registrant and have:

(a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 14, 2008

/s/Martha L. Long

Martha L. Long

Senior Vice President of ConCap Equities, Inc., equivalent of the chief executive officer of the Partnership

EX-31 3 ccipexhibit312.htm EX 31.2 Exhibit 31

Exhibit 31.2

CERTIFICATION

I, Stephen B. Waters, certify that:

I have reviewed this quarterly report on Form 10-Q of Consolidated Capital Institutional Properties, LP;

(a)

(b)

(c)

(d)

(a)

(b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 14, 2008

/s/Stephen B. Waters

Stephen B. Waters

Vice President of ConCap Equities, Inc., equivalent of the chief financial officer of the Partnership

EX-32 4 ccipexhibit321.htm EX 32.1 Exhibit 32

Exhibit 32.1

Certification of CEO and CFO

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Consolidated Capital Institutional Properties, LP (the "Partnership"), for the quarterly period ended June 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Martha L. Long, as the equivalent of the chief executive officer of the Partnership, and Stephen B. Waters, as the equivalent of the chief financial officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.


	/s/Martha L. Long
	Name: Martha L. Long
	Date: August 14, 2008

	/s/Stephen B. Waters
	Name: Stephen B. Waters
	Date: August 14, 2008

This certification is furnished with this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Partnership for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

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