-----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, RK4PElijyg3j//o7ZU0oRBVWV/5VQsjscbMiswL+BpIMUY/Kqjaxuhsxk3o5+8nY B18Svm6hsJkS6d8wN+JsMA== 0000725614-96-000004.txt : 19960812 0000725614-96-000004.hdr.sgml : 19960812 ACCESSION NUMBER: 0000725614-96-000004 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960809 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONSOLIDATED CAPITAL PROPERTIES V CENTRAL INDEX KEY: 0000725614 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 942918560 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-13083 FILM NUMBER: 96607532 BUSINESS ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLZ STREET 2: POST OFFICE BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 8032391000 MAIL ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLAZA STREET 2: PO BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 10QSB 1 FORM 10-QSB.--QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Quarterly or Transitional Report (As last amended by 34-32231, eff. 6/3/93.) U.S. Securities and Exchange Commission Washington, D.C. 20549 Form 10-QSB [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1996 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period.........to......... Commission file number 0-13083 CONSOLIDATED CAPITAL PROPERTIES V (Exact name of small business issuer as specified in its charter) California 94-2918560 (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) One Insignia Financial Plaza, P.O. Box 1089 Greenville, South Carolina 29602 (Address of principal executive offices) (Zip Code) Issuer's telephone number (864) 239-1000 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 a) CONSOLIDATED CAPITAL PROPERTIES V CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands, except unit data) June 30, 1996 Assets Cash and cash equivalents: Unrestricted $ 283 Restricted - tenant security deposits 105 Investments 207 Accounts receivable 34 Escrows for taxes and insurance 205 Restricted escrows 110 Prepaid and other assets 267 Investment properties: Land $ 1,969 Buildings and related personal property 18,203 20,172 Less accumulated depreciation (12,495) 7,677 $ 8,888 Liabilities and Partners' Deficit Liabilities Accounts payable $ 89 Tenant security deposits 107 Accrued taxes 323 Other liabilities 206 Mortgage notes payable 9,397 Partners' Deficit General partner $ (17) Special limited partners (55) Limited partners (179,617 units issued and outstanding) (1,162) (1,234) $ 8,888 See Accompanying Notes to Consolidated Financial Statements b) CONSOLIDATED CAPITAL PROPERTIES V CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except unit data)
Three Months Ended Six Months Ended June 30, June 30, 1996 1995 1996 1995 Revenues: Rental income $1,006 $1,129 $1,984 $2,323 Other income 66 131 97 186 Total revenues 1,072 1,260 2,081 2,509 Expenses: Operating 389 522 756 1,101 General and administrative 80 90 136 203 Maintenance 141 167 240 369 Depreciation 285 328 567 643 Interest 265 343 529 674 Property taxes 62 139 176 303 Total expenses 1,222 1,589 2,404 3,293 Loss before extraordinary item (150) (329) (323) (784) Extraordinary gain on refinancing -- -- 700 -- Net (loss) income $ (150) $ (329) $ 377 $ (784) Net (loss) income allocated to general partners (.2%) $ -- $ (1) $ 1 $ (2) Net (loss) income allocated to limited partners (99.8%) (150) (328) 376 (782) $ (150) $ (329) $ 377 $ (784) Net (loss) income per limited partnership unit: Loss before extraordinary item $ (.83) $(1.83) $(1.80) $(4.35) Extraordinary gain from refinancing -- -- 3.89 -- Net (loss) income $ (.83) $(1.83) $ 2.09 $(4.35) See Accompanying Notes to Consolidated Financial Statements
c) CONSOLIDATED CAPITAL PROPERTIES V CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' DEFICIT (Unaudited) For the Six Months Ended June 30, 1996 (in thousands, except unit data)
Limited Special Partnership General Limited Limited Units Partner Partners Partners Total Original capital contributions 180,037 $ 1 $ -- $45,009 $45,010 Partners' deficit at December 31, 1995 179,617 $ (18) $ (56) $(1,537) $(1,611) Amortization of timing difference (Note D) -- -- 1 (1) -- Net income for the six months ended June 30, 1996 -- 1 -- 376 377 Partners' deficit at June 30, 1996 179,617 $ (17) $ (55) $(1,162) $(1,234) See Accompanying Notes to Consolidated Financial Statements
d) CONSOLIDATED CAPITAL PROPERTIES V CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Six Months Ended June 30, 1996 1995 Cash flows from operating activities: Net income (loss) $ 377 $ (784) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation 567 643 Amortization of lease commissions, discounts, and loan costs 84 89 Casualty gain -- (32) Extraordinary gain on refinancing (700) -- Change in accounts: Restricted cash 3 (17) Accounts receivable (12) 10 Escrows for taxes and insurance (10) 41 Prepaid and other assets 12 66 Accounts payable (140) 190 Tenant security deposit liabilities (10) (4) Accrued taxes (6) (102) Other liabilities (41) 99 Net cash provided by operating activities 124 199 Cash flows from investing activities: Property improvements and replacements (104) (262) Deposits to restricted escrows (33) (33) Receipts from restricted escrows -- 26 Proceeds from sale of investments -- 199 Net cash used in investing activities (137) (70) Cash flows from financing activities: Payments on mortgage notes payable (82) (51) Repayment of mortgage note payable (700) -- Net cash used in financing activities (782) (51) Net (decrease) increase in cash and cash equivalents (795) 78 Cash and cash equivalents at beginning of period 1,078 240 Cash and cash equivalents at end of period $ 283 $ 318 Supplemental disclosure of cash flow information: Cash paid for interest $ 483 $ 590 Property improvements and replacements included in accounts payable $ -- $ 42 See Accompanying Notes to Consolidated Financial Statements
