-----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, QhnvVOCwfnrhaewOBQkB3CWcFGjSdU0pm03dd+19hZOehKBOxg/WCzaA+KDXEOwq YT96TYUaSJtlMCHIC8LJhQ== 0000763701-96-000003.txt : 19960813 0000763701-96-000003.hdr.sgml : 19960813 ACCESSION NUMBER: 0000763701-96-000003 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960812 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONAL PROPERTY INVESTORS 8 /CA/ CENTRAL INDEX KEY: 0000763701 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 133254885 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-14554 FILM NUMBER: 96608300 BUSINESS ADDRESS: STREET 1: 5665 NORTHSIDE DR N W STE 370 CITY: ATLANTA STATE: GA ZIP: 30328 BUSINESS PHONE: 4049169090 MAIL ADDRESS: ZIP: ----- 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 (Mark One) [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 0-14554 NATIONAL PROPERTY INVESTORS 8 (Exact name of small business issuer as specified in its charter) California 13-3254885 (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) (864) 239-1000 Issuer's phone number 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) NATIONAL PROPERTY INVESTORS 8 CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands) June 30, 1996
Assets Cash and cash equivalents: Unrestricted cash $ 2,874 Restricted 57 Other assets 629 Investment properties: Land $ 1,970 Buildings and related personal property 26,592 28,562 Less accumulated depreciation (13,325) 15,237 Total assets $ 18,797 Liabilities and Partners' Capital (Deficit) Liabilities Accounts payable and accrued liabilities $ 701 Tenants' security deposits payable 87 Mortgage payable 10,272 Partners' Capital (Deficit): Limited partners $ 7,883 General partners (146) 7,737 Total liabilities and partners' capital $ 18,797 See Notes to Consolidated Financial Statements
b) NATIONAL PROPERTY INVESTORS 8 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 $ 1,058 $ 1,075 $ 2,111 $ 2,156 Other income 85 83 159 148 Total revenues 1,143 1,158 2,270 2,304 Expenses: Operating 531 584 1,121 1,143 Mortgage interest 205 218 427 444 Depreciation 291 342 578 683 General and administrative 89 74 163 155 Total expenses 1,116 1,218 2,289 2,425 Net income (loss) $ 27 $ (60) $ (19) $ (121) Net income (loss) allocated to general partner (1%) $ -- $ (1) $ -- $ (1) Net income (loss) allocated to limited partners (99%) 27 (59) (19) (120) Net income (loss) $ 27 $ (60) $ (19) $ (121) Net income (loss) per limited partnership unit $ .60 $ (1.32) $ (.42) $ (2.66) See Accompanying Notes to Consolidated Financial Statements
c) NATIONAL PROPERTY INVESTORS 8 CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL (DEFICIT) (Unaudited) (in thousands, except unit data)
Limited Partnership General Limited Total Units Partners Partners Capital Original capital contributions 44,882 $ 1 $ 22,441 $ 22,442 Partners' capital (deficit) at December 31, 1995 44,882 $ (146) $ 7,902 $ 7,756 Net loss for the six months ended June 30, 1996 -- -- (19) (19) Partners' capital (deficit) at June 30, 1996 44,882 $ (146) $ 7,883 $ 7,737 See Notes to Consolidated Financial Statements
d) NATIONAL PROPERTY INVESTORS 8 CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Six Months Ended June 30, 1996 1995 Cash flows from operating activities: Net loss $ (19) $ (121) Adjustments to reconcile net income to cash provided by operating activities: Depreciation 578 683 Amortization of mortgage costs 4 4 Change in accounts: Other Assets (81) (147) Accounts payable and accrued expenses 219 145 Tenants' security deposit liability (9) 5 Net cash provided by operating activities 692 569 Cash flows from investing activities: Property improvements and replacements (102) (63) Increase in restricted cash -- (252) Cash used in investing activities (102) (315) Cash flows from financing activities: Payments on mortgages payable (99) (79) Net cash used in financing activities (99) (79) Net increase in cash and cash equivalents 491 175 Cash and cash equivalents at beginning of period 2,383 1,631 Cash and cash equivalents at end of period $ 2,874 $ 1,806 Supplemental information: Interest paid $ 423 $ 389 See Notes to Consolidated Financial Statements
e) NATIONAL PROPERTY INVESTORS 8 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note A - Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-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 NPI Equity Investments, Inc. ("NPI Equity" or the "Managing 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, 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 financial statements and footnotes thereto included in the Partnership's annual report on Form 10-K for the year ended December 31, 1995. Certain reclassifications have been made to the 1995 information to conform to the 1996 presentation. Note B - Transactions with Affiliated Parties National Property Investors 8 (the "Partnership") has no employees and is dependent on the Managing 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. The following transactions with Insignia Financial Group, Inc. ("Insignia"), National Property Investors, Inc. ("NPI, Inc."), and affiliates were charged to expense in 1996 and 1995:
For the Six Months Ended June 30, 1996 1995 Property management fees (included in operating expenses) $109,000 $110,000 Reimbursement for services of affiliates 94,000 143,000
