-----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, HJphc1U1uUxuo4fgD8Dkyo88rBmrhhsLzDSq5kbwBwhxh4FSEsySI4oyhQR5vTj0 ctZpMuC14CSKWzcvwk98Lg== 0000890566-99-000636.txt : 19990514 0000890566-99-000636.hdr.sgml : 19990514 ACCESSION NUMBER: 0000890566-99-000636 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SIERRA PACIFIC PENSION INVESTORS 84 CENTRAL INDEX KEY: 0000747729 STANDARD INDUSTRIAL CLASSIFICATION: OPERATORS OF NONRESIDENTIAL BUILDINGS [6512] IRS NUMBER: 330043952 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-14269 FILM NUMBER: 99619607 BUSINESS ADDRESS: STREET 1: 5850 SAN FELIPE STREET 2: STE 500 CITY: HOUSTON STATE: TX ZIP: 77057 BUSINESS PHONE: 7137066271 MAIL ADDRESS: STREET 1: 5850 SAN FELIPE STREET 2: STE 500 CITY: HOUSTON STATE: TX ZIP: 77057 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter ended March 31, 1999 ---------------------------------------------------- Commission file number 0-14269 ---------------------------------------------------- SIERRA PACIFIC PENSION INVESTORS `84 (A LIMITED PARTNERSHIP) State of California 33-0043952 - ------------------------------------- ----------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification incorporation or organization) Number) 5850 San Felipe, Suite 450 Houston, Texas 77057 - ---------------------------------------- -------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (713) 706-6271 ----------------------------------------------- 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 The following financial statements are submitted in the next pages: PAGE NUMBER Balance Sheets - March 31, 1999 and December 31, 1998 5 Statements of Operations - For the Three Months Ended March 31, 1999 and 1998 6 Statements of Changes in Partners' Equity - From June 5, 1984 (inception of the Partnership) to December 31, 1998 and for the Three Months Ended March 31, 1999 7 Statements of Cash Flows - for the Three Months Ended March 31, 1999 and 1998 8 Notes to Financial Statements 9 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (a) OVERVIEW The following discussion should be read in conjunction with the Partnership's Financial Statements and Notes thereto appearing elsewhere in this Form 10-Q. The Partnership currently owns one property, Sierra Valencia. In addition, the Partnership holds a 66.99% interest in Sierra Mira Mesa Partners ("SMMP"). (b) RESULTS OF OPERATIONS Rental income for the three months ended March 31, 1999 increased by $22,000, or 19%, when compared to the corresponding period in the prior year, primarily due to higher rental rates. Further, billing credits were given to tenants in the first quarter of the prior year due to common area maintenance fees being lower than anticipated in 1997. The Property was 100% occupied at March 31, 1999. 2 Operating expenses for the three months ended March 31, 1999 increased by $10,000, or 8%, principally due to an increase in data processing fees and other general and administrative costs incurred during the quarter. Depreciation and amortization expenses for the three months ended March 31, 1999 increased by $4,000, or 6%, when compared to the corresponding period in 1998, due to additional capitalized tenant improvements and leasing costs. The Partnership's share of income from investment in SMMP was $59,000 for the three months ended March 31, 1999 compared to $81,000 for the same period in the 1998. SMMP increased its income for the three months ended March 31, 1999, however, the Partnership had overstated its share of loss from investment in SMMP in 1997 and recorded a $76,000 adjustment in the first quarter of 1998. (c) LIQUIDITY AND CAPITAL As of March 31, 1999, the Partnership is in an illiquid position. Total cash and billed receivables amount to $7,000 compared to $141,000 of accrued and other liabilities. The Partnership anticipates cash required to meet debt obligations and for the construction of new tenant space will be funded from the operations of the Property and distributions from SMMP. (d) YEAR 2000 COMPLIANCE The Year 2000 Compliance issue is the result of computer programs being written using two digits rather than four to define the applicable year. Any of the Partnership's computer programs that have time-sensitive software may recognize a date using "00" as the year 1900 rather than the year 2000. This could result in a system failure or miscalculations causing