-----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, K5w4kCCUGBHAY5NnH9X5dPJ3vTfH/a0UOwsAocGDb4eXcHugsJKvbEzhWGmgYb0f B5CZuL+rURMqNONGxRA+0Q== 0000892569-95-000652.txt : 19951119 0000892569-95-000652.hdr.sgml : 19951119 ACCESSION NUMBER: 0000892569-95-000652 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950930 FILED AS OF DATE: 19951114 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN RETIREMENT VILLAS PROPERTIES CENTRAL INDEX KEY: 0000778643 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 330154077 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-26428 FILM NUMBER: 95591275 BUSINESS ADDRESS: STREET 1: 245 FISCHER AVE STE D1 CITY: COSTA MESA STATE: CA ZIP: 92626 BUSINESS PHONE: 7147517400 MAIL ADDRESS: STREET 1: 245 FISCHER AVE STE D1 STREET 2: 245 FISCHER AVE STE D1 CITY: COSTA MESA STATE: CA ZIP: 92626 10-Q 1 AMERICAN RETIREMENT VILLAS PROPERTIES - 9/30/95 1 Securities and Exchange Commission Washington, D.C. 20549 Form 10 Q Quarterly Report under section 13 or 15(d) of the Securities and Exchange Act of 1934 For the Quarter Ended September 30, 1995 Commission file number 33-633 American Retirement Villas Properties - ------------------------------------- (Exact name of Registrant as specified in it's charter) California 33-0154077 - ---------- ---------- state or other jurisdiction (IRS Employer Identification of organization Number) 245 Fischer Avenue, Suite D-1 Costa Mesa, California 92626 - ---------------------- ----- (address of principal executive (zip code) office) Registrant's telephone number, (714) 751-7400 including area code -------------- Indicate by a check mark whether the registrant (1) has filed all the reports to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months, (or for such shorter period that the registrant was required to file reports), and (2) has been subject to such filing requirements for the past 90 days. YES X NO -------- -------- 2 PART 1 ITEM 1 AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) Balance Sheets September 30, 1995 (unaudited) and December 31, 1994 (audited) - --------------------------------------------------------------------------------
1995 1994 Assets (unaudited) (audited) ------ ----------- ----------- Properties, at cost (notes 4 and 5) Land $ 2,695,099 $ 2,695,099 Building and improvements, less accumulated depreciation of $5,228,435 in 1995 and $4,689,608 in 1994 14,571,819 15,035,175 Furniture, fixtures and equipment less accumulated depreciation of $325,701 in 1995 and $330,734 in 1994 273,124 239,999 ----------- ----------- Net Properties 17,540,042 17,970,273 Cash and cash equivalents 668,301 245,898 Loan fees, less accumulated amortization of $9,250 in 1995 and $5,630 in 1994 24,531 28,151 Other assets 411,190 107,784 ----------- ----------- Total assets $18,644,064 $18,352,106 =========== =========== Liabilities and Partners' Capital --------------------------------- Notes payable (note 6) $ 981,054 $ 989,281 Accounts payable and accrued expenses 420,589 350,833 Amounts payable to affiliate (note 3) 0 9,601 Distribution payable to partners 52,367 455,919 ----------- ----------- Total Liabilities 1,454,010 1,805,634 Partners' capital (note 2) 30,000 units outstanding at September 30, 1995 and December 31, 1994 17,190,054 16,546,472 ----------- ----------- Total liabilities and partners' capital $18,644,064 $18,352,106 =========== ===========
See accompanying notes to financial statements. 3 PART 1 ITEM 1 (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) Statements of Operations (unaudited) For the quarter ended September 30, 1995 For the quarter ended September 30, 1994 For the nine months ended September 30, 1995 For the nine months ended September 30, 1994 - --------------------------------------------------------------------------------
Quarter Quarter Nine months Nine months ended Sept ended Sept ended Sept ended Sept 30, 1995 30, 1994 30, 1995 30, 1994 (unaudited) (unaudited) (unaudited) (unaudited) ----------- ----------- ----------- ----------- Revenues: Rent $1,824,822 $1,745,928 $5,439,214 $5,118,379 Assisted living 214,107 170,288 598,839 499,229 Other 43,279 37,283 138,659 140,041 ---------- ---------- ---------- ---------- Total Revenues 2,082,208 1,953,498 6,176,711 5,757,648 ---------- ---------- ---------- ---------- Costs and expenses: Rental property operations (note 3 and 7) 1,049,899 1,016,810 3,128,489 3,017,833 Assisted living (note 3) 93,455 77,645 267,684 229,408 General and administrative (note 3) 252,637 260,313 751,679 758,035 Depreciation and amortization 206,623 223,166 618,989 658,080 Property taxes 61,634 65,250 190,292 197,406 Advertising 10,917 9,009 34,746 31,095 Interest (note 6) 23,860 24,120 71,262 83,136 Legal 1,710 0 11,497 5,791 Bad debt 1,499 75 3,759 1,683 ---------- ---------- ---------- ---------- Total costs and expenses 1,702,234 1,676,388 5,078,397 4,982,466 Net income $ 379,974 $ 277,110 $1,098,314 $ 775,182 ========== ========== ========== ========== Net income to General Partner 3,800 2,771 10,983 7,752 Net income to limited partner $ 376,174 $ 274,339 $1,087,331 $ 767,430 ========== ========== ========== ========== Net income per limited partners unit $ 12.54 $ 9.14 $ 36.24 $ 25.58 ========== ========== ========== ==========
