0000760612-95-000035.txt : 19950815 0000760612-95-000035.hdr.sgml : 19950815 ACCESSION NUMBER: 0000760612-95-000035 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950814 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: WINTHROP GROWTH INVESTORS I LP CENTRAL INDEX KEY: 0000722565 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 042797919 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-13389 FILM NUMBER: 95563096 BUSINESS ADDRESS: STREET 1: ONE INTERNATIONAL PL STREET 2: C/O FIRST WINTHROP CORP CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6173308600 MAIL ADDRESS: STREET 1: C/O FIRST WINTHROP CORP STREET 2: ONE INTERNATIONAL PLACE CITY: BOSTON STATE: MA ZIP: 02110 FORMER COMPANY: FORMER CONFORMED NAME: WINTHROP INCOME PROPERTIES I LTD PARTNERSHP DATE OF NAME CHANGE: 19840124 10-Q 1 WINTHROP GROWTH INVESTORS I LTD. PRT. 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 the Quarter Ended June 30, 1995 Commission File Number 2-84760 ------------- ------- WINTHROP GROWTH INVESTORS 1 LIMITED PARTNERSHIP Massachusetts 04-2839837 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) One International Place, Boston, MA 02110 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (617) 330-8600 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 PART I - FINANCIAL INFORMATION ITEM 1. - FINANCIAL STATEMENTS STATEMENTS OF OPERATIONS --------------------------------------------------------------------------------------------------------------------------------- Three Months Ended Six Months Ended June 30, June 30, 1995 1994 1995 1994 (Unaudited) (Unaudited) (Unaudited) (Unaudited) --------------------------------------------------------------------------------------------------------------------------------- Income Rental $ 1,580,719 $ 1,531,671 $ 3,162,507 $ 3,032,222 Interest on short-term investments 11,331 14,484 23,536 32,153 Other 62,996 62,369 130,037 122,833 ------------ ------------ ------------ ------------ 1,655,046 1,608,524 3,316,080 3,187,208 ----------- ----------- ----------- ----------- Expenses Leasing 45,853 45,879 103,721 87,033 General & administrative 72,305 77,713 161,639 131,615 Management Fees 81,619 79,988 163,665 160,133 Utilities 143,037 147,234 304,268 294,802 Repairs & Maintenance 315,379 316,497 615,077 587,388 Insurance 63,491 59,442 131,449 116,403 Taxes 129,592 132,005 263,594 265,670 ---------- ----------- ----------- ----------- Total operating expenses 851,276 858,758 1,743,413 1,643,044 Other expenses Depreciation 414,585 407,800 823,765 815,600 Amortization 25,315 31,003 50,634 62,006 Interest expense 478,714 502,535 956,215 1,025,366 Other expenses 55,201 21,326 78,562 97,005 ----------- ----------- ----------- ----------- Total expenses 1,825,091 1,821,422 3,652,589 3,643,021 ----------- ----------- ----------- ----------- Net loss $ (170,045) $ (170,045) $ (212,898) $ (336,509) $ (455,813) =========== =========== =========== =========== Net loss allocated General Partners $ (17,005) $ (21,290) $ (33,651) $ (45,581) Limited Partners $ (153,040) $ (191,608) $ (302,858) $ (410,232) ----------- ------------ ------------ ----------- $ (170,045) $ (212,898) $ (336,509) $ (455,813) =========== ============= ============= ========== Net loss per unit outstanding - Limited Partners $ (6.61) $ (8.28) $ (13.09) $ (17.73) ============ ============= ============= =============
See notes to Financial Statements. BALANCE SHEETS --------------------------------------------------------------------------------------------------------------------------------- June 30, December 31, 1995 1994 (Unaudited) (Audited) --------------------------------------------------------------------------------------------------------------------------------- ASSETS Investment in Real Estate Land $ 4,015,369 $ 4,015,369 Buildings and improvements 37,493,153 37,218,583 ------------ ------------ 41,508,522 41,233,952 Less accumulated depreciation 17,607,610 16,783,845 ------------ ------------ 23,900,912 24,450,107 Cash and cash equivalents 730,975 923,214 Tenant security deposits - funded 143,622 125,295 Accounts receivable and other receivables 26,107 27,542 Escrow accounts 441,565 250,622 Reserve accounts 465,729 413,464 Deferred costs, net of accumulated amortization of $973,357 and $922,723 1,070,364 1,120,998 Prepaid expenses and other assets 89,071 199,999 ------------ ------------ 2,967,433 3,061,134 Total Assets $ 26,868,345 $ 27,511,241 ============ ============
LIABILITIES AND PARTNERS' CAPITAL Liabilities applicable in investment in real property Mortgage payable $ 20,402,978 $ 20,711,814 Other liabilities Accounts payable 122,569 105,449 Tenant security deposits 149,375 133,245 Accrued expenses and other liabilities 413,117 343,958 ------------ ------------ Total Liabilities 21,088,039 21,294,466 Partners' Capital Limited Partners 6,927,525 7,330,343 General Partners (1,147,219) (1,113,568) ------------ ------------ Total Partners' Capital 5,780,306 6,216,775 Total Liabilities and Partners' Capital $ 26,868,345 $ 27,511,241 ============ ============
