-----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, WBUsQnUB3G7iKK3RKkSCYtH6hBD1Qn+DhA0x4MJZpr4R6ecM6Co/2t99EzzgHvmj C2JJfYsRM/RQvOagSQCROg== 0000759198-97-000002.txt : 19970805 0000759198-97-000002.hdr.sgml : 19970805 ACCESSION NUMBER: 0000759198-97-000002 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970804 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MCCOMBS REALTY PARTNERS LTD CENTRAL INDEX KEY: 0000759198 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 330068732 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-14570 FILM NUMBER: 97650760 BUSINESS ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLZ STREET 2: P O BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 8032391000 MAIL ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLAZA STREET 2: PO BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 10QSB 1 FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES 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, 1997 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from.........to......... Commission file number 0-14570 MCCOMBS REALTY PARTNERS, LTD. (Exact name of small business issuer as specified in its charter) California 33-0068732 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) One Insignia Financial Plaza, 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 Securities Exchange Act of 1934 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) MCCOMBS REALTY PARTNERS, LTD. CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands) June 30, 1997 Assets Cash and cash equivalents: Unrestricted $ 429 Restricted--tenant security deposits 30 Accounts receivable 7 Escrow for taxes 45 Restricted escrows 225 Other assets 171 Investment properties: Land $ 499 Buildings and related personal property 5,310 5,809 Less accumulated depreciation (3,141) 2,668 $ 3,575 Liabilities and Partners' Capital (Deficit) Liabilities Accounts payable $ 21 Tenant security deposits 30 Accrued taxes 40 Other liabilities 65 Mortgage note payable 5,755 Partners' Capital (Deficit) General partners $ 1 Limited partners (22,036 units issued and outstanding) (2,337) (2,336) $3,575 See Accompanying Notes to Consolidated Financial Statements b) MCCOMBS REALTY PARTNERS, LTD. CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except unit data)
Three Months Ended Six Months Ended June 30, June 30, 1997 1996 1997 1996 Revenues: Rental income $ 371 $ 338 $ 714 $ 672 Interest income 6 4 11 11 Other income 25 22 53 46 Total revenues 402 364 778 729 Expenses: Operating 138 106 261 220 General and administrative 22 14 29 24 Maintenance 40 35 65 95 Depreciation 52 47 102 93 Interest 122 123 244 285 Property taxes 20 20 40 40 Total expenses 394 345 741 757 Net income (loss) $ 8 $ 19 $ 37 $ (28) Net income (loss) allocated to general partners (1%) $ -- $ -- $ -- $ -- Net income (loss) allocated to limited partners (99%) 8 19 37 (28) $ 8 $ 19 $ 37 $ (28) Net income (loss) per limited partnership unit $ .34 $ .88 $ 1.66 $(1.24) See Accompanying Notes to Consolidated Financial Statements
c) MCCOMBS REALTY PARTNERS, LTD. CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT) (Unaudited) (in thousands, except for unit data)
Limited Partnership General Limited Units Partner Partners Total Partners' capital (deficit) at December 31, 1996 22,036 $ 1 $ (2,374) $ (2,373) Net income for the six months ended June 30, 1997 -- -- 37 37 Partners' capital (deficit) at June 30, 1997 22,036 $ 1 $ (2,337) $ (2,336) See Accompanying Notes to Consolidated Financial Statements
d) MCCOMBS REALTY PARTNERS, LTD. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended June 30, 1997 1996 Cash flows from operating activities: Net income (loss) $ 37 $ (28) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation 102 93 Amortization of loan costs 10 10 Change in accounts: Restricted cash 1 (3) Accounts receivable 18 3 Escrows for taxes 36 (39) Other assets (10) (3) Accounts payable (14) (152) Tenant security deposit liabilities 3 3 Accrued taxes (36) 40 Other liabilities (9) 25 Net cash provided by (used in) operating activities 138 (51) Cash flows from investing activities: Property improvements and replacements (33) (120) Deposits to restricted escrows (36) (34) Net cash used in investing activities (69) (154) Cash flows from financing activities: Payments on mortgage note payable (26) (24) Net cash used in financing activities (26) (24) Net increase (decrease) in cash and cash equivalents 43 (229) Cash and cash equivalents at beginning of period 386 688 Cash and cash equivalents at end of period $ 429 $ 459 Supplemental disclosure of cash flow information: Cash paid for interest $ 234 $ 236 See Accompanying Notes to Consolidated Financial Statements e) MCCOMBS REALTY PARTNERS, LTD. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE A - BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements of McCombs Realty Partners, Ltd. ("Partnership") have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Article 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 CRPTEX, Inc. ("General Partner"), all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six month periods ended June 30, 1997, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 1997. 