-----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, Ono3rqbnTyZQnclTcAOISrv9Radzn8qJzmoNYOXQBQrqWRegG66ud64SDgJDDZ/P vdcI+dKwqGzjFCjEEuPIvg== 0000745481-97-000001.txt : 19970423 0000745481-97-000001.hdr.sgml : 19970423 ACCESSION NUMBER: 0000745481-97-000001 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970422 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-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-14542 FILM NUMBER: 97584715 BUSINESS ADDRESS: STREET 1: 5453 W 61ST PL CITY: MISSION STATE: KS ZIP: 66205 BUSINESS PHONE: 9133845700 10-K 1 FORM 10-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the year ended December 31, 1996 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 Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] PART I Item 1. Business Secured Investment Resources Fund, L.P. ("Partnership") is a Kansas limited partnership formed pursuant to the Kansas Revised Uniform Limited Partnership Act on March 30, 1984. James R. Hoyt is the Individual General Partner and Secured Investment Resources, Inc., a Kansas corporation, is the Corporate General Partner. The Partnership was formed with the intent to engage in the business of acquiring, improving, developing, operating and holding for investment, income producing properties with the objectives of (i) preserving and protecting the Partnership's capital; (ii) providing capital gains through potential appreciation; (iii) providing quarterly "tax sheltered" cash distributions from operations; (iv) generating tax losses in excess of tax shelter distributions, which may be used to offset taxable income from other sources; and (v) increasing equity through the reduction of mortgage loans on Partnership properties. On August 31, 1986, the Partnership closed its offering, having received gross proceeds of $12,434,750 from the sale of 24,869.5 units of limited partnership interests. This amount includes the purchase of 190 units by the Corporate General Partner. The Partnership acquired two garden-style apartment communities in 1985 and three commercial strip shopping centers in 1986. The General Partners feel that all of these properties met the Partnership's investment criteria and objectives. Total rent charges for Sampler Shoppes, Inc. (SSI), the anchor tenant at Foothills Village Shopping Center, represented approximately 9.0% and 8.95% of Partnership rent revenues for the years ended December 31, 1996 and 1995, respectively. As of December 31, 1996, the Partnership has made cash distributions to Limited Partners of $5,343,132 for the period June 1, 1985 through December 31, 1996. No distributions have been made since January 1990. Future distributions will only be made from excess cash flow not needed for working capital reserves. As of December 31, 1996, the Partnership had no employees. Employees of SPECS, Inc. provide services to the Partnership. The individual General Partner is a shareholder in SPECS, Inc. Item 1. Business--Cont'd. Competition The real estate business is highly competitive and the Partnership competes with numerous entities engaged in real estate activities, some of which have greater financial resources than those of the Partnership. The Partnership's management believes that success against such competition is dependent upon the geographic location of the property, the performance of property managers, the amount of new construction in the area and the maintenance and appearance of the property. With respect to residential property, competition is also based upon the design and mix of the units and the ability to provide a community atmosphere for the tenants. The Partnership's management believes that general economic circumstances and trends and new properties in the vicinity of each of the Partnership's properties will also be competitive factors. Inflation The effects of inflation on the Partnership's operations or investments are not quantifiable. Revenues from property operations fluctuate proportionately with increases and decreases in housing costs. Fluctuations in the rate of inflation also affect the sales values of properties and, correspondingly, the ultimate gains to be realized by the Partnership from property sales. (The remainder of this page intentionally left blank.) Item 2. Properties. The following table sets forth the investment portfolio of the Partnership at December 31, 1996: Average Properties at Occupancy(*) Property Description Initial Cost Date Acquired Percentage 1996 1995 The Colony Apartments 140 units $5,940,707 Oct. 16, 1989 90% 94% Burlington, NC Cascade Apartments 86 units $2,584,253 Dec. 7, 1989 94% 94% Topeka, KS Hidden Valley Exchange 27,200 Sq.Ft. $2,013,709 Sep. 30, 1986 76% 76% Shopping Ctr. Independence, MO Foothills Village Shopping Ctr. 66,953 Sq.Ft. $4,746,556 Nov. 13, 1986 87% 94% Las Vegas, NV The Market Shopping Ctr. 12,782 Sq.Ft. $1,414,510 Nov. 18, 1986 74% 100% Overland Park, KS (*) Based upon vacancy amount (in dollars) as a percent of gross possible rents. Item 3. Legal Proceedings. None. Item 4. Submission of Matters to a Vote of Security Holders. None. PART II Item 5. Market for Registrant's Common Equity and Related Security Holder Matters. (A) There is no established public trading market for the Units of the Partnership. (B) There have been no distributions the last three years. (C) As of December 31, 1996, the Partnership had admitted 1,297 Limited Partners who purchased 24,869.5 units. Item 6. Selected Financial Data. For The Years Ended December 31, OPERATING DATA 1996 1995 1994 1993 1992 (In Thousands) Rents $ 2,225 $ 2,235 $ 2,116 $ 1,857 $ 1,939 Maintenance Escalations and Other Income 74 91 91 110 128 Property Operating and Administrative Exp 997 1,009 910 821 887 Interest Expense 1,202 1,175 1,208 1,140 1,145 Depreciation/ Amortization 624 627 590 591 603 Partnership Loss $ (524) $ (485) $ (501) $ (585) $ (568) PER LIMITED PARTNERSHIP UNIT Partnership Loss (1)$ (20.88) $ (19.32) $ (19.94) $ (23.27) $ (22.60) Cash Distributions $ --- $ --- $ --- $ --- $ --- BALANCE SHEET DATA 1996 1995 1994 1993 1992 (In Thousands) Total Assets 11,962 12,398 12,973 13,285 13,768 Mortgage Debt 11,952 11,826 11,576 11,630 11,511 (1) Partnership loss per limited partnership unit is computed by dividing loss allocated to the Limited Partners by the weighted average number of limited partnership units outstanding. Per unit information has been computed based on 24,869.5 weighted average limited partnership units outstanding. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. Results of Operations Revenue for the partnership decreased in 1996 to $2,299,000 as compared to $2,326,000 in 1995. This represented a decrease of $27,000 or 1.2%. The operating costs stabilized in 1996 over 1995 with a slight decrease of $12,000 (1.2%) from $1,009,000 to $997,000. Interest expense was up from 1995 by $27,000 (2.3%). Depreciation and amortization for 1996 decreased slightly by $3,000 (.3%) over 1995 depreciation of $627,000. The net result to the Partnership was an increase in the loss of $39,000 (8.0%) over 1995 levels. In 1996 AT&T Wireless Services signed a 10 year lease on a pad at the rear of Foothills Shopping Center. In November of 1996, AT&T paid the ten (10) years rent in the amount of $60,000. This rent is being amortized at $500.00 per month over the term of the lease. Revenue in 1995 was $2,326,000 as compared to $2,207,000 in 1994, an increase of 5.4%. This higher revenue was achieved through average higher occupancy levels at both residential and commercial properties and through increased rental rates on the residential properties. The increased residential rental rates resulted in a high resident turnover and higher operating costs. The operating costs increased $99,000 (10.9%) from $910,000 to $1,009,000. These increases were primarily in the areas of repairs, payroll, and utilities. Interest expense was down from 1994 by $33,000 (2.7%). Depreciation for 1995 increased $37,000 (6.3%) over 1994 depreciation of $590,000. The net result to the Partnership was a reduction of the loss by $16,000 (3.1%) from 1994 levels. Revenue in 1994 was $2,207,000 as compared to $1,968,000 in 1993, an increase of 12.2%. This higher revenue was achieved through average higher occupancy levels at both residential and commercial properties and through increased rental rates on the residential properties. In 1994 to 1993, the lower occupancy levels at Hidden Valley were more than offset by higher occupancy levels at Foothills and the Market. The increased residential rental rates in 1994 resulted in a high resident turnover and higher operating costs. The operating costs increased $88,500 (10.8%) from $822,000 to $910,000. These increases were primarily in the areas of repairs, payroll, and utilities. Interest Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.--Cont'd. Results of Operations -- Cont'd. expense was up from 1993 by $68,200 (6.0%) due primarily to prime interest rate increases during 1994. The net result to the Partnership was a reduction of the loss by $84,000 (14.3%) from 1993 levels. The Partnership anticipates that the operating results will improve during 1997. The general partner anticipates that the Fund will achieve higher occupancy levels, increased rental rates, decreased rent promotions and will begin a closer monitoring of operating expenses. Liquidity and Sources of Capital During 1996, the Partnership's primary source of working capital was from borrowing/refinancing of long term debt of $118,000 net of repayments. Operations provided $68,000 of funds. Property improvements utilized $200,000 of these funds, and $58,000 was provided by restricted deposits for capital improvements. The net effect was an increase in cash of $46,000 at year end. The trend of higher occupancy levels and higher rental rents that began several years ago should continue through 1997 and improve cash flow from operations. During 1995, the Partnership's primary source of working capital was from borrowing/refinancing of long term debt of $196,000 net of repayments. Operations provided $39,000 of funds. Property improvements utilized $183,000 of these funds, as did $73,000 in restricted deposits for capital improvements. The net effect was a decrease in cash of $21,000 at year end. During 1995, Sampler Shoppes, Inc. (The primary tenant at Foothills) paid the entire amount of delinquent rent thereby reducing the Rent and Other receivable balance at December 31, 1994 by $231,000. With these funds the partnership paid delinquent real estate taxes of $138,000 at Foothills Shopping Center, reduced accrued interest on real estate loans and funded additional closing costs on the new Colony Apartments' loan. During 1994, the Partnership's primary source of working capital was from operations, which provided $413,000. These funds were used to fund capital improvements of $142,000 to investment properties, and $186,000 was used for financing activities. The net effect was an increase in cash of $85,000 at year end. The General Partners' believe that sufficient working capital will be available to fund known, on-going Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.--Cont'd. Liquidity and Sources of Capital--Cont'd. operating and capital expenditure requirements for the Partnership during 1997. The Partnership expects con- tinued increased rental income from the residential properties due to ongoing scheduled rental increases. It is also anticipated that occupancy will remain stable on the commercial properties. Operating expenses in 1997 will be up slightly from 1996 due primarily to increased operating costs incurred in conjunction with scheduled rent increases. Interest expense on variable rate notes is expected to increase slightly from 1996 levels. 