For the period from January 19, 1996, to June 30, 1996, the Partnership insured its properties under a master policy through an agency and insurer unaffiliated with the Managing General Partner. An affiliate of the Managing 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 Managing General Partner who received payments on these obligations from the agent. The amount of the Partnership's insurance premiums accruing to the benefit of the affiliate of the Managing General Partner by virtue of the agent's obligations is not significant. Included in operating expenses for the six months ended June 30, 1995, are insurance premiums of approximately $56,000 which were paid to the Managing General Partner under a master insurance policy arranged for by the Managing General Partner. NPI Equity is a wholly-owned subsidiary of NPI, Inc. On August 17, 1995, the stockholders of NPI, Inc. entered into an agreement to sell to IFGP Corporation, a Delaware corporation and an affiliate of Insignia, a Delaware corporation, all of the issued and outstanding common stock of NPI, Inc. for an aggregate purchase price of $1,000,000. The closing of the transactions contemplated by the above mentioned agreement (the "Closing") occurred on January 19, 1996. Upon the Closing, the officers and directors of NPI, Inc. and the Managing General Partner resigned and IFGP Corporation caused new officers and directors of each of those entities to be elected. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The Partnership's investment properties consist of two apartment complexes, one comprised of two sections. The following table sets forth the average occupancy of the properties for the six months ended June 30, 1996 and 1995: Average Occupancy Property 1996 1995 Williamsburg on the Lake Apartments I Indianapolis, Indiana 91% 96% Williamsburg on the Lake Apartments II Indianapolis, Indiana 91% 96% Huntington Athletic Club Apartments Morrisville, North Carolina 93% 97% The Managing General Partner attributes the decrease in occupancy at Huntington to new communities in the area and short-term residents waiting for houses to be completed. The decrease in occupancy at Williamsburg I and Williamsburg II is attributable to road construction at the main intersection of the property affecting access to the property. The Partnership's net loss for the six months June 30, 1996, was approximately $19,000 versus $121,000 for the comparable period of 1995. The decrease in the net loss is attributable to an increase in other income and a decrease in depreciation expense. The increase in other income is due to tax refunds received for Huntington Apartments for prior year taxes. The decrease in depreciation expense is due to several assets being fully depreciated in the prior year. The Partnership's net income for the three months ended June 30, 1996, was approximately $27,000 versus a net loss of approximately $60,000 for the comparable period of 1995. The increase in income is attributable to the decrease in depreciation expense as previously discussed. Offsetting this decrease was an increase in general and administrative expense for tax and accounting related expenses and license fees. As part of the ongoing business plan of the Partnership, the Managing General Partner monitors the rental market environment 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 Managing 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 conditions, there is no guarantee that the Managing General Partner will be able to sustain such a plan. At June 30, 1996, the Partnership had unrestricted cash of $2,874,000 as compared to $1,806,000 at June 30, 1995. Net cash provided by operating activities increased primarily as a result of an increase in accounts payable and accrued expenses due to the prepayment of rent and an increase in accrued taxes due to the timing of the payment of real estate taxes. The decrease in cash used in investing activities is due to a decrease in deposits to restricted cash. The increase in cash used in financing activities is due to the payment of the mortgage principal balance. The Managing General Partner has extended to the Partnership a $500,000 line of credit. At the present time, the Partnership has no outstanding amounts due under this line of credit. Based on present plans, the Managing General Partner does not anticipate the need to borrow against the line of credit in the near future. Other than cash and cash equivalents, the line of credit is the Partnership's only unused source of liquidity. 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 properties 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 $10,272,000 is amortized over varying periods. The Managing General Partner is evaluating the refinancing opportunities. Future cash distributions will depend on the levels of cash generated from operations, a property sale, and the availability of cash reserves. The Managing General Partner is evaluating the economic position of the Partnership and the Partnership's ability to make a distribution. No cash distributions were paid in 1995 or during the first half 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 filed during the quarter ended June 30, 1996. 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. NATIONAL PROPERTY INVESTORS 8 By: NPI EQUITY INVESTMENTS, INC. MANAGING GENERAL PARTNER By: /s/William H. Jarrard, Jr. William H. Jarrard, Jr. President and Director By: /s/Ronald Uretta Ronald Uretta Principal Financial Officer and Principal Accounting Officer Date: August 12, 1996 EX-27 2
5 This schedule contains summary financial information extracted from National Property Investors 8 1996 Second Quarter 10-QSB and is qualified in it's entirety by reference to such 10-QSB filing. 0000763701 NATIONAL PROPERTY INVESTORS 8 1,000 6-MOS DEC-31-1996 JUN-30-1996 2,874 0 0 0 0 0 28,562 (13,325) 18,797 0 10,272 0 0 0 7,737 18,797 0 2,270 0 0 2,289 0 427 (19) 0 0 0 0 0 (19) (.42) 0 The Registrant has an unclassified balance sheet. Multiplier is 1.
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