See accompanying notes to financial statements. 4 PART 1 ITEM 1 (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) Statement of Cash Flows (unaudited) For the nine months ended September 30, 1995 For the nine months ended September 30, 1994 - --------------------------------------------------------------------------------
1995 1994 (unaudited) (unaudited) ----------- ----------- Cash flows from operating activities: Net income $1,098,314 $ 775,182 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 618,989 658,080 Change in assets and liabilities: Increase in other assets (303,406) (3,416) Decrease in loan fees 3,620 7,759 Increase in accounts payable and accrued expenses 70,264 59,625 (Decrease) in amounts payable to affiliates (10,108) (2,194) ---------- ----------- Total adjustments 379,359 719,853 Net cash provided by operating activities 1,477,673 1,495,035 ---------- ----------- Cash flows from (used in) investing activities: Capital expenditures (177,536) (167,210) ---------- ----------- Net cash used in investing activities (177,536) (167,210) Cash flows from (used in) financing activities: Principal reduction of notes payable (8,227) (332,463) Distributions paid (869,507) (1,277,605) ---------- ----------- Net cash used in financing activities (877,734) (1,610,068) ---------- ----------- Increase (Decrease) in cash 422,403 (282,243) Cash at the beginning of the period 245,898 498,543 ---------- ----------- Cash at the end of the period $ 668,301 $ 216,300 ========== ===========
See accompanying notes to financial statements. 5 PART 1 ITEM 1 (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) NOTES TO FINANCIAL STATEMENTS (UNAUDITED) September 30, 1995 - -------------------------------------------------------------------------------- (1) Summary of Significant Accounting Policies Basis of Accounting Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Carrying Value of Real Estate Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Loan Fees Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Rental Income Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Income Taxes Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Net Income Per Limited Partner Unit Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. The weighted average number of units outstanding at September 30, 1995 and September 30, 1994 was 30,000. Cash and Cash Equivalents Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. 6 PART 1 ITEM 1 (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) NOTES TO FINANCIAL STATEMENTS (UNAUDITED) September 30, 1995 - -------------------------------------------------------------------------------- Reclassifications Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. (2) Organization and Partnership Agreement Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. (3) Transactions with Affiliates Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference, except for the following additional comments. For the nine months ended September 30, 1995 property management and partnership management fees of $308,836 and $192,642 respectively, were paid or accrued to the Managing General Partner. (4) Properties Villa Bonita: Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Rancho Park Villa: Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Tamalpais Creek: Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. Maria del Sol: Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. 7 PART I ITEM I (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) NOTES TO FINANCIAL STATEMENTS (UNAUDITED) September 30, 1995 - -------------------------------------------------------------------------------- (5) Accounts Payable and Accrued Expenses Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. (6) Notes Payable Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. (7) ESOP Pursuant to Regulation S-X Rule 10-1(5) the material stated in the December 31, 1994 Form 10K is incorporated by this reference. 