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 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. The Partnership is actively seeking a mortgage lender for the Cascade Apartments mortgage, which matured in March, 1996. The mortgage was extended by the lender from March, 1995 at the same rate of interest. As of the date of this report, the Partnership continues to make monthly principal and interest payments of $18,900 and will continue on a month-to-month basis with the lender until a refinancing can be completed which is anticipated to be in 1997. The Foothills Village Shopping Center's first mortgage matured in November, 1996. The Partnership is aggressively seeking replacement financing and has entered negotiations with the current mortgage holder to extend the existing financing. The Foothills Village Shopping Centers second mortgage matured on November 11, 1996. The maturity date of this note was extended to December 1, 2001 with an interest rate of 8.5%. The General Partners believe that sufficient working capital will be available during 1997 to fund known, ongoing operating and capital requirements of the Partnership. In 1997, the Partnership anticipates cash flow from operations will improve because management intends to 1) improve occupancy on the commercial properties; 2) achieve rental rate increase; 3) decrease the amount of promotional rent discounts offered on the residential properties; and 4) continue to maintain stringent controls over expenses. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.--Cont'd. Liquidity and Sources of Capital--Cont'd. The General Partners intend to evaluate the property portfolio to determine if it is prudent to offer one or more properties for sale or possibly restructure the related financing packages. Any unleveraged portion of the net sales proceeds or favorable refinancing terms will generate additional working capital. The General Partners have determined it prudent to discontinue cash distributions until such time that adequate working capital reserves are available. All statements contained herein that are not historical facts including the Partnership's current business strategy, the Partnership's projected sources and uses of cash, and the Partnership's plans for future operations, are based upon current expectations. These statements are forward-looking in nature and involve a number of risks and uncertainties. Actual results may differ materially. Among the factors that could cause actual results to differ materially are the following: the availability of sufficient capital to finance the Partnership's business plans on terms satisfactory to the Partnership; competitive factors; changes in regulations affecting the Partnership's business; general businesses and economic conditions; and other factors described from time to time in the Partnership's reports filed with the Securities and Exchange Commission. The Partnership cautions readers not to place undue reliance on any such forward-looking statements, which statements are made pursuant to the Private Litigation Reform Act of 1995 and, as such, speak only as of the date made. (The remainder of this page intentionally left blank.) Item 8. Financial Statements and Supplementary Data. SECURED INVESTMENT RESOURCES FUND, L.P. Index Page Independent Auditors' Report 11 Financial Statements: Consolidated Balance Sheets - December 31, 1996 and 1995 12-13 Consolidated Statements of Operations - Years Ended December 31, 1996, 1995 and 1994 14 Consolidated Statements of Partnership Capital (Deficit)- Years Ended December 31, 1996, 1995 and 1994 15 Consolidated Statements of Cash Flows - Years Ended December 31, 1996, 1995 and 1994 16-17 Notes to Consolidated Financial Statements 18-27 INDEPENDENT AUDITORS' REPORT The Partners Secured Investment Resources Fund, L.P. Mission, KS We have audited the accompanying consolidated balance sheets of Secured Investment Resources Fund, L.P. and affiliated companies as of December 31, 1996 and 1995, and the related statements of operations, partnership capital (deficit) and cash flows for each of the three years in the period ended December 31, 1996. We have also audited the schedules listed in the accompanying index. These financial statements and schedules are the responsibility of the Partnership's management. Our responsibility is to express an opinion on these financial statements and schedules based upon our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and schedules are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and schedules. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and schedules. We believe that our audits provide a reasonable basis for our opinion. As discussed in Note C, the Partnership has mortgage loans that mature during the next fiscal year or that have become due. The Partnership is in current negotiations with the mortgage holders to extend or refinance these obligations. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Secured Investment Resources Fund, L.P. and affiliated companies at December 31, 1996 and 1995, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 1996 in conformity with generally accepted accounting principles. Also in our opinion, the schedules present fairly, in all material respects, the information set forth therein. s/ BDO Seidman LLP St. Louis, Missouri February 7, 1997 SECURED INVESTMENT RESOURCES FUND, L.P. BALANCE SHEETS December 31, 1996 1995 ASSETS INVESTMENT PROPERTIES (Note B) Land and buildings $16,523,135 $16,486,456 Furniture, fixtures and equipment 1,714,939 1,552,076 18,238,074 18,038,532 Less accumulated depreciation and allowance for losses 6,667,531 6,078,281 11,577,543 11,960,251 Cash 206,974 161,414 Rents and other receivables, less allowance of $42,350 in 1996 and $57,200 in 1995 (Notes F and I) 10,236 18,351 Prepaid expenses 368 8,257 Debt issuance costs, net of accumulated amortization of $63,135 in 1996 and $41,550 in 1995 141,488 149,231 Commercial commissions, deposits and other 17,015 27,591 Restricted deposits 15,105 73,299 397,186 438,143 $11,967,729 $12,398,394 See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED BALANCE SHEETS--CONT'D. December 31, 1996 1995 LIABILITIES AND PARTNERSHIP CAPITAL (DEFICIT) Mortgage Debt (Note C) $11,952,227 $11,826,431 Accrued interest 128,096 94,146 Accounts payable and accrued expenses (Note G) 106,926 240,756 Due to related parties (Note D) 57,416 50,922 Unearned