-----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, MCplLRnnsjuYW+nb50XgjTm84sIaFZ3XVsG64z57mdceaRVFjsk4WBbKcEc2YdPQ mJ0yE4Ea9q+usjZuDSZhKQ== 0000705752-96-000001.txt : 19961108 0000705752-96-000001.hdr.sgml : 19961108 ACCESSION NUMBER: 0000705752-96-000001 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961107 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENTURY PROPERTIES FUND XIX CENTRAL INDEX KEY: 0000705752 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 942887133 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-11935 FILM NUMBER: 96655674 BUSINESS ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLZ STREET 2: PO BOX 1089 C/O INSIGNIA FINANICAL GROUP CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 8642391513 MAIL ADDRESS: STREET 1: C/O INSIGNIA FINANCIAL GROUP 14TH FL STREET 2: ONE INSIGNIA FINANCIAL PLZ CITY: GREENVILLE STATE: SC ZIP: 29062 10QSB 1 FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 QUARTERLY OR TRANSITIONAL REPORT (As last amended in Rel. No. 312905, eff. 4/26/93.) UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1996 or [ ] 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 0-11935 CENTURY PROPERTIES FUND XIX (Exact name of small business issuer as specified in its charter) California 94-2887133 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) One Insignia Financial Plaza Greenville, South Carolina 29602 (Address of principal executive offices) (Zip Code) Issuer's telephone number (864) 239-1000 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 . PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS a) CENTURY PROPERTIES FUND XIX CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands, except unit data) September 30, 1996
Assets Cash and cash equivalents $ 3,206 Other assets and deferred costs 2,274 Investment properties: Land $ 11,635 Buildings and related personal property 83,155 94,790 Less accumulated depreciation (36,432) 58,358 $ 63,838 Liabilities and Partners' Capital (Deficit) Liabilities Accrued expenses and other liabilities $ 2,166 Mortgage notes payable 61,742 Partners' Capital (Deficit): General partners $ (9,079) Limited partners (89,292 units issued and outstanding) 9,009 (70) $ 63,838 See Accompanying Notes to Consolidated Financial Statements
b) CENTURY PROPERTIES FUND XIX CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except unit data)
Three Months Ended Nine Months Ended September 30, September 30, 1996 1995 1996 1995 Revenues: Rental income $ 3,769 $ 3,618 $ 11,226 $ 10,740 Other income 203 180 584 475 Total revenues 3,972 $ 3,798 11,810 $ 11,215 Expenses: Operating 2,319 2,077 6,261 5,623 Interest 1,285 1,377 3,866 4,534 Depreciation 687 684 2,076 2,053 General and administrative 121 90 340 209 Total expenses 4,412 4,228 12,543 12,419 Net loss before extraordinary loss (440) (430) (733) (1,204) Extraordinary loss on extinguishment of debt -- -- -- (730) Net loss $ (440) $ (430) $ (733) $ (1,934) Net loss allocated to general partners $ (53) $ (51) $ (87) $ (228) Net loss allocated to limited partners (387) (379) (646) (1,706) Net loss $ (440) $ (430) $ (733) $ (1,934) Net loss per limited partnership unit: Net loss before extraordinary loss $ (4.34) $ (4.24) $ (7.23) $ (11.90) Extraordinary loss -- -- -- (7.21) Net loss per limited partnership unit $ (4.34) $ (4.24) $ (7.23) $ (19.11) See Accompanying Notes to Consolidated Financial Statements
c) CENTURY PROPERTIES FUND XIX CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL (DEFICIT) (Unaudited) (in thousands, except unit data)
Limited Partnership General Limited Units Partners Partners Total Original capital contributions 89,292 $ -- $ 89,292 $ 89,292 Partners' (deficit) capital at December 31, 1995 89,292 $(8,992) $ 9,655 $ 663 Net loss for the nine months ended September 30, 1996 -- (87) (646) (733) Partners' (deficit) capital at September 30, 1996 89,292 $ (9,079) $ 9,009 $ (70) See Accompanying Notes to Consolidated Financial Statements
d) CENTURY PROPERTIES FUND XIX CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Nine Months Ended September 30, 1996 1995 Cash flows from operating activities: Net loss $ (733) $ (1,934) Adjustments to reconcile net loss to cash provided by operating activities: Depreciation 2,076 2,053 Amortization 92 256 Extraordinary loss on early extinguishment of debt -- 730 Change in accounts: Other assets and deferred costs (358) (508) Accrued expenses and other liabilities 874 553 Net cash provided by operating activities 1,951 1,150 Cash flows from investing activities: Property improvements and replacements (911) (208) Decrease in restricted cash -- 86 Net cash used in investing activities (911) (122) Cash flows from financing activities: Mortgage principal payments (600) (17,501) Loan costs (102) (255) Notes payable principal payments -- (246) Costs paid to extinguish debt -- (730) Note payable proceeds -- 18,810 Net cash (used in) provided by financing activities (702) 78 Net increase in cash and cash equivalents 338 1,106 Cash and cash equivalents at beginning of period 2,868 218 Cash and cash equivalents at end of period $ 3,206 $ 1,324 Supplemental information: Interest paid $ 3,698 $ 4,869 See Accompanying Notes to Consolidated Financial Statements