disruptions of operations, including, among other things, a temporary inability to process transactions, send invoices, or engage in similar normal business activities. As a result, many companies' software and computer systems may need to be upgraded or replaced in order to comply with Year 2000 requirements. The Partnership employs a property management company to manage, operate and lease the property. The management company believes it will be ready for the Year 2000 date change by the end of 1999. The impact of Year 2000 non-compliance by other third parties cannot accurately be gauged. The total cost to the Partnership of activities associated with Year 2000 Compliance is not anticipated to be material to its financial position or results of operations in any given year. In January 1999, the Partnership began utilizing a new software program to maintain books and records. The new software program is Year 2000 compliant. The total amount of potential risk that would be reasonably likely to result from Year 2000 failures cannot presently be estimated. In the event the Partnership does not properly identify Year 2000 issues in a timely manner, there can be no assurance that Year 2000 issues will not materially affect the Partnership's results. 3 The Partnership's contingency plan should systems fail due to the Year 2000 date change is to temporarily convert to a manual system. The Partnership believes it could temporarily operate on a manual system without adversely impacting operations. The preceding Year 2000 discussion contains various forward-looking statements which represent the Partnership's beliefs or expectations regarding future events. All forward-looking statements involve a number of risks and uncertainties that could cause the actual results to differ materially from projected results. 4 SIERRA PACIFIC PENSION INVESTORS '84 (A LIMITED PARTNERSHIP) BALANCE SHEETS MARCH 31, 1999 AND DECEMBER 31, 1998 - -------------------------------------------------------------------------------- March 31, 1999 December 31, 1998 -------------- ----------------- ASSETS Cash and cash equivalents ................. $ 7,119 $ 10,122 Receivables: Note receivable, net of deferred gain of $215,786............................ 2,227,627 2,227,627 Unbilled rent .......................... 43,269 42,331 Billed rent ............................ 650 962 Other .................................. 61,085 0 Due from affiliates ....................... 47,466 47,466 Income-producing property - net of accumulated depreciation and valuation allowance of $3,794,266 and $3,741,937, respectively ............................ 1,207,711 1,212,015 Investment in unconsolidated joint venture 6,800,939 6,743,274 Other assets .............................. 230,900 274,381 -------------- ----------------- Total Assets .............................. $ 10,626,766 $ 10,558,178 ============== ================= LIABILITIES AND PARTNERS' EQUITY Accrued and other liabilities ............. $ 140,611 $ 143,487 Due to affiliate .......................... 54,500 0 Notes payable ............................. 1,463,824 1,484,983 -------------- ----------------- Total Liabilities ......................... 1,658,935 1,628,470 -------------- ----------------- Partners' equity: General Partner ......................... 0 0 Limited Partners: 80,000 units authorized, 77,000 issued and outstanding ......... 8,967,831 8,929,708 -------------- ----------------- Total Partners' equity .................... 8,967,831 8,929,708 -------------- ----------------- Total Liabilities and Partners' equity .... $ 10,626,766 $ 10,558,178 ============== ================= UNAUDITED SEE ACCOMPANYING NOTES 5 SIERRA PACIFIC PENSION INVESTORS '84 (A LIMITED PARTNERSHIP) STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 19981 - -------------------------------------------------------------------------------- 1999 1998 --------- --------- REVENUES: Rental income ................................ $ 143,659 $ 121,168 Interest income .............................. 61,088 55,534 --------- --------- Total revenues .......................... 204,747 176,702 --------- --------- EXPENSES: Operating expenses ........................... 122,176 112,319 Depreciation and amortization ................ 68,349 64,343 Interest expense ............................. 34,769 38,127 --------- --------- Total costs and expenses ................ 