-----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, SHiXsKHmzjVu6bX+/X/xWeY5/wj36NBYV5tr1BZEBrOWpp+dI30RtQqfehqkpZrw wbXHM3bwoInLTllYCZqSSg== 0000705752-97-000006.txt : 19970731 0000705752-97-000006.hdr.sgml : 19970731 ACCESSION NUMBER: 0000705752-97-000006 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970730 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: 97648125 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 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 June 30, 1997 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 Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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) June 30, 1997 Assets Cash and cash equivalents $ 4,082 Other assets and deferred costs 1,901 Restricted escrows 289 Investment properties: Land $ 11,635 Buildings and related personal property 83,796 95,431 Less accumulated depreciation (38,567) 56,864 $63,136 Liabilities and Partners' Capital (Deficit) Liabilities Accrued expenses and other liabilities $ 2,047 Mortgage notes payable (including $12,402 in default) 61,292 Partners' Capital (Deficit): General partners $ (9,095) Limited partners (89,292 units outstanding) 8,892 (203) $63,136 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 Six Months Ended June 30, June 30, 1997 1996 1997 1996 Revenues: Rental income $3,774 $3,704 $7,554 $7,457 Interest income 41 61 74 94 Other income 161 163 332 287 Total revenues 3,976 3,928 7,960 7,838 Expenses: Operating 1,187 1,208 2,356 2,367 General and administration 69 86 153 219 Maintenance 494 636 852 1,036 Depreciation 715 700 1,421 1,389 Interest 1,263 1,290 2,525 2,581 Property taxes 276 263 557 539 Total expenses 4,004 4,183 7,864 8,131 Net income (loss) $ (28) $ (255) $ 96 $ (293) Net income (loss) allocated to general partners $ (4) $ (30) $ 11 $ (34) Net income (loss) allocated to limited partners (24) (225) 85 (259) Net income (loss) $ (28) $ (255) $ 96 $ (293) Net income (loss) per limited partnership unit $ (.28) $(2.52) $ .95 $(2.90) 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, 1996 89,292 $(9,106) $ 8,807 $ (299) Net income for the six months ended June 30, 1997 -- 11 85 96 Partners' (deficit) capital at June 30, 1997 89,292 $(9,095) $ 8,892 $ (203) See Accompanying Notes to Consolidated Financial Statements
d) CENTURY PROPERTIES FUND XIX CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Six Months Ended June 30, 1997 1996 Cash flows from operating activities: Net income (loss) $ 96 $ (293) Adjustments to reconcile net income (loss) to cash provided by operating activities: Depreciation 1,421 1,389 Amortization 66 62 Change in accounts: Other assets and deferred costs (144) 90 Accrued expenses and other liabilities 182 480 Net cash provided by operating activities 1,621 1,728 Cash flows from investing activities Property improvements and replacements (422) (703) Deposits to restricted escrows (152) (227) Withdrawals from restricted escrows 13 29 Net cash used in investing activities (561) (901) Cash flows from financing activities Mortgage principal repayments (376) (389) Loan costs (21) (72) Net cash used in by financing activities (397) (461) Net increase in cash and cash equivalents 663 366 Cash and cash equivalents at beginning of period 3,419 2,868 Cash and cash equivalents at end of period $ 4,082 $ 3,234 Supplemental information: Interest paid $ 2,351 $ 2,450 See Accompanying Notes to Consolidated Financial Statements
e) CENTURY PROPERTIES FUND XIX NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE A - BASIS OF PRESENTATION The accompanying unaudited financial statements of Century Properties Fund XIX (the "Partnership") 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, ("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 six month periods ended June 30, 1997, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 1997. For further information, refer to the financial statements and footnotes thereto included in the Partnership's annual report on Form 10-KSB for the year ended December 31, 1996. Certain reclassifications have been made to the 1996 information to conform to the 1997 presentation. NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES The Partnership has no employees and is dependent on its general partner, Fox Partners II, a California general partnership, and the Managing General Partner, a California Corporation, and their affiliates for the management and administration of all partnership activities. The Partnership Agreement provides for payments to affiliates for services and as reimbursement of certain expenses incurred by affiliates on behalf of the Partnership. The general partners of Fox Partners II are FCMC, Fox Realty Investors ("FRI"), and Fox Partners 83. Pursuant to a series of transactions which closed during the first half of 1996, affiliates of Insignia Financial Group, Inc. ("Insignia") acquired all of the issued and outstanding shares of stock of FCMC, NPI Equity Investments II, Inc. ("NPI Equity"), the managing general partner of FRI, and National Property Investors, Inc. ("NPI"). NPI Equity is a wholly-owned subsidiary of 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 incurred in the six month periods ended June 30, 1997 and 1996 (in thousands): For the Six Months Ended June 30, 1997 1996 Property management fees (included in operating expenses) $369 $363 Reimbursement for services of affiliates (included in general and administrative expenses) 78 142 Since January 19, 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. NOTE C - MORTGAGE NOTES PAYABLE On November 1, 1996, the Partnership refinanced the mortgage on its Sunrunner Apartments with a new first mortgage in the amount of $3,250,000. The loan requires monthly payments of approximately $20,000 at a rate of 7.33% and matures November 1, 2003. The Partnership incurred closing costs and fees of $114,000 in 1996 and $15,000 in 1997. In connection with the Sunrunner refinancing, the Partnership recognized an extraordinary loss on extinguishment of debt of $14,000, consisting primarily of a prepayment penalty. In connection with the refinancing, the property was conveyed from a wholly-owned subsidiary, Century Sunrunner 19, L.P., back to the Partnership. 