-----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, GxkEfqfYQajbM8/xkYWP3itUG5f+0kon939zWbLRYSUuJtJsaSFeKmURGq2vCcrk EMdTC3wt2HsZQ4ZuR61LRg== 0000702117-98-000001.txt : 19980331 0000702117-98-000001.hdr.sgml : 19980331 ACCESSION NUMBER: 0000702117-98-000001 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980330 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: KRUPP REALTY FUND LTD III CENTRAL INDEX KEY: 0000702117 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 042763323 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: SEC FILE NUMBER: 000-11210 FILM NUMBER: 98578975 BUSINESS ADDRESS: STREET 1: C/O BERKSHIRE REALTY AFFILIATES STREET 2: 470 ATLANTIC AVENUE CITY: BOSTON STATE: MA ZIP: 02210 BUSINESS PHONE: 6174232233 MAIL ADDRESS: STREET 1: 470 ATLANTIC AVENUE STREET 2: C/O BERKSHIRE REALTY AFFILIATES CITY: BOSTON STATE: MA ZIP: 02210 10-K 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the fiscal year ended December 31, 1997 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from to Commission file number 0-11210 Krupp Realty Fund, Ltd.-III (Exact name of registrant as specified in its charter) Massachusetts 04-2763323 (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 470 Atlantic Avenue, Boston, Massachusetts 02210 (Address of principal executive offices) (Zip Code) (Registrant's telephone number, including area code) (617) 423-2233 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Units of Investor Limited Partner Interests 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. Yes X No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]. Aggregate market value of voting securities held by non-affiliates: Not applicable. Documents incorporated by reference: Part IV, Item 14. The exhibit index is located on pages 8-11. The total number of pages in this document is 28. PART I This Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Actual results could differ materially from those projected in the forward-looking statements as a result of a number of factors, including those identified herein. ITEM 1. BUSINESS Krupp Realty Fund, Ltd.-III ("KRF-III") was formed on April 23, 1982 by filing a Certificate of Limited Partnership in The Commonwealth of Massachusetts. KRF-III issued all of the General Partner Interest to two General Partners, The Krupp Company, a Massachusetts limited partnership, and The Krupp Corporation, a Massachusetts corporation. KRF-III also issued all of the Original Limited Partner Interests to The Krupp Company. On June 4, 1982, KRF-III commenced an offering of up to 25,000 units of Investor Limited Partner Interests (the "Units") for $1,000 per Unit. As of September 29, 1982, KRF-III received subscriptions for all 25,000 Units and therefore, the public offering was successfully completed on that date. For details, see Note A to Consolidated Financial Statements included in Item 8 (Appendix A) of this report. Theprimary business of KRF-III is to acquire, operate, and ultimately dispose of real estate. KRF-III initially acquired five multi-family apartment complexes (Druid Valley, Willow Lake, Brookeville, Dorsey's Forge/Oakland Meadows and Hannibal Grove Apartments) and an office building (Woodlake Office Park). KRF-III considers itself to be engaged only in the industry segment of investment in real estate. KRF-III sold Druid Valley and Willow Lake in 1991 and Woodlake Office Park in 1992. On July, 1, 1993, the General Partners formed Brookeville Apartments Limited Partnership ("Brookeville L.P.") as a prerequisite for the refinancing of Brookeville Apartments ("Brookeville") with the Department of Housing and Urban Development ("HUD"). At the same time, the General Partners transferred ownership of Brookeville to Brookeville L.P. The General Partner of Brookeville L.P. is the Westcop Corporation ("Westcop") and KRF-III is the Limited Partner of Brookeville L.P. Westcop has beneficially assigned its interest in Brookeville L.P. to KRF-III. KRF-III and Brookeville L.P. are collectively known as Krupp Realty Fund, Ltd.-III and Subsidiary (the "Partnership"). The Partnership's real estate investments are subject to some seasonal fluctuations due to changes in utility consumption and seasonal maintenance expenditures. However, the future performance of the Partnership will depend upon factors which cannot be predicted. Such factors include general economic and real estate market conditions, both on a national basis and in those areas where the Partnership's investments are located, real estate tax rates, operating expenses, energy costs, government regulations, and federal and state income tax laws. The requirements for compliance with federal, state and local regulations to date have not had an adverse effect on the Partnership's operations, and no adverse effect therefrom is anticipated in the future. The Partnership's investments in real estate are also subject to such risks as (i) competition from existing and future projects held by other owners in the areas of the Partnership's properties, (ii) possible reduction in rental income due to an inability to maintain high occupancy levels, (iii) possible adverse changes in mortgage interest rates, (iv) possible adverse changes in general economic and local conditions, such as competitive over-building, increased unemployment or adverse changes in real estate zoning laws, (v) the possible future adoption of rent control legislation which would not permit the full amount of increased costs to be passed on to tenants in the form of rent increases, and (vi) other circumstances over which the Partnership may have little or no control. As of December 31, 1997, the Partnership did not employ any personnel. ITEM 2. PROPERTIES As of December 31, 1997, the Partnership had leveraged investments in three apartment complexes having an aggregate of 990 units. A summary of the Partnership's real estate investments is presented below. Schedule III included in Item 8 (Appendix A) of this report contains additional detailed information with respect to individual properties.