See notes to Financial Statements. STATEMENTS OF CASH FLOWS --------------------------------------------------------------------------------------------------------------------------- For the Six Months Ended June 30, 1995 and 1994 (Unaudited) 1995 1994 --------------------------------------------------------------------------------------------------------------------------- Cash flows from operating activities: Net loss $ (336,509) $ (455,813) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 874,399 877,606 Changes in assets and liabilities: Increase in tenant security deposits - funded (18,327) (66,629) Decrease (increase) in accounts receivable and other receivables 1,435 (4,908) Increase in escrow accounts (190,943) (118,057) Decrease in prepaid expenses and other assets 110,928 173,437 Increase (decrease) in accounts payable 17,120 (12,195) Increase (decrease) in tenant security deposits 16,130 (7,213) Increase in accrued expenses and other liabilities 69,159 100,901 ----------- ----------- Net cash provided by operating activities 543,392 487,129 Cash flows from investing activities: Additions to buildings and improvements (274,570) (64,791) Increase in reserve accounts (52,265) (60,705) ----------- ------------ Net cash used in investing activities (326,835) (125,496) ----------- ------------ Cash flows from financing activities: Principal payments on mortgage note (308,836) (1,627,862) Cash distributions paid to partners (99,960) (99,971) ------------ ------------ Net cash used in financing activities (408,796) (1,727,833) ------------ ------------ Net decrease in cash and cash equivalents (192,239) (1,366,200) Cash and cash equivalents, beginning 923,214 2,394,552 ------------ ------------ Cash and cash equivalents, end $ 730,975 $ 1,028,352 ============ ============ Supplemental disclosure of cash flow information: Cash paid for interest $ 956,215 $ 1,025,366 ============ ============
See notes to Financial Statements. STATEMENTS OF CHANGES IN PARTNERS' CAPITAL --------------------------------------------------------------------------------------------------------------------------- Units of For the Six Months Ended Limited General Limited June 30, 1995 and 1994 Partnership Partners' Partners' Total (Unaudited) Interest Capital Capital Capital --------------------------------------------------------------------------------------------------------------------------- Balance, December 31, 1994 23,139 $(1,113,568) $ 7,330,343 $ 6,216,775 Net loss (33,651) (302,858) (336,509) Distributions - (99,960) (99,960) ---------- ------------- ---------- ---------- Balance, June 30, 1995 23,139 $(1,147,219) $ 6,927,525 $ 5,780,306 ======== =========== =========== =========== Balance, December 31, 1993 23,139 $(1,036,192) $ 8,226,672 $ 7,190,480 Net loss (45,581) (410,232) (455,813) Distributions - (99,971) (99,971) ------------ -------------- ----------- ----------- Balance, June 30, 1994 23,139 $(1,081,773) $ 7,716,469 $ 6,634,696 ========= =========== =========== ===========
See notes to Financial Statements. NOTES TO FINANCIAL STATEMENTS June 30, 1995 (Unaudited) 1. ACCOUNTING AND FINANCIAL REPORTING POLICIES The condensed consolidated financial statements included herein have been prepared by the Registrant, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. The Registrant's accounting and financial reporting policies are in conformity with generally accepted accounting principles and include adjustments in interim periods considered necessary for a fair presentation of the results of operations. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Registrant's latest annual report on Form 10-K. The accompanying consolidated financial statements reflect the Partnership's results of operations for an interim period and are not necessarily indicative of the results of operations for the year ending December 31, 1995. 2. CASH AVAILABLE FOR DISTRIBUTION The Managing General Partner determined it to be in the best interest of the Partnership to retain cash available for distribution from July 1, 1987 to December 31, 1990 in order to increase the Partnership's operating reserves. In 1991, Management began to distribute cash available for distribution. A distribution of $49,980 was paid in the quarter ended June 30, 1995 representing cash available for distribution from the prior quarter. Going forward, the Managing General Partner has determined to again retain any cash available for distribution pending the refinancing of the first mortgage loan encumbering Stratford Place Apartments. 3. TAXABLE INCOME The Partnership's results of operations on a tax basis are expected to differ from net income for financial reporting purposes primarily due to the accounting differences in the recognition of depreciation and amortization. ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The Partnerships operating results for the quarter ended June 30, 1995 improved relative to the same period in 1994. The Partnership's net loss for the quarter declined from $212,898 in 1994 to $170,045 in 1995. Revenue increased by 2.9% and expenses remained stable. The Partnership operated at a net loss of $336,509 for the six months ended June 30, 1995, compared to a net loss of $455,813 for the six months ended June 30, 1994. Excluding non-cash items such as depreciation and amortization, however, the Partnership's properties have, in the aggregate, generated cash flow, which the Partnership has used to make improvements to the properties, principal payments on the loans encumbering the properties and cash distributions to limited partners. The Partnership's income increased by 4.0% for the first six months of 1995 compared to the first six months of 1994, primarily as a result of a 4.3% increase in rental income. On an aggregate basis, average rents at the Partnership's four properties have increased by 5.2% since the first