-----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, F7P3kgBQzNkwWIUVG9bRtW4MM2K2NuVWl+703sJvzbcj8an3cke8vySi1G90ua8R v1ma7XbU3J+hR9I0VUJFtA== 0000768598-96-000002.txt : 19960807 0000768598-96-000002.hdr.sgml : 19960807 ACCESSION NUMBER: 0000768598-96-000002 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960806 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONSOLIDATED CAPITAL PROPERTIES VI CENTRAL INDEX KEY: 0000755908 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 942940204 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-14099 FILM NUMBER: 96604310 BUSINESS ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLZ STREET 2: POST OFFICE BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 2147020027 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 0-14099 CONSOLIDATED CAPITAL PROPERTIES VI (Exact name of small business issuer as specified in its charter) California 94-2940204 (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 VI CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands, except unit data) June 30, 1996 Assets Cash and cash equivalents: Unrestricted $ 1,498 Restricted - tenant security deposits 102 Investments 356 Accounts receivable 4 Escrows for taxes and insurance 167 Restricted escrows 67 Prepaid and other assets 156 Investment properties: Land $ 1,652 Buildings and personal property 14,773 16,425 Less accumulated depreciation (6,800) 9,625 $11,975 Liabilities and Partners' Capital (Deficit) Liabilities Accounts payable $ 40 Tenant security deposits 102 Accrued taxes 139 Other liabilities 235 Mortgage notes payable 10,131 Partners' Capital (Deficit) General partner $ (5) Special limited partners (66) Limited partners (181,288 units issued and outstanding) 1,399 1,328 $11,975 See Accompanying Notes to Consolidated Financial Statements b) CONSOLIDATED CAPITAL PROPERTIES VI 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 $ 793 $ 766 $1,539 $1,559 Other income 64 89 134 156 Total revenues 857 855 1,673 1,715 Expenses: Operating 297 250 604 500 General and administrative 58 87 96 519 Maintenance 108 117 222 189 Depreciation 176 164 349 326 Interest 232 179 442 417 Property tax 69 81 135 142 Total expenses 940 878 1,848 2,093 Net loss $ (83) $ (23) $ (175) $ (378) Net loss allocated to general partner (.2%) $ -- $ -- $ -- $ (1) Net loss allocated to limited partners (99.8%) (83) (23) (175) (377) $ (83) $ (23) $ (175) $ (378) Net loss per limited partnership unit: $ (.46) $ (.13) $ (.97) $(2.08) See Accompanying Notes to Consolidated Financial Statements
c) CONSOLIDATED CAPITAL PROPERTIES VI CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL (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 181,808 $ 1 $ -- $ 45,452 $45,453 Partners' capital (deficit) at December 31, 1995 181,288 $ (5) $ (70) $ 1,578 $ 1,503 Amortization of timing difference (Note D) -- -- 4 (4) -- Net loss for the six months ended June 30, 1996 -- -- -- (175) (175) Partners' capital (deficit) at June 30, 1996 181,288 $ (5) $ (66) $ 1,399 $ 1,328 See Accompanying Notes to Consolidated Financial Statements
d) CONSOLIDATED CAPITAL PROPERTIES VI CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Six Months Ended June 30, 1996 1995 Cash flows from operating activities: Net loss $ (175) $ (378) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation 349 326 Amortization of loan costs and discounts 115 112 Change in accounts: Restricted cash (8) (38) Accounts receivable 6 (7) Escrows for taxes and insurance (11) 85 Prepaid and other assets 181 51 Accounts payable (137) 91 Tenant security deposit liabilities 7 (2) Accrued taxes 27 (120) Other liabilities (49) (31) Net cash provided by operating activities 305 89 Cash flows from investing activities: Property improvements and replacements (120) (74) Purchase of investments -- (4,462) Proceeds from sale of investments 34 5,007 Deposits to restricted escrows (49) (43) Receipts from restricted escrows 120 -- Net cash (used in) provided by investing activities (15) 428 Cash flows from financing activities: Payments on mortgage notes payable (103) (95) Distributions to partners -- (275) Net cash used in financing activities (103) (370) Net increase in cash and cash equivalents 187 147 Cash and cash equivalents at beginning of period 1,311 414 Cash and cash equivalents at end of period $1,498 $ 561 Supplemental disclosure of cash flow information: Cash paid for interest $ 342 $ 350 See Accompanying Notes to Consolidated Financial Statements
e) CONSOLIDATED CAPITAL PROPERTIES VI NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note A - Basis of Presentation The accompanying unaudited consolidated financial statements of Consolidated Capital Properties VI ("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 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 consolidated 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 ninety days, are considered to be held-to-maturity securities. Note B - Transactions with Affiliated Parties The Partnership has paid property management fees based upon collected gross rental revenues for property management services in each of the six months ended June 30, 1996 and 1995. Property management fees of approximately $80,000 and $81,000 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 Limited Partnership Agreement ("Partnership Agreement") provides for a special management fee equal to 9% of the total distributions made to the limited partners to be paid to the General Partner for executive and administrative management services. The Partnership paid approximately $24,000 to affiliates of the General Partner for the six months ended June 30, 1995, under this provision of the Partnership Agreement. No such fees were paid or accrued for the six months ended June 30, 1996. Note B - Transactions with Affiliated Parties - (continued) 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 approximately $56,000 and $83,000 were paid to the General Partner and affiliates for 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 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 approximately $1,955,000, are less than the reserve requirement of approximately $2,266,000 at June 30, 1996. The Partnership intends to replenish working capital reserves from cash flow from operations after consideration of any capital improvement needs of the properties. 