revenue 110,733 51,483 Tenant security deposits 75,485 79,383 TOTAL LIABILITIES 12,430,883 12,343,121 PARTNERSHIP CAPITAL (DEFICIT) General Partners Capital contribution 1,000 1,000 Partnership deficit (60,789) (55,545) (59,789) (54,545) Limited Partners Capital contributions 5,608,838 5,608,838 Partnership deficit (6,018,203) (5,499,020) (409,365) 109,818 TOTAL PARTNERSHIP CAPITAL (DEFICIT) (469,154) 55,273 $11,961,729 $12,398,394 See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF OPERATIONS Years Ended December 31, 1996 1995 1994 REVENUES Rents $ 2,224,610 $ 2,234,875 $ 2,116,070 Interest 4,990 6,721 1,267 Maintenance escalations 68,992 84,824 90,151 2,297,592 2,326,420 2,207,488 OPERATING AND ADMINISTRATIVE EXPENSES Property operating expenses 753,457 738,543 688,186 General and administrative expenses 50,846 58,304 44,919 Professional services (Note D) 89,990 104,216 82,181 Management fees (Note D) 102,613 107,915 94,860 996,906 1,008,978 910,146 NET OPERATING INCOME 1,301,686 1,317,442 1,297,342 NON-OPERATING EXPENSES Interest 1,202,257 1,175,423 1,207,972 Depreciation and amortization 623,856 627,298 590,270 1,826,113 1,802,721 1,798,242 PARTNERSHIP LOSS $ (524,427) $ (485,279) $ (500,900) Allocation of loss: General Partners $ (5,244) $ (4,853) $ (5,009) Limited Partners (519,183) (480,426) (495,891) $ (524,427) $ (485,279) $ (500,900) Partnership loss per limited partnership unit $ (20.88) $ (19.32) $ (19.94) See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF PARTNERSHIP CAPITAL (DEFICIT) Years Ended December 31, 1996, 1995 and 1994 General Limited Partners Partners Total Balances at January 1, 1994 $ (44,683) $ 1,086,135 $ 1,041,452 Partnership loss (5,009) (495,891) (500,900) Balances at December 31, 1994 (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) See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31, 1996 1995 1994 OPERATING ACTIVITIES Partnership loss $ (524,427) $ (485,279) $ (500,900) Adjustments to reconcile partnership loss to net cash provided by operating activities: Depreciation and amortization 623,856 627,298 590,270 Provisions for losses on rents and other receivables (14,850) 36,819 46,068 Changes in assets and liabilities: Rents and other receivables 22,965 189,148 (55,746) Prepaid expenses 7,889 12,675 62,035 Commercial commissions, deposits and other (2,445) (12,097) 3,933 Accounts payable and accrued expenses (133,830) (131,140) 54,906 Accrued interest 33,950 (188,743) 149,896 Unearned revenue 59,250 (9,376) 58,234 Tenant security deposits (3,898) 166 4,058 NET CASH PROVIDED BY OPERATING ACTIVITIES 68,460 39,471 412,754 INVESTING ACTIVITIES Improvements to investment properties (199,542) (182,714) (142,105) Restricted deposits 58,194 (73,299) --- NET CASH USED IN INVESTING ACTIVITIES (141,348) (256,013) (142,105) SECURED INVESTMENT RESOURCES FUND, L.P. CONSOLIDATED STATEMENTS OF CASH FLOWS--CONT'D. Years Ended December 31, 1996 1995 1994 FINANCING ACTIVITIES Borrowings under debt arrangements $ 2,017,300 $ 3,850,781 $ --- Debt issuance costs (13,842) (43,867) (108,250) Advances (to) from related parties 6,494 (11,178) (23,000) Principal payments on debt (1,891,504) (3,600,042) (54,574) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 118,448 195,694 (185,824) INCREASE (DECREASE) IN CASH 45,560 (20,848) 84,825 CASH BEGINNING OF YEAR 161,414 182,262 97,437 CASH END OF YEAR $ 206,974 $ 161,414 $ 182,262 See notes to consolidated financial statements. SECURED INVESTMENT RESOURCES FUND, L.P. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE A--SIGNIFICANT ACCOUNTING POLICIES Organization and Business--Secured Investment Resources Fund, L.P. (the Partnership) is a Kansas limited partnership formed pursuant to the Kansas Revised Uniform Limited Partnership Act on March 30, 1984. The General Partners' and Limited Partners' interest in Partnership earnings or loss initially amounts to 1% and 99%, respectively. The allocation of the 1% interest between the General Partners is discretionary. At such point in time cash distributions to the Limited Partners amount to their original invested capital plus interest at a rate of the greater of 8% or the increase in the consumer price index per annum, cumulative non- compounded on their adjusted invested capital, earnings or loss will be allocated 15% to the General Partners and 85% to the Limited Partners. Consolidated Limited Partnerships To satisfy current real estate lending requirements that real estate assets be in single asset partnerships, the Partnership has formed two single asset partnerships. Cascade Joint Venture L.P., a Kansas limited partnership was formed on December 28, 1993 and Colony Joint Venture, L.P., a Kansas limited partnership was formed on September 14, 1994. These partnerships retained the same partnership structure as Secured Investment Resources Fund, L.P., with Secured Investment Resources Fund, L.P. being the sole Limited Partner. The General Partners of Cascade Joint Venture L.P. and Colony Joint Venture, L.P. are identical to the General Partners of Secured Investment Resources Fund, L.P. The result of operations of these single asset partnerships have been consolidated with the Partnership. Depreciation--Investment property is depreciated on a straight-line basis over the estimated useful life of the property (30 years for buildings and 5 years for furniture, fixtures and equipment). Improvements are capitalized and depreciated over their estimated useful lives. Maintenance and repair expenses are charged to operations as incurred. Income Taxes--Any tax liabilities or benefits arising from Partnership operations are recognized individually by the respective partners and, consequently, no provision will be made by the Partnership for income taxes or income tax benefits. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE A--SIGNIFICANT ACCOUNTING POLICIES--CONT'D Partnership Loss Per Limited Partnership Unit--Partnership loss per limited partnership unit is computed by dividing loss allocated to the Limited Partners by the weighted average number of limited partnership units outstanding. Per unit information has been computed based on 24,869.5 weighted average limited partnership units outstanding. Debt Issuance Costs--Loan costs are capitalized by the Partnership and are amortized over the term of the related loan. Accounting Estimates--The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statement and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. New Accounting Standards--In March 1995, the FASB issued its Statement of Financial Accounting Standards No. 121, Accounting for the Impairment of Long-Lived Assets and For Long-Lived Assets to Be Disposed Of ("SFAS 121"). SFAS 121 requires that long-lived assets and certain intangibles to be held and used by an entity be reviewed for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. In addition, SFAS 121 requires long-lived assets and certain intangibles to be disposed of to be reported at the lower of carrying amount or fair value less costs to sell. SFAS 121 is effective for fiscal years beginning after December 15, 1995. The application of this pronouncement did not have a material effect on the financial statements of the Partnership. Reclassification--Certain reclassifications have been made to the 1995 Financial Statement to conform to the 1996 presentation. These reclassifications had no effect on the results of operations. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE B--INVESTMENT PROPERTIES Investment properties consist of the following: December 31, 1996 1995 Cost (including capital improvements subsequent to acquisition): The Colony Apartments $ 6,339,111 $ 6,223,377 Cascade Apartments 2,693,957 2,667,321 Hidden Valley Exchange Shopping Center 2,122,326 2,118,826 Foothills Village Shopping Center 5,645,845 5,595,794 The Market Shopping Center 1,434,163 1,430,542 Partnership 2,672 2,672 18,238,074 18,038,532 Less Accumulated depreciation 6,262,531 5,673,281 Allowance for losses 405,000 405,000 $ 11,570,543 $ 11,960,251 During 1990, the Partnership reduced the carrying value of its commercial property portfolio to reflect real estate market conditions. This change is reflected in Allowance for Losses on Investment Properties. Depreciation expense was $589,250, $584,926 and $576,209 for the years ended December 31, 1996, 1995, and 1994. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE C--MORTGAGE DEBT Non-recourse mortgage debt consists of the following: December 31, 1996 1995 Collateralized by Investment Property First Mortgages Hidden Valley Exchange S.C. $ 813,628 $ 811,973 The Market S.C./Hidden Valley 1,601,745 1,825,697 Foothills Village S.C. 2,621,779 2,621,779 The Colony Apts. 3,661,657 3,699,260 Cascade Apts. 1,875,173 1,914,656 Second Mortgages Foothills Village S.C. 968,245 953,066 The Colony Apartments 410,000 --- $11,952,227 $11,826,431 Hidden Valley Exchange Shopping Center (Hidden Valley) and The Market Shopping Center (The Market) In February 1993, a $750,000 note, collateralized by Hidden Valley and assignment of its rents and leases, was increased to $820,000 and converted to a mortgage payable with interest charged at 8.5%. This loan requires monthly principal and interest payments of $6,266 with the final payment due September 2000. Also in February 1993, a $1,650,000 note, collateralized by Hidden Valley and The Market, was increased to $1,800,000 and converted to a mortgage payable. In August of 1995 an advance on the $1,800,000 note brought the balance to $1,825,696. This loan is payable at 7.0% interest with monthly principal and interest of $11,426 through the maturity date of June 2001. Foothills Village Shopping Center (Foothills) A purchase money note in the amount of $2,621,714 is collateralized by Foothills. Interest only payments are due monthly at the rate of 10% through the maturity date of November 11, 1996. Subsequent to the loan's maturity date, the Partnership has been able to make monthly interest only payments continuing at 10%. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE C--MORTGAGE DEBT--CONT'D. On December 24, 1990, the Partnership secured a line of credit note, collateralized by the second mortgage on Foothills, in the amount of $1,000,000. On February 26, 1993, this note was converted to a mortgage payable at 8% interest with a twenty-five year amortization rate through the maturity date of December 10, 1996. During 1996, the maturity date of this note was extended to December 1, 2001 with monthly payments of $8,416 of principal and interest at 8.5%. The net book value of this property was $2,706,000 as of December 31, 1996. The Colony Apartments (The Colony) On January 17, 1995, the purchase money note in the amount of $3,500,000 was retired through the issuance of a new mortgage. This new mortgage in the original amount of $3,728,000 is due in February, 2005. The interest rate is fixed for the term of the loan at 10.09%, with monthly principal and interest payments of $34,113. On May 28, 1996, the Partnership signed a note, collateralized by a second mortgage on The Colony Apartments, in the amount of $410,000 at 7% interest. The Partnership will make monthly interest payments on this mortgage 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. Cascade Apartments (Cascade) A 9.875% note is collateralized by Cascade. Both principal and interest payments are made in an amount necessary to amortize the $2,100,000 loan over 25 years with the unpaid principal due on the maturity date of March 1, 1995. The lender has given a verbal commitment to extend the mortgage on a month-to-month basis. The Partnership will make monthly principal, interest and escrow payments of $21,733 until permanent financing is found. The net book value of this property was $1,663,000 as of December 31, 1996. Cash paid for interest totaled $1,168,308, $1,364,166 and $1,058,076 during 1996, 1995, and 1994, respectively. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE C--MORTGAGE DEBT--CONT'D. Maturities of mortgage debt are as follows: Year 1997 $ 4,590,272 1998 511,876 1999 111,236 2000 906,452 2001 2,428,806 Thereafter 3,403,585 TOTAL $11,952,227 NOTE D--RELATED PARTY TRANSACTIONS Through December 31, 1994, property management services were provided by The Hoyt Group, a Kansas Corporation in which the individual General Partner had a majority interest. As of January 1, 1995, SPECS, Inc., a Kansas Corporation in which the individual General Partner has an 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. Amounts paid by the Partnership to The Hoyt Group and SPECS, Inc. are as follow: Years Ended December 31, 1996 1995 1994 Property management fees $102,613 $107,915 $ 94,860 Professional Services 47,168 46,000 --- $149,781 $153,915 $ 94,860 These professional services were provided by an unrelated entity previous to January 1, 1995. The General Partners are entitled to receive a Partnership Management Fee equal to 5% of Cash Flow From Operations (as defined) for managing the normal operations of the Partnership except for Hidden Valley and The Market whose Management Fee is equal to 3% of Cash Flow From Operations. There was no management fee due for the years ending December 31, 1996, 1995 and 1994. Amounts due from (to) related parties consist of the following: Years Ended December 31, 1996 1995 SIR Inc. $ 25,929 $ 23,721 Secured Investment Resources Fund, L.P. II (5,000) --- Secured Investment Resources Fund, L.P. III (78,345) (74,643) Due To Related Parties $ (57,416) $ (50,922) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE D -- CONT'D. Advances to SIR Inc. are scheduled to be reimbursed in 1997. In May, 1995, the Partnership began repaying the advances owed to Secured Investment Resources Fund, L.P. III. During 1996, $2,440 of principal was repaid while $6,142 of interest expense was accrued at 9% per annum into the note balance. NOTE E--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. NOTE F--PARTNERSHIP LIQUIDITY The Partnership operates within the real estate industry and is subject to its economic forces, which contributes additional liquidity risk to the Partnership's investment portfolio. These risks include, but are not limited to, changes in general or local economic conditions, changes in interest rates and the availability of permanent mortgage financing which may render the acquisition, sale or refinancing of a property difficult or unattractive, changes in real estate and zoning laws, increases in real estate taxes, federal or local economic or rent controls, floods, earthquakes and other acts of God and other factors beyond the control of the Partnership's management. The illiquidity of real estate investments generally may impair the ability of the Partnership to respond promptly to changing economic conditions. The General Partners believe that sufficient working capital will be available to fund known, ongoing operating and capital expenditure requirements of the Partnership during 1997. The primary sources of working capital during 1997 are expected to be cash flow from operations. The Partnership is actively seeking a mortgage lender for the Cascade Apartments mortgage and the Foothills Village Shopping Center first mortgage. The projected new loan proceeds would include refinancing costs as well as reserves for capital improvements as needed on the mortgaged properties. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE F -- CONT'D. Certain positive factors are expected to 1997 operations. Occupancy levels on the commercial properties have improved and stabilized requiring less tenant improvement costs and leasing commission expense. The two residential properties are expected to maintain, if not increase, their levels of occupancy and income during 1997. Management believes revenue will increase from 1996 levels because of this leasing activity. It is anticipated that property operating expenses in 1997 will increase only slightly from those amounts which were incurred during 1996. Interest expense on the variable rate notes payable is expected to increase slightly over those levels realized during 1996. The availability of the liquidity sources and accomplishment of these objectives are partially predicated on the real estate economic conditions discussed above, which are beyond the control of the Partnership and will influence the achieved results. NOTE G--ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consist of the following: December 31, 1996 1995 Vendor accounts payable $ 16,353 $ 14,032 Property taxes 16,473 178,416 Professional fees 55,458 28,176 Utilities 11,764 13,013 Accrued Payroll and taxes 6,878 7,119 $ 106,926 $ 240,756 As of December 31, 1996, all real estate taxes are current. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE H--INCOME TAX The Partners' capital accounts differ for financial reporting purposes and federal income tax purposes. The primary difference results from depreciation and amortization and provision for doubtful accounts. The effect of these items is summarized as follows: December 31, 1996 1995 Financial reporting basis: Total assets $ 11,961,729 $ 12,398,394 Total liabilities (12,430,883) (12,343,121) Total Partners' capital $ (469,154) $ 55,273 Tax basis: Total assets $ 11,016,535 $ 11,537,581 Total liabilities (12,320,149) (12,291,638) Total Partners' capital $ (1,303,614) $ (754,057) Years Ended December 31, 1996 1995 1994 Partnership loss-financial reporting purposes $ (524,427) $ (485,279) $ (500,900) Book versus tax differences due to: Depreciation and amortization (69,531) (57,364) (54,856) Provision for doubtful accounts (14,850) (49,902) (8,976) Other 59,251 (2,017) (28,636) (25,130) (109,283) (92,468) Partnership loss-federal income tax purposes $ (549,557) $ (594,562) $ (593,368) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--CONT'D. NOTE I--LEASES Rental income on investment properties is reported when earned. The Partnership leases its commercial properties under non-cancelable operating lease agreements. The Partnership's residential properties are leased under short-term lease agreements. Future minimum rents to be received as of December 31, 1996 are as follows: Year 