10QSB 1 sp5.txt SP5 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2005 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from _________to _________ Commission file number 0-11574 SHELTER PROPERTIES V (Exact name of small business issuer as specified in its charter) South Carolina 57-0721855 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 55 Beattie Place, PO Box 1089 Greenville, South Carolina 29602 (Address of principal executive offices) (864) 239-1000 Issuer's telephone number 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 SHELTER PROPERTIES V CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands, except unit data) March 31, 2005
Assets Cash and cash equivalents $ 444 Receivables and deposits 402 Restricted escrows 278 Other assets 1,655 Investment properties: Land $ 4,054 Buildings and related personal property 89,078 93,132 Less accumulated depreciation (60,314) 32,818 $ 35,597 Liabilities and Partners' Deficit Liabilities Accounts payable $ 586 Tenant security deposit liabilities 283 Accrued property taxes 271 Other liabilities 661 Due to affiliates (Note C) 3,207 Mortgage notes payable 43,694 Partners' Deficit General partners $ (383) Limited partners (52,538 units issued and outstanding) (12,722) (13,105) $ 35,597 See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except per unit data)
Three Months Ended March 31, 2005 2004 Revenues: Rental income $ 3,211 $ 3,059 Other income 368 375 Total revenues 3,579 3,434 Expenses: Operating 1,651 1,533 General and administrative 105 82 Depreciation 832 853 Interest 904 869 Property taxes 321 260 Total expenses 3,813 3,597 Net loss $ (234) $ (163) Net loss allocated to general partners (1%) $ (2) $ (2) Net loss allocated to limited partners (99%) (232) (161) $ (234) $ (163) Net loss per limited partnership unit $ (4.42) $ (3.06) See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' DEFICIT (Unaudited) (in thousands, except unit data)
Limited Partnership General Limited Units Partners Partners Total Original capital contributions 52,538 $ 2 $52,538 $52,540 Partners' deficit at December 31, 2004 52,538 $ (381) $(12,490) $(12,871) Net loss for the three months ended March 31, 2005 -- (2) (232) (234) Partners' deficit at March 31, 2005 52,538 $ (383) $(12,722) $(13,105) See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Three Months Ended March 31, 2005 2004 Cash flows from operating activities: Net loss $ (234) $ (163) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation 832 853 Amortization of loan costs 18 19 Casualty loss (16) -- Change in accounts: Receivables and deposits 66 56 Other assets (177) (319) Accounts payable (17) 99 Tenant security deposit liabilities 10 (13) Accrued property taxes 177 23 Due to affiliates (70) -- Other liabilities (39) 47 Net cash provided by operating activities 550 602 Cash flows from investing activities: Property improvements and replacements (1,167) (193) Net deposits to restricted escrows (1) -- Net cash used in investing activities (1,168) (193) Cash flows from financing activities: Payments on mortgage notes payable (360) (293) Advances from affiliate 318 150 Payments on advances from affiliate (34) (150) Net cash used in financing activities (76) (293) Net (decrease) increase in cash and cash equivalents (694) 116 Cash and cash equivalents at beginning of period 1,138 458 Cash and cash equivalents at end of period $ 444 $ 574 Supplemental disclosure of cash flow information: Cash paid for interest $ 889 $ 744 Supplemental disclosure of non-cash activity: Property improvements and replacements in accounts payable $ 442 $ 40 At December 31, 2004, approximately $726,000 of property improvements and replacements were included in accounts payable. See Accompanying Notes to Consolidated Financial Statements
SHELTER PROPERTIES V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note A - Basis of Presentation The accompanying unaudited consolidated financial statements of Shelter Properties V (the "Partnership" or "Registrant") 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. The general partner responsible for management of the Partnership's business is Shelter Realty V Corporation (the "Corporate General Partner"). In the opinion of the Corporate General Partner, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended March 31, 2005 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2005. For further information, refer to the consolidated financial statements and footnotes thereto included in the Partnership's Annual Report on Form 10-KSB for the fiscal year ended December 31, 2004. The Corporate General Partner is a subsidiary of Apartment Investment and Management Company ("AIMCO"), a publicly traded real estate investment trust. The other general partner of the partnership, AIMCO Properties, L.P., is also an affiliate of AIMCO. Note B - Reconciliation of Cash Flows As required by the Partnership Agreement, the following is a reconciliation of "Net cash provided by operating activities" in the accompanying consolidated statements of cash flows to "Net cash from operations", as defined in the Partnership Agreement. However, "Net cash from operations" should not be considered an alternative to net loss as an indicator of the Partnership's operating performance or to cash flows as a measure of liquidity. Three Months Ended March 31, (in thousands) 2005 2004 Net cash provided by operating activities $ 550 $ 602 Payments on mortgage notes payable (360) (293) Property improvements and replacements (1,167) (193) Change in restricted escrows, net (1) -- Changes in reserves for net operating liabilities 50 107 Net cash (used in) from operations $ (928) $ 223 Note C - Transactions with Affiliated Parties The Partnership has no employees and depends on the Corporate General Partner and its affiliates for the management and administration of all Partnership activities. The Partnership Agreement provides for certain payments to affiliates for services and reimbursement of certain expenses incurred by affiliates on behalf of the Partnership. Affiliates of the Corporate General Partner receive 5% of gross receipts from all of the Partnership's investment properties as compensation for providing property management services. The Partnership paid to such affiliates approximately $176,000 and $185,000 for the three months ended March 31, 2005 and 2004, respectively, which are included in operating expenses. In accordance with the Partnership Agreement, during the fourth quarter of 2004, the Corporate General Partner advanced approximately $1,949,000 to the Partnership to fund the redevelopment project at Lake Johnson Mews Apartments and approximately $954,000 to fund operating expenses and real estate taxes at four of the Partnership's investment properties. During the three months ended March 31, 