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 six months ended June 30, 1997 and 1996: Average Occupancy 1997 1996 Sunrunner Apartments St. Petersburg, Florida 94% 94% Misty Woods Apartments Charlotte, North Carolina 91% 95% McMillan Place Apartments Dallas, Texas 96% 95% Vinings Peak Apartments (formerly Wood Ridge Apartments) Atlanta, Georgia 92% 96% Plantation Crossing Atlanta, Georgia 87% 96% Wood Lake Apartments Atlanta, Georgia 93% 93% Greenspoint Apartments Phoenix, Arizona 92% 93% Sandspoint Apartments Phoenix, Arizona 91% 95% The Managing General Partner attributes the decrease in occupancies at Misty Woods, Vinings Peak and Plantation Crossing to soft markets caused by increased competition as a result of newly constructed units, which were in the same market niches as the discussed investment properties. The decrease in occupancy at Sandspoint Apartment was due to staffing issues which have been addressed and resulted in the third quarter of 1997. The Partnership's net income for the six months ended June 30, 1997, was approximately $96,000 versus a net loss of approximately $293,000 for the six months ended June 30, 1996. The Partnership realized net losses for the three months ended June 30, 1997 and 1996 of approximately $28,000 and $255,000, respectively. The increase in net income is primarily attributable to decreases in maintenance and general and administrative expenses and to an increase in other income. The decrease in maintenance expense is primarily due to an exterior rehabilitation project at Vinings Peak Apartments in 1996 to enhance the appearance and appeal of the property. Included in maintenance expense for the six month period ended June 30, 1997 is approximately $187,000 of major repairs and maintenance comprised of major landscaping, window coverings, and exterior building improvements. For the six months ended June 30, 1996, approximately $383,000 of major repairs and maintenance is included in maintenance expense comprised of major landscaping, gutters, and exterior painting. The decrease in general and administrative expense is due to a decrease in expense reimbursements paid to affiliates in 1997. The increased expense reimbursements in 1996 is directly attributable to the combined transition efforts of the Greenville, South Carolina, and Atlanta, Georgia, administrative offices during the 1995 year-end close, preparation of the 1995 10-K and tax return (including the limited partner K-1s), filing of the first two quarterly reports and transition of asset management responsibilities to the new administration. The increase in other income is due to increases in lease cancellation fees and application fees as a result of decreased occupancies at all but three of the investment properties as previously discussed. 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 June 30, 1997, the Partnership had unrestricted cash of approximately $4,082,000 compared to approximately $3,234,000 at June 30, 1996. Net cash provided by operating activities decreased due to a decrease in accrued expenses and other liabilities due to the timing of payments to vendors. Net cash used in investing activities decreased due to a reduction in property improvements and replacements. Net cash used in financing activities decreased due to a decrease in loan costs as a result of the refinancings at the end of 1995 which resulted in loan costs being paid during the six months ended June 30, 1996. The Managing General Partner budgeted $250,000 in 1997 for exterior painting at McMillan Place Apartments, which is to be funded from operations and replacement reserves that the lender is holding. The Partnership has no other material capital programs scheduled to be performed in 1997, although certain routine capital expenditures and maintenance expenses have been budgeted. These capital expenditures and maintenance expenses will be incurred only if cash is available from operations or is received from the capital reserve account. 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, management 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. Mortgage indebtedness of approximately $48,890,000 is amortized over varying periods with required balloon payments ranging from January 2003 to January 2006, at which time the properties will either be refinanced or sold. Additional mortgage indebtedness of approximately $12,402,000, secured by McMillan Place Apartments, is currently in default. The accrued interest on the above indebtedness which is in default is approximately $632,000. The Managing General Partner is currently negotiating with the lender for a seven year extension, however, there is no assurance that an extension will be obtained. If an extension is not obtained, the lender may foreclose on the property. The Partnership is prohibited from making distributions from operations until the mortgages encumbering McMillan Place Apartments are satisfied. No cash distributions were paid in 1996 or during the first six months of 1997. Future cash distributions will depend on the levels of cash generated from operations, a property sale, and the availability of cash reserves. 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 June 30, 1997. 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, A 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: July 30, 1997 EX-27 2
5 This schedule contains summary financial information extracted from Century Properties Fund XIX 1997 Second Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000705752 CENTURY PROPERTIES FUND XIX 1,000 6-MOS DEC-31-1997 JUN-30-1997 4,082 0 0 0 0 0 95,431 38,567 63,136 0 61,292 0 0 0 (203) 63,136 0 7,960 0 0 7,864 0 2,525 0 0 96 0 0 0 96 .95 0 Registrant has an unclassified balance sheet. Multiplier is 1.
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