-----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, TcYNQz5SMvO2eUikBYEKy36JkCv3Y1ET1jJ7VbHfBC33rRfiwJS/RV3oQkZhhdTQ 1K3ksDmvBQy9L2jT5PltWA== 0000787621-96-000004.txt : 19961106 0000787621-96-000004.hdr.sgml : 19961106 ACCESSION NUMBER: 0000787621-96-000004 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961104 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: JOHNSTOWN CONSOLIDATED INCOME PARTNERS CENTRAL INDEX KEY: 0000787621 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 943004963 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-16010 FILM NUMBER: 96653656 BUSINESS ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLAZA STREET 2: PO BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 8032391513 MAIL ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLAZA STREET 2: PO BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 FORMER COMPANY: FORMER CONFORMED NAME: CONSOLIDATED CAPITAL INCOME GROWTH PARTNERS DATE OF NAME CHANGE: 19860401 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 September 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 0-16010 JOHNSTOWN/CONSOLIDATED INCOME PARTNERS (Exact name of small business issuer as specified in its charter) California 94-3004963 (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) JOHNSTOWN/CONSOLIDATED INCOME PARTNERS BALANCE SHEET (Unaudited) (in thousands, except unit data) September 30, 1996 Assets Cash and cash equivalents: Unrestricted $ 1,429 Restricted - tenant security deposits 54 Investments 447 Accounts receivable, net of allowance 54 Escrows for taxes and insurance 149 Restricted escrows 136 Other assets 243 Investment properties: Land $ 1,896 Buildings and related personal property 11,768 13,664 Less accumulated depreciation (5,803) 7,861 $10,373 Liabilities and Partners' Capital (Deficit) Accounts payable $ 6 Tenant security deposits 61 Accrued taxes 124 Other liabilities 131 Mortgage notes payable 1,856 Partners' Capital (Deficit) General partner $ (164) Corporate limited partner on behalf of the Unitholders - (128,810 Units 8,359 8,195 issued and outstanding) $10,373 See Accompanying Notes to Financial Statements b) JOHNSTOWN/CONSOLIDATED INCOME PARTNERS STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except unit data)
Three Months Ended Nine Months Ended September 30, September 30, 1996 1995 1996 1995 Revenues: Rental income $ 529 $ 539 $1,547 $1,585 Other income 41 60 129 255 Total revenues 570 599 1,676 1,840 Expenses: Operating 166 171 487 511 General and administrative 70 71 223 266 Maintenance 59 68 188 147 Depreciation 128 117 383 383 Interest 44 46 139 134 Property taxes 39 36 125 120 Total expenses 506 509 1,545 1,561 Net income $ 64 $ 90 $ 131 $ 279 Net income allocated to general partner (1%) $ -- $ 1 $ 1 $ 3 Net income allocated to Unitholders (99%) 64 89 130 276 $ 64 $ 90 $ 131 $ 279 Net income per Unit of Depositary Receipt $ .50 $ .69 $ 1.01 $ 2.14 See Accompanying Notes to Financial Statements
c) JOHNSTOWN/CONSOLIDATED INCOME PARTNERS STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT) (Unaudited) (in thousands, except unit data)
Unitholders Units of Units of Depositary Depositary General Receipts Receipts Partner (Note A) Total Original capital contributions 129,266 $ 1 $ 32,317 $ 32,318 Partners' capital (deficit) at December 31, 1995 128,810 $ (155) $ 9,219 $ 9,064 Distributions to partners -- (10) (990) (1,000) Net income for the nine months ended September 30, 1996 -- 1 130 131 Partners' capital (deficit) at September 30, 1996 128,810 $ (164) $ 8,359 $ 8,195 See Accompanying Notes to Financial Statements
d) JOHNSTOWN/CONSOLIDATED INCOME PARTNERS STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) Nine Months Ended September 30, 1996 1995 Cash flows from operating activities: Net income $ 131 $ 279 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 383 383 Amortization of lease commissions, discounts 32 30 Change in accounts: Restricted cash (2) (3) Accounts receivable, net of allowance (20) 13 Escrows for taxes and insurance (112) (89) Other assets (12) (32) Accounts payable (11) 8 Tenant security deposit liabilities 9 8 Accrued taxes 124 121 Other liabilities 41 72 Net cash provided by operating activities 563 790 Cash flows from investing activities: Property improvements and replacements (39) (78) Purchase of investments -- (1,009) Proceeds from sale of investments -- 2,713 Deposits to restricted escrows (17) (16) Net cash (used in) provided by investing activities (56) 1,610 Cash flows from financing activities: Payments on notes payable (45) (37) Distributions to partners (1,000) (1,000) Net cash used in financing activities (1,045) (1,037) Net (decrease) increase in cash and cash equivalents (538) 1,363 Cash and cash equivalents at beginning of period 1,967 564 Cash and cash equivalents at end of period $ 1,429 $ 1,927 Supplemental disclosure of cash flow information: Cash paid for interest $ 118 $ 107 See Accompanying Notes to Financial Statements e) JOHNSTOWN/CONSOLIDATED INCOME PARTNERS NOTES TO FINANCIAL STATEMENTS (Unaudited) NOTE A - BASIS OF PRESENTATION The accompanying unaudited financial statements of Johnstown/Consolidated Income Partners, (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 ConCap Equities, Inc. (the "General Partner"), all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 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-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. Units of Depositary Receipts Johnstown/Consolidated Depositary Corporation (the "Corporate Limited Partner"), an affiliate of the General Partner, serves as a