-----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, CGhG0oNWn1PIeUwiASMwr+iEZKLfQPCt+Seg2oAEG4VjoVk5Q5NC1UHA/RcU4a3c Ep7MKa9XdNFdyfydAL6Llg== 0000711512-97-000010.txt : 19970725 0000711512-97-000010.hdr.sgml : 19970725 ACCESSION NUMBER: 0000711512-97-000010 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970724 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN REPUBLIC REALTY FUND I CENTRAL INDEX KEY: 0000711512 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 391421936 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-11578 FILM NUMBER: 97644702 BUSINESS ADDRESS: STREET 1: 6210 CAMPBELL RD STREET 2: STE 140 CITY: DALLAS STATE: TX ZIP: 75248 BUSINESS PHONE: 2143808000 MAIL ADDRESS: STREET 1: 6210 CAMPBELL RD STREET 2: STE 140 CITY: DALLAS STATE: TX ZIP: 75248 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ________________________ FORM 10-Q Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 ________________________________________ For Quarter Ended June 30, 1997 Commission file number 0-11578 AMERICAN REPUBLIC REALTY FUND I (Exact name of registrant as specified in its charter) WISCONSIN 39-1421936 ____________ ___________ (State or other jurisdiction (IRS Employer incorporation or organization) Identification Number) 6210 Campbell Road Suite 140 Dallas, Texas 75248 (Address of principal executive offices) Registrant's telephone number, including area code: (972)380-8000. 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:___Y__ No______ REGISTRANT IS A LIMITED PARTNERSHIP TABLE OF CONTENTS Item 1. Financial Statements The following Unaudited financial statements are filed herewith: Consolidated Balance Sheet as of June 30, 1997 and December 31, 1996 Page 3 Consolidated Statements of Operations for the Three Months Ended June 30, 1997 and 1996 Page 4 Consolidated Statements of Cash Flows for the Three Months Ended June 30, 1997 and 1996 Page 5 Item 2. Results of Operations and Management's Discussion and Analysis of: Financial Condition Page 6-7 Liquidity and Capital Resources Page 8 Other Information Page 9 Signatures Page 10 The statements, insofar as they relate to the period subsequent to December 31, 1996, are Unaudited. PART 1. FINANCIAL INFORMATION Item 1. Financial Statements _____________________________ AMERICAN REPUBLIC REALTY FUND I Condensed Consolidated Balance Sheets June December 30, 31, 1997 1996 __________ __________ (Unaudited) ASSETS Real Estate assets, at cost Land $1,822,718 1,822,718 Buildings and improvements 14,994,509 14,994,509 __________ ___________ 16,817,227 16,817,227 Less Accumulated depreciation (8,699,635) (8,397,635) ____________ ____________ Real Estate,net 8,117,592 8,419,592 Cash including cash investments 61,668 23,211 Escrow deposits 232,213 182,966 Prepaid Expenses 58,606 19,614 __________ __________ TOTAL ASSETS $8,470,079 $8,645,383 ============ ============ LIABILITIES AND PARTNERS'EQUITY: LIABILITES Mortgage and notes payable $6,889,368 $7,239,679 Note Payable to affiliates 2,935,310 2,935,310 Amounts due affiliates 1,115,169 1,282,696 Real estate taxes payable 133,156 0 Security deposits 50,325 45,746 Accounts payable & accrued expenses 147,198 117,202 ____________ ____________ Total liabilities 11,270,526 11,620,633 ____________ ____________ PARTNERS CAPITAL(DEFICIT) Limited Partners (2,858,137) (3,031,192) General Partner 57,690 55,942 ___________ ___________ Total Partners capital(Deficit) (2,800,447) (2,975,250) ___________ ___________ TOTAL LIABILITIES AND PARTNER DEFICIT $8,470,079 $8,645,383 ============= ============ See notes to Condensed Consolidated Financial Statements AMERICAN REPUBLIC REALTY FUND I Condensed Consolidated Statement of Operations (Unaudited) Three Months Ended Six Months Ended June 30, June 30, ------------------- ----------------- REVENUES 1997 1996 1997 1996 ---- ---- ---- ---- Rental income $635,855 $581,766 1,235,634 1,177,098 Other property 15,006 11,269 23,990 17,960 ---------- --------- --------- --------- Total revenues 650,861 593,035 1,259,624 1,195,058 EXPENSES Salaries & wages 77,361 75,639 140,638 138,462 Maintenance & repairs 58,787 74,980 111,518 109,220 Utilities 41,075 48,000 93,011 92,590 Real estate taxes 66,900 60,900 133,800 121,800 General administrative 21,889 21,895 29,421 42,369 Contract services 31,339 27,020 59,465 47,234 Insurance 13,649 11,543 25,747 22,864 Interest 64,540 67,370 126,267 135,850 Depreciation and amortization 151,000 155,000 302,000 310,000 Property management fees (a) 32,535 29,688 62,954 59,783 -------- -------- -------- -------- Total expenses 559,075 572,035 1,084,821 1,080,172 NET INCOME (LOSS) $91,786 $21,000 $174,803 $114,886 ========= ========= ========== ========== NET INCOME PER UNITS $ 8.34 $ 1.91 $ 15.89 $ 10.44 ======== ======== ========= ======== See Notes to Condensed Consolidated Financial Statements