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 year ended December 31, 1996. Certain reclassifications have been made to the 1996 information to conform to the 1997 presentation. NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES The Partnership has no employees and is dependent on the General Partner and its affiliates for the management and administration of all partnership activities. The Partnership Agreement provides for payments to affiliates for services and as reimbursement of certain expenses incurred by affiliates on behalf of the Partnership. Property management fees are included in operating expense on the consolidated statements of operations. Reimbursements for services from affiliates are included in general and administrative expense in the consolidated statements of operations. The following transactions with the General Partner and affiliates were charged to expense in 1997 and 1996: Six Months Ended June 30, 1997 1996 Property management fees $38 $ 36 Reimbursement for services from affiliates 11 19 The Partnership insures 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 payments 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. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The Partnership's investment property consists of one apartment complex. The following table sets forth the average occupancy of the property for the six month periods ended June 30, 1997 and 1996: Average Occupancy 1997 1996 Lakewood at Pelham Greenville, South Carolina 95% 94% Results of Operations The Partnership's net income as shown in the financial statements for the six months ended June 30, 1997, was approximately $37,000 as compared to a net loss of approximately $28,000 for the corresponding period in 1996. The Partnership's net income for the three month period ended June 30, 1997 was approximately $8,000 versus net income of approximately $19,000 for the corresponding period in 1996. The increase in net income for the six months ended June 30, 1997 as compared to the six months ended June 30, 1996 is primarily the result of an increase in rental income, decreases in interest expense and maintenance expense. Rental income increased due to increases in rental rates and occupancy. Interest expense decreased as a result of an under-accrual at December 31, 1995. Maintenance expense decreased due to interior and exterior painting projects completed at Lakewood at Pelham during March 1996. These items are partially offset by an increase in operating expense due to the timing of billings for water and sewer. As part of the ongoing business plan of the Partnership, the General Partner monitors the rental market environment of its investment property to assess the feasibility of increasing rents, maintaining or increasing occupancy levels and protecting the Partnership for increases in expense. As part of this plan the General Partner attempts to protect the Partnership from the burden of inflation-related increases in expenses by increasing rents and maintaining a high overall occupancy level. However, due to changing market conditions, which can result in the use of rental concessions and rental reductions to offset softening market conditions, there is no guarantee that the General Partner will be able to sustain such a plan. Liquidity and Capital Resources At June 30, 1997, the Partnership had unrestricted cash of approximately $429,000 versus approximately $459,000 at June 30, 1996. Net cash provided by operating activities increased due to the increase in net income, as described above, a decrease in escrows for taxes, and a decrease in the change of accounts payable related to the timing of payments. Net cash used in investing activities decreased due to a decrease in property improvements and replacements. Net cash used in financing activities remained stable. The Partnership has no material capital programs scheduled to be performed in 1997, although certain routine capital expenditures and maintenance expenses have been budgeted. These capital expenditures and maintenance expenses will be incurred only if cash is available from operations, is received from the capital reserve account or from cash and cash equivalents on hand. 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 $5,755,000 has a maturity date of July 1, 2005, at which time the property will be sold or refinanced. No cash distributions were recorded during the three months ended June 30, 1997 or 1996, and none are expected for the remainder of 1997. Future cash distributions will depend on the level of net cash generated from operations, a property sale, and the availability of cash reserves. On March 9, 1987, the original General Partners, on behalf of the Partnership, filed a voluntary petition under Chapter 11 of the Federal Bankruptcy Code in U.S. Bankruptcy Court, Central District Court of California ("Court"). The Partnership continued as Debtor-In-Possession to operate its business in the ordinary course subject to control of the Court until the Court confirmed the Partnership's Plan of Reorganization ("Plan") effective October 25, 1988. The Plan was approved by all required classes of creditors. In order to attempt to satisfy the remaining claims under the Plan, the Partnership would be required to sell the investment property. As an alternative to the sale of the property the Partnership may attempt to obtain authorization from the Court and the limited partners to extend the settlement date of October 20, 1998 to a future period. 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 filed during the quarter ended June 30, 1997. 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. MCCOMBS REALTY PARTNERS, LTD. By: CRPTEX, INC. the General Partner By:/s/ Carroll D. Vinson Carroll D. Vinson President By:/s/ Robert D. Long, Jr. Robert D. Long, Jr. Vice President/CAO Date: August 4, 1997 EX-27 2
5 This schedule contains summary financial information extracted from McCombs Realty Partners Ltd. 1997 Second Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000759198 MCCOMBS REALTY PARTNERS, LTD. 1,000 6-MOS DEC-31-1997 JUN-30-1997 429 0 7 0 0 0 5,809 (3,141) 3,575 0 5,755 0 0 0 (2,336) 3,575 0 778 0 0 741 0 244 0 0 0 0 0 0 37 1.66 0 Registrant has an unclassified balance sheet. Multiplier is 1.
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