depositary of certain Units of Depositary Receipts ("Units"). The Units represent economic rights attributable to the limited partnership interests in the Partnership and entitle the holders thereof ("Unitholders") to certain economic benefits, allocations and distributions of the Partnership. NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES The Partnership Agreement provides that the Partnership shall pay in monthly installments to the General Partner, or an affiliate, a yearly asset management fee equal to: (i) 3/8 of 1% of the original principal balance of mortgage loans outstanding at the end of the month preceding the installment payment; (ii) 1/8 of 1% of the market value of guaranteed mortgage-backed securities as of the end of the Partnership quarter immediately preceding the installment payment; and (iii) 5/8 of 1% of the purchase price of the properties plus improvements for managing the Partnership's assets. In the event the property was not owned at the beginning or end of the year, such fee shall be pro-rated for the short-year period of ownership. Under this provision, fees of approximately $73,000 and $74,000 were paid to the General Partner and affiliates for each of the nine months ended September 30, 1996 and 1995, respectively, and are included in general and administrative expenses. The Partnership has paid property management fees based upon collected gross rental revenues for property management services in each of the nine months ended September 30, 1996 and 1995. In late December 1994, an affiliate of the General Partner assumed day-to-day property management responsibilities for all of the Partnerships' properties except Cedar Brooke Apartments. Management of Cedar Brooke was assumed by an affiliate of the General Partner on February 15, 1995. Property management fees of approximately $90,000 and $85,000 were paid to an affiliate of the General Partner for each of the nine months ended September 30, 1996 and 1995, respectively. These fees are included in operating expenses. 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 $93,000 and $106,000 were paid to the General Partner and affiliates for each of the nine months ended September 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 by the Partnership Agreement to maintain working capital 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. Reserves, including cash and cash equivalents, tenant security deposits and investments totalling approximately $1,930,000 at September 30, 1996, exceeded the Partnership's reserve requirement of approximately $1,385,000. NOTE D - DISTRIBUTIONS For each of the nine months ended September 30, 1996 and 1995, the Partnership declared and paid distributions attributable to cash flow from operations of approximately $1,000,000. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS The Partnership's investment properties consist of one apartment complex, two commercial properties and a one-third (1/3) undivided interest in the Florida #6 Mini-Warehouse property. The following table sets forth the average occupancy of the properties for the nine months ended September 30, 1996 and 1995: Average Occupancy 1996 1995 Cedar Brooke Apartments 99% 99% Independence, Missouri Florida #6 Mini-Warehouse 92% 91% Lauderhill, Florida Florida #1l Mini-Warehouse 95% 96% Davie, Florida Phoenix Business Campus 58% 57% College Park, Georgia The vacancy created by a large tenant moving out during the first quarter of 1995 continues to negatively impact the 1996 occupancy of the Phoenix Business Center. Subsequent to September 30, 1996, a lease was executed for a new tenant, who will occupy 14% of the total square footage at Phoenix Business Center, and new tenants are being actively recruited in efforts to lease the remaining vacant space. The Partnership realized net income of approximately $64,000 and $131,000 for the three and nine months ended September 30, 1996, respectively, compared to net income of approximately $90,000 and $279,000 for the three and nine months ended September 30, 1995, respectively. The decrease in net income is primarily due to decreased other income and increased maintenance costs as discussed below. The decrease in other income resulted from the Partnership receiving no dividends on its investment in Southmark Preferred Stock during 1996. General and administrative expenses decreased due to reduced expense reimbursements related primarily to the efforts of the Dallas partnership administration staff during the management transition in 1995. This expense decrease was partially offset by an increase in maintenance expenses due to exterior painting at the Florida #11 Mini-Warehouse and exterior building improvements made at the Cedar Brooke Apartments in efforts to increase 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 September 30, 1996, the Partnership held cash of $1,429,000 compared to $1,927,000 at September 30, 1995. Net cash provided by operating activities decreased due to reduced rental and other income, an increase in interest payments and higher maintenance expenses. Net cash used by investing activities increased as a result of the Partnership investing primarily in shorter term cash equivalents during 1996 rather than longer term securities. 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 $1,856,000, net of discount, matures in 2013, at which time the related property will either be refinanced or sold. Future cash distributions will depend on the levels of net cash generated from operations, capital expenditure requirements, property sales and the availability of cash reserