-----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, O/iSITZVSR0eoVOZrEVjAeSV9gL4Zp8YPT9Q+3Lq63A46gAg3zj90eQpJjvLWGUP Rc5TvksDkmuK1zbg9BWdUA== 0000928790-96-000092.txt : 19960606 0000928790-96-000092.hdr.sgml : 19960606 ACCESSION NUMBER: 0000928790-96-000092 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960229 FILED AS OF DATE: 19960415 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HUTTON CONAM REALTY INVESTORS 3 CENTRAL INDEX KEY: 0000711389 STANDARD INDUSTRIAL CLASSIFICATION: 6500 IRS NUMBER: 133176625 STATE OF INCORPORATION: CA FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-11769 FILM NUMBER: 96547061 BUSINESS ADDRESS: STREET 1: 3 WORLD FINANCIAL CENTER STREET 2: 29TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10285 BUSINESS PHONE: 2125263237 MAIL ADDRESS: STREET 1: 3 WORLD FINANCIAL CENTER STREET 2: 29TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10285 10-Q 1 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 February 29, 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: 0-11769 HUTTON/CONAM REALTY INVESTORS 3 Exact Name of Registrant as Specified in its Charter California 13-3176625 - - --------------------------- --------------------------------- State or Other Jurisdiction I.R.S. Employer Identification No. of Incorporation or Organization 3 World Financial Center, 29th Floor, New York, NY Attn: Andre Anderson 10285 - - ------------------------------------ -------- Address of Principal Executive Offices Zip Code (212) 526-3237 ------------------------- 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. Yes X No ----- ----- Consolidated Balance Sheets At February 29, At November 30, 1996 1995 Assets ---------- ---------- Investment in real estate: Land $ 5,817,668 $ 5,817,668 Building and improvements 22,164,580 22,164,580 ---------- ---------- 27,982,248 27,982,248 ---------- ---------- Less accumulated depreciation (9,859,395) (9,645,010) ---------- ---------- 18,122,853 18,337,238 ---------- ---------- Cash and cash equivalents 1,117,901 1,060,348 Restricted cash 83,385 61,141 Other assets, net of accumulated amortization of $130,930 in 1996 and $120,176 in 1995 178,419 191,114 ---------- ---------- Total Assets $19,502,558 $19,649,841 ========== ========== Liabilities and Partners' Capital Liabilities: Mortgages payable $ 8,533,410 $ 8,564,859 Distribution payable 222,222 222,222 Accounts payable and accrued expenses 150,900 149,215 Due to general partners and affiliates 32,002 40,519 Security deposits 110,372 109,876 ---------- ---------- Total Liabilities 9,048,906 9,086,691 ========== ========== Partners' Capital (Deficit): General Partners (857,252) (846,302) Limited Partners 11,310,904 11,409,452 ---------- ---------- Total Partners' Capital 10,453,652 10,563,150 ---------- ---------- Total Liabilities and Partners' Capital $19,502,558 $19,649,841 ========== ========== Consolidated Statement of Partners' Capital (Deficit) For the three months ended February 29, 1996 Limited General Partners Partners Total ---------- -------- ---------- Balance at November 30, 1995 $11,409,452 $(846,302) $10,563,150 Net income 101,452 11,272 112,724 Distributions (200,000) (22,222) (222,222) ---------- -------- ---------- Balance at February 29, 1996 $11,310,904 $(857,252) $10,453,652 ========== ======== ========== Consolidated Statements of Operations For the three months ended February 29 and February 28, 1996 1995 Income ------- --------- Rental income $923,946 $1,069,833 Interest income 12,673 54,273 ------- --------- Total Income 936,619 1,124,106 Expenses Property operating $365,982 $511,550 Depreciation and amortization 225,139 285,077 Interest 188,112 264,640 General and administrative 44,662 32,778 ------- --------- Total Expenses 823,895 1,094,045 ------- --------- Net Income $112,724 $ 30,061 ======= ========= Net Income Allocated: To the General Partners $ 11,272 $ 3,006 To the Limited Partners 101,452 27,055 ------- --------- $112,724 $ 30,061 Per limited partnership unit: ------- --------- (80,000 outstanding) $1.27 $.34 ===== ==== Consolidated Statements of Cash Flows For the three months ended February 29 and February 28, 1996 1995 - - ------------------------------------------------------------------------------- Cash Flows From Operating Activities: Net income $112,724 $30,061 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 225,139 285,077 Increase (decrease) in cash arising from changes in operating assets and liabilities: Funding to restricted cash (38,257) (64,454) Release of restricted cash to property operations 16,013 26,229 Other assets 1,941 13,679 Accounts payable and accrued expenses 1,685 31,979 Due to general partners and affiliates (8,517) 381 Security deposits 496 (3,520) ------- ------- Net cash provided by operating activities 311,224 319,432 - - ------------------------------------------------------------------------------- Cash Flows From Investing Activities: Additions to real estate -- (52,071) ------- ------- Net cash used for investing activities -- (52,071) - - ------------------------------------------------------------------------------- Cash Flows From Financing Activities: Mortgage principal payments (31,449) (34,902) Distributions (222,222) (311,111) ------- ------- Net cash used for financing activities (253,671) (346,013) - - ------------------------------------------------------------------------------- Net increase (decrease) in cash and cash equivalents 57,553 (78,652) Cash and cash equivalents, beginning of period 1,060,348 4,213,148 --------- --------- Cash and cash equivalents, end of period $1,117,901 $4,134,496 Supplemental Disclosure of Cash Flow Information Cash paid during the period for interest $ 188,112 $ 264,640 --------- --------- Notes to the Consolidated Financial Statements The unaudited interim consolidated financial statements should be read in conjunction with the Partnership's annual 1995 audited consolidated financial statements within Form 10-K. The unaudited consolidated financial statements include all adjustments which are, in the opinion of management, necessary to present a fair statement of financial position as of February 29, 1996 and the results of operations and cash flows for the three months ended February 29, 1996 and February 28, 1995 and the statement of changes in partners' capital (deficit) for the three months ended February 29, 1996. Results of operations for the period are not necessarily indicative of the results to be expected for the full year. No significant events have occurred subsequent to fiscal year 1995, and no material contingencies exist which would require disclosure in this interim report per Regulation S-X, Rule 10-01, Paragraph (a)(5). Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources - - ------------------------------- At February 29, 1996, the Partnership had cash and cash equivalents of $1,117,901, which were invested in unaffiliated money market funds, relatively unchanged from the balance at November 30, 1995. The Partnership also maintains a restricted cash balance, which totaled $83,385 at February 29, 1996, representing real estate tax escrows required under the terms of the Autumn Heights and Skyline Village loans. The Partnership expects sufficient cash to be generated from operations to meet its current operating expenses. During 1996, the General Partners are implementing an extensive improvement program to upgrade the properties. This program, which includes roof repairs at all three properties and asphalt repairs at Autumn Heights and Ponte Vedra Beach II, is intended to protect each property's position within their respective markets, which are growing increasingly competitive with the addition of new apartment properties and position the property for increases in revenue and market value. These improvements will be funded from the Partnership's cash reserves. The General Partners declared a cash distribution of $2.50 per Unit for the quarter ended February 29, 1996 which will be paid to investors on or about April 15, 1996. The level of future distributions will be evaluated on a quarterly basis and will depend on the Partnership's operating results and future cash needs. It is anticipated that cash from reserves may be required to fund a portion of the distributions during 1996 as a result of the property improvements required. Results of Operations - - --------------------- Partnership operations for the three months ended February 29, 1996, resulted in net income of $112,724 compared with $30,061 in the first quarter of fiscal 1995. The increase in net income for the three months ended February 29, 1996 is due primarily to reductions in property operating expense, depreciation and amortization, and interest expense resulting from the sale of Country Place Village II in July 1995. Net cash provided by operating activities was $311,224 for the three months ended February 29, 1996 virtually unchanged from $319,432 for the same period in fiscal 1995. Rental income for the three months ended February 29, 1996 was $923,946 compared with $1,069,833 in the first quarter of fiscal 1995. The decrease reflects the sale of Country Place Village II, partially offset by increases in rental income at the three remaining properties due to increased rental rates. Interest income totaled $12,673 for the three months ended February 29, 1996 compared to $54,273 in the first quarter of fiscal 1995. The decrease is the result of the Partnership maintaining a lower cash balance in the 1996 period compared to the 1995 period. Property operating expenses and depreciation and amortization were lower in the first quarter of fiscal 1996 compared to the same period in fiscal 1995 due to the July 1995 sale of Country Place Village II. Interest expense also declined due to the June 1995 repayment of the Country Place Village II mortgage. During the first three months of fiscal 1996 and 1995, average occupancy levels at each of the properties were as follows: Property 1996 1995 -------- ---- ---- Autumn Heights 97% 96% Ponte Vedra Beach Village II 96% 94% Skyline Village 95% 97% Part II Other Information Items 1-5 Not applicable. Item 6 Exhibits and reports on Form 8-K. (a) Exhibits - (27) Financial Data Schedule (b) Reports on Form 8-K - On March 15, 1996, based upon, among other things, the advice of Partnership counsel, Skadden, Arps, Slate, Meagher & Flom, the General Partners adopted a resolution that states, among other things, if a Change of Control (as defined below) occurs, the General Partners may distribute the Partnership's cash balances not required for its ordinary course day-to-day operations. "Change of Control" means any purchase or offer to purchase more than 10% of the Units that is not approved in advance by the General Partners. In determining the amount of the distribution, the General Partners may take into account all material factors. In addition, the Partnership will not be obligated to make any distribution to any partner and no partner will be entitled to receive any distribution until the General Partners have declared the distribution and established a record date and distribution date for the distribution. The Partnership filed a form 8-K disclosing this resolution on March 21, 1996. 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. HUTTON/CONAM REALTY INVESTORS 3 BY: RI 3-4 Real Estate Services, Inc. General Partner Date: April 15, 1996 BY: /s/ Paul L. Abbott Director, President, Chief Executive Officer and Chief Financial Officer EX-27 2 FINANCIAL DATA SCHEDULE FOR FIRST QUARTER 10-Q HUTTON/CONAM REALTY INVESTORS 3
5 3-mos Nov-30-1996 Feb-29-1996 1,201,286 0 0 0 0 0 27,982,248 9,859,395 19,502,558 182,902 8,533,410 0 0 0 10,453,652 19,502,558 0 936,619 0 365,982 269,801 0 188,112 0 0 0 0 0 0 112,724 1.27 1.27
-----END PRIVACY-ENHANCED MESSAGE-----