1997 $ 561,381 1998 382,700 1999 346,013 2000 289,807 2001 227,155 Thereafter 133,142 Total $ 1,940,198 NOTE J--DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying values reflected in the balance sheets at December 31, 1996, reasonably approximate the fair values for cash and cash equivalents. The Partnership cannot estimate the fair value of its fixed-rate borrowings at December 31, 1996, as there is no readily available market value for instruments with similar characteristics. (The remainder of this page intentionally left blank.) Item 9. Changes in and Disagreements with Registrant's Certifying Accountants on Accounting and Financial Disclosure. None. PART III Item 10. Directors and Executive Officers of the Registrant. The General Partners of the Partnership are James R. Hoyt and Secured Investment Resources, Inc. Secured Investment Resources, Inc. (the "Corporate General Partner") was incorporated under the laws of the State of Kansas on December, 1983 for the purpose of acting as General Partner and the Acquisition Agent of the Partnership. James R. Hoyt is the sole director and officer of the Corporate General Partner. James R. Hoyt, the Individual General Partner, age 59, holds a Bachelor's Degree in Business Administration and is a licensed real estate broker in two states. Mr. Hoyt has been actively involved for more than the past twenty years in various real estate endeavors including development, syndication, property management and brokerage. Mr. Hoyt is the Individual General Partner and sponsor of Secured Investment Resources Fund, L.P. II and Secured Investment Resources Fund, L.P. III. Since 1983, Mr. Hoyt has also been involved as the Individual General Partner in ten specified real estate private placement offerings. As of December 31, 1996, these partnerships, including Secured Investment Resources Fund, L.P., have raised a total of $60,709,750. Item 11. Management Compensation During 1996, The Partnership paid $102,613 in fees to affiliated companies for property management services. Item 12. Security Ownership of Certain Beneficial Owners and Management. (a) Security ownership of certain beneficial owners. No individual or group as defined by Section 13(d)(3) of the Securities Exchange Act of 1934, known to the registrant is the beneficial owner of more than 5 percent of the registrant's securities. (b) Security ownership of Management. The General Partners own less than 1%. Change in Control. None. Item 13. Certain Relationships and Related Transactions. See Notes to Consolidated Financial Statements, Note D, appearing in Item 8. PART IV Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K. (a)(1) The following Financial Statements of Secured Investment Resources Fund, L.P. are included in Item 8: Page (i) Report of Independent Auditor 11 (ii) Consolidated Balance Sheets - December 31, 1996 and 1995 12-13 (iii) Consolidated Statements of Operations - Years Ended December 31, 1996, 1995 and 1994 14 (iv) Consolidated Statements of Partnership Capital - Years ended December 31, 1996, 1995 and 1994 15 (v) Consolidated Statements of Cash Flows - Years Ended December 31, 1996, 1995 and 1994 16-17 (vi) Notes to Consolidated Financial Statements 18-27 (a)(2) The following Financial Statement Schedules are filed as part of this report: (i) Schedule II - Allowance for Doubtful Accounts 34 (ii) Schedule III - Real Estate and Accumulated Depreciation 35-37 All schedules other than those indicated in the index have been omitted as the required information is presented in the financial statements, related notes or is inapplicable. (a)(3) The following Exhibits are Incorporated by Reference and are an integral part of this Form 10-K. Exhibit Number Description (4) (a) Restated Certificate and Agreement of Limited Partnership. (iii) (b) Second Amendment to Restated Certificate and Agreement of Limited Partnership. (i) (10) (a) Property Management Agreement, as amended. (i) (b) Escrow Agreement. (i) (c) Administrative Services Agreement. (i) (d) Amendment No. 1 to Escrow Agreement. (i) (e) Agreement of Sale for The Colony Apartments. (v) (f) Purchase Money Short-Term Note for The Colony Apartments. (v) (g) Purchase Money Deed of Trust for The Colony Apartments. (v) (h) Purchase Money Wraparound Deed of Trust for The Colony Apartments. (v) (i) Purchase Money Wraparound Deed of Trust for The Colony Apartments. (v) (j) Real Estate Contract of Sale for The Cascade Apartments. (v) (k) Lease Agreement for Certain Portions of The Cascade Apartments. (v) (l) Real Estate Contract of Sale for the Hidden Valley Exchange Shopping Center. (vi) (m) Real Estate Contract of Sale for the Foothills Village Shopping Center. (vii) Exhibit Number Description (n) Real Estate Contract of Sale for the Market Shopping Center. (viii) (o) Assignment of Real Estate Contract (The Market Shopping Center). (viii) (16) (a) Letter Regarding Change in Certified Accountant. (ix), (x) (28) (a) Guarantee of James R. Hoyt. (ii) (b) Guarantee of General Partners. (ii) (c) North Carolina Special Warranty Deed for The Colony Apartments. (v) (d) General Warranty Deed for The Cascade Apartments. (v) (i) Previously filed on September 13, 1985 as an Exhibit to Post-Effective Amendment #2 to the Registration Statement on Form S-11 (file no. 2-90975) such Exhibit and Registration Statement incorporated herein by reference. (ii) Previously filed on September 19, 1984 as an Exhibit to Amendment #2 to the Registration Statement of Form S-11 such Exhibit and Registration Statement incorporated herein by reference. (iii) Previously included in the Prospectus filed as part of Amendment #2 to Registration Statement and incorporated herein by reference. (iv) Previously filed as an exhibit to a current report on Form 8-K dated February 1, 1985 which exhibit and Form are incorporated herein by reference. (v) Previously filed on January 6, 1986 as an exhibit to Post-Effective Amendment #3 to the Registration Statements on Form S-11, such Exhibit and Registration Statement incorporated herein by reference. (vi) Previously filed