Average Occupancy For the Year Ended Year December 31, DescriptionAcquired Total Units 1997 1996 1995 19941993 Brookeville Apartments Columbus, Ohio 1983 424 Units 98% 95% 94% 94% 93% Hannibal Grove Apartments Columbia, Maryland 1983 316 Units 100% 94% 93% 94% 88% Dorsey's Forge and Oakland Meadows Apartments Columbia, Maryland 1983 250 Units 99% 94% 94% 95% 92%
ITEM 3.LEGAL PROCEEDINGS There are no material pending legal proceedings to which the Partnership is a party or of which any of its property is the subject. ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None. PART II ITEM 5.MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS The transfer of Units of Limited Partner Interest is subject to certain limitations contained in the Partnership Agreement. There is no public market for the Units and it is not anticipated that any such public market will develop. The number of Investor Limited Partners as of December 31, 1997 was approximately 1,600. One of the objectives of the Partnership is to generate cash available for distribution, however, there is no assurance that future operations will generate cash available for distribution. The Partnership discontinued distributions during 1990 because of insufficient operating cash flow. In 1994, however, property operations improved and distributions were reinstituted and paid in August, 1994 at a rate of $3.97 per Unit and increased to an annual rate of $11.90 and $15.86 per Unit in 1995 and 1996, respectively. Thereafter, the Partnership has continued semiannual distributions at an annual rate of $15.86. The Partnership made the following distributions to its Partners during the years ended December 31, 1997 and 1996:
Year Ended December 31, 1997 1996 Amount Per Unit Amount Per Unit Limited Partners: Investor Limited Partners (25,000 Units outstanding) $396,500 $15.86 $396,500 $15.86 Original Limited Partner 16,697 16,697 General Partners 4,174 4,174 $417,371 $417,371
ITEM 6. SELECTED FINANCIAL DATA The following table sets forth selected financial information regarding the Partnership's financial position and operating results. This information should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations and the Consolidated Financial Statements which are included in Items 7 and 8 of this report, respectively.
1997 1996 1995 1994 1993 Total revenue $7,280,181 $ 6,628,658$ 6,352,337 $6,215,466$ 5,757,960 Net loss (23,224) (446,360) (547,893) (453,031) (1,521,667) Net loss allocated to: Investor Limited Partners (22,063) (424,042) (520,498) (430,380) (1,445,583) Per Unit (.88) (16.96) (20.82) (17.22) (57.82) Original Limited Partner (929) - - (18,121) (60,867) General Partners (232) (22,318) (27,395) (4,530) (15,217) Total assets at December 31 12,354,768 13,224,310 14,384,144 15,702,150 16,561,486 Long-term obligations at December 31 18,726,677 19,126,371 19,491,853 19,827,968 20,133,422 Distributions: Investor Limited Partners 396,500 396,500 297,495 99,132 - Per Unit 15.86 15.86 11.90 3.97 - Original Limited Partner 16,697 16,697 12,526 4,174 - General Partners 4,174 4,174 3,132 1,043 -
The per Unit distributions for the years ended December 31, 1997, 1996, 1995, 1994 and 1993 were $15.86, $15.86, $11.90, $3.97 and $0, respectively, none of which represented a return of capital. Prior performance of the Partnership is not necessarily indicative of future operations. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements including those concerning Management's expectations regarding the future financial performance and future events. These forward-looking statements involve significant risk and uncertainties, including those described herein. Actual results may differ materially from those anticipated by such forward-looking statements. Liquidity and Capital Resources The Partnership's ability to generate cash adequate to meet its needs is dependent primarily upon the operations of its real estate investments. Such ability is also dependent upon the future availability of bank borrowings and the potential refinancing and sale of the Partnership's remaining real estate investments. These sources of liquidity will be used by the Partnership for payment of expenses related to real estate operations, capital expenditures, debt service and expenses. Cash Flow, if any, as calculated under Section 8.2(a) of the Partnership Agreement, will then be available for distribution to the Partners. In 1994, distributions were reinstituted and paid in August, 1994 at a rate of $3.97 per Unit and increased to an annual rate of $11.90 and $15.86 per Unit in 1995 and 1996, respectively. Thereafter, the Partnership has continued semiannual distributions at an annual rate of $15.86. The Partnership is planning to spend approximately $1,089,000 for capital improvements at its properties in 1998. The Partnership believes that the improvements are necessary to compete in its current markets, produce quality rental units and absorb excess market supply at the properties' respective locations and to both maintain and increase current occupancy levels. Renovations include the replacement of countertops, carpeting, appliances, pavement upgrades and both interior and exterior building improvements. The Partnership expects to fund these improvements from established reserves and cash generated from property operations. Operations 1997 compared to 1996 Net loss decreased in 1997 when compared with 1996, as the increase in total revenue more than offset the increase in total expenses. Rental revenue increased in 1997 when compared to 1996, with substantial increases in average occupancy rates at all the Partnership's properties. Total expenses increased slightly in 1997 as compared to 1996. Maintenance expense increased with landscaping and exterior building repairs completed at Brookeville. Real estate taxes increased due to a rise in the assessed value of Dorsey's Forge in addition to a 1995 real estate tax refund for the property received in 1996. Management fees increased as a result of the increases in rental revenue, as discussed above. Depreciation expense increased in conjunction with capital improvement expenditures. 