225,294 214,789 --------- --------- LOSS BEFORE PARTNERSHIP'S SHARE OF JOINT VENTURE INCOME ......................... (20,547) (38,087) PARTNERSHIP'S SHARE OF UNCONSOLIDATED JOINT VENTURE INCOME ......................... 58,670 80,549 --------- --------- NET INCOME ..................................... $ 38,123 $ 42,462 ========= ========= Net income per limited partnership unit ........ $ 0.50 $ 0.55 ========= ========= UNAUDITED SEE ACCOMPANYING NOTES 6 SIERRA PACIFIC PENSION INVESTORS '84 (A LIMITED PARTNERSHIP) STATEMENTS OF CHANGES IN PARTNERS' EQUITY FROM JUNE 5, 1984 (INCEPTION OF PARTNERSHIP) TO DECEMBER 31, 1998 AND FOR THE THREE MONTHS ENDED MARCH 31, 1999 - --------------------------------------------------------------------------------
Limited Partners Total ---------------------------- General Partners' Per Unit Total Partner Equity ------------ ------------ ------------ ------------ Proceeds from sale of partnership units ............... $ 250.00 $ 19,418,250 -- $ 19,418,250 Underwriting commissions and other organization expenses . (37.34) (2,894,014) -- (2,894,014) Repurchase of 665 partnership units (0.03) (151,621) -- (151,621) Cumulative net (loss) income (to December 31, 1998) .......... (75.23) (5,792,901) $ 133,334 (5,659,567) Cumulative distributions (to December 31, 1998) .......... (21.43) (1,650,006) (133,334) (1,783,340) ------------ ------------ ------------ ------------ Partners' equity - January 1, 1999 115.97 8,929,708 0 8,929,708 Net income ........................ 0.50 38,123 -- 38,123 ------------ ------------ ------------ ------------ Partners' equity - March 31, 1999 . $ 116.47 $ 8,967,831 $ 0 $ 8,967,831 ============ ============ ============ ============
UNAUDITED SEE ACCOMPANYING NOTES 7 SIERRA PACIFIC PENSION INVESTORS '84 (A LIMITED PARTNERSHIP) STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998 - -------------------------------------------------------------------------------- 1999 1998 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income ........................................... $ 38,123 $ 42,462 Adjustments to reconcile net income to cash provided by (used in) operating activities: Depreciation and amortization ...................... 68,349 64,343 Undistributed income of unconsolidated joint venture .................................... (58,670) (80,549) (Increase) decrease in rent receivable ............. (626) 5,702 Increase in other receivables ...................... (61,085) (55,532) Decrease (increase) in other assets ................ 28,466 (49,982) (Decrease) increase in accrued and other liabilites (2,876) 49,280 -------- -------- Net cash provided by (used in) operating activities 11,681 (24,276) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Payments for property additions .................... (48,025) 0 -------- -------- Net cash used in investing activities .............. (48,025) 0 -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Principal payments on notes payable ................ (21,159) (18,900) Loan from affiliate ................................ 54,500 33,000 -------- -------- Net cash provided by financing activities .......... 33,341 14,100 -------- -------- NET DECREASE IN CASH AND CASH EQUIVALENTS ............. (3,003) (10,176) CASH AND CASH EQUIVALENTS - Beginning of period ........ 10,122 27,154 -------- -------- CASH AND CASH EQUIVALENTS - End of period .............. $ 7,119 $ 16,978 ======== ======== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for interest ........... $ 34,888 $ 38,233 ======== ======== UNAUDITED SEE ACCOMPANYING NOTES 8 SIERRA PACIFIC PENSION INVESTORS `84 (A LIMITED PARTNERSHIP) NOTES TO FINANCIAL STATEMENTS ------------------------------------------------------------------------ 1. BASIS OF FINANCIAL STATEMENTS In the opinion of the Partnership's management, these unaudited financial statements reflect all adjustments which are necessary for a fair presentation of its financial position at March 31, 1999 and results of operations and cash flows for the periods presented. All adjustments included in these statements are of a normal and recurring nature. These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Annual Report of the Partnership for the year ended December 31, 1998. 