AMERICAN REPUBLIC REALTY FUND I Condensed Consolidated Statement of Cash Flows Six Months Ended June 30, ---------------- 1997 1996 ----- ----- CASH FLOWS FROM OPERATING ACITIVTY Net income (loss) $174,803 $114,886 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 302,000 310,000 Net Effect of changes in operating accounts Escrow deposits (49,247) (133,704) Prepaid expenses (38,992) (26,661) Accrued real estate taxes 133,156 107,800 Security deposits 4,579 3,700 Accounts payable 29,996 55,559 Other assets 0 (24,756) -------- --------- Net cash provided by (used for)operating activities 556,295 406,824 -------- --------- CASH FLOWS FROM INVESTING ACTIVITES Repayment of mortgage notes payable (350,311) (377,414) Repayment of notes payable to affiliates 0 0 Proceeds from amounts due affiliates (167,527) (89,598) Repayment of amounts due affiliates 0 57,738 --------- ---------- Net cash used for investing activities (517,838) (409,274) ---------- ---------- NET INCREASE (DECREASE) IN CASH AND CASH 38,457 (2,450) EQUVILENTS CASH AND CASH EQUIVELNTS, BEGINNING OF PERIOD 23,211 19,047 --------- --------- CASH AND CASH EQUIVELNTS, END OF PERIOD $61,668 $16,597 ========= ========= See Notes to Condensed Consolidated Financial Statements Basis of Presentation: - --------------------- Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Partnership believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Partnership's latest annual report on Form 10-K. Item 2.RESULTS OF OPERATIONS AND MANAGEMENT'S DISCUSSION AND ANALYSIS ------------------------------------------------------------- OF FINANCIAL CONDITION ---------------------- FIRST SIX MONTHS 1997 COMPARED TO FIRST SIX MONTHS 1996 - ------------------------------------------------------- At June 30, 1997 the Partnership owned two properties with approximately 416,623 net rentable square feet. Both properties are apartment communities. The portfolio had an average occupancy of 93.70% for the first six months of 1997, as compared to 93.75% for the first six months of 1996. Revenue from property operations increased $64,566, or 5.40%, for the first six months of 1997, as compared to the 1996 first six months. The increase in other income of $6,030 or 33.57% is primarily due to a increase in late and returned check charges over the prior year. The following table illustrates the components: Increase (Decrease) ----------------- Rental income $58,536 4.97% Other property 6,030 33.57% -------- -------- $64,566 5.40% ========= ========= Property operating expenses increased $4,649, or 0.43%, for the first six months of 1997, as compared to the same period in 1996, primarily due to increases in contract services, offset by decreases in general and administrative expense. The increase in contract service of $12,231 or 25.89% is due primarily to increased lawn care and rubbish removal costs. Insurance costs rose $2,883 or 12.61% higher annual insurance premiums that began in May, 1997. Interest expenses declined by $9,583 or 7.05% as a result of normal amortization of the self-amortizing mortgage debt. The following table illustrates the components by category: Increase Decrease ------------------ Salaries & wages $2,176 1.57% Maintenance & repairs 2,298 2.10% Utilities 421 0.45% Real estate taxes 12,000 9.85% General administrative (12,948) 30.56% Contract services 12,231 25.89% Insurance 2,883 12.61% Interest (9,583) 7.05% Depreciation and amortization (8,000) 2.58% Property management fees (a) 3,171 5.30% -------- -------- Net Increase (Decrease) $4,649 0.43% ======== ======== SECOND QUARTER 1997 COMPARED TO SECOND QUARTER 1996 - --------------------------------------------------- At June 30, 1997 the Partnership owned two properties with approximately 416,623 net rentable square feet. Both properties are apartment communities. The portfolio had an average occupancy of 95.0% for the second quarter of 1997, as compared to 95.2% for the second quarter of 1996. Revenue from property operations increased $57,826, or 9.75%, for the second quarter of 1997, as compared to the 1996 second quarter. The increase in other income of $3,737 or 33.16% is primarily due to an increase in late and returned check charges from the prior year. The following table illustrates the components: Increase Decrease --------------- Rental income $54,089 9.30% Other property 3,737 33.16% -------- -------- Net Increase (Decrease) $57,826 9.75% ======= ======== Property operating expenses decreased $12,960, or 2.27%, for the second quarter of 1997, as compared to the same period in 1996, primarily due to decreases in maintenance & repairs and utilities, offset by increases in contract services insurance and real estate taxes. The increase in contract service of $4,319 or 15.98% is due primarily to increased lawn care and rubbish removal costs. Insurance costs rose $2,106 or 18.24% due to higher annual insurance premiums that began in May 1997. Interest expenses declined by $2,830 or 4.20% as a result of normal amortization of the self-amortizing mortgage debt. The following table illustrates the components by category: Increase (Decrease) ------------------------ Salaries & wages $1,722 2.28% Maintenance & repairs (16,193) 21.60% Utilities (6,925) 14.43% Real estate taxes 6,000 9.85% General administrative (6) 0.03% Contract services 4,319 15.98% Insurance 2,106 18.24% Interest (2,830) 4.20% Depreciation and amortization (4,000) 2.58% Property management fees (a) 2,847 9.59% --------- ------- Net Increase (Decrease) $(12,960) 2.27% ========= ======== LIQUIDITY AND CAPITAL RESOURCES - ------------------------------- While it is the General Partners primary intention to operate and manage the existing real estate investments, the General Partner also continually evaluates this investment in light of current economic conditions and trends to determine if this asset should be considered for disposal. At this time, there is no plan to dispose of either property. As of June 30, 1997, the Partnership had $61,668 in cash and cash equivalents as compared to $23,211 as of December 31, 1996 . The net increase in cash of $38,457 is principally due to positive cash flow from operations repayments on mortgages and notes payable. The properties are encumbered by two non-recourse mortgage notes as of December 31, 1996. These mortgages payable have a carrying value of $7,239,679 at December 31, 1996. The mortgage notes were entered into during 1993 and 1992 to refinance certain mortgage notes which were in default. The Partnership accounted for these transactions as troubled debt restructuring, and accordingly, are being carried at the total future cash outflows for principal and interest. Accordingly, no interest expense was or will be recorded on these notes. Additionally, the general partner has provided funding to the Partnership in the form of notes payable with balances at December 31,1996 totaling $2,35,310 which accrue interest at prime plus 2% and are due on June 30, 2001, or upon demand. Additional funds have been provided by the general partner in the form of advances which totaled $1,282,696 at December 31, 1996. The general partner is not obligated to provide additional funding to the Partnership. For the foreseeable future, the Partnership anticipates that mortgage principal payments (excluding any balloon mortgage payments), improvements and capital expenditures will be funded by net cash from operations. The primary source of capital to fund future Partnership acquisitions and balloon mortgage payments will be proceeds from the sale, financing or refinancing of the Properties. The Partnership's required principal payments due under the stated terms of the Partnership's mortgage notes payable and notes payable to affiliates are $124,505, $2,580,216 and $4,021,625 for each of the next three years. The Partnership is not generating sufficient cash flows to meet these obligations. Management believes it will be able to refinance these debt obligations; however, at this time, there can be no assurance this refinancing will occur. Other Information Item 1. Legal Proceedings Item 2. Changes in Securities None Item 3. Defaults Upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information None Item 6. Exhibit and Reports on Form 8-K (A) The following documents are filed herewith or incorporated herein by reference as indicated as Exhibits: Exhibit Designation Document Description - ------------------- --------------------- 2 Certificate of Limited partnership, as amended,incorporated by reference to Registration Statement No.2-81074 effective May 2, 1983. Limited Partnership Agreement, incorporated by reference to Registration Statement No.2-81074 effective May 2,1983. 11 Not Applicable 15 Not Applicable 18 Not Applicable 19 Not Applicable 20 Not Applicable 23 Not Applicable 24 Not Applicable 25 Power of Attorney,incorporated by reference to Registration Statement No. 2-81074 effective May 2,1983. 28 None (B) Reports on Form 8-K for the quarter ended June 30, 1997. 1 None 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. AMERICAN REPUBLIC REALTY FUND I a Wisconsin limited partnership By: /s/ Robert J. Werra Robert J. Werra, General Partner Date: August 11, 1997 EX-27 2
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM BOTH THE JUNE 30, 1997 BALANCE SHEET AND STATEMENT OF INCOME AND EXPENSES AND IS QAULIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0000711512 AMERICAN REPUBLIC REALTY FUND I 6-MOS DEC-31-1997 JUN-30-1997 61,668 0 0 0 0 0 16,817,227 8,699,635 8,470,079 0 6,889,368 0 0 0 (2,800,447) 8,470,079 0 1,235,634 0 0 958,554 0 126,267 0 0 0 0 0 0 174,803 15.89 0
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