1996 compared to 1995 Net loss decreased in 1996, as compared to 1995, as the increase in revenue more than offset the increase in expenses. Rental revenue for 1996, as compared to 1995, increased due to increased rental rates at the Partnership's properties in addition to slight increases in average occupancy rates at both Brookeville and Hannibal Grove in 1996. Total expenses increased in 1996, when compared to 1995, primarily due to increases in operating and depreciation expenses, partially offset by decreases in maintenance, real estate taxes, and general and administrative expenses. The increase in operating expense was due to a rise in payroll costs at both Brookeville and Hannibal Grove, greater utility consumption as a result of the unusually harsh winter weather in 1996, and an increase in leasing costs related to locating and retaining qualified tenants. Maintenance expense decreased due to costs incurred in 1995 in connection with a fire at Brookeville. The decrease in real estate taxes was the result of a 1995 real estate tax refund for Dorsey's Forge received in 1996. General and administrative expense decreased as a result of costs incurred in 1995 associated with obtaining appraisals of the Partnership's properties. Depreciation expense increased in 1996, as compared to 1995, in conjunction with capital improvement expenditures. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA See Appendix A to this report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The Partnership has no directors or executive officers. Information as to the directors and executive officers of The Krupp Corporation, which is a General Partner of both the Partnership and The Krupp Company, the other General Partner of the Partnership, is as follows: Position with Name and Age The Krupp Corporation Douglas Krupp (51) President and Co-Chairman of the Board George Krupp (53) Co-Chairman of the Board Wayne H. Zarozny (39) Treasurer Douglas Krupp is Co-Chairman and Co-Founder of The Berkshire Group. Established in 1969 as the Krupp Companies, this real estate-based firm expanded over the years within its areas of expertise including investment program sponsorship, property and asset management, mortgage banking, healthcare facility ownership and the management of the company. Mr. Krupp is a graduate of Bryant College. In 1989 he received an honorary Doctor of Science in Business Administration from this institution and was elected trustee in 1990. Mr. Krupp is Chairman of the Board and a Director of both Berkshire Realty Company, Inc. (NYSE-BRI) and Harborside Healthcare (NYSE-HBR). Mr. Krupp also serves as Chairman of the Board and Trustee of Krupp Government Income Trust and as Chairman of the Board and Trustee of Krupp Government Income Trust II. George Krupp is Douglas Krupp's brother. George Krupp is the Co-Chairman and Co- Founder of The Berkshire Group. Established in 1969 as the Krupp Companies, this real estate-based firm expanded over the years within its areas of expertise including investment program sponsorship, property and asset management, mortgage banking and healthcare facility ownership. Mr. Krupp received his undergraduate education from the University of Pennsylvania and Harvard University Extension School and holds a Master's degree in History from Brown University. Wayne H. Zarozny is Vice President of The Berkshire Group. Mr. Zarozny has held several positions within The Berkshire Group since joining the company in 1986 and is currently responsible for accounting and financial reporting, treasury, accounts payable and payroll activities. Prior to joining The Berkshire Group, he was an audit supervisor for Pannell Kerr Forster International and on the audit staff of Deloitte, Haskins and Sells in Boston. He received a B.S. degree from Bryant College, a Master's degree in Business Administration from Clark University and is a Certified Public Accountant. ITEM 11. EXECUTIVE COMPENSATION The Partnership has no directors or executive officers. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT As of December 31, 1997, beneficial owners of record owning more than 5% of the Partnership's 25,000 Units of Investor Limited Partner Interests outstanding are as follows: Title Name and Address Amount and Nature Percent of of of of Class Beneficial Owner BeneficialOwnership Class Investor Equity Resource Limited Fund XVI LP Partner 14 Story Street Units Cambridge, MA 02138 926 Units 3.7% Investor Equity Resource Limited Fund XIX LP Partner 14 Story Street Units Cambridge, MA 02138 333 Units 1.3% Investor Equity Resource Limited Cambridge Fund LP Partner 14 Story Street Units Cambridge, MA 02138 95 Units 0.4% Investor Equity Resource Limited General Fund LP Partner 14 Story Street Units Cambridge, MA 02138 40 Units 0.2% Investor Equity Resource Limited Brattle Fund LP Partner 14 Story Street Units Cambridge, MA 02138 30 Units 0.1% Investor AP-GP Prom Partners Limited Inc. Partner 2 Manhattanville Rd. Units Purchase, NY 10577 824 Units 3.3% Investor Apollo Real Estate Limited Advisors II, LP Partner 2 Manhattanville Rd. Units Purchase, NY 10577 824 Units 3.3% Investor Apollo Real Estate Limited Investment Fund II, LP Partner 2 Manhattanville Rd. Units Purchase, NY 10577 824 Units 3.3% Investor Limited Krescent Partners LLC Partner 2 Manhattanville Rd. Units Purchase, NY 10577 824 Units 3.3% Total 4,720 Units 18.9% As of December 31, 1997, the General Partners or their affiliates owned 80 Units (.3% of the total outstanding) of the Partnership in addition to their General Partner and Original Limited Partner Interests. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The Partnership does not have any directors, executive officers or nominees for election as director. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULE AND REPORTS ON FORM 8-K (a) 1. Consolidated Financial Statements - see Index to Consolidated Financial Statements and Schedule included under Item 8 (Appendix A) on page F-2 of this Report. 2. Consolidated Financial Statement Schedule - see Index to Consolidated Financial Statements and Schedule included under Item 8 (Appendix A) on page F-2 of this Report. All other schedules are omitted as they are not applicable, not required or the information is provided in the Consolidated Financial Statements or the Notes thereto. (b) Exhibits: Number and Description Under Regulation S-K The following reflects all applicable Exhibits required under Item 601 of Regulation S-K. (4) Instruments defining the rights of security holders including indentures: (4.1) Agreement of Limited Partnership dated as of April 23, 1982 [Exhibit A to Prospectus included in Registrant's Registration Statement on Form S-11 (File 2-77155)].