8 PART I ITEM II AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- (1) Liquidity. The General Partners expect that the cash to be generated from operations of all the Registrant's properties will be adequate to pay operating expenses, make necessary capital improvements, make required principal reductions, and provide distributions to the Partners. On a long-term basis, the Registrant's liquidity is sustained primarily from cash flow provided by operating activities. During the nine months ended September 30, 1995, net cash provided by operating activities was approximately $1,477,673 as compared to cash provided by operating activities of approximately $1,430,722 for the nine months ended September 30, 1994. During the nine months ended September 30, 1995, the Registrant used net cash in investing activities of $177,536 compared to $167,210 for the nine months ended September 30, 1994. The Registrant's investing activities consisted of capital improvements made on its four properties. During the nine months ended September 30, 1995, the Registrant used net cash in financing activities of $877,734 compared to $1,610,068 for the nine months ended September 30, 1994. The Registrant's financing activities consisted of principal reduction on notes payable and distributions paid to the Partners. The General Partners are not aware of any trends, other than national economic conditions, which have had or which may be reasonably expected to have a material favorable or unfavorable impact on revenues or income from the operations or sale of properties. The General Partners believe that if the inflation rate increases they will be able to pass the subsequent increase in operating expenses onto the residents of the properties by way of higher rental and Assisted Living rates. The Registrant has long term debt of approximately $981,000 ,as of September 30, 1995, which matures on September 20, 2000. The amount of this indebtedness is minor in relation to the Registrant's equity. (2) Capital Resources. Registrant contemplates spending approximately $200,000 for capital expenditures during 1995 for physical improvements at its four facilities. The funds for these improvements should be available from operations. There are no known material trends, favorable or unfavorable, in the Registrant's capital resources, and there is no expected change in the mix of such resources. (3) Results of Operations. Three months ended September 30, 1995 compared with the three months ended September 30, 1994. Revenue for the three months ended September 30, 1995, and the three months ended September 30, 1994 includes rental income and Assisted Living income from all four properties, interest earned on cash balances and other revenue. Total revenues for the three months ended September 30, 1995 were $2,082,208, an increase of approximately 7% over revenues of $1,953,498 for the three months ended September 30, 1994. 9 PART I ITEM II (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- The largest component of revenue, rent, increased by approximately 5% from the three months ended September 30, 1994 to the three months ended September 30, 1995. The increase in rent was due to an increase in occupancy of approximately 3% and an increase in rental rates of approximately 2%. Revenue from Assisted Living increased by approximately 26% from the three months ended September 30, 1994 to the three months ended September 30, 1995. The increase in Assisted Living was due to aggressive marketing of the Assisted Living services and the resulting increase in the number of residents using the program. Interest and other revenue increased by over 16% from the three months ended September 30, 1994 to the three months ended September 30, 1995. Interest income results from interest earned on cash deposits. Other revenue generally includes processing fees and beauty shop revenue. Sources of revenue for the three months ended September 30, 1995 and September 30, 1994 are summarized as follows:
Three Months Ended Three Months Ended September 30, 1995 September 30, 1994 Rent $1,824,822 $1,745,928 Assisted Living 214,107 170,288 Other 43,279 37,283 ---------- ---------- $2,082,208 $1,953,498 ========== ==========