2005, the Corporate General Partner loaned approximately $199,000 to the Partnership to fund the redevelopment project at Lake Johnson Mews Apartments and approximately $119,000 to fund real estate taxes and capital expenditures at Lake Johnson Mews Apartments and Foxfire Apartments. The Corporate General Partner loaned approximately $150,000 to the Partnership to fund real estate taxes at Woodland Village Apartments during the three months ended March 31, 2004. Interest is accrued at 10.0% on the redevelopment advances and the prime rate plus 2% (7.75% at March 31, 2005) for all other advances. Interest expense was approximately $65,000 and $1,000 for the three months ended March 31, 2005 and 2004, respectively. During the three months ended March 31, 2005 and 2004, the Partnership made payments on advances of approximately $34,000 and $150,000, respectively, and related interest of $66,000 and $1,000, respectively, with cash from operations. At March 31, 2005, the total outstanding advances and accrued interest due to an affiliate of the Corporate General Partner is approximately $3,207,000 and is included in due to affiliates. An affiliate of the Corporate General Partner has committed to fund additional redevelopment costs for the redevelopment project at Lake Johnson Mews Apartments of approximately $1,911,000 (see Item 2. Management's Discussion and Analysis or Plan of Operation). Affiliates of the Corporate General Partner charged the Partnership for reimbursement of accountable administrative expenses amounting to approximately $111,000 and $70,000 for the three months ended March 31, 2005 and 2004, respectively, which are included in general and administrative expenses and investment properties. The portion of these reimbursements included in investment properties for the three months ended March 31, 2005 and 2004 are fees related to construction management services provided by an affiliate of the Corporate General Partner of approximately $31,000 and $14,000, respectively. The construction management service fees are calculated based on a percentage of current additions to investment properties. The Partnership insures its properties up to certain limits through coverage provided by AIMCO which is generally self-insured for a portion of losses and liabilities related to workers' compensation, property casualty and vehicle liability. The Partnership insures its properties above the AIMCO limits through insurance policies obtained by AIMCO from insurers unaffiliated with the Corporate General Partner. During the three months ended March 31, 2005, the Partnership was charged by AIMCO and its affiliates approximately $126,000 for hazard insurance coverage and fees associated with policy claims administration. Additional charges will be incurred by the Partnership during 2005 as other insurance policies renew later in the year. The Partnership was charged by AIMCO and its affiliates approximately $193,000 for insurance coverage and fees associated with policy claims administration during the year ended December 31, 2004. Note D - Casualty Events In September 2004, Millhopper Apartments experienced damage from Hurricane Frances. At March 31, 2005, the Partnership estimates damage costs of this casualty will be approximately $78,000. The Corporate General Partner anticipates that insurance proceeds to be received will be sufficient to cover estimated repairs and no casualty loss will result from this event. In addition, the Partnership incurred clean up costs of approximately $60,000, which were not covered by insurance, for the year ended December 31, 2004. The Partnership incurred additional clean up costs of approximately $9,000 which were not covered by insurance, for the three months ended March 31, 2005, which are reflected in operating expenses. The Partnership incurred clean up costs of approximately $9,000 at The Lexington Green Apartments for Hurricanes Frances and Jeanne which were not covered by insurance for the year ended December 31, 2004. The Partnership incurred additional clean up costs of approximately $11,000, which were not covered by insurance, for the three months ended March 31, 2005, which are reflected in operating expenses. The Partnership also recognized a casualty gain of approximately $16,000 due to a change in the estimated building damages at The Lexington Green Apartments, which is reflected in operating expenses. Note E - Property Taxes During the three months ended March 31, 2005, the Partnership received notification that its appeal of the 2004 assessed value of The Lexington Green Apartments was denied. The Partnership recorded property tax expense for 2004 based upon its best estimate of the property tax as provided by a third party property tax specialist. The Partnership paid the billed property tax amount and at December 31, 2004 established a receivable in the amount of approximately $50,000. This receivable was reversed during the three months ended March 31, 2005, with a resulting increase to property tax expense. Note F - Contingencies In March 1998, several putative unit holders of limited partnership units of the Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the State of California for the County of San Mateo. The plaintiffs named as defendants, among others, the Partnership, its Corporate General Partner and several of their affiliated partnerships and corporate entities. The action purported to assert claims on behalf of a class of limited partners and derivatively on behalf of a number of limited partnerships (including the Partnership) that are named as nominal defendants, challenging, among other things, the acquisition of interests in certain Corporate General Partner entities by Insignia Financial Group, Inc. ("Insignia") and entities that were, at one time, affiliates of Insignia; past tender offers by the Insignia affiliates to acquire limited partnership units; management of the partnerships by the Insignia affiliates; and the series of transactions which closed on October 1, 1998 and February 26, 1999 whereby Insignia and Insignia Properties Trust, respectively, were merged into AIMCO. The plaintiffs sought monetary damages and equitable relief, including judicial dissolution of the Partnership. In addition, during the third quarter of 2001, a complaint captioned Heller v. Insignia Financial Group (the "Heller action") was filed against the same defendants that are named in the Nuanes action. On or about August 6, 2001, plaintiffs filed a first amended complaint. The Heller action was brought as a purported derivative action, and asserted claims for, among other things, breach of fiduciary duty, unfair competition, conversion, unjust enrichment, and judicial dissolution. On January 28, 2002, the trial court granted defendants motion to strike the complaint. On