* (4.2) Amended Certificate of Limited Partnership filed with the Massachusetts Secretary of State on September 29, 1982 [Exhibit 4.2 to Registrant's Report on Form 10-K dated December 31, 1982 (File No. 2-77155)].* (10) Material Contracts: Brookeville Apartments (10.1) Property Management Agreement dated October 1, 1991 between Brookeville Apartments Limited Partnership, as Owner, and BRI OP Limited Partnership, formerly known as Berkshire Property Management, a subsidiary of Berkshire Realty Company, Inc. [Exhibit 10.6 to Registrant's Annual Report on Form 10-K for the year ended December 31, 1991 (File No. 0-11210)].* (10.2) Contract of Limited Partnership and Certificate of Limited Partnership of Brookeville Apartments Limited Partnership [Exhibit 10.5 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993 (File No. 0-11210)].* (10.3) Agreement to Hold Title dated July 20, 1993 by and between Brookeville Apartments Limited Partnership and Krupp Realty Fund, Ltd. - III. [Exhibit 10.6 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993 (File No. 0-11210)].* (10.4) Quitclaim deed dated July 20, 1993 between Krupp Realty Fund, Ltd.-III and Brookeville Apartments Limited Partnership. [Exhibit 10.7 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993 (File No. 0-11210)].* (10.5) Open-End Mortgage Note dated July 20, 1993 by and between Brookeville Apartments Limited Partnership and Sussex Mortgage Company. [Exhibit 10.8 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993 (File No. 0-11210)].* (10.6) Open-End Mortgage Deed dated July 20, 1993 by and between Brookeville Apartments Limited Partnership and Sussex Mortgage Company. [Exhibit 10.9 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993 (File No. 0-11210)].* Dorsey's Forge, Oakland Meadows and Hannibal Grove Apartments (10.7) Agreements dated as of November 30, 1982, and related supplemental Agreement dated as of November 30, 1982 between George Krupp and Douglas Krupp, on behalf of themselves and others, and Shelter Corporation of Canada, Limited and Metropolitan Properties Co. Limited [Exhibit to Registrant's Report on Form 8-K dated January 10, 1983 (File 2-77155)].* (10.8) Deed dated April 25, 1983 between Dorsey's Properties, Ltd. and D.O.H., Inc. relating to Dorsey's Forge [Exhibit 1 to Registrant's Amendment No. 1 to Form 8-K dated January 18, 1983 (File No. 2-77155)].* (10.9) Deed dated April 25, 1983 between D.O.H., Inc. and Krupp Realty Fund, Ltd.-III relating to Dorsey's Forge [Exhibit 2 to Registrant's Amendment No. 1 to Form 8-K dated January 18, 1983 (File No. 2-77155)].* (10.10) Modification and Restatement of Promissory Note dated April 28, 1993 by and between Krupp Realty Fund - III, Ltd. and John Hancock Mutual Life Insurance Company relating to Dorsey's Forge. [Exhibit 10.1 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993. (File No. 0-11210)].* (10.11) Modification and Restatement of Indemnity Deed of Trust and Security Agreement dated April 28, 1993 between Krupp Realty Fund, Ltd.-III and John Hancock Mutual Life Insurance Company relating to Dorsey's Forge [Exhibit 10.2 to Registrant's Report on Form 10-Q dated September 30, 1993. (File No. 0-11210)].* (10.12) Property Management Agreement dated, December 19, 1986, between Krupp Realty Fund, Ltd.-III (as "Owner") and BRI OP Limited Partnership, formerly known as Berkshire Property Management, a subsidiary of Berkshire Realty Company, Inc., relating to Dorsey's Forge [Exhibit 10.15 to Registrant's Annual Report on Form 10-K dated December 31, 1986 (File No. 0-11210)].* (10.13) Management Agreement dated December 19, 1986 between Krupp Realty Fund, Ltd.-III (as "Owner") and BRI OP Limited Partnership, formerly known as Berkshire Property Management , a subsidiary of Berkshire Realty Company, Inc., relating to Oakland Meadows [Exhibit 10.16 to Registrant's Annual Report on Form 10-K dated December 31, 1986 (File No. 0-11210)].* (10.14) Deed dated April 25, 1983 between Dorsey Properties Ltd., and D.O.H., Inc., relating to Oakland Meadows [Exhibit 4 to Registrant's Amendment No. 1 to Form 8-K dated January 18, 1983 (File No. 2-77155)].* (10.15) Deed dated April 25, 1983 between D.O.H., Inc., and Krupp Realty Fund, Ltd.-III relating to Oakland Meadows [Exhibit 5 to Registrant's Amendment No. 1 to Form 8-K dated January 18, 1983 (File No. 2-77155)].* (10.16) Modification and Restatement of Promissory Note dated April 28, 1993 between Krupp Realty Fund, Ltd.-III and John Hancock Mutual Life Insurance Company relating to Hannibal Grove. [Exhibit 10.3 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993 (File No. 0-11210)].* (10.17) Modification and Restatement of Indemnity Deed of Trust and Security Agreement dated April 28, 1993 between Krupp Realty Fund, Ltd.-III and John Hancock Mutual Life Insurance Company relating to Hannibal Grove [Exhibit 10.4 to Registrant's Report on Form 10-Q for the quarter ended September 30, 1993. (File No. 0-11210)].* (10.18) Management Agreement dated December 19, 1986 between Krupp Realty Fund, Ltd.-III (as "Owner") and BRI OP Limited Partnership, formerly known as Berkshire Property Management, a subsidiary of Berkshire Realty Company, Inc., relating to Hannibal Grove [Exhibit 10.21 to Registrant's Annual Report on Form 10-K dated December 31, 1986 (File No. 0-11210)].* (10.19) Deed dated April 25, 1983 between Dorsey Properties, Ltd., and D.O.H., Inc., relating to Hannibal Grove [Exhibit 7 to Registrant's Amendment No. 1 to Form 8-K dated January 18, 1983 (File No. 2-77155)].* (10.20) Deed dated April 25, 1983 between D.O.H., Inc., and Krupp Realty Fund, Ltd.-III relating to Hannibal Grove [Exhibit 8 to Registrant's Amendment No. 1 to Form 8-K dated January 18, 1983 (File No. 2-77155)].* * Incorporated by reference. (b) Reports on Form 8-K During the quarter ended December 31, 1997, the Partnership did not file any reports on Form 8-K. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on the 25th day of March, 1998. KRUPP REALTY FUND, LTD.