e) CENTURY PROPERTIES XIX NOTES TO CONSOLIDATED FINANCIAL STATEMENT (Unaudited) NOTE A - BASIS OF PRESENTATION The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B. 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 Fox Capital Management Corporation, a California corporation ("FCMC" or the "Managing General Partner"), all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine month periods ended September 30, 1996, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 1996. For further information, refer to the financial statements and footnotes thereto included in the Partnership's annual report on Form 10-K for the year ended December 31, 1995. Certain reclassifications have been made to the 1995 information to conform to the 1996 presentation. NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES Century Properties Fund XIX (the "Partnership") has no employees and is dependent on FCMC and its affiliates for the management and administration of all partnership activities. The Partnership Agreement provides for payments to affiliates for services and for reimbursement of certain expenses incurred by affiliates on behalf of the Partnership. Fox Partners II, a California general partnership, is the general partner of the Partnership. The general partners of Fox Partners II are FCMC, Fox Realty Investors ("FRI"), a California general partnership, and Fox Partners 83, a California general partnership. Pursuant to a series of transactions which closed during the first half of 1996, affiliates of Insignia Financial Group, Inc. ("Insignia") acquired (i) control of NPI Equity Investments II, Inc.("NPI Equity"), the managing general partner of FRI, and (ii) all of the issued and outstanding shares of stock of FCMC. NPI Equity is a wholly-owned subsidiary of National Property Investors, Inc. ("NPI"). In connection with these transactions, affiliates of Insignia appointed new officers and directors of NPI Equity and FCMC. The following transactions with affiliates of Insignia, NPI, and affiliates of NPI were charged to expense in 1996 and 1995:
For the Nine Months Ended September 30, 1996 1995 Property management fees (included in operating expenses) $ 552,000 $ 551,000 Reimbursement for services of affiliates (included in general and administrative expenses) $ 157,000 108,000
For the period from January 19, 1996, to September 30, 1996, the Partnership insured its properties under a master policy through an agency and insurer unaffiliated with the Managing General Partner. An affiliate of the Managing General Partner acquired, in the acquisition of a business, certain financial obligations from an insurance agency which was later acquired by the agent who placed the current year's master policy. The current agent assumed the financial obligations to the affiliate of the Managing General Partner who received payments on these obligations from the agent. The amount of the Partnership's insurance premiums accruing to the benefit of the affiliate of the Managing General Partner by virtue of the agent's obligations is not significant. During the nine month period ended September 30, 1995, an affiliate of NPI was paid a $9,000 fee relating to a successful real estate tax appeal on the Partnership's Sandspoint Apartments property. This fee is included in operating expenses. NOTE C - MORTGAGE NOTES PAYABLE On June 29, 1995, the Partnership replaced its maturing mortgage encumbering Greenspoint Apartments with a new first mortgage in the amount of $9,000,000, of which $8,810,000 was released at June 30, 1995, and the remaining $190,000 released pending satisfaction of certain conditions as set by the lender. These funds were released in November 1995. The loan requires monthly payments of approximately $68,000 at 8.33% interest and is being amortized over 30 years. The loan matures on May 15, 2005, with a balloon payment of approximately $7,974,000. The Partnership incurred closing costs of $138,000 in connection with this refinancing. In connection with the satisfaction of its maturing debt, the Partnership paid a $337,000 exit fee at date of closing, which is included as an extraordinary loss on early extinguishment of debt. On June 29, 1995, the Partnership replaced its maturing mortgage encumbering Sandspoint Apartments with a new first mortgage in the amount of $10,000,000. The loan requires monthly payments of approximately $76,000 at 8.33% interest and is being amortized over 30 years. The loan matures on May 15, 2005, with a balloon payment of approximately $8,859,000. A premium is to be calculated under the terms of the mortgage if the loan is prepaid. The Partnership incurred closing costs of $150,000 in connection with this refinancing. In connection with the satisfaction of its maturing debt, the Partnership paid a $393,000 exit fee at date of closing, which is included as an extraordinary loss on early extinguishment of debt. ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The Partnership's investment properties consist of eight apartment complexes. The following table sets forth the average occupancy of the properties for the nine months ended September 30, 1996 and 1995: Average Occupancy Property 1996 1995 Sunrunner Apartments St. Petersburg, Florida 94% 95% Misty Woods Apartments Charlotte, North Carolina 95% 97% McMillan Place Apartments Dallas, Texas 95% 97% Vinings Peak Apartments (formerly Wood Ridge Apartments) Atlanta, Georgia 96% 95% Plantation Crossing Atlanta, Georgia 95% 95% Wood Lake Apartments Atlanta, Georgia 93% 97% Greenspoint Apartments Phoenix, Arizona 93% 96% Sandspoint Apartments Phoenix, Arizona 95% 96% The Partnership's net loss for the three and nine month periods ended September 30, 1996, was approximately $440,000 and $733,000 versus net losses of approximately $430,000 and $1,934,000 for the corresponding periods of 1995. The decrease in the net loss for the nine month period ended September 30, 1996, versus the same period in 1995, is primarily attributable to an increase in revenues in 1996 and the recognition in 1995 of an extraordinary loss on early extinguishment of debt. The increase in net loss for the three month period ended September 30, 1996, versus the same period of 1995, is primarily due to increases in real estate tax assessments at the Partnership's three Atlanta properties. These assessments are under appeal. Both revenues and expenses before extraordinary