January 8, 2003, the parties filed a Stipulation of Settlement in proposed settlement of the Nuanes action and the Heller action. On June 13, 2003, the court granted final approval of the settlement and entered judgment in both the Nuanes and Heller actions. On August 12, 2003, an objector ("Objector") filed an appeal (the "Appeal") seeking to vacate and/or reverse the order approving the settlement and entering judgment thereto. On May 4, 2004 the Objector filed a second appeal challenging the court's use of a referee and its order requiring Objector to pay those fees. On March 21, 2005, the Court of Appeals issued opinions in both pending appeals. With regard to the settlement and judgment entered thereto, the Court of Appeals vacated the trial court's order and remanded to the trial court for further findings on the basis that the "state of the record is insufficient to permit meaningful appellate review". With regard to the second appeal, the Court of Appeals reversed the order requiring the Objector to pay referee fees. On April 26, 2005, the Court of Appeals lifted the stay of a pending appeal related to the Heller action and the trial court's order striking the complaint. On April 28, 2005, the Objector filed a Petition for Review with the California Supreme Court in connection with the opinion vacating the order approving settlement and remanding for further findings. The Corporate General Partner and its affiliates are currently scheduled to file an answer to Objector's petition on May 18, 2005. The Corporate General Partner does not anticipate that any costs to the Partnership, whether legal or settlement costs, associated with these cases will be material to the Partnership's overall operations. AIMCO Properties L.P. and NHP Management Company, both affiliates of the Corporate General Partner, are defendants in a lawsuit alleging that they willfully violated the Fair Labor Standards Act ("FLSA") by failing to pay maintenance workers overtime for all hours worked in excess of forty per week. The complaint attempts to bring a collective action under the FLSA and seeks to certify state subclasses in California, Maryland, and the District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties L.P. and NHP Management Company failed to compensate maintenance workers for time that they were required to be "on-call." Additionally, the complaint alleges AIMCO Properties L.P. and NHP Management Company failed to comply with the FLSA in compensating maintenance workers for time that they worked in responding to a call while "on-call." The defendants have filed an answer to the amended complaint denying the substantive allegations. Oral argument relating to the certification of the collective action took place on May 12, 2005 and the parties await a ruling from the Court. Although the outcome of any litigation is uncertain, AIMCO Properties, L.P. does not believe that the ultimate outcome will have a material adverse effect on its financial condition or results of operations. Similarly, the Corporate General Partner does not believe that the ultimate outcome will have a material adverse effect on the Partnership's consolidated financial condition or results of operations. The Partnership is unaware of any other pending or outstanding litigation matters involving it or its investment properties that are not of a routine nature arising in the ordinary course of business. Environmental Various Federal, state and local laws subject property owners or operators to liability for management, and the costs of removal or remediation, of certain hazardous substances present on a property. Such laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release or presence of the hazardous substances. The presence of, or the failure to manage or remedy properly, hazardous substances may adversely affect occupancy at affected apartment communities and the ability to sell or finance affected properties. In addition to the costs associated with investigation and remediation actions brought by government agencies, the presence of hazardous substances on a property could result in claims by private plaintiffs for personal injury, disease, disability or other infirmities. Various laws also impose liability for the cost of removal, remediation or disposal of hazardous substances through a licensed disposal or treatment facility. Anyone who arranges for the disposal or treatment of hazardous substances is potentially liable under such laws. These laws often impose liability whether or not the person arranging for the disposal ever owned or operated the disposal facility. In connection with the ownership and operation of its properties, the Partnership could potentially be liable for environmental liabilities or costs associated with its properties. Mold The Partnership is aware of lawsuits against owners and managers of multifamily properties asserting claims of personal injury and property damage caused by the presence of mold, some of which have resulted in substantial monetary judgments or settlements. The Partnership has only limited insurance coverage for property damage loss claims arising from the presence of mold and for personal injury claims related to mold exposure. Affiliates of the Corporate General Partner have implemented a national policy and procedures to prevent or eliminate mold from its properties and the Corporate General Partner believes that these measures will eliminate, or at least minimize, the effects that mold could have on residents. To date, the Partnership has not incurred any material costs or liabilities relating to claims of mold exposure or to abate mold conditions. Because the law regarding mold is unsettled and subject to change the Corporate General Partner can make no assurance that liabilities resulting from the presence of or exposure to mold will not have a material adverse effect on the Partnership's consolidated financial condition or results of operations. SEC Investigation The Central Regional Office of the United States Securities and Exchange Commission (the "SEC") is conducting a formal investigation relating to certain matters. Although the staff of the SEC is not limited in the areas that it may investigate, AIMCO believes the areas of investigation include AIMCO's miscalculated monthly net rental income figures in third quarter 2003, forecasted guidance, accounts payable, rent concessions, vendor rebates, capitalization of payroll and certain other costs, and tax credit transactions. At the end of the first quarter of 2005, the SEC added certain tender offers for limited partnership interests as an area of investigation. AIMCO is cooperating fully. AIMCO is not able to predict when the investigation will be resolved. AIMCO does not believe that the ultimate outcome will have a material adverse effect on its consolidated financial condition or results of operations. Similarly, the Corporate General Partner does not believe that the ultimate outcome will have a material adverse effect on the Partnership's consolidated financial condition or results of operations. Note G - Subsequent Event Subsequent to March 31, 2005, the Partnership entered into a Purchase and Sale Contract to sell The Lexington Green Apartments to a third party for a purchase price of approximately $19,200,000. The anticipated closing date for the transaction is June 13, 2005. At March 31, 2005, the carrying amounts of the mortgage note payable and investment property for The Lexington Green Apartments are approximately $6,257,000 and $4,675,000, respectively. The operating results of The Lexington Green Apartments for the three months ended March 31, 2005 and 2004 were income of approximately $17,000 and $13,000, respectively, which included revenues of approximately $667,000 and $567,000, respectively. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The matters discussed in this report contain certain forward-looking statements, including, without limitation, statements regarding future financial performance and the effect of government regulations. Actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors including, without limitation: national and local economic conditions; the terms of governmental regulations that affect the Registrant and interpretations of those regulations; the competitive environment in which the Registrant operates; financing risks, including the risk that cash flows from operations may be insufficient to meet required payments of principal and interest; real estate risks, including variations of real estate values and the general economic climate in local markets and competition for tenants in such markets; litigation, including costs associated with prosecuting and defending claims and any adverse outcomes, and possible environmental liabilities. Readers should carefully review the Registrant's financial statements and the notes thereto, as well as the risk factors described in the documents the Registrant files from time to time with the Securities and Exchange Commission. The Partnership's investment properties consist of seven apartment complexes. The following table sets forth the average occupancy of the properties for the three months ended March 31, 2005 and 2004: March 31, Property 2005 2004 Foxfire Apartments Atlanta, Georgia 90% 90% Old Salem Apartments Charlottesville, Virginia 89% 91% Woodland Village Apartments Columbia, South Carolina (1) 94% 88% Lake Johnson Mews Apartments Raleigh, North Carolina 87% 89% The Lexington Green Apartments Sarasota, Florida (2) 98% 94% Millhopper Village Apartments Gainesville, Florida (3) 97% 89% Tar River Estates Apartments Greenville, North Carolina (4) 98% 88% (1) The Corporate General Partner attributes the increase in occupancy at Woodland Village Apartments to increased marketing and resident retention efforts. (2) The Corporate General Partner attributes the increase in occupancy at The Lexington Green Apartments to improved economic conditions in the Sarasota area and increased resident retention efforts. (3) The Corporate General Partner attributes the increase in occupancy at Millhopper Village Apartments to improved economic conditions in the Gainesville area. (4) The Corporate General Partner attributes the increase in occupancy at Tar River Estates Apartments to increased resident retention efforts. The Partnership's financial results depend upon a number of factors including the ability to attract and maintain tenants at the investment properties, interest rates on mortgage loans, costs incurred to operate the investment properties, general economic conditions and weather. As part of the ongoing business plan of the Partnership, the Corporate 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 expenses. As part of this plan, the Corporate 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, the Corporate General Partner may use rental concessions and rental rate reductions to offset softening market conditions; accordingly, there is no guarantee that the Corporate General Partner will be able to sustain such a plan. Further, a number of factors that are outside the control of the Partnership, such as the local economic climate and weather can adversely or positively affect the Partnership's financial results. Results of Operations The Partnership's net loss for the three months ended March 31, 2005 was approximately $234,000 as compared to a net loss of approximately $163,000 for the three months ended March 31, 2004. The increase in net loss is due to an increase in total expenses, partially offset by an increase in total revenues. The increase in total expenses is due to increases in operating, interest, property tax, and general and administrative expenses, partially offset by a decrease in depreciation expense. The increase in operating expenses is primarily due to increases in payroll related expenses at Foxfire Apartments and Tar River Estates Apartments and utility expenses at four of the Partnership's investment properties. Interest expense increased primarily due to an increase in interest expense on advances from an affiliate of the Corporate General Partner, partially offset by scheduled principal payments made on the mortgages encumbering the Partnership's investment properties, which reduced the carrying balances of the loans. The increase in property tax expense is primarily due to an increase in the assessed value of Tar River Estates Apartments and the unsuccessful appeal of the assessed value of Lexington Green Apartments that resulted in approximately $50,000 of additional property tax expense related to 2004 being recognized during the three months ended March 31, 2005. The decrease in depreciation expense is primarily due to property improvements and replacements placed into service in prior years becoming fully depreciated during the past twelve months. The increase in general and administrative expenses is primarily due to an increase in the management reimbursements to the Corporate General Partner as allowed under the Partnership Agreement. Costs associated with the quarterly and annual communications with investors and regulatory agencies and the annual audit required by the Partnership Agreement are also included in general and administrative expenses for the three months ended March 31, 2005 and 2004. The increase in total revenues is primarily due to an increase in rental income, partially offset by a decrease in other income. Rental income increased primarily due to increases in occupancy at four of the Partnership's investment properties and average rental rates at five properties, partially offset by decreases