-III By: The Krupp Corporation, a General Partner By: /s/ Douglas Krupp Douglas Krupp, President, Co- Chairman (Principal Executive Officer) and Director of The Krupp Corporation Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated, on the 25th day of March, 1998. Signatures Titles /s/ Douglas Krupp President, Co-Chairman (Principal Executive Douglas Krupp Officer) and Director of The Krupp Corporation, a General Partner. /s/ George Krupp Co-Chairman (Principal Executive Officer)and George Krupp Director of The Krupp Corporation, a General Partner. /s/ Wayne H. Zarozny Treasurer of the Krupp Corporation, a Wayne H. Zarozny General Partner. APPENDIX A KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE ITEM 8 OF FORM 10-K ANNUAL REPORT TO THE SECURITIES AND EXCHANGE COMMISSION For the Year Ended December 31, 1997 KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE Report of Independent Accountants F-3 Consolidated Balance Sheets for December 31, 1997 and December 31, 1996 F-4 Consolidated Statements of Operations For the Years Ended December 31, 1997, 1996 and 1995 F-5 Consolidated Statements of Changes in Partners' Deficit For the Years Ended December 31, 1997, 1996 and 1995 F-6 Consolidated Statements of Cash Flows For the Years Ended December 31, 1997, 1996 and 1995 F-7 Notes to Consolidated Financial StatementsF-8 - F-13 Schedule III - Real Estate and Accumulated Depreciation F-14 - F-15 All other schedules are omitted as they are not applicable or not required, or the information is provided in the consolidated financial statements or the notes thereto. REPORT OF INDEPENDENT ACCOUNTANTS To the Partners of Krupp Realty Fund, Ltd.-III and Subsidiary: We have audited the consolidated financial statements and the financial statement schedule of Krupp Realty Fund, Ltd.- III and Subsidiary (the "Partnership") listed in the index on page F-2 of this Form 10-K. These financial statements and financial statement schedule are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these financial statements and financial statement schedule based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Krupp Realty Fund, Ltd.- III and Subsidiary at December 31, 1997 and 1996, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 1997 in conformity with generally accepted accounting principles. In addition, in our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material respects, the information required to be included therein. Boston, Massachusetts COOPERS & LYBRAND L.L.P. February 2, 1998 KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS December 31, 1997 and 1996
ASSETS 1997 1996 Multi-family apartment complexes, less accumulated depreciation of $20,216,642 and $18,281,640, respectively (Note C) $10,519,769 $11,505,230 Cash and cash equivalents 552,221 468,735 Replacement reserve and repair escrows (Note C) 177,778 110,994 Cash restricted for tenant security deposits 202,691 183,758 Prepaid expenses and other assets 595,696 603,090 Deferred expenses, less accumulated amortization of $212,971 and $167,081, respectively 306,613 352,503 Total assets $12,354,768 $13,224,310 LIABILITIES AND PARTNERS' DEFICIT Liabilities: Mortgage notes payable (Note C) $19,126,371 $19,491,853 Accounts payable - 22,397 Accrued expenses and other liabilities 683,413 724,481 Total liabilities 19,809,784 20,238,731 Partners' deficit (Note D): Investor Limited Partners (25,000 Units outstanding) (6,220,367) (5,801,804) Original Limited Partner (906,151) (888,525) General Partners (328,498) (324,092) Total Partners' deficit (7,455,016) (7,014,421) Total liabilities and Partners' deficit$12,354,768 $13,224,310
The accompanying notes are an integral part of the consolidated financial statements. KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS For the Years Ended December 31, 1997, 1996 and 1995
1997 1996 1995 Revenue: Rental $7,224,085 $6,568,309 $ 6,284,399 Other income 56,096 60,349 67,938 Total revenue 7,280,181 6,628,658 6,352,337 Expenses: Operating (Note E) 2,041,820 1,991,923 1,747,005 Maintenance 578,869 556,909 672,020 Real estate taxes 539,978 504,867 517,945 Management fees (Note E) 357,766 326,363 315,695 General and administrative (Note E) 101,687 93,995 145,488 Depreciation and amortization 1,980,892 1,866,979 1,738,951 Interest (Note C) 1,702,393 1,733,982 1,763,126 Total expenses 7,303,405 7,075,018 6,900,230 Net loss (Note F)$ (23,224) $ (446,360) $ (547,893) Allocation of net loss (Note D): Investor Limited Partners (25,000 Units outstanding) $ (22,063)$ (424,042)$ (520,498) Investor Limited Partners Per Unit $ (.88)$ (16.96)$ (20.82) Original Limited Partner $ (929)$ - $ - General Partners $ (232)$ (22,318)$ (27,395)
The accompanying notes are an integral part of the consolidated financial statements. KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' DEFICIT For the Years Ended December 31, 1997, 1996 and 1995
Investor Original Total Limited Limited General Partners' Partners Partner Partners Deficit Balance at December 31, 1994$(4,163,269) $(859,302)$(267,073)$(5,289,644) Net loss (520,498) - (27,395) (547,893) Distributions (297,495) (12,526) (3,132) (313,153) Balance at December 31, 1995 (4,981,262) (871,828) (297,600) (6,150,690) Net loss (424,042) - (22,318) (446,360) Distributions (396,500) (16,697) (4,174) (417,371) Balance at December 31, 1996 (5,801,804) (888,525) (324,092) (7,014,421) Net loss (Note D) (22,063) (929) (232) (23,224) Distributions (Note D) (396,500) (16,697) (4,174) (417,371) Balance at December 31, 1997 $(6,220,367)$(906,151)$(328,498)$(7,455,016)
The per Unit distributions for the years ended December 31, 1997, 1996 and 1995 were $15.86, $15.86 and $11.90, respectively, none of which represented a return of capital. The accompanying notes are an integral part of the consolidated financial statements. KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended December 31, 1997, 1996 and 1995
