-----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, AoL1EFMRprQ5hzSB5+0xbA5wW0n1cdpPwNzJTTrZ8LSYGBIFMS1h96GgJIMCu/Jr 6VuA9V8kpcmUeMU2eWvQkw== 0000745481-97-000002.txt : 19971020 0000745481-97-000002.hdr.sgml : 19971020 ACCESSION NUMBER: 0000745481-97-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19971017 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SECURED INVESTMENT RESOURCES FUND LP CENTRAL INDEX KEY: 0000745481 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 480979566 STATE OF INCORPORATION: KS FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-14542 FILM NUMBER: 97697526 BUSINESS ADDRESS: STREET 1: 5453 W 61ST PL CITY: MISSION STATE: KS ZIP: 66205 BUSINESS PHONE: 9133845700 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter ended June 30, 1997 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period to Commission file number 0-14542 SECURED INVESTMENT RESOURCES FUND, L.P. (Exact name of registrant as specified in its charter) Kansas 48-0979566 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 5453 W. 61st Place, Mission, Kansas 66205 (Address of principal executive offices) (Zip Code) (Registrant's telephone number, including area code) (913) 384-5700 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Limited Partnership Interests ("Units") 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 such shorter periods 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 SECURED INVESTMENT RESOURCES FUND, L.P. Index PART I. FINANCIAL INFORMATION Page Item 1. Financial Statements (Unaudited): Consolidated Balance Sheets -- June 30, 1997 and December 31, 1996 3-4 Consolidated Statements of Operations -- Three and Six Months Ended June 30, 1997 and 1996 5 Consolidated Statements of Partnership Capital -- Six Months Ended June 30, 1997 and the Years Ended December 31, 1996, and 1995 6 Consolidated Statements of Cash Flows -- Six Months Ended June 30, 1997 and 1996 7-8 Notes to Consolidated Financial Statements 9-10 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations 11-12 PART II. OTHER INFORMATION Item 1. Legal Proceedings 13 Item 2. Changes in Securities 13 Item 3. Defaults Upon Senior Securities 13 Item 4. Submission of Matters to a Vote of Security Holders 13 Item 5. Other Information 13 Item 6. Exhibits and Reports on Form 8-K 13 SIGNATURES 14 PART I. FINANCIAL INFORMATION Item 1. FINANCIAL STATEMENTS SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED BALANCE SHEETS June 30, 1997 December 31, (Unaudited) 1996 ASSETS INVESTMENT PROPERTIES Land and buildings $ 16,538,383 $ 16,523,135 Furniture, fixtures and equipment 1,732,509 1,714,939 18,270,892 18,238,074 Less accumulated depreciation and allowance for losses 6,960,221 6,667,531 11,310,671 11,570,543 OTHER ASSETS Cash 257,612 206,974 Rents and other receivables, less allowance of $33,850 in 1997 $42,350 in 1996 14,951 10,236 Prepaid expenses 34,611 368 Debt issuance costs, net of accumulated amortization of $66,934 in 1997 and $63,135 in 1996 143,320 141,488 Commercial commissions, deposits and other 20,780 17,015 Restricted deposits 19,588 15,105 490,862 391,186 TOTAL ASSETS $ 11,801,533 $ 11,961,729 SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED BALANCE SHEETS--CONT'D. June 30, 1996 December 31, (Unaudited) 1995 LIABILITIES AND PARTNERSHIP CAPITAL Mortgage debt (Note B) $ 11,866,304 $ 11,952,227 Accrued interest 174,658 128,096 Accounts payable and accrued expenses 204,283 106,926 Due to related parties (Note C) 59,941 57,416 Unearned revenue 103,604 110,733 Tenant security deposits 79,422 75,485 TOTAL LIABILITIES 12,488,212 12,430,883 PARTNERSHIP CAPITAL General Partners Capital contribution 1,000 1,000 Partnership deficit (62,964) (60,789) (61,964) (59,789) Limited Partners Capital contributions 5,608,838 5,608,838 Partnership deficit (6,233,553) (6,018,203) (624,715) (409,365) TOTAL PARTNERSHIP CAPITAL (686,679) (469,154) $ 11,801,533 $ 11,961,729 See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Six months Ended Three Months Ended June 30, June 30, 1997 1996 1997 1996 REVENUES Rents $1,109,730 $1,082,812 $ 571,929 $ 541,189 Interest 1,738 2,453 901 1,211 Maintenance escalations 34,728 37,013 17,031 17,578 1,146,196 1,122,278 589,861 559,978 OPERATING AND ADMINISTRATIVE EXPENSES Property operating expenses 383,543 379,028 201,890 191,169 General and administrative expenses 22,326 25,990 11,621 14,091 Professional services 45,527 46,725 22,550 35,328 Management Fees 56,673 49,051 29,524 24,748 508,069 500,794 265,585 265,336 NET OPERATING INCOME 638,127 621,484 324,276 294,642 NON-OPERATING EXPENSES