in occupancy at Old Salem Apartments and Lake Johnson Mews and average rental rates at Woodland Village Apartments and Old Salem Apartments. The decrease in other income is primarily due to a decrease in lease cancellation fees at most of the Partnership's investment properties. In September 2004, Millhopper Apartments experienced damage from Hurricane Frances. At March 31, 2005, the Partnership estimates damage costs of approximately $78,000. The Corporate General Partner anticipates that insurance proceeds to be received will be sufficient to cover estimated repairs and no casualty loss will result from this event. In addition, the Partnership incurred clean up costs of approximately $60,000, which were not covered by insurance, for the year ended December 31, 2004. The Partnership incurred additional clean up costs of approximately $9,000 which were not covered by insurance, for the three months ended March 31, 2005, which are reflected in operating expenses. The Partnership incurred clean up costs of approximately $9,000 at The Lexington Green Apartments for Hurricanes Frances and Jeanne which were not covered by insurance for the year ended December 31, 2004. The Partnership incurred additional clean up costs of approximately $11,000, which were not covered by insurance, for the three months ended March 31, 2005, which are reflected in operating expenses. During the year ended December 31, 2004, the Corporate General Partner began a major redevelopment project at Lake Johnson Mews Apartments. The property has had difficulty staying competitive and needs to be updated. Therefore, in an effort to increase occupancy and remain competitive in the local market, a significant redevelopment project has been started and is expected to be completed in January 2006 at a total cost of approximately $4,059,000. The project is being funded from advances from an affiliate of the Corporate General Partner. The Corporate General Partner anticipates that all units will remain available to lease during the redevelopment period. Liquidity and Capital Resources At March 31, 2005, the Partnership had cash and cash equivalents of approximately $444,000, compared to approximately $574,000 at March 31, 2004. The decrease in cash and cash equivalents of approximately $694,000, from the Partnership's year ended December 31, 2004, is due to approximately $1,168,000 of cash used in investing activities and approximately $76,000 of cash used in financing activities, partially offset by approximately $550,000 of cash provided by operating activities. Cash used in investing activities consisted of property improvements and replacements and net deposits to escrow accounts maintained by the mortgage lenders. Cash used in financing activities consisted of payments of principal on the mortgages encumbering the Partnership's investment properties and payment on advances from an affiliate of the Corporate General Partner, partially offset by the receipt of advances from an affiliate of the Corporate General Partner. The Partnership invests its working capital reserves in interest bearing accounts. 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 investment properties to adequately maintain the physical assets and other operating needs of the Partnership and to comply with Federal, state, and local legal and regulatory requirements. The Corporate General Partner monitors developments in the area of legal and regulatory compliance. For example, the Sarbanes-Oxley Act of 2002 mandates or suggests additional compliance measures with regard to governance, disclosure, audit and other areas. In light of these changes, the Partnership expects that it will incur higher expenses related to compliance. Capital improvements planned for each of the Partnership's properties are detailed below. Millhopper Village Apartments: During the three months ended March 31, 2005, the Partnership completed approximately $219,000 of capital improvements at Millhopper Village Apartments, consisting primarily of roof replacement, siding, exterior painting, parking area improvements, gutter replacement and construction resulting from the casualty as discussed in "Results of Operations". These improvements were funded from operations. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no other material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during 2005. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property. Foxfire Apartments: During the three months ended March 31, 2005, the Partnership completed approximately $40,000 of capital improvements at Foxfire Apartments, consisting primarily of recreational facility upgrades and floor covering replacement. These improvements were funded from operations and an advance from an affiliate of the Corporate General Partner. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during 2005. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property. Lake Johnson Mews Apartments: During the three months ended March 31, 2005, the Partnership completed approximately $263,000 of capital improvements at Lake Johnson Mews Apartments arising from the redevelopment of the property. Additional capital improvements of approximately $41,000 consisted primarily of floor covering replacement. These improvements were funded from operations and an advance from an affiliate of the Corporate General Partner. The property is currently undergoing a redevelopment project in order to remain competitive with other properties in the area in the effort to increase occupancy at the property. Based on current redevelopment plans, the Corporate General Partner anticipates the redevelopment to be complete in January 2006 at a total cost of approximately $4,059,000. The project is being funded from advances from an affiliate of the Corporate General Partner and cash from operations. The Partnership regularly evaluates the capital improvement needs of the property. The Partnership currently expects to budget approximately $1,328,000 for property redevelopment during 2005. While the Partnership has no other material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during 2005. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property. Woodland Village Apartments: During the three months ended March 31, 2005, the Partnership completed approximately $60,000 of capital improvements at Woodland Village Apartments, consisting primarily of swimming pool upgrades and floor covering replacement. These improvements were funded from operations. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during 2005. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property. The Lexington Green Apartments: During the three months ended March 31, 2005, the Partnership completed approximately $118,000 of capital improvements at The Lexington Green Apartments, consisting primarily of balcony upgrades and floor covering replacement. These improvements were funded from operations. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during 2005. Such capital expenditures will depend on the physical condition of the property as well as replacement reserves and anticipated cash flow generated by the property. Tar River Estates Apartments: During the three months ended March 31, 2005, the Partnership completed approximately $24,000 of capital improvements at Tar River Estates Apartments, consisting primarily of floor covering replacement. These improvements were funded from operations. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during 2005. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property. Old Salem Apartments: During the three months ended March 31, 2005, the Partnership completed approximately $118,000 of capital improvements at Old Salem Apartments, consisting primarily of furniture and fixtures, structural improvements, plumbing upgrades, heating upgrades, floor covering replacement, and construction related to the May 2004 fire, as discussed in the Partnership's 10-KSB for the year ended December 31, 2004. These improvements were funded from operations. The Partnership regularly evaluates the capital improvement needs of the property. While the Partnership has no material commitments for property improvements and replacements, certain routine capital expenditures are anticipated during 2005. Such capital expenditures will depend on the physical condition of the property as well as anticipated cash flow generated by the property. The capital expenditures will be incurred only if cash is available from operations and from Partnership reserves. To the extent that capital improvements are completed, the Partnership's distributable cash flow, if any, may be adversely affected at least in the short term. The Partnership's assets are thought to be sufficient for any near-term needs (exclusive of capital improvements) of the Partnership. The mortgage indebtedness encumbering all of the Partnership's investment properties of approximately $43,694,000 is amortized over varying periods with maturity dates ranging from November 1, 2019 to January 1, 2022, at which time the loans are scheduled to be fully amortized. Subsequent to March 31, 2005, the Partnership entered into a Purchase and Sale Contract to sell The Lexington Green Apartments to a third party for a purchase price of approximately $19,200,000. The anticipated closing date for the transaction is June 13, 2005. At March 31, 2005, the carrying amounts of the mortgage note payable and investment property for The Lexington Green Apartments are approximately $6,257,000 and $4,675,000, respectively. The operating results of The Lexington Green Apartments for the three months ended March 31, 2005 and 2004 were income of approximately $17,000 and $13,000, respectively, which included revenues of approximately $667,000 and $567,000, respectively. There were no distributions made to the partners during the three months ended March 31, 2005 and 2004. Future cash distributions will depend on the levels of net cash generated from operations and the timing of property refinancings and/or property sales. The Partnership's cash available for distribution is reviewed on a monthly basis. In light of the amounts accrued and payable to affiliates of the Corporate General Partner at March 31, 2005, there can be no assurance that the Partnership will generate sufficient funds from operations, after required capital improvement expenditures, to permit any distributions to its partners in 2005 or subsequent periods. Other In addition to its indirect ownership of the general partner interests in the Partnership, AIMCO and its affiliates owned 39,234 limited partnership units (the "Units") in the Partnership representing 74.68% of the outstanding Units at March 31, 2005. A number of these Units were acquired pursuant to tender offers made by AIMCO or its affiliates. It is possible that AIMCO or its affiliates will acquire additional Units in exchange for cash or a combination of cash and units in AIMCO Properties, L.P., the operating partnership of AIMCO, either through private purchases or tender offers. Pursuant to the Partnership Agreement, unitholders holding a majority of the Units are entitled to take action with respect to a variety of matters that include, but are not limited to, voting on certain amendments to the Partnership Agreement and voting to remove the Corporate General Partner. As a result of its ownership of 74.68% of the outstanding Units, AIMCO and its affiliates are in a position to control all voting decisions with respect to the Partnership. Although the Corporate General Partner owes fiduciary duties to the limited partners of the Partnership, the Corporate General Partner also owes fiduciary duties to AIMCO as its sole stockholder. As a result, the duties of the Corporate General Partner, as corporate general partner, to the Partnership and its limited partners may come into conflict with the duties of the Corporate General Partner to AIMCO as its sole stockholder. Critical Accounting Policies and Estimates The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States, which require the Partnership to make estimates and assumptions. The Partnership believes that of its significant accounting policies, the following may involve a higher degree of judgment and complexity. Impairment of Long-Lived Assets The Partnership's investment properties are recorded at cost, less accumulated depreciation, unless considered impaired. If events or circumstances indicate that the carrying amount of a property may be impaired, the Partnership will make an assessment of its recoverability by estimating the undiscounted future cash flows, excluding interest charges, of the property. If the carrying amount exceeds the aggregate future cash flows, the Partnership would recognize an impairment loss to the extent the carrying amount exceeds the fair value of the property. Real property investments are subject to varying degrees of risk. Several factors may adversely affect the economic performance and value of the Partnership's investment properties. These factors include, but are not limited to, changes in the national, regional and local economic climate; local conditions, such as an oversupply of multifamily properties; competition from other available multifamily property owners and changes in market rental rates. Any adverse changes in these factors could cause impairment of the Partnership's assets. Revenue Recognition The Partnership generally leases apartment units for twelve-month terms or less. The Partnership will offer rental concessions during particularly slow months or in response to heavy competition from other