1997 1996 1995 Operating activities: Net loss $ (23,224) $ (446,360)$ (547,893) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 1,980,892 1,866,979 1,738,951 Interest earned on replacement reserve and repair escrows (4,889) - (3,018) Changes in assets and liabilities: Decrease (increase) in cash restricted for tenant security deposits (18,933) 19,192 (8,170) Decrease (increase) in prepaid expenses and other assets 7,394 (6,836) 61,980 Decrease in accounts payable(13,397) (40,773) (189,912) Increase (decrease) in due to affiliate - (10,790) 10,790 Increase (decrease) in accrued expenses and other liabilities (41,068) 80,668 27,783 Net cash provided by operating activities 1,886,775 1,462,080 1,090,511 Investing activities: Additions to fixed assets (949,541) (996,817) (1,064,103) Increase (decrease) in accounts payable related to fixed asset additions (9,000) 9,000 - Withdrawals from replacement reserve and repair escrows - 153,250 472,172 Deposits to replacement reserve and repair escrows (61,895) (61,895) (61,895) Net cash used in investing activities (1,020,436) (896,462) (653,826) Financing activities: Principal payments on mortgage notes payable (365,482) (334,208) (305,621) Distributions (417,371) (417,371) (313,153) Net cash used in financing activities (782,853) (751,579) (618,774) Net increase (decrease) in cash and cash equivalents 83,486 (185,961) (182,089) Cash and cash equivalents, beginning of the year 468,735 654,696 836,785 Cash and cash equivalents, end of the year$ 552,221$ 468,735$ 654,696
The accompanying notes are an integral part of the consolidated financial statements. KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS A. Organization Krupp Realty Fund, Ltd.-III ("KRF-III") was formed on April 23, 1982 by filing a Certificate of Limited Partnership in The Commonwealth of Massachusetts. KRF-III terminates on December 31, 2020, unless earlier terminated upon the sale of the last of KRF- III's properties or the occurrence of certain other events as set forth in the Partnership Agreement. KRF-III issued all of the General Partner Interests to The Krupp Company, a Massachusetts limited partnership, and The Krupp Corporation, a Massachusetts corporation, in exchange for capital contributions aggregating $1,000. Except under certain limited circumstances upon termination of KRF-III, the General Partners are not required to make any additional capital contributions. KRF-III also issued all of the Original Limited Partner Interests to The Krupp Company in exchange for a capital contribution of $4,000. The Original Limited Partner is not required to make any additional capital contributions to KRF-III. On June 4, 1982, KRF-III commenced an offering of up to 25,000 units of Investor Limited Partner Interests (the "Units") for $1,000 per Unit. As of September 29, 1982, KRF-III received subscriptions for all 25,000 Units and therefore, the public offering was successfully completed on that date. In 1993, the General Partners formed Brookeville Apartments Limited Partnership ("Brookeville L.P.") as a prerequisite for the refinancing of Brookeville Apartments ("Brookeville") with the Department of Housing and Urban Development ("HUD"). At the same time, the General Partners transferred ownership of Brookeville to Brookeville L.P. The General Partner of Brookeville L.P. is the Westcop Corporation ("Westcop") and KRF-III is the Limited Partner in Brookeville L.P. Westcop has beneficially assigned its interest in Brookeville L.P. to KRF-III. KRF-III and Brookeville L.P. are collectively known as Krupp Realty Fund, Ltd.-III and Subsidiary (the "Partnership"). B.Significant Accounting Policies The Partnership uses the following accounting policies for financial reporting purposes, which may differ in certain respects from those used for federal income tax purposes (see Note F). Basis of Presentation The consolidated financial statements present the consolidated assets, liabilities and operations of the Partnership. All intercompany balances and transactions have been eliminated. Risks and Uncertainties The Partnership invests its cash primarily in deposits and money market funds with commercial banks. The Partnership has not experienced any losses to date on its invested cash. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, contingent assets and liabilities and revenues and expenses during the reporting period. Actual results could differ from those estimates. Continued KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued B.Significant Accounting Policies, Continued Cash and Cash Equivalents The Partnership includes all short-term investments with maturities of three months or less from the date of acquisition in cash and cash equivalents. The cash investments are recorded at cost, which approximates current market values. Rental Revenues Leases require the payment of rent monthly in advance. Rental revenues are recorded on the accrual basis. Depreciation Depreciation is provided for by the use of the straight-line method over estimated useful lives as follows: Buildings and improvements 5 to 25 years Appliances, carpeting and equipment 3 to 8 years Impairment of Long-Lived Assets Real estate assets and equipment are stated at depreciated cost. Pursuant to Statement of Financial Accounting Standards Opinion No. 121 "Accounting or the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of", impairment losses are recorded on long- lived assets used in operations on a property by property basis, when events and circumstances indicate that the assets might be impaired and the estimated undiscounted cash flows to be generated by those assets are less than the carrying amount of those assets. Upon determination that an impairment has occurred, those assets shall be reduced to fair value. Deferred Expenses Costs of obtaining and recording mortgages are amortized over the life of the related mortgage notes using the straight-line method which approximates the effective interest method. Income Taxes The Partnership is not liable for federal or state income taxes as Partnership income or loss is allocated to the Partners for income tax purposes. In the event the Partnership's tax returns are examined by the Internal Revenue Service or state taxing authority and the examination results in a change in Partnership taxable income or loss, such change will be reported to the Partners. Reclassifications Certain prior year balances have been reclassified to conform with current year financial statement presentation. Continued KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued C. Mortgage Notes Payable The properties owned by the Partnership are pledged as collateral for the non-recourse mortgage notes outstanding at December 31, 1997 and 1996. Mortgage notes payable consisted of the following:
Annual Principal Interest Property 1997 1996 Rate Maturity Date Brookeville > Apartments $ 8,499,549 $ 8,565,244 7.75% August 1, 2028 Dorsey's Forge Apartments and Oakland Meadows Apartments 4,502,891 4,629,919 9.25% May 3, 2000 Hannibal Grove Apartments 6,123,931 6,296,690 9.25% May 3, 2000 Total $19,126,371$19,491,853
Brookeville Apartments The property is subject to a non-recourse mortgage note in the original amount of $8,755,000, payable to the Department of Housing and Urban Development ("HUD"). The mortgage note requires monthly payments of $60,600 consisting of principal and interest at the rate of 7.75% per annum. In addition, the Partnership is required to fund a monthly deposit of $5,158 to an escrow account to be used for future property replacements and improvements and a mortgage insurance premium deposit equal to .5% per annum of the outstanding principal balance. The note matures on August 1, 2028. In accordance with HUD regulations, distributions are limited to the extent of Surplus Cash, as defined by the Regulatory Agreement. The mortgage note payable is collateralized by the property and may not be prepaid for a period of five years and, thereafter, during the next five years beginning August 1, 1998, may be prepaid subject to a declining prepayment penalty of 5% to 1%, respectively. After August 1, 2003, there is no prepayment penalty. Since the mortgage note cannot be prepaid prior to August 1, 1998, the fair market value cannot be determined. Hannibal Grove Apartments ("Hannibal") and Dorsey's Forge and Oakland Meadows Apartments ("Dorsey's") The properties are subject to non-recourse mortgage notes for Hannibal and Dorsey's in the original amounts of $6,800,000 and $5,000,000, respectively, payable at a rate of 9.25% per annum. Monthly principal and interest payments are $62,333 for Hannibal and $45,833 for Dorsey's. The notes mature on May 3, 2000 at which time all unpaid principal, $5,653,175 (Hannibal) and $4,156,746 (Dorsey's), and any accrued interest are due. The mortgage notes payable are collateralized by the respective properties and the notes may not be prepaid prior to June 1, 1998 and thereafter, may be prepaid subject to a prepayment penalty. The prepayment penalty will be the greater of 1) the principal balance multiplied by the difference between 9.4301% and the yield rate on publicly traded U.S. Treasury Securities having the closest matching maturity date as reported in the Wall Street Journal, or 2) one percent of the then outstanding principal. Continued KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued C.Mortgage Notes Payable, Continued Since the mortgage notes cannot be prepaid prior to June 1, 1998, the fair market value cannot be determined. The aggregate scheduled principal amounts of long-term borrowings due during the five years ending December 31, 2002 are $399,694, $437,124, $10,020,473, $89,480 and $96,667. During 1997, 1996 and 1995 the Partnership paid $1,659,719, $1,690,992 and $1,719,579 of interest, respectively, on its mortgage notes. D.Partners' Deficit Under the terms of the Partnership Agreement, profits and losses from operations are allocated 95% to the Investor Limited Partners, 4% to the Original Limited Partner and 1% to the General Partners until such time that the Investor Limited Partners have received a return of their total invested capital plus a 9% per annum Cumulative Return on Investment thereon and thereafter, 65% to the Investor Limited Partners, 28% to the Original Limited Partner and 7% to the General Partners. Also, under the Partnership Agreement, cash distributions from operations are generally made on the same basis as the allocations of profits and losses described above. Net cash proceeds, as determined by the General Partners, resulting from transactions such as refinancing or sale of a property, are to be distributed as follows: 1) to the Investor Limited Partners until they have received a return of their total Invested Capital; 2) to the Investor Limited Partners until they have received an amount equal to their Cumulative Return on Investment in respect of all fiscal years of the Partnership; 3) to the Original Limited Partner and General Partners until they have received a return of their total Invested Capital; 4) to an unaffiliated brokerage firm (the "Sales Agent") to the extent of any subordinated Financial Consulting Fee then due, and; 5) any remaining Cash Proceeds shall be distributed 65% to the Investor Limited Partners, 28% to the Original Limited Partner and 7% to the General Partners. Notwithstanding anything above, the General Partners shall, under all circumstances, receive at least 1% of all distributions of net cash proceeds from a capital transaction. Per the Partnership Agreement, profits from capital transactions are to be allocated to the extent of cash distributions described above, first to the Investor Limited Partners until they have received a return of their total Invested Capital. Losses from capital transactions are to be allocated to the extent of cash distributions described above, first to the Investor Limited Partners until they have received a return of their total Invested Capital plus their Cumulative Return on Investment. Thereafter, profits and losses from capital transactions are to be allocated in accordance with the Partnership Agreement. Notwithstanding anything above, the General Partners shall be allocated, under all circumstances, at least 1% of all profits and losses from capital transactions. Continued KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued D.Partners' Deficit, Continued For income tax purposes, the allocation of Partnership items is determined according to the Partnership Agreement, to the extent that each allocation has "substantial economic effect" pursuant to the Internal Revenue Code, Section 704. In the event that an allocation does not meet these statutory requirements, Partnership items will be reallocated according to these provisions. For the years 1995 and 1996, reallocation was necessary. The consolidated financial statements presented herein reflect the allocation of net loss in accordance with the rules of the Internal Revenue Code for the years ended December 31, 1995 and 1996. As of December 31, 1997 the following cumulative partner contributions and allocations have been made since the inception of the Partnership:
Investor Original Limited Limited General Partners Partner Partners Total Capital contributions$ 25,000,000$ 4,000 $1,000 $ 25,005,000 Syndication costs (3,486,600) - - (3,486,600) Cash distributions from operations (10,112,121) (425,768) (106,440) (10,644,329) Cash distributions from refinancing proceeds (5,173,000) - (52,252) (5,225,252) Net loss from operations (21,851,313) (880,284) (269,782) (23,001,379) Net income from capital transaction 9,402,667 395,901 98,976 9,897,544 Balance at December 31, 1997$ (6,220,367)$(906,151)$(328,498)$ (7,455,016)
E.Related Party Transactions The Partnership pays property management fees to an affiliate of the General Partners for management services. Pursuant to the management agreements, management fees are payable monthly at a rate of 5% of the gross receipts from the properties under management. The affiliate of the General Partners sold its management agreements to BRI OP Limited Partnership, a subsidiary of Berkshire Realty Company Inc., a publicly traded real estate investment trust and an affiliate of the General Partners, on February 28, 1997. The Partnership also reimburses affiliates of the General Partners for certain expenses incurred in connection with the operation of the Partnership and its properties including administrative expenses. Amounts paid to the General Partners' affiliates during the years ended December 31, 1997, 1996 and 1995 were as follows:
1997 1996 1995 Property management fees $357,766 $326,363 $315,695 Expense reimbursements 179,032 173,132 156,319 Charged to operations $536,798 $499,495 $472,014
Continued KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued F.Federal Income Taxes For federal income tax purposes, the Partnership is depreciating property under the Accelerated Cost Recovery System ("ACRS") and the Modified Accelerated Cost Recovery System ("MACRS"), depending on which is applicable. The reconciliation of the net income loss) reported in the accompanying Consolidated Statement of Operations with the net loss reported in the Partnership's 1997, 1996 and 1995 federal income tax returns is as follows:
1997 1996 1995 Net loss per Consolidated Statement of Operations $ (23,224) $(446,360) $(547,893) Difference in book to tax depreciation and amortization 557,885 221,435 347,827 Net income (loss) for federal income tax purposes$ 534,661$ (224,925) $(200,066) The allocation of the net income for federal income tax purposes for the year ended December 31, 1997 is as follows: Portfolio Passive Income Income Total Investor Limited Partners$ 52,748 $ 455,181 $ 507,929 Original Limited Partner 2,221 19,165 21,386 General Partners 555 4,791 5,346 $ 55,524 $ 479,137 $ 534,661
During the years ended December 31, 1997, 1996 and 1995 the per Unit net income (loss) to the Investor Limited Partners for federal income tax purposes was $21.17, $(8.55) and $(7.60), respectively. The basis of the Partnership's assets for financial reporting purposes exceeds its tax basis by approximately $3,451,000 and $4,010,000 at December 31, 1997 and 1996, respectively. The tax and book basis of the Partnership's liabilities are the same. KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 1997
Costs Capitalized Subsequent to Initial Costs to Partnership Acquisition Buildings Buildings and and Depreciable Description Encumbrances Land Improvements Improvements Life Brookeville Apartments Columbus, OH $ 8,499,549 $ 623,126 $ 8,312,134 $3,822,800 3 to 25 years Hannibal Grove Apartments Columbia, MD 4,502,891 518,519 6,883,945 3,803,869 3 to 25 years Dorsey's Forge & Oakland Meadows Apartments Columbia, MD 6,123,931 340,956 4,521,895 1,909,167 3 to 25 years Total $19,126,371 $1,482,601 $19,717,974 $ 9,535,836 Gross Amounts Carried at End of Year Buildings Year and Accumulated Year Construction Description Land Improvements Total Depreciation Acquired Completed Brookeville Apartments Columbus, OH $ 623,126 $12,134,934 $12,758,060 $ 8,213,896 1983 1975 Hannibal Grove Apartments Columbia, MD 518,519 10,687,814 11,206,333 7,615,275 1983 1970 Dorsey's Forge & Oakland Meadows Apartments Columbia, MD 340,956 6,431,062 6,772,018 4,387,471 1983 1970 Total $1,482,601 $29,253,810 $30,736,411 $20,216,642
Continued KRUPP REALTY FUND, LTD.-III AND SUBSIDIARY SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION, Continued December 31, 1997 Reconciliation of Real Estate and Accumulated Depreciation for each of the three years in the period ended December 31, 1997:
1997 1996 1995 Real Estate Balance at beginning of year$29,786,870$28,790,053 $27,725,950 Acquisition and improvements 949,541 996,817 1,064,103 Balance at end of year $30,736,411 $29,786,870 $28,790,053 Accumulated Depreciation 1997 1996 1995 Balance at beginning of year$18,281,640$16,460,550 $14,767,489 Depreciation expense 1,935,002 1,821,090 1,693,061 Balance at end of year $20,216,642 $18,281,640 $16,460,550
Note: The Partnership uses the cost basis for property valuation for both income tax and financial statement purposes. The aggregate cost for federal income tax purposes at December 31, 1997 is $30,736,411, and the aggregate accumulated depreciation for federal income tax purposes is $23,667,444. EX-27 2
5 This schedule contains summary financial information extracted from Cash Plus V Financial Statements for the year ended December 31, 1997 and is qualified in its entirety by reference to such financial statements. 12-MOS DEC-31-1997 DEC-31-1997 552,221 0 39,568 0 0 936,597 31,255,995 (20,429,613) 12,354,768 683,413 19,126,371 0 0 (7,455,016) 0 12,354,768 0 7,280,181 0 0 5,601,012 0 1,702,393 0 0 0 0 0 0 (23,224) 0 0 Includes all receivables grouped in "Prepaid Expenses and Other Assets" on the Balance Sheet. Includes apartment complexes of $30,736,411 and deferred expenses of $519,584. Includes depreciation of $20,216,642 and amortization of deferred expenses of $212,971. Represents mortgage note payable. Represents total deficit of the General Partners ($328,498) and the Limited Partners ($7,126,518). Includes all revenue of the Partnership. Includes operating expenses of $3,080,142, real estate taxes of $539,978 anf depreciation and amortization of $1,980,892. Net Loss allocated ($232) to the General Partners and ($22,992) to Limited Partners. Net Loss of ($.92) per unit on 25,000 units outstanding.
-----END PRIVACY-ENHANCED MESSAGE-----