six months of 1994. While overall average occupancy declined slightly from 92% to 90%, the Partnership was able to significantly reduce the level of tenant concessions, especially at Stratford Place Apartments. Occupancy improved at Stratford Place (from 92% to 96%) was stable at Sunflower (92%) but was lower at Meadow Wood (87% compared to 92%) and Stratford Village (86% compared to 92%). The direct operating costs of the Partnership's properties increased by 6.1%, primarily as a result of a one-time fee that was paid to a consultant for reducing the 1994 through 1996 real estate tax liability of some of the Partnership's properties. This payment is reflected in the Partnership's "General & Administrative" expense. In addition, the Partnership's utility expense increased by 3.2% and repairs and maintenance expense increased by 4.7%, primarily as a result of additional carpet replacements in apartment units. Interest expense declined as a result of the Partnership's significantly reducing the principal balance of the Sunflower mortgage loan as part of a restructuring of the loan during 1994. The Dallas (Sunflower) and Gaithersburg, Maryland (Stratford Place) markets are currently stable. The submarket of Jacksonville in which Meadow Wood is located has weakened somewhat as indicated by the property's lower occupancy for the quarter. Competition in the Montgomery, Alabama, market in which Stratford Village is located has increased dramatically with the addition of over 1,000 new apartment units to the market over the last year. The Partnership continues to make capital improvements to the properties to enhance their competitiveness within their local markets. The Partnership spent $274,570 on capital improvements during the first six months of 1995 compared to $64,791 in the six months of 1994. At two of the properties (Meadow Wood and Stratford Village), a portion of the capital improvements is funded by replacement reserves held by the mortgage lenders, with the balance being funded from operations. The balance of these replacement reserves was $465,729 at June 30, 1995. Capital improvements from the other two properties are funded entirely from operations. The Partnership is currently pursuing a refinancing of the first mortgage loan encumbering Stratford Place Apartments in Gaithersburg, Maryland, and it is unclear whether the Partnership will be able to obtain a new loan large enough to repay the existing loan in its entirety. In addition, the Partnership has been using its reserves to make the increased debt service payments on the Sunflower Apartments mortgage loan that are required by the restructuring of that loan. The increased payments are serving to significantly reduce the principal balance of that loan such that the loan will be fully repaid by the end of 1996. For these reasons the Partnership has elected to temporarily suspend quarterly cash distributions in order to be certain that the Partnership has sufficient reserves to refinance the Stratford Place loan. Cash distributions should resume after the Sunflower loan is retired. The results of operations in future quarters may differ from the results of operations for the quarter ended June 30, 1995, due to inflation and changing economic conditions which could affect occupancy levels, rental rates and operating expenses. PART II - OTHER INFORMATION NOT APPLICABLE SIGNATURE 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. WINTHROP GROWTH INVESTORS 1 LIMITED PARTNERSHIP (Registrant) BY: TWO WINTHROP PROPERTIES, INC. Managing General Partner DATED: August 11, 1995 By: /s/Richard J. McCready Richard J. McCready Chief Operating Officer DATED: August 11, 1995 By: /s/Thomas C. Staples Thomas C. Staples Chief Accounting Officer SUPPLEMENTARY INFORMATION REQUIRED PURSUANT TO SECTION 9.4 OF THE PARTNERSHIP AGREEMENT June 30, 1995 (Unaudited) 1. Statement of Cash Available for Distribution for the three months ended June 30, 1995: Net loss $(170,045) Add: Amortization charges to income not affecting cash available for distribution 10,783 Net loss from the Properties 149,607 Cash from reserves 59,635 --------- Cash Available for Distribution $ 49,980 ========= Distributions allocated to Limited Partners $ 49,980 ========= 2. Fees and other compensation paid or accrued by the Partnership to the General Partners, or their affiliates, during the three months ended June 30, 1995: --------------------------------------------------------------------------------------------------------------------------- Entity Receiving Form of Compensation Compensation Amount --------------------------------------------------------------------------------------------------------------------------- Winthrop Management Property Management Fee $81,619
All other information required pursuant to Section 9.4 of the Partnership Agreement is set forth in the attached Report on Form 10-Q or Partnership Report. EX-27 2 ART. 5 FDS FOR 2ND QTR 10
5 This schedule contains summary financial information extracted from unaudited financial statements for the six month period ending June 30, 1995 and is qualified in its entirety by reference to such financial statements. 0000722565 Winthrop Growth Investors 1 L.P. 1 U.S. DOLLARS 6-MOS DEC-31-1994 JAN-01-1995 JUN-30-1995 1.00000 730,975 0 0 0 0 2,236,458 41,508,522 17,607,610 26,868,345 685,061 20,402,978 0 0 0 5,780,306 26,868,345 0 3,316,080 0 1,743,413 952,961 0 956,215 (336,509) 0 (336,509) 0 0 0 (336,509) (13.090) 0.000