as an exhibit to a report on Form 8-K dated September 30, 1986, which exhibit and Form are incorporated herein by reference. (vii) Previously filed as an Exhibit to a report on Form 8-K dated November 10, 1986, which Exhibit and Form are incorporated herein by reference. (viii) Previously filed as an Exhibit to a report on Form 8-K dated November 20, 1986, which Exhibit and Form are incorporated herein by reference. (ix) Previously filed as an Exhibit to a report on Form 8-K dated December 5, 1986, which Exhibit and Form are incorporated herein by reference. (x) Previously filed as an Exhibit to a current report on Form 8-K dated December 4, 1989, which Exhibit and Form are incorporated herein by reference. (b) Report of Form 8-K filed during the fourth quarter. None. (The remainder of this page intentionally left blank.) Secured Investment Resources Fund L.P. Schedule II - Allowance for Doubtful Accounts December 31, 1996 Balance at Additions Bad Debt Write- Balance at Beginning of Charged to Offs Deducted End Period Operations From Allowance of Period For Years Ended December 31, 1994 $150,452 $46,068 $ 55,044 $141,476 1995 141,476 36,819 121,095 57,200 1996 57,200 44,725 59,575 42,350 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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: Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: Secured Investment Resources, Inc., as Corporate General Partner By: James R. Hoyt, President Date: Supplemental Information to be Furnished With Reports Filed Pursuant to Section 15(d) of the Act by Registrants Which Have Not Registered Securities Pursuant to Section 12 of the Act. No annual report or proxy material has been sent to security holders. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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: April 14, 1997 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: Secured Investment Resources, Inc., as Corporate General Partner By: /s/ James R. Hoyt James R. Hoyt, President Date: April 14, 1997 Supplemental Information to be Furnished With Reports Filed Pursuant to Section 15(d) of the Act by Registrants Which Have Not Registered Securities Pursuant to Section 12 of the Act. No annual report or proxy material has been sent to security holders. Secured Investment Resources Fund, L.P. Schedule III - Real Estate & Accumulated Depreciation December 31, 1996
Initial Cost to Partnership (A) Subsequent to Acquisition Buildings & Furniture Reduction Encumbrances Land Improvements Equipment Improvements of Basis (B) Other Equipment $ --- $ --- $ --- $ --- $ 2,672 $ --- Garden Apartments: Colony Apts 3,661,657 578,791 5,035,482 259,367 465,471 --- Burlington, NC Cascade Apts 1,875,173 389,924 1,903,915 254,347 145,771 --- Topeka, KS Strip Shopping Centers Hidden Valley 813,628 293,715 1,775,991 --- 143,838 (91,218) Independence MO Foothills 3,590,024 1,069,233 3,661,619 --- 914,993 --- Las Vegas, NV The Market Square 2,011,745 265,250 1,196,129 --- 19,653 (46,869) Overland Park, KS $11,952,227 $2,596,913 $13,573,136 $ 513,714 $1,692,398 $(138,087)
Gross Amount at Which Carried at Close of Period
Buildings & Furniture Accumulated Date Depreciation Land Improvements Equipment Total Depreciation Acquired Life Other Equipment $ --- $ --- $ 2,672 $ 2,672 $ 2,672 Garden Apartments: Colony Apartments 578,791 5,250,599 509,721 6,339,111 2,307,003 16-Oct-85 30 Yrs Burlington, NC 5 Yrs Cascade Apartments 390,509 2,057,481 245,967 2,693,957 1,030,670 19-Dec-85 30 Yrs Topeka, KS 5 Yrs Strip Shopping Centers Hidden Valley 277,809 1,747,242 97,275 2,122,326 656,027 30-Sep-85 30 Yrs Independence, MO 5 Yrs Foothills 1,069,233 3,721,335 855,278 5,645,846 1,870,165 13-Nov-85 30 Yrs Las Vegas, NV 5 Yrs Market Square 256,345 1,173,791 4,026 1,434,162 800,994 18-Nov-85 30 Yrs Overland Park, KS 5 Yrs $2,572,687 $13,950,448 $1,714,939 $18,238,074 $ 6,667,531 (1) Estimated useful life of buildings. (2) Estimated useful life of furniture and fixtures. (3) Includes Allowance for Losses of $405,000. NOTES: (A) The initial cost to the Partnership represents the original purchase price of the properties, including $181,643 and $7,943 of improvements incurred in 1986 and 1985, respectively, which were contemplated at the time the property was acquired. (B) Receipts received under the terms of certain guarantee agreements are recorded by the Partnership as a reduction of the basis of the property to which the guaranteed income relates.
Secured Investment Resources Fund, L.P. Schedule III - Real Estate & Accumulated Depreciation--Continued December 31, 1996
Furniture Buildings & Fixtures & Total Land Improvements Equipment Reconciliation of Real Estate Owned: Balance at January 1, 1994 $17,713,713 $2,572,687 $13,744,003 $1,397,023 Additions during year: Improvements 142,105 --- 60,565 81,540 Balance at December 31, 1994 17,855,818 2,572,687 13,804,568 1,478,563 Additions during year: Improvements 182,714 --- 109,201 73,513 Balance at December 31, 1995 18,038,532 2,572,687 13,913,769 1,552,076 Additions during year: Improvements 199,542 --- 36,678 162,864 Balance at December 31, 1996 $18,238,074 $2,572,687 $13,950,447 $1,714,940 (D) Reconciliation of Accumulated Depreciation: Balance at January 1, 1994 $ 4,917,146 $ --- $ 4,346,045 $ 571,101 Additions during year: Depreciation 576,209 --- 419,540 156,669 Balance at December 31, 1994 5,493,355 --- 4,765,585 727,770 Additions during year: Depreciation 584,926 --- 277,906 307,020 Balance at December 31, 1995 6,078,281 --- 5,043,491 1,034,790 Additions during year: Depreciation 589,250 --- 459,358 129,892 Balance at December 31, 1996 $ 6,667,531 $ --- $ 5,502,849 $1,164,682 (E) The total gross amount of real estate at December 31, 1996 includes $971,323 of acquisition fees paid to affiliates.
EX-27 2
5 1 12-MOS DEC-31-1996 JAN-01-1996 DEC-31-1996 206,974 0 52,586 42,350 0 397,183 18,238,074 6,667,531 11,967,729 478,656 11,952,227 0 0 0 0 11,961,729 0 2,297,592 0 996,906 623,856 0 1,202,257 0 0 0 0 0 0 (524,427) (20.88) 0
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