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 During 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 II ("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 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 to the Limited Partners' capital account as the components of the timing differences which created the balance reverse. Note E - Distributions In March 1995, the Partnership declared and paid distributions, attributable to cash flow from operations, totalling approximately $275,000 to the partners. No distributions were declared or paid during the six months ended June 30, 1996. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The Partnership's investment properties consist of two apartment complexes. 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 Celina Plaza Apartments El Paso, Texas 91% 93% Colony of Springdale Apartments Springdale, Ohio 91% 91% The decrease in occupancy at the Celina Plaza Apartments is due to a decline in the El Paso market resulting from military spending cuts and the relocation of military personnel which has created increased competition from similar apartment complexes in the area. Ongoing property improvements at Celina Plaza, resulting in improved consumer appeal, are expected to positively impact rental rates and occupancy. The Partnership realized a net loss of approximately $83,000 for the three months ended June 30, 1996, and a net loss of approximately $175,000 for the six months ended June 30, 1996, compared to net loss of approximately $23,000 for the three months ended June 30, 1995, and a net loss of approximately $378,000 for the six months ended June 30, 1995. The decreased net loss is due primarily to decreased general and administrative expenses, partially offset by a decrease in other income and increased operating and maintenance expenses. Other income decreased due to the non-recurring nature of dividends received on the Partnership's investment in Southmark Preferred Stock during the second quarter of 1995. The increase in property operating expenses is due primarily to higher concessions being granted to attract tenants to the Celina Plaza Apartments in El Paso. Administrative expenses decreased due to prior year amounts being unusually high due to approximately $340,000 of legal costs associated with the Partnership's required responses to various tender offers in 1995 and approximately $53,000 of expense reimbursements related to the efforts of the Dallas partnership administration staff during the transition period in 1995. Administrative expenses were also higher for the six months ended June 30, 1995, due to a special management fee of approximately $24,000 related to the distribution made to the Limited Partners in March 1995. Maintenance expenses increased due to additional expenditures made for interior and exterior repairs in efforts to improve the curb appeal of the Partnership's properties. 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 expenses. 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 approximately $1,498,000 compared to approximately $561,000 at June 30, 1995. Net cash provided by operating activities increased primarily due to the decreased legal costs discussed above partially offset by increased operating expenses and slightly lower revenues. Net cash provided by investing activities decreased as a result of the Partnership investing in shorter term cash equivalents during 1996 rather than longer term securities. Net cash used in financing activities decreased due to the absence of partner distributions during 1996. 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 approximately $10,124,000, 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 cash generated from operations, capital expenditure requirements, property sales and the availability of cash reserves. During the first six months of 1995 distributions of approximately $275,000 were declared and paid. No cash distributions were declared or paid during the first six months of 1996. 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 VI By: CONCAP EQUITIES, INC. General Partner By: /s/Carroll D. Vinson Carroll D. Vinson President By: /s/Robert D. Long Robert D. Long, Jr. Vice President/CAO Date: August 6, 1996 EX-27 2
5 This schedule contains summary financial information extracted from Consolidated Capital Properties VI 1996 Second Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000755908 CONSOLIDATED CAPITAL PROPERTIES VI 1,000 6-MOS DEC-31-1996 JUN-30-1996 1,498 356 4 0 0 0 16,425 6,800 11,975 0 10,131 0 0 0 1,328 11,975 0 1,673 0 0 1,848 0 442 0 0 0 0 0 0 (175) (.97) 0 The Registrant has an unclassified balance sheet. Multipler is 1.
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