similar complexes in the area. Rental income attributable to leases, net of any concessions, is recognized on a straight-line basis over the term of the lease. The Partnership evaluates all accounts receivable from residents and establishes an allowance, after the application of security deposits, for accounts greater than 30 days past due on current tenants and all receivables due from former tenants. ITEM 3. CONTROLS AND PROCEDURES (a) Disclosure Controls and Procedures. The Partnership's management, with the participation of the principal executive officer and principal financial officer of the Corporate General Partner, who are the equivalent of the Partnership's principal executive officer and principal financial officer, respectively, has evaluated the effectiveness of the Partnership's disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the principal executive officer and principal financial officer of the Corporate General Partner, who are the equivalent of the Partnership's principal executive officer and principal financial officer, respectively, have concluded that, as of the end of such period, the Partnership's disclosure controls and procedures are effective. (b) Internal Control Over Financial Reporting. There have not been any changes in the Partnership's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Partnership's internal control over financial reporting. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS In March 1998, several putative unit holders of limited partnership units of the Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia Financial Group, Inc., et al. (the "Nuanes action") in the Superior Court of the State of California for the County of San Mateo. The plaintiffs named as defendants, among others, the Partnership, its Corporate General Partner and several of their affiliated partnerships and corporate entities. The action purported to assert claims on behalf of a class of limited partners and derivatively on behalf of a number of limited partnerships (including the Partnership) that are named as nominal defendants, challenging, among other things, the acquisition of interests in certain Corporate General Partner entities by Insignia Financial Group, Inc. ("Insignia") and entities that were, at one time, affiliates of Insignia; past tender offers by the Insignia affiliates to acquire limited partnership units; management of the partnerships by the Insignia affiliates; and the series of transactions which closed on October 1, 1998 and February 26, 1999 whereby Insignia and Insignia Properties Trust, respectively, were merged into AIMCO. The plaintiffs sought monetary damages and equitable relief, including judicial dissolution of the Partnership. In addition, during the third quarter of 2001, a complaint captioned Heller v. Insignia Financial Group (the "Heller action") was filed against the same defendants that are named in the Nuanes action. On or about August 6, 2001, plaintiffs filed a first amended complaint. The Heller action was brought as a purported derivative action, and asserted claims for, among other things, breach of fiduciary duty, unfair competition, conversion, unjust enrichment, and judicial dissolution. On January 28, 2002, the trial court granted defendants motion to strike the complaint. On January 8, 2003, the parties filed a Stipulation of Settlement in proposed settlement of the Nuanes action and the Heller action. On June 13, 2003, the court granted final approval of the settlement and entered judgment in both the Nuanes and Heller actions. On August 12, 2003, an objector ("Objector") filed an appeal (the "Appeal") seeking to vacate and/or reverse the order approving the settlement and entering judgment thereto. On May 4, 2004 the Objector filed a second appeal challenging the court's use of a referee and its order requiring Objector to pay those fees. On March 21, 2005, the Court of Appeals issued opinions in both pending appeals. With regard to the settlement and judgment entered thereto, the Court of Appeals vacated the trial court's order and remanded to the trial court for further findings on the basis that the "state of the record is insufficient to permit meaningful appellate review". With regard to the second appeal, the Court of Appeals reversed the order requiring the Objector to pay referee fees. On April 26, 2005, the Court of Appeals lifted the stay of a pending appeal related to the Heller action and the trial court's order striking the complaint. On April 28, 2005, the Objector filed a Petition for Review with the California Supreme Court in connection with the opinion vacating the order approving settlement and remanding for further findings. The Corporate General Partner and its affiliates are currently scheduled to file an answer to Objector's petition on May 18, 2005. The Corporate General Partner does not anticipate that any costs to the Partnership, whether legal or settlement costs, associated with these cases will be material to the Partnership's overall operations. AIMCO Properties L.P. and NHP Management Company, both affiliates of the Corporate General Partner, are defendants in a lawsuit alleging that they willfully violated the Fair Labor Standards Act ("FLSA") by failing to pay maintenance workers overtime for all hours worked in excess of forty per week. The complaint attempts to bring a collective action under the FLSA and seeks to certify state subclasses in California, Maryland, and the District of Columbia. Specifically, the plaintiffs contend that AIMCO Properties L.P. and NHP Management Company failed to compensate maintenance workers for time that they were required to be "on-call." Additionally, the complaint alleges AIMCO Properties L.P. and NHP Management Company failed to comply with the FLSA in compensating maintenance workers for time that they worked in responding to a call while "on-call." The defendants have filed an answer to the amended complaint denying the substantive allegations. Oral argument relating to the certification of the collective action took place on May 12, 2005 and the parties await a ruling from the Court. Although the outcome of any litigation is uncertain, AIMCO Properties, L.P. does not believe that the ultimate outcome will have a material adverse effect on its financial condition or results of operations. Similarly, the Corporate General Partner does not believe that the ultimate outcome will have a material adverse effect on the Partnership's consolidated financial condition or results of operations. ITEM 5. OTHER INFORMATION None. ITEM 6. EXHIBITS See Exhibit Index. 