2. RELATED PARTY TRANSACTIONS Included in the financial statements for the three months ended March 31, 1999 and 1998 are affiliate transactions as follows: March 31 ---------------- 1999 1998 ------- ------- Management fees ....... $ 4,585 $ 4,298 Administrative fees ... 16,596 16,401 3. INVESTMENT IN UNCONSOLIDATED JOINT VENTURE Sierra Mira Mesa Partners ("SMMP") was formed in 1985 between the Partnership and Sierra Pacific Development Fund II ("SPDFII"), an affiliate, to develop and operate the real property known as Sierra Mira Mesa, an office building, located in San Diego, California. The Partnership's initial ownership interest in SMMP was 49%; the remaining 51% was owned by SPDFII. Effective December 31, 1996, the general partners amended the partnership agreement to allow for adjustments in the sharing ratio each year based upon the relative net contributions and distributions since inception of each general partner. At March 31, 1999 the Partnership's interest in SMMP was 66.99%; the remaining 33.01% interest is owned by SPDFII. The consolidated financial statements of SMMP include the accounts of SMMP and Sorrento I Partners, a majority owned California general partnership. Summarized income statement information for SMMP for the three months ended March 31, 1999 and 1998 follows: UNAUDITED 9 Sierra Pacific Pension Investors '84 Notes to Financial Statements Page two March 31 -------------------------- 1999 1998 -------- -------- Rental income .................. $500,720 $482,917 Total revenues ................. 556,010 534,154 Operating expenses ............. 190,270 206,776 Share of unconsolidated joint venture loss ........... 25,266 57,843 Net income ..................... 87,978 5,549 As of March 31, 1999, SMMP holds a 35.10% interest in Sorrento II Partners ("SIIP"), a California general partnership with Sierra Pacific Institutional Properties V formed in 1993; a 6.55% interest in Sierra Creekside Partners ("SCP"), a California general partnership with Sierra Pacific Development Fund formed in 1994; and a 33.32% interest in Sierra Vista Partners ("SVP"), a California general partnership with Sierra Pacific Development Fund III formed in 1994. Summarized income statement information for these Partnerships, which are accounted for by SMMP under the equity method, for the three months ended March 31, 1999 and 1998 follows: SIIP --------------------------- March 31 --------------------------- 1999 1998 -------- -------- Rental income ................ $260,066 $169,808 Total revenues ............... 260,066 169,808 Operating expenses ........... 123,578 104,860 Net loss ..................... 63,391 136,367 SCP SVP --------------------- --------------------- March 31 March 31 --------------------- --------------------- 1999 1998 1999 1998 -------- -------- -------- -------- Rental income .............. $214,772 $203,881 $ 0 $ 0 Total revenues ............. 214,772 203,881 11,907 0 Operating expenses ......... 126,351 125,117 13,797 20,852 Net loss ................... 36,421 52,473 2,457 20,852 4. PARTNERS' EQUITY Equity and net income (loss) per limited partnership unit is determined by dividing the Limited Partners' share of the Partnership's equity and net income (loss) by the number of limited partnership units outstanding, 77,000. UNAUDITED 10 PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits The following Exhibits are filed herewith pursuant to Rule 601 of Regulation S-K. EXHIBIT NUMBER DESCRIPTION OF EXHIBIT - ---------- ----------------------------- 27 Financial Data Schedule (b) Reports on Form 8-K None. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report be signed on its behalf by the undersigned thereunto duly authorized. SIERRA PACIFIC PENSION INVESTORS `84 a Limited Partnership S-P PROPERTIES, INC. General Partner Date: MAY 4, 1999 /S/ THOMAS N. THURBER ----------------- ----------------------------------------- Thomas N. Thurber President and Director Date: MAY 4, 1999 /S/ G. ANTHONY EPPOLITO ----------------- ----------------------------------------- G. Anthony Eppolito Chief Accountant 11
EX-27 2
5 THE FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM SIERRA PACIFIC PENSION INVESTORS '84 MARCH 31, 1999 FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS DEC-31-1999 MAR-31-1999 7,119 0 105,004 0 0 116,320 5,001,977 3,794,266 10,626,766 195,111 1,463,824 0 0 0 8,967,831 10,626,766 143,659 204,747 0 122,176 68,349 0 34,769 38,123 0 38,123 0 0 0 38,123 .50 .50
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