gain increased during the three months ended September 30, 1996, versus the same periods of 1995. The increase in revenues is mostly due to increases in rental rates at the properties. Although the Partnership had a decrease in interest expense due to several of the properties being refinanced in the latter part of 1995 at lower interest rates, this decrease was more than offset by increases in both operating and general and administrative expenses. The increase in operating expense was caused by increases in expenses intended to enhance the appearance and appeal of the properties such as additional landscaping, exterior painting and gutter replacements. General and administrative expenses increased due to the cost reimbursement increases. As noted in "Item 1, Note B - Transactions with Affiliated Parties," the Partnership reimburses the Managing General Partner and its affiliates for its costs involved in the management and administration of all partnership activities. While overall expense reimbursements have increased during the three and nine month periods ended September 30, 1996, the recurring expenses subsequent to the transition efforts to the new administration are expected to more closely approximate historical levels. The increase in expense reimbursements during the three and nine month periods ended September 30, 1996, is directly attributable to the combined transition efforts of the Greenville, South Carolina, and Atlanta, Georgia, administrative offices during the year- end close, preparation of the 1995 10-K and tax return (including the limited partner K-1's), filing of the first two quarterly reports and transition of asset management responsibilities to the new administration. Finally, on May 10, 1996, there was a fire at Greenspoint Apartments which damaged twelve units. These units are expected to be out of service until December 1996. The damage, net of a $10,000 deductible, and rent loss are covered by insurance. As of September 30, 1996, the Partnership had received approximately $127,000 in proceeds which included funds for repair work and rent loss through the end of September. As part of the ongoing business plan of the Partnership, the Managing 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 expense. As part of this plan, the Managing 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, due to changing market conditions which can result in the use of rental concessions and rental reductions to offset softening market conditions, there is no guarantee that the Managing General Partner will be able to sustain such a plan. At September 30, 1996, the Partnership had unrestricted cash of approximately $3,206,000 as compared to approximately $1,324,000 at September 30, 1995. Net cash provided by operations increased due to an increase in accrued expenses and a decrease in other assets and deferred costs. Cash used in investing activities increased due to an increase in property improvements and replacements. Net cash used in financing activities increased due to the refinancing proceeds received in 1995 (see "Note C"). In 1995, the payoffs of the previous mortgages on the refinanced properties were less than the proceeds from the refinancing of the properties. An affiliate of the Managing General Partner has made available to the Partnership a credit line of up to $150,000 per property owned by the Partnership. The Partnership has no outstanding amounts due under this line of credit. Based on present plans, the Managing General Partner does not anticipate the need to borrow in the near future. Other than cash and cash equivalents, the line of credit is the Partnership's only unused source of liquidity. 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. Such assets are currently thought to be sufficient for any near-term needs of the Partnership. The mortgage indebtedness of approximately $61,742,000 is amortized over varying periods with required balloon payments ranging from January 1997 to January 2006, at which time the properties will either be refinanced or sold. The Managing General Partner expects to be able to refinance the mortgage indebtedness encumbering Sunrunner Apartments which matures in January 1997. The amount of the balloon payment due at maturity is $3,169,000. The Partnership is prohibited from making distributions from operations until the mortgages encumbering McMillan Place Apartments (combined balance of $12,543,000 at September 30, 1996) are satisfied. Future cash distributions will depend on the levels of cash generated from operations, a property sale, and the availability of cash reserves. No cash distributions were paid in 1995 or during the nine months ended September 30, 1996. PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a) Exhibits: Exhibit 27, Financial Data Schedule, is filed as an exhibit to this report. b) Reports on Form 8-K: None filed during the quarter ended September 30, 1996. SIGNATURES In accordance with the requirements of the Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CENTURY PROPERTIES FUND XIX By: FOX PARTNERS II, Its General Partner By: FOX CAPITAL MANAGEMENT CORPORATION, Managing General Partner By: /s/William H. Jarrard, Jr. William H. Jarrard, Jr. President and Director By: /s/Ronald Uretta Ronald Uretta Principal Financial Officer and Principal Accounting Officer Date: November 7, 1996 EX-27 2
5 This schedule contains summary information extracted from Century Properties Fund XIX 1996 Third Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000705752 CENTURY PROPERTIES FUND XIX 1,000 9-MOS DEC-31-1996 SEP-30-1996 3,206 0 0 0 0 0 94,790 (36,432) 63,838 0 61,742 0 0 0 (70) 63,838 0 11,810 0 12,543 0 0 3,866 0 0 0 0 0 0 (733) (7.23) 0 Registrant has an unclassified balance sheet. Multiplier is 1.
-----END PRIVACY-ENHANCED MESSAGE-----