Interest 559,163 648,688 282,576 327,636 Depreciation and amortization 296,489 299,394 148,245 148,692 855,652 948,082 430,821 476,328 PARTNERSHIP LOSS $ (217,525) $ (326,598) $ (106,545) $(181,686) Allocation of loss: General Partners (2,175) (3,266) (1,065) (1,817) Limited Partners (215,350) (323,332) (105,480) (179,869) $ (217,525) $ (326,598) $ (106,545) $ (181,686) Partnership loss per limited partnership unit $ (8.66) $ (13.00) $ (4.24) $ (7.23) See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF PARTNERSHIP CAPITAL Six months Ended June 30, 1997 (Unaudited) and the Years Ended December 31, 1996 and 1995 General Limited Partners Partners Total Balances at January 1, 1995 $ (49,692) $ 590,244 $ 540,552 Partnership loss (4,853) (480,426) (485,279) Balances at December 31, 1995 (54,545) 109,818 55,273 Partnership loss (5,244) (519,183) (524,427) Balances at December 31, 1996 (59,789) (409,365) (469,154) Patnership loss (2,175) (215,350) (217,525) Balances at June 30, 1997 $ (61,964) $ (624,715) $ (686,679) See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended June 30, 1997 1996 OPERATING ACTIVITIES Partnership loss $ (217,525) $ (326,598) Adjustments to reconcile partnership loss to net cash provided by (used in) operating activities: Depreciation and amortization 303,015 305,734 Provision for losses on rents and other receivables (8,500) (2,800) Changes in assets and liabilities: Rents and other receivables 3,785 1,676 Prepaid expenses (34,244) (25,885) Commercial commission, deposits and other (10,291) (646) Account payable and accrued expenses 97,357 (49,282) Accrued interest 46,563 17,465 Unearned revenue (7,129) (5,159) Tenant security deposits 3,937 5,429 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 176,968 (80,066) INVESTING ACTIVITIES Purchase of and improvements to investment property (32,818) (99,235) Restricted deposits (4,482) 45,292 NET CASH USED IN INVESTING ACTIVITIES (37,300) (53,943) SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)--CONT'D. Six Months Ended June 30, 1997 1996 FINANCING ACTIVITIES Mortgage Proceeds $ 0 $ 410,000 Due To (From) Related Parties 2,525 1,492 Principal payments on long-term debt (85,923) (219,018) Debt Issuance Cost (5,632) (2,999) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES (89,030) 189,475 INCREASE IN CASH AND CASH EQUIVALENTS 50,638 55,466 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 206,974 161,414 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 257,612 $ 216,880 See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. NOTES TO FINANCIAL STATEMENTS (Unaudited) June 30, 1997 NOTE A--BASIS OF PRESENTATION The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. 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 management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the six month period ended June 30, 1997 are not necessarily indicative of the results that may be expected for the year ended December 31, 1997. For further information, refer to the financial statements and footnotes thereto included in the Partnership's annual report on Form 10-K for the year ended December 31, 1996. NOTE B--MORTGAGE DEBT Mortgage debt consists of the following: June 30, December 31, 1997 1996 Collateralized by Investment Property: First Mortgages: The Colony Apartments $ 3,641,057 $ 3,661,657 Foothills Village S.C. 2,593,695 2,621,779 Cascade Apartments 1,853,926 1,875,173 The Market S.C./Hidden Valley Exchange S.C. 1,589,367 1,601,745 Hidden Valley Exchange S.C. 810,014 813,628 Second Mortgages: Foothills Village, S.C. 968,245 968,245 The Market S.C./Hidden Valley Exchange S.C. 410,000 410,000 $ 11,866,304 $ 11,952,227 Interest expense totaled $559,163 and $648,688 for the six months ending June 30, 1997 and 1996, respectively. SECURED INVESTMENT RESOURCES FUND, L.P. NOTES TO FINANCIAL STATEMENTS--CONT'D. NOTE B--MORTGAGE DEBT--CONT'D. The mortgage for Cascade Apartments matured March 1, 1995. The present mortgage holder has agreed to temporarily extend the mortgage on a month-to-month basis and the Partnership continues to make principal and interest payments of $18,900 to said mortgage holder. On May 28, 1996, the Partnership signed a note, collateralized by a second mortgage on The Market and Hidden Valley Exchange, in the amount of $410,000 at 7% interest. The Partnership will make consolidated monthly principal and interest payments on this and the first mortgage in the amount of $11,426 per month until June 25, 1998 when the entire amount becomes due and payable. The proceeds of this note were used to pay delinquent real estate taxes