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. SHELTER PROPERTIES V By: Shelter Realty V Corporation Corporate General Partner By: /s/Martha L. Long Martha L. Long Senior Vice President By: /s/Stephen B. Waters Stephen B. Waters Vice President Date: May 13, 2005 SHELTER PROPERTIES V EXHIBIT INDEX Exhibit 3 See Exhibit 4(a) 3.1 Second Amended and Restated Bylaws of IPT, dated October 2, 1998 (incorporated by reference to Current Report on Form 8-K, dated October 1, 1998). 4 (a) Amended and Restated Certificate and Agreement of Limited Partnership (included as Exhibit A to the Prospectus of Registrant dated May 27, 1983 contained in Amendment No. 1 to Registration Statement No. 2-81308, of Registrant filed June 8, 1982 (the "Prospectus") and incorporated herein by reference.) (b) Subscription Agreement and Signature Page (included as Exhibits 4(A) and 4 (B) to the Registration Statement, incorporated herein by reference). 10(i) Contracts related to acquisition of properties. (a) Purchase Agreement dated May 23, 1983 between CFC 1978 Partnership C and U.S. Shelter Corporation to acquire Foxfire Apartments.* (b) Purchase Agreement dated May 14, 1983 between Old Salem and U.S. Shelter Corporation to acquire Old Salem Apartments.* (c) Purchase Agreement dated April 21, 1983 between Europco Management Company of America and U.S. Shelter Corporation to acquire Woodland Village Apartments.* (d) Purchase Agreement dated May 6, 1983 between Europco Management Company of America and U.S. Shelter Corporation to acquire Lake Johnson Mews.* *Filed as Exhibits 12(a) through 12(d), respectively, to Amendment No. 1 of Registration Statement No. 2-81308 of Registrant filed May 24, 1983 and incorporated herein by reference. (e) Purchase Agreement dated June 17, 1983 between The Lexington Apartments and U.S. Shelter Corporation to acquire The Lexington Apartments. (Filed as Exhibit 12(E) to Post-Effective Amendment No. 1 of Registration Statement No. 2-81308 of Registrant filed June 27, 1983 and incorporated herein by reference). (f) Purchase Agreement dated August 26, 1983 between James S. Quincey and U.S. Shelter Corporation to acquire Millhopper Village Apartments. (Filed as Exhibit 12(F) to Post-Effective Amendment No. 1 of Registration Statement No. 2-81308 of Registrant filed October 13, 1983 and incorporated herein by reference). (h) Purchase Agreement dated December 14, 1983 between Virginia Real Estate Investors and U.S. Shelter Corporation to acquire Tar River Estates. (Filed as Exhibit 10(B) to Form 8-K of Registrant dated December 8, 1983 and incorporated herein by reference). (iii) Contracts related to refinancing of debt: (l) Multifamily Note secured by a Mortgage or Deed of Trust dated October 25, 1999, between Foxfire Apartments V Limited Partnership and GMAC Commercial Mortgage Corporation relating to Foxfire Apartments. (Filed as Exhibit 10(1) to Form 10-KSB of Registrant for period ended November 30, 1999 and incorporated herein by reference). (m) Multifamily Note secured by a Mortgage or Deed of Trust dated November 10, 1999, between Shelter Properties V Limited Partnership and GMAC Commercial Mortgage Corporation relating to Old Salem Apartments. (Filed as Exhibit 10(m) to Form 10-KSB of Registrant for period ended November 30, 1999 and incorporated herein by reference). (n) Multifamily Note secured by a Mortgage or Deed of Trust dated December 15, 2000 between New Shelter Properties V Limited Partnership and Reilly Mortgage Group, Inc. relating to Lexington Green Apartments. (Filed as Exhibit 10(iii)n to Form 10-KSB of Registrant filed on April 2, 2001 and incorporated herein by reference). (o) Multifamily Note dated June 28, 2001, by and between Shelter Properties V Limited Partnership, a South Carolina limited partnership, and GMAC Commercial Mortgage Corporation, relating to Lake Johnson Mews Apartments. (Filed as Exhibit 10(iii)o to Form 10-QSB of Registrant filed on August 13, 2001 and incorporated herein by reference). (p) Multifamily Note dated June 28, 2001, by and between Shelter Properties V Limited Partnership, a South Carolina limited partnership, and GMAC Commercial Mortgage Corporation, relating to Millhopper Village Apartments. (Filed as Exhibit 10(iii)p to Form 10-QSB of Registrant filed on August 13, 2001 and incorporated herein by reference). (q) Multifamily Note dated August 30, 2001, by and between Shelter Properties V Limited Partnership, a South Carolina limited partnership, and GMAC Commercial Mortgage Corporation, relating to Woodland Village Apartments. (Filed as Exhibit 10(iii)q to Form 10-QSB of Registrant filed on November 13, 2001 and incorporated herein by reference). (r) Multifamily Note dated December 28, 2001, by and between New Shelter V Limited Partnership, a South Carolina limited partnership, and Lend Lease Mortgage Capital, LP, a Texas limited partnership. (Filed as Exhibit 10(iii)r to Form 8-K of Registrant filed on January 14, 2002 and incorporated herein by reference). 31.1 Certification of equivalent of Chief Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2 Certification of equivalent of Chief Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a)/15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1 Certification of the equivalent of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Exhibit 31.1 CERTIFICATION I, Martha L. Long, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Shelter Properties V; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; 4. The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (c) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Date: May 13, 2005 /s/Martha L. Long Martha L. Long Senior Vice President of Shelter Realty V Corporation, equivalent of the chief executive officer of the Partnership Exhibit 31.2 CERTIFICATION I, Stephen B. Waters, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of Shelter Properties V; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; 4. The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (c) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Date: May 13, 2005 /s/Stephen B. Waters Stephen B. Waters Vice President of Shelter Realty V Corporation, equivalent of the chief financial officer of the Partnership Exhibit 32.1 Certification of CEO and CFO Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 In connection with the Quarterly Report on Form 10-QSB of Shelter Properties V (the "Partnership"), for the quarterly period ended March 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Martha L. Long, as the equivalent of the chief executive officer of the Partnership, and Stephen B. Waters, as the equivalent of the chief financial officer of the Partnership, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership. /s/Martha L. Long Name: Martha L. Long Date: May 13, 2005 /s/Stephen B. Waters Name: Stephen B. Waters Date: May 13, 2005 This certification is furnished with this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Partnership for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.