-----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, Fw79E3d3/3kdbc76lYU5fNcYv3gQeo/kmKfKdGgue8tnUZeAR4B1LbqEtyZ9dX4i CUkVGEvFhhWnJqgMEEswIA== 0000928790-96-000188.txt : 19961016 0000928790-96-000188.hdr.sgml : 19961016 ACCESSION NUMBER: 0000928790-96-000188 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960831 FILED AS OF DATE: 19961015 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HUTTON CONAM REALTY INVESTORS 3 CENTRAL INDEX KEY: 0000711389 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [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: 96643502 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 August 31, 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 of I.R.S. Employer Identification No. Incorporation or Organization 3 World Financial Center, 29th Floor, 10285 New York, NY Attn: Andre Anderson Zip Code Address of Principal Executive Offices (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 August 31, At November 30, 1996 1995 Assets Investments in real estate: Land $5,817,668 $5,817,668 Buildings and improvements 22,284,967 22,164,580 28,102,635 27,982,248 Less accumulated depreciation (10,293,576) (9,645,010) 17,809,059 18,337,238 Cash and cash equivalents 1,179,135 1,060,348 Restricted cash 95,609 61,141 Other assets, net of accumulated amortization of $152,438 in 1996 and $120,176 in 1995 178,050 191,114 Total Assets $19,261,853 $19,649,841 Liabilities and Partners' Capital Liabilities: Mortgages payable $8,468,418 $8,564,859 Distribution payable 222,222 222,222 Accounts payable and accrued expenses 190,891 149,215 Due to general partners and affiliates 40,447 40,519 Security deposits 115,896 109,876 Total Liabilities 9,037,874 9,086,691 Partners' Capital (Deficit): General Partners (880,218) (846,302) Limited Partners 11,104,197 11,409,452 Total Partners' Capital 10,223,979 10,563,150 Total Liabilities and Partners' Capital $19,261,853 $19,649,841 Consolidated Statement of Partners' Capital (Deficit) For the nine months ended August 31, 1996 Limited General Partners Partners Total Balance at November 30, 1995 $11,409,452 $(846,302) $10,563,150 Net income 294,745 32,750 327,495 Cash distributions (600,000) (66,666) (666,666) Balance at August 31, 1996 $11,104,197 $(880,218) $10,223,979 Consolidated Statements of Operations Three months ended Nine months ended August 31, August 31, 1996 1995 1996 1995 Income Rental $908,718 $977,296 $2,745,501 $3,131,082 Interest and other 11,184 47,150 46,543 161,395 Total Income 919,902 1,024,446 2,792,044 3,292,477 Expenses Property operating 386,867 505,094 1,100,374 1,473,186 Depreciation and amortization 227,444 256,865 680,828 820,222 Interest 186,710 212,365 562,242 740,856 General and administrative 41,969 46,093 121,105 114,545 Total Expenses 842,990 1,020,417 2,464,549 3,148,809 Income from operations 76,912 4,029 327,495 143,668 Loss on sale of property _ (83,992) _ (83,992) Net Income (Loss) $76,912 $(79,963) $327,495 $59,676 Net Income (Loss) Allocated: To the General Partners $7,691 $ (437) $32,750 $13,527 To the Limited Partners 69,221 (79,526) 294,745 46,149 $76,912 $(79,963) $327,495 $59,676 Per limited partnership unit: (80,000 outstanding) $.87 $(.99) $3.68 $.58 Consolidated Statements of Cash Flows For the nine months ended August 31, 1996 1995 Cash Flows From Operating Activities: Net income $327,495 $ 59,676 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 680,828 820,222 Loss on sale of property _ 83,992 Increase (decrease) in cash arising from changes in operating assets and liabilities: Fundings to restricted cash (116,782) (114,829) Release of restricted cash to property operations 82,314 99,539 Other assets (19,198) 15,679 Accounts payable and accrued expenses 41,676 82,011 Due to general partners and affiliates (72) 22,389 Security deposits 6,020 (42,621) Net cash provided by operating activities 1,002,281 1,026,058 Cash Flows From Investing Activities: Net proceeds from sale of property _ 3,832,290 Additions to real estate (120,387) (52,071) Net cash provided by (used for) investing activities (120,387) 3,780,219 Cash Flows From Financing Activities: Mortgage principal payments (96,441) (3,002,889) Distributions (666,666) (4,755,555) Net cash used for financing activities (763,107) (7,758,444) Net increase (decrease) in cash and cash equivalents 118,787 (2,952,167) Cash and cash equivalents, beginning of period 1,060,348 4,213,148 Cash and cash equivalents, end of period $1,179,135 $1,260,981 Supplemental Disclosure of Cash Flow Information: Cash paid during the period for interest $562,242 $740,856 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 