Total cost and expenses for the three months ended September 30,1 995 were $1,702,234, an increase of approximately 2% over costs and expenses of $1,676,388 for the three months ended September 30, 1994. The largest component of expenses, rental property operations, consist primarily of property management costs, payroll related expenses, utilities, food expenses and maintenance and supplies. Rental property operations expenses increased by 3% from the three months ended September 30, 1994 to the three months ended September 30, 1995. The increase in rental property operating expenses is primarily due to increases in payroll expenses and increases in occupancy which generate increases in expenses. Assisted Living expenses consist primarily of the related payroll expense. Assisted living expenses increased by over 20% from the three months ended September 30, 1994 to the three months ended September 30, 1995. Assisted Living expenses increased due to the increases in size of the related staff providing Assisted Living services. This increase corresponds to the increase in Assisted Living revenue. 10 PART I ITEM II (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- General and administrative expenses are comprised of, but not limited to, costs for accounting, partnership administration, bad debt, data processing, investor relations, insurance, and professional services. General and administrative expenses decreased about 3% from the three months ended September 30, 1994 to the three months ended September 30, 1995. Depreciation and amortization expense decreased by over 7% from the three months ended September 30, 1994 to the three months ended September 30, 1995. Interest expense decreased over 1% for the three months ended September 30, 1994 compared to the three months ended September 30, 1995, as a result of principal reduction. Selected costs and expenses for the three months ended September 30, 1995 and September 30, 1994 are summarized as follows:
Three Months Ended Three Months Ended September 30, 1995 September 30, 1994 Rental Property Operations $1,049,899 $1,016,810 Assisted Living 93,455 77,645 General and Administrative 252,637 260,313 Depreciation and Amortization 206,623 223,166 Property Taxes 61,634 65,250 Interest 23,860 24,120
NINE MONTHS ENDED SEPTEMBER 30, 1995 COMPARED WITH THE NINE MONTHS ENDED SEPTEMBER 30, 1994. Revenue for the nine months ended September 30, 1995, and the nine months ended September 30,1994 includes rental income and Assisted Living revenue from all four facilities, interest earned on cash balances and other revenue. Total revenues for the nine months ended September 30, 1995 were $6,176,711 an increase of approximately 7% over revenues of $5,757,648 for the nine months ended September 30, 1994. The largest component of revenue, rent, increased by over 6% from the nine months ended September 30, 1994 to the nine months ended September 30, 1995. This increase in rent was due to an increase in occupancy of approximately 3% and an increase in rental rates of over 2%. Revenue from Assisted Living increased by almost 20% from the nine months ended September 30, 1994 to the nine months ended September 30, 1995. The increase in Assisted Living was due to aggressive marketing of the Assisted Living services and the resulting increase in the number of residents using the program. 11 PART I ITEM II (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- Interest and other revenue decreased by approximately 1% from the nine months ended September 30, 1994 to the nine months ended September 30, 1995. Interest income results from interest earned on cash deposits. Other revenue generally includes processing fees and beauty shop revenue. Sources of revenue for the nine months ended September 30, 1995 and September 30, 1994 are summarized as follows:
Nine Months Ended Nine Months Ended September 30, 1995 September 30, 1994 Rent $5,439,214 $5,118,379 Assisted Living 598,839 499,229 Interest and Other 138,659 140,041 ---------- ---------- Total Revenue $6,176,611 $5,757,648 ========== ==========
Total costs and expenses for the nine months ended September 30, 1995 were $5,078,397, an increase of approximately 2% over costs and expenses of $4,982,466 for the nine months ended September 30, 1994. The largest component of expenses, rental property operations, consist primarily of the property management costs, payroll related expenses, utilities, food expenses and maintenance and supplies. Rental property operations expense increased by almost 4% from the nine months ended September 30, 1994 to the nine months ended September 30, 1995. The increase in rental property operating expenses is primarily due to increased in payroll expenses and increases in occupancy which generate increases in expenses. Assisted Living expenses consist primarily of the related payroll expense. Assisted Living expenses increased by over 16% from the nine months ended September 30, 1994 to the nine months ended September 30, 1995. Assisted Living expenses increased due to the increases in size of the related staff providing Assisted Living services. This increase corresponds to the increase in Assisted Living revenue. General and administrative expenses are comprised of, but not limited to, costs for accounting, partnership administration, bad debt, data processing, investor relations, insurance, and professional services. General and administrative expenses decreased about 1% from the nine months ended September 30, 1994 to the nine months ended September 30, 1995. Depreciation and amortization expense decreased by more than 5% from the nine months ended September 30, 1994 to the nine months ended September 30, 1995. Depreciation and amortization decreased due to a portion of fixed assets becoming fully depreciated. Interest expense decreased over 14% for the nine months ended September 30, 1994 compared to the nine months ended September 30, 1995, as a result of paying off a loan secured by a first deed of trust on Villa Bonita of $321,250 on or about March 31, 1994. 12 PART I ITEM II (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - -------------------------------------------------------------------------------- Selected costs and expenses for the nine months ended September 30, 1995 and September 30, 1994 are as follows:
Nine Months Ended Nine Months Ended September 30, 1995 September 30, 1994 Rental Property Operations $3,128,489 $3,017,833 Assisted Living 267,684 229,408 General and Administrative 751,679 758,035 Depreciation and Amortization 618,989 658,080 Property Taxes 190,292 197,406 Interest 71,262 83,136
13 PART II AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) Item 1 Legal Proceedings None Item 2 Change in Securities None Item 3 Defaults Upon Senior Securities None Item 4 Submission of Matters to Vote of Security Holders On August 29, 1995, American Retirement Villas Properties (the "Partnership") initiated the solicitation of consents from the holders of units of the Partnership regarding the sale of the four assisted living facilities (the "Properties") owned by the Partnership to Nationwide Health Properties, Inc. ("NHP") . a) On September 28, 1995, the Partnership received consents from holders of a majority of the units to the proposed Sale and Liquidation and terminated the solicitation of consents. b) The tabulation of the votes for the solicitation of consents was as follows:
Votes For Votes Against Abstain ----------- ------------- -------- 15,953.9840 4,444.2350 261.0230
Item 5 Other Information A. On May 25 the Managing General Partner had a name change from ARV Housing Group, Inc. to ARV Assisted Living, Inc.. B. On August 29, 1995, American Retirement Villas Properties (the "Partnership") initiated the solicitation of consents from the holders of units of the Partnership regarding the sale of the four assisted living facilities (the "Properties") owned by the Partnership to Nationwide Health Properties, Inc. ("NHP") and, following such sale, the distribution of the net proceeds of sale in accordance with the terms of the limited partnership agreement of the Partnership, and the subsequent termination, dissolution and winding up of the Partnership (collectively, the "Sale and Liquidation"). On September 28, 1995, the Partnership received consents from holders of a majority of the units to the proposed Sale and Liquidation and terminated the solicitation of consents. The sale of the Properties to NHP closed on October 16, 1995 and distribution of the net proceeds from the sale were forwarded to holders on October 18, 1995. The Partnership will be dissolved and the Partnership's business affairs will be wound up before the end of the year. C. Form 8-A General Form for Registration of Securities - Filed July 14, 1995. Item 6 Exhibits and Reports on Form 8K A. Exhibit 27 - Financial Data Schedule B. Reports on Form 8-K - Filed September 28, 1995 14 PART II (Continued) AMERICAN RETIREMENT VILLAS PROPERTIES (a California Limited Partnership) Pursuant to the requirements 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. AMERICAN RETIREMENT VILLAS PROPERTIES, A CALIFORNIA LIMITED PARTNERSHIP By ARV Assisted Living, Inc. ---------------------------- Managing General Partner Date: November 11, 1995 By /s/ GARY L. DAVIDSON -------------------------- Gary L. Davidson Chairman of the Board Date: November 11, 1995 By /s/ GRAHAM ESPLEY-JONES -------------------------- Graham Espley-Jones Chief Financial Officer EX-27 2 FINANCIAL DATA SCHEDULE
5 3-MOS DEC-31-1995 JUL-31-1995 SEP-30-1995 668,301 0 0 0 0 435,721 17,540,042 5,554,136 18,644,064 1,454,010 0 0 0 0 17,190,054 18,644,064 0 2,082,208 0 1,678,374 0 0 23,860 379,974 0 0 0 0 0 379,974 0 0
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