for The Market and Hidden Valley Exchange as well as accrued interest and related loan costs. NOTE C--RELATED PARTY TRANSACTIONS SPECS, Inc., a Kansas Corporation in which the individual General Partner has a minority interest, receives property management fees for providing property management services. SPECS, Inc. also performs various professional services for the Partnership, primarily tax accounting, audit preparation, SEC 10Q and 10K preparation, and investor services. Property management fees paid by the Partnership to SPECS, Inc. are as follows: Six Months Ended June 30, 1997 1996 Property management fees $ 56,673 $ 49,051 Amounts due (to) from related parties consist of the following: June 30, June 31, 1997 1996 Secured Investment Resources Fund, L.P. III $ (81,937) (78,345) Secured Investment Resources Fund, L.P. II (5,000) (5,000) SIR, Inc. 26,996 25,929 $ (59,941) $ (57,416) SECURED INVESTMENT RESOURCES FUND, L.P. NOTE D--CASH DISTRIBUTIONS No distributions have been made since January 1990. Future distributions will be made only from excess cash flow not needed for working capital reserves. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Results of Operations Revenues for the first six months of 1997 increased by $24,000 (2.1%) compared with the same period last year. Apartment rentals decreased $12,000 and commercial properties accounted for increases of $36,000. The apartment market has not allowed the Partnership to increase rental rates. Several smaller leases have been negotiated at Foothills Shopping Center which has raised occupancy. Total operating and administrative expenses increased $900 (0.2%) when comparing the first six months of 1997 to the first six months of 1996. The Partnership anticipates that operating results for the year ending December 31, 1997 will show a continued increase in revenues due to new leases signed on the commercial properties. Liquidity and Capital Resources During the first six months of 1997 $177,000 of cash was provided by operating activities, $37,300 was used for investing activities and $89,000 was used in financing activities. In May 1996, a $410,000 note, collateralized by Hidden Valley and The Market, was signed. This loan matures June 25, 1998 and the interest rate is 7%. The mortgage for Cascade Apartments matured in March, 1995. The existing mortgage holder has agreed to extend this note on a month-to-month basis and the Partnership makes monthly principal and interest payments of $18,900. The General Partners also anticipate that 1997 cash flow from operations will continue to improve because of strong occupancy, rental rate increases, stabilized expenses, and new leases signed on commercial properties. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.--Cont'd. The General Partners have the option of offering one or more properties for sale. Any net proceeds in excess of the outstanding mortgage balance could be used to generate additional additional working capital. The General Partners have determined it prudent to discontinue cash distributions until such time that adequate working capital and capital improvement reserves are in place. (The remainder of this page intentionally left blank.) PART II. OTHER INFORMATION Item 1. LEGAL PROCEEDINGS None. Item 2. CHANGES IN SECURITIES Inapplicable. Item 3. DEFAULTS UPON SENIOR SECURITIES None. Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Inapplicable. Item 5. OTHER INFORMATION Inapplicable. Item 6. EXHIBIT AND REPORTS ON FORM 8-K (a) Exhibits None. (b) Reports on Form 8-K There were no reports on Form 8-K filed during the quarter ended June 30, 1997. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. SECURED INVESTMENT RESOURCES FUND, L.P. A Kansas Limited Partnership (Registrant) By: James R. Hoyt as Individual General Partner Date: August 15, 1997 By: Secured Investment Resources, Inc. as Corporate General Partner By: James R. Hoyt, President Date: August 15, 1997 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. SECURED INVESTMENT RESOURCES FUND, L.P. A Kansas Limited Partnership (Registrant) By: /s/ James R. Hoyt James R. Hoyt as Individual General Partner Date: August 15, 1997 By: Secured Investment Resources, Inc. as Corporate General Partner By: /s/ James R. Hoyt James R. Hoyt, President Date: August 15, 1997 EX-27 2
5 Unaudited. 1 6-MOS DEC-31-1997 JAN-01-1997 JUN-30-1997 257,612 0 48,801 (33,850) 0 490,862 18,270,892 6,960,221 11,801,533 621,908 11,866,304 0 0 0 0 11,801,533 0 1,146,196 0 508,069 296,489 0 559,163 0 0 0 0 0 0 (217,525) (8.66) 0
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