interim consolidated financial statements include all adjustments which are, in the opinion of management, necessary to present a fair statement of financial position as of August 31, 1996 and the results of operations and cash flows for the nine months ended August 31, 1996 and 1995 and the consolidated statement of partner's capital (deficit) for the nine months ended August 31, 1996. Results of operations for the periods 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 August 31, 1996, the Partnership had cash and cash equivalents of $1,179,135 that were invested in unaffiliated money market funds, an increase of $118,787 from the balance at November 30,1995. The increase is attributable to net cash provided by operating activities exceeding cash used for distributions, mortgage payments, and additions to real estate. The Partnership also maintains a restricted cash balance, which totaled $95,609 at August 31, 1996, representing real estate tax escrows required under the terms of the Autumn Heights and Skyline Village loans. Accounts payable and accrued expenses increased by $41,676 from the corresponding period in 1995 as a result of real estate tax accruals for 1996, partially offset by a decrease in audit fees payable due to the payment of invoices from the prior year. The Partnership expects sufficient cash to be generated from operations to meet its current operating expenses. The General Partners continue to perform various improvements at the properties which include roof repairs at Autumn Heights and exterior painting at Skyline Village. Thus far, the roof repairs at Autumn Heights are complete, with the painting at Skyline Village currently underway. It is expected that this work will be finished by the end of the year. The General Partners will evaluate the need for additional improvement work at the properties on an ongoing basis. The General Partners declared a cash distribution of $2.50 per Unit for the quarter ended August 31, 1996 which will be paid to investors on or about October 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. Results of Operations Partnership operations for the three and nine months ended August 31, 1996, resulted in net income of $76,912 and $327,495, respectively, compared with a net loss of $79,963 and net income of $59,676, respectively, for the corresponding periods in fiscal 1995. The increases in net income for both periods are 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. Also contributing to the net loss for the three month period and lower net income for the nine month period in 1995 was the loss recognized on the sale of the property recorded in the third quarter of 1995. Rental income for the three and nine months ended August 31, 1996 was $908,718 and $2,745,501, respectively, compared with $977,296 and $3,131,082, respectively, in the corresponding periods in fiscal 1995. The decreases reflect the sale of Country Place Village II and a decrease in occupancy at Skyline Village, and are partially offset by increases in rental income at two of the Partnership's other properties due to increased rental rates and, in the case of Ponte Vedra Beach Village II, an increase in occupancy. Interest income totaled $11,184 and $46,543 for the three and nine months ended August 31, 1996, respectively, compared to $47,150 and $161,395 for the corresponding periods in fiscal 1995. The decreases are the result of the Partnership maintaining a lower cash balance in the 1996 periods compared to the 1995 periods. Property operating expenses and depreciation and amortization were lower in the three and nine month periods ended August 31, 1996 compared to the same periods 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 nine months of fiscal 1996 and 1995, average occupancy levels at each of the properties were as follows: Property 1996 1995 Autumn Heights 96% 96% Ponte Vedra Beach Village II 96% 93% Skyline Village 92% 94% 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 - No reports on Form 8-K were filed during the three month period covered by this report. 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: October 14, 1996 BY: /s/ Paul L. Abbott Director, President, Chief Executive Officer and Chief Financial Officer EX-27 2 FINANCIAL DATA SCHEDULE FOR THIRD QUARTER 10-Q HUTTON/CONAM REALTY INVESTORS 3
5 9-mos Nov-30-1996 Aug-31-1996 1,274,744 0 0 0 0 0 28,102,635 10,293,576 19,261,853 569,456 8,468,418 0 0 0 10,223,979 19,261,853 0 2,792,044 0 1,100,374 801,933 0 562,242 0 0 0 0 0 0 327,495 3.68 3.68
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