-----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, WyRRrfXuBiM1Ko+IrckX7h8kh+t36p0nIXAMoDW4wrmYW2dXS+RA6i0iRfpRlN5J V20Bl6ecpqRBOXjR9ixFNA== 0001047469-99-027423.txt : 19990715 0001047469-99-027423.hdr.sgml : 19990715 ACCESSION NUMBER: 0001047469-99-027423 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990531 FILED AS OF DATE: 19990714 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONAM REALTY INVESTORS 3 L P 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: SEC FILE NUMBER: 000-11769 FILM NUMBER: 99664098 BUSINESS ADDRESS: STREET 1: 1764 SAN DIEGO AVE STREET 2: ATTN: ROBERT J SVATOS CITY: SAN DIEGO STATE: CA ZIP: 92100 BUSINESS PHONE: 2125263237 MAIL ADDRESS: STREET 1: 3 WORLD FINANCIAL CENTER STREET 2: 29TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10285 FORMER COMPANY: FORMER CONFORMED NAME: HUTTON CONAM REALTY INVESTORS 3 DATE OF NAME CHANGE: 19920703 10-Q 1 10-Q 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 MAY 31, 1999 or Transition Report Pursuant to Section 13 of 15(d) - ------------ of the Securities Exchange Act of 1934 For the transition period from ____ to ____ COMMISSION FILE NUMBER: 0-11769 CONAM REALTY INVESTORS 3 L.P. ----------------------------- 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 1764 San Diego Avenue San Diego, CA 92110 Attn. Robert J. Svatos 92110-1906 - -------------------------------------------- ---------- ADDRESS OF PRINCIPAL EXECUTIVE OFFICES ZIP CODE (619) 297-6771 -------------- 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 --- --- CONAM REALTY INVESTORS 3 L.P. AND CONSOLIDATED VENTURES PART I - FINANCIAL INFORMATION ITEM 1. Financial Statements
------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ CONSOLIDATED BALANCE SHEETS AT MAY 31, AT NOVEMBER 30, 1999 1998 ------------------------------------------------------------------------------------------------------------------------ ASSETS Investments in real estate: Land $ - $ 5,817,668 Buildings and improvements - 22,534,407 ----------------------------------------------- - 28,352,075 Less accumulated depreciation - (12,020,027) ----------------------------------------------- - 16,332,048 Cash and cash equivalents 728,144 849,125 Restricted cash - 107,640 Other assets, net of accumulated amortization of $0 in 1999 and $249,225 in 1998 - 143,646 ------------------------------------------------------------------------------------------------------------------------ TOTAL ASSETS $ 728,144 $ 17,432,459 ======================================================================================================================== LIABILITIES AND PARTNERS' CAPITAL Liabilities: Mortgages payable - 8,151,572 Accounts payable and accrued expenses 195,441 302,618 Due to general partner and affiliates - 15,684 Security deposits - 98,029 ----------------------------------------------- Total Liabilities 195,441 8,567,903 ----------------------------------------------- Partners' Capital (Deficit) General Partner 34,450 (995,408) Limited Partners (80,000 Units outstanding) 498,253 9,859,964 ----------------------------------------------- Total Partners' Capital 532,703 8,864,556 ------------------------------------------------------------------------------------------------------------------------ TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 728,144 $ 17,432,459 ========================================================================================================================
SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS. CONAM REALTY INVESTORS 3 L.P. AND CONSOLIDATED VENTURES
--------------------------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------------------- CONSOLIDATED STATEMENTS OF OPERATIONS THREE MONTHS ENDED SIX MONTHS ENDED MAY 31, MAY 31, 1999 1998 1999 1998 --------------------------------------------------------------------------------------------------------------------------- INCOME Rental $ - $ 911,646 $ 559,979 $ 1,815,206 Interest and other 16,109 1,869 86,996 5,243 ------------------------------------------------------------------------- Total Income 16,109 913,515 646,975 1,820,449 --------------------------------------------------------------------------------------------------------------------------- EXPENSES Property operating - 450,879 369,131 900,104 Depreciation and amortization - 229,366 131,952 459,086 Interest - 181,288 119,545 363,402 General and administrative 50,755 61,493 79,336 102,323 Write-off of assets - - 10,124 16,887 ------------------------------------------------------------------------- Total Expenses 50,755 923,026 710,088 1,841,802 --------------------------------------------------------------------------------------------------------------------------- Loss from operations (34,646) (9,511) (63,113) (21,353) Gain on sale of properties - - 8,346,297 - --------------------------------------------------------------------------------------------------------------------------- NET INCOME (LOSS) $(34,646) $ (9,511) $ 8,283,184 $ (21,353) =========================================================================================================================== NET INCOME (LOSS) ALLOCATED: To the General Partner $ (346) $ (95) $ 1,044,895 $ (213) To the Limited Partners (34,300) (9,416) 7,238,289 (21,140) --------------------------------------------------------------------------------------------------------------------------- NET INCOME (LOSS) $(34,646) $ (9,511) $ 8,283,184 $ (21,353) =========================================================================================================================== PER LIMITED PARTNERSHIP UNIT (80,000 UNITS OUTSTANDING) Loss from operations $ (0.43) $ (0.12) $ (0.78) $ (0.26) Gain on sale of properties - - 91.26 - --------------------------------------------------------------------------------------------------------------------------- NET INCOME (LOSS) $ (0.43) $ (0.12) $ 90.48 $ (0.26) ===========================================================================================================================
------------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------------------------------------------------------------ CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL FOR THE SIX MONTHS ENDED MAY 31, 1999 GENERAL LIMITED PARTNER PARTNERS TOTAL ------------------------------------------------------------------------------------------------------------------------ BALANCE (DEFICIT) AT NOVEMBER 30, 1998 $ (995,408) $ 9,859,964 $ 8,864,556 Net income 1,044,895 7,238,289 8,283,184 Distributions ($207.50 per Limited Partner Unit) (15,037) (16,600,000) (16,615,037) ------------------------------------------------------------------------------------------------------------------------ BALANCE AT MAY 31, 1999 $ 34,450 $ 498,253 $ 532,703 ========================================================================================================================
SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS. CONAM REALTY INVESTORS 3 L.P. AND CONSOLIDATED VENTURES
------------------------------------------------------------------------------------------------------------------------ CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED MAY 31, 1999 1998 ------------------------------------------------------------------------------------------------------------------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ 8,283,184 $ (21,353) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 131,952 459,086 Write-off of assets 10,124 16,887 Gain on sale of properties (8,346,297) - Increase (decrease) in cash arising from changes in operating assets and liabilities: Fundings to restricted cash (19,344) (78,269) Release of restricted cash to property operations 126,984 75,079 Other assets 86,126 (41,356) Accounts payable and accrued expenses (107,177) 37,018 Due to general partner and affiliates (15,684) (1,393) Security deposits (98,029) (112) --------------------------------------- Net cash provided by operating activities 51,839 445,587 ------------------------------------------------------------------------------------------------------------------------ CASH FLOWS FROM INVESTING ACTIVITIES: Additions to real estate (90,479) (85,417) Net proceeds from sale of real estate 24,684,268 54,191 --------------------------------------- Net cash provided by (used in) investing activities 24,593,789 (31,226) ------------------------------------------------------------------------------------------------------------------------ CASH FLOWS FROM FINANCING ACTIVITIES: Mortgage principal payments (8,151,572) (67,551) Distributions (16,615,037) (279,992) --------------------------------------- Net cash used in financing activities (24,766,609) (347,543) ------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in cash and cash equivalents (120,981) 66,818 Cash and cash equivalents, beginning of period 849,125 796,824 ------------------------------------------------------------------------------------------------------------------------ CASH AND CASH EQUIVALENTS, END OF PERIOD $ 728,144 $ 863,642 ======================================================================================================================== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for interest $ 179,308 $ 329,123 ------------------------------------------------------------------------------------------------------------------------ SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITIES: Write-off of buildings and improvements $ (22,837) $ (38,740) Write-off of accumulated depreciation $ 12,713 $ 21,853 ------------------------------------------------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS. CONAM REALTY INVESTORS 3 L.P. AND CONSOLIDATED VENTURES ------------------------------------------------------------------------- ------------------------------------------------------------------------- NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS The unaudited interim consolidated financial statements should be read in conjunction with the Partnership's annual 1998 audited consolidated financial statements within Form 10-K. The unaudited interim consolidated financial statements include all normal and recurring adjustments which are, in the opinion of management, necessary to present a fair statement of financial position as of May 31, 1999 and the results of operations for the three and six months ended May 31, 1999 and 1998, cash flow for the six months ended May 31, 1999 and 1998, and the consolidated statement of partners' capital for the six months ended May 31, 1999. Results of operations are not necessarily indicative of the results to be expected for the full year. The Partnership has sold its remaining investments in real estate. The sale and liquidation plan was approved by the Unitholders through a consent solicitation statement as of January 15, 1999 and the sale of the properties was completed on January 29, 1999. For assets sold or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in net income for the period. Within 30 days of the completion of the sale of the properties, the Partnership declared a cash distribution representing substantially all of the net proceeds from sale and substantially all of the remaining cash from operations of the Partnership less an amount for costs and contingencies associated with the sale and liquidation of the Partnership. Certain first quarter 1999 amounts have been reclassified to conform with the presentation adopted in the current quarter. No other significant events have occurred subsequent to fiscal year 1998, and no material contingencies exist, which would require disclosure in this interim report per Regulation S-X, Rule 10-01, Paragraph (a) (5). CONAM REALTY INVESTORS 3 L.P. AND CONSOLIDATED VENTURES ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations LIQUIDITY AND CAPITAL RESOURCES On February 26, 1999, the Partnership declared a cash distribution in the amounts of $16,600,000 to the Limited Partner Unitholders ($207.50 per Unit) and $15,037 to the General Partner, which amounts were equal to substantially all of the net proceeds from the sale (the "Sale") of the Partnership's remaining investments in real estate ("Properties") together with other available cash from operations of the Partnership less an amount for costs associated with the liquidation of the Partnership and other contingencies. As a result of the Sale and distribution, cash and cash equivalents comprise all of the remaining assets of the Partnership. The General Partner believes that the Partnership has sufficient cash to meet the needs of the Partnership for any contingencies or costs associated with the Sale and the final liquidation of the Partnership. As a result of the Sale of the remaining Properties, the only source of revenue prior to final liquidation will be the interest generated on the remaining cash balances. The remaining cash is invested in an unaffiliated highly liquid money market fund. At May 31, 1999, the Partnership had cash and cash equivalents of $728,144 compared with $849,125 at November 30, 1998. The decrease in cash and cash equivalents is due to the Sale of the Properties and the subsequent distribution of substantially all of the net proceeds thereof and other Partnership cash. Remaining cash available, if any, after the satisfaction of all Partnership obligations will be distributed pursuant to the Partnership agreement. RESULTS OF OPERATIONS Partnership net income (loss) for the three and six months ended May 31, 1999 was ($34,646) and $8,283,184, respectively, compared to ($9,511) and ($21,353) for the corresponding periods in fiscal 1998. The increased loss for the three months ended May 31, 1999 is primarily attributable to the lack of income due to the Sale of the Properties. The increase in income for the six month period is primarily attributable to the gain on the Sale. The Partnership generated operating losses for the three and six months ended May 31, 1999 of ($34,646) and ($63,113), respectively, compared to ($9,511) and ($21,353), respectively, for the corresponding periods in fiscal 1998. Total income for the three and six months ended May 31, 1999 totaled $16,109 and $646,975, respectively, compared with $913,515 and $1,820,449, respectively, for the corresponding period in fiscal 1998. The decreased total income is primarily attributable to the decrease in rental income attributable to the Sale on January 29, 1999, partially offset by interest income earned on the proceeds from the Sale prior to distributions to the Unitholders. Total expenses for the three and six months ended May 31, 1999 were $50,755 and $710,088, respectively, compared to $923,026 and $1,841,802, respectively, for the corresponding periods in fiscal 1998. The decrease in total expenses is primarily attributable to the Sale. General and administrative expenses for the three and six months ended May 31, 1999 were $50,755 and $79,336, respectively, compared to $61,493 and $102,323, respectively, for the corresponding periods in fiscal 1998. The decrease in general and administrative expenses is primarily attributable to lower fees charged for printing, mailing and investor relations. YEAR 2000 Due to the consummation of the Sale, the Partnership is no longer engaged in the operation of real properties or any other business. As a result of the foregoing, and in view of the General Partner's plan to complete the full liquidation of the Partnership prior to January 1, 2000, the Partnership has no exposure to Year 2000 issues. CONAM REALTY INVESTORS 3 L.P. AND CONSOLIDATED VENTURES ITEM 3. Quantitative and Qualitative Disclosures About Market Risks Due to the consummation of the Sale and its mortgage indebtedness was repaid or assumed, the Partnership has no exposure to interest rate risk. In addition, the Partnership is expected to be liquidated during 1999. PART II - OTHER INFORMATION ITEMS 1-5. Not applicable ITEM 6. Exhibits & Reports on Form 8-K (a)Exhibits 3.1 Amendment, dated January 18, 1999 to Partnership's Certificate and Agreement of Limited Partnership (included as, and incorporated herein by reference to, Exhibit 4.1 to the Partnership's Report on Form 8-K filed on February 16, 1999). 10.1 Agreement for Purchase and Sale and Joint Escrow Instructions between ConAm Realty Investors 3 LP and DOC Investors, L.L.C. dated January 26, 1999 with respect to the Sale of Autumn Heights Apartments (included as, and incorporated herein by reference to, Exhibit 10.1 to the Partnership's Report on Form 8-K filed on February 16, 1999). 10.2 Agreement for Purchase and Sale and Joint Escrow Instructions between ConAm Realty Investors 3 LP and DOC Investors, L.L.C. dated January 26, 1999 with respect to the Sale of Ponte Vedra Beach Village II Apartments (included as, and incorporated herein by reference to, Exhibit 10.2 to the Partnership's Report on Form 8-K filed on February 16, 1999). 10.3 Agreement for Purchase and Sale and Joint Escrow Instructions between Skyline Village Joint Venture Limited Partnership and DOC Investors, L.L.C. dated January 26, 1999 with respect to the Sale of Skyline Village (included as, and incorporated herein by reference to, Exhibit 10.3 to the Partnership's Report on Form 8-K filed on February 16, 1999). (b)Reports on Form 8-K No reports on Form 8-K were filed during the quarter ended May 31, 1999. (27)Financial Data Schedule 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 hereunto duly authorized. CONAM PROPERTY SERVICES IV, LTD. General Partner of ConAm Realty Investors 3 L.P. BY: CONTINENTAL AMERICAN DEVELOPMENT, INC. GENERAL PARTNER Date: July 13, 1999 BY:/s/ DANIEL J. EPSTEIN Daniel J. Epstein Director, President, and Principal Executive Officer Date: July 13, 1999 BY:/s/ ROBERT J. SVATOS Robert J. Svatos Vice President and Director EX-27 2 EXHIBIT 27
5 6-MOS NOV-30-1999 DEC-01-1998 MAY-31-1999 728,144 0 0 0 0 0 0 0 728,144 195,441 0 0 0 0 532,703 728,144 559,979 646,975 0 369,131 221,412 0 119,545 (63,113) 0 (63,113) 0 0 0 8,283,184 90.48 90.48
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