e) CONSOLIDATED CAPITAL PROPERTIES V NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note A - Basis of Presentation The accompanying unaudited financial statements of Consolidated Capital 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. In the opinion of ConCap Equities, Inc. (the "General Partner"), all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 1996, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 1996. For further information, refer to the financial statements and footnotes thereto included in the Partnership's annual report on Form 10-KSB for the fiscal year ended December 31, 1995. Certain reclassifications have been made to the 1995 information to conform to the 1996 presentation. Investments Investments consisting primarily of U.S. Treasury Notes with original maturities of more than 90 days, are considered to be held-to-maturity securities. Note B - Transactions with Related Parties The Partnership has paid property management fees based upon collected gross rental revenues for property management services in each of the six month periods ended June 30, 1996 and 1995. In December 1994, affiliates of the General Partner assumed day-to-day property management responsibilities for all of the Partnership's properties with the exception of the Fourth and Race Tower, which was managed by a third party until it was sold in December 1995. Property management fees of $100,000 and $101,000 were paid to affiliates of the General Partner for the six months ended June 30, 1996 and 1995, respectively. These fees are included in operating expenses. The Partnership Agreement also provides for reimbursement to the General Partner and its affiliates for costs incurred in connection with the administration of Partnership activities. Reimbursements for services of affiliates of $84,000 and $122,000 were paid to the General Partner and its affiliates during the six months ended June 30, 1996 and 1995, respectively. In July 1995, the Partnership began insuring its properties under a master policy through an agency and insurer unaffiliated with the General Partner. An affiliate of the General Partner acquired, in the acquisition of a business, certain financial obligations from an insurance agency which was later acquired by the agent who placed the current year's master policy. The current agent assumed the financial obligations to the affiliate of the General Partner who receives payment on these obligations from the agent. The amount of the Partnership's insurance premiums accruing to the benefit of the affiliate of the General Partner by virtue of the agent's obligations is not significant. Note C - Commitment The Partnership is required to maintain working capital reserves for normal repairs, replacements, working capital and contingencies of not less than 5% of Net Invested Capital as defined in the Partnership Agreement. In the event expenditures are made from these reserves, operating revenue shall be allocated to such reserves to the extent necessary to maintain the foregoing level. Cash and cash equivalents, tenant security deposits and investments totalling $595,000, are less than the reserve requirement of $1,761,000 at June 30, 1996. The Partnership intends to replenish the working capital reserve from cash flow from operations after consideration of any capital improvement needs of the properties. The Partnership's recent cash flows from operations, however, have not been sufficient to replenish the reserve and there is no assurance that future levels of cash flow from operations will be adequate to accomplish this objective. The working capital requirement must be met prior to any consideration for distributions to the partners. Note D - Change in Status of Non-Corporate General Partner In the year ended December 31, 1991, the Partnership Agreement was amended to convert the General Partner interests held by the non-corporate General Partner, Consolidated Capital Group ("CCG"), to that of a special limited partner ("Special Limited Partner"). The Special Limited Partner does not have a vote and does not have any of the other rights of a Limited Partner except the right to inspect the Partnership's books and records; however, the Special Limited Partner will retain the economic interest in the Partnership which it previously owned as a general partner. ConCap Equities, Inc. ("CEI") became the sole general partner of the Partnership effective December 31, 1991. In connection with CCG's conversion, a special allocation of gross income was made to the Special Limited Partner in order to eliminate its tax basis negative capital account. After the conversion, the various owners of interests in the Special Limited Partner transferred portions of their interests to CEI so that CEI now holds a .2% interest in all allocable items of income, loss and distribution. The difference between the Special Limited Partner's capital accounts for financial statement and tax reporting purposes is being amortized as the components of the timing differences which created the balance, reverse. Note E - Debt Restructuring The Partnership restructured the debt on the 51 North High Building and made a principal prepayment (without penalty) of $700,000 in January 1996. In addition to this payment, the lender reduced the debt by an additional $700,000, resulting in a $700,000 extraordinary gain on refinancing for a total principal reduction of $1,400,000. The interest rate of the loan was reduced from 13.5% to 9%. The maturity date of June 1, 2004, was unchanged. To facilitate the debt restructuring of the 51 North High Building in 1996, the property was placed into a lower-tier partnership known as Fifty-One North High Street, L.P. in which the Partnership is the 99.99% limited partner. The Partnership retained substantially all economic benefits from the property. Note F - Subsequent Event Subsequent to June 30, 1996, Sutton Place Apartments was transferred to a lower-tier partnership known as Sutton Place CCPV, L.P., in which the Partnership is the 99.99% limited partner, to facilitate the potential refinancing of the first mortgage indebtedness secured by the property. The Partnership retained substantially all economic benefits from the property. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The Partnership's investment properties consist of two apartment complexes and one commercial property. The following table sets forth the average occupancy of the properties for the six months ended June 30, 1996 and 1995: Average Occupancy 1996 1995 Aspen Ridge Apartments Chicago, Illinois 93% 93% Sutton Place Apartments Corpus Christi, Texas 92% 89% 51 North High Street Building Columbus, Ohio 88% 84% The occupancy increase at Sutton Place Apartments resulted from additional military troops being relocated to Corpus Christi. The increase in occupancy at the 51 North High Street Building is due to existing tenants leasing additional space. The Partnership realized a loss before extraordinary item of $150,000 and $323,000 for the three and six months ended June 30, 1996, respectively, compared to a loss of $329,000 and $784,000 for the three and six months ended June 30, 1995, respectively. The decreased loss before extraordinary item primarily resulted from the sale of the Fourth and Race Tower office building in December 1995. The sale of Fourth and Race Tower resulted in decreases in rental and other income. Other income also decreased due to lower lease cancellation fees, cleaning and damage fees and fewer late charges at the Sutton Place Apartments due to a stronger tenant base. Additionally, the Partnership received no dividends on its investment in Southmark Preferred Stock during 1996 which further reduced other income. The Partnership had received approximately $21,000 in dividends during the six months ended June 30, 1995. These decreases in other income were partially offset by a property tax refund received during the six months ended June 30, 1996, resulting from an appeal of the 1994 taxes for the 51 North High Street Building. Property operations, maintenance, depreciation and property taxes also decreased due to the Fourth and Race Tower sale. The decrease in depreciation was partially offset by an increase in the depreciable asset base at the 51 North High property from capital additions of approximately $215,000 in 1995. General and administrative expenses decreased due to reduced expense reimbursements related primarily to the efforts of the Dallas partnership administration staff during the management transition period in 1995 as well as reduced legal costs related to the marketing for sale of the Fourth and Race Tower in 1995 which negatively impacted operations in 1995. The decrease in interest expense is due to a reduction of the interest rate and a reduction of the debt balance by $1.4 million at 51 North High in January 1996. (See "Note E" in the Notes to Consolidated Financial Statements in "Item 1"). During the six months ended June 30, 1995, the Partnership realized a casualty gain as a result of a fire at the Fourth and Race Tower on June 5, 1995. The total insurance proceeds expected to be received exceeds the total estimated costs of replacing the equipment destroyed resulting in a casualty gain of $32,000 which is included in other income. As part of the ongoing business plan of the Partnership, the General Partner monitors the rental market environment of each of its investment properties to assess the feasibility of increasing rents, maintaining or increasing occupancy levels and protecting the Partnership from increases in expense. As part of this plan, the 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, due to changing market conditions, which can result in the use of rental concessions and rental reductions to offset softening market conditions, there is no guarantee that the General Partner will be able to sustain such a plan. At June 30, 1996, the Partnership held cash and cash equivalents of $283,000 compared to $318,000 at June 30, 1995. Net cash provided by operating activities decreased primarily due to increased payments of certain repair and maintenance items related to painting and other unit interior and exterior maintenance incurred in December of 1995, partially offset by the elimination of the negative cash flows of the Fourth and Race Tower subsequent to the building sale in late 1995. Net cash used in investing activities increased primarily due to no long-term investments maturing in 1996. Net cash used in financing activities increased due primarily to the payment on the 51 North High Street Building debt in January 1996 noted above. 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 property to adequately maintain the physical assets and other operating needs of the Partnership. Such assets are currently thought to be sufficient for any near-term needs of the Partnership. The mortgage indebtedness of $9,397,000, net of discount, matures at various times with balloon payments due at maturity, at which time the properties will either be refinanced or sold. Future cash distributions will depend on the levels of net cash generated from operations, capital expenditure requirements, property sales and the availability of cash reserves. During the six months ended June 30, 1996, and June 30, 1995, no distributions were declared or paid. PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits. Exhibit 27, Financial Data Schedule, is filed as an exhibit to this report. (b) Reports on Form 8-K. None. 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. CONSOLIDATED CAPITAL PROPERTIES V By: CONCAP EQUITIES, INC. General Partner By: /s/Carroll D. Vinson Carroll D. Vinson President By: /s/Robert D. Long, Jr. Robert D. Long, Jr. Vice President/CAO Date: August 9, 1996 EX-27 2
5 This schedule contains summary financial information extracted from Consolidated Capital Properties V 1996 Second Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000725614 CONOSLIDATED CAPITAL PROPERTIES V 1,000 6-MOS DEC-31-1996 JUN-30-1996 283 207 34 0 0 0 20,172 12,495 8,888 0 9,397 0 0 0 (1,234) 8,888 0 2,081 0 0 2,404 0 529 0 0 0 0 700 0 377 2.09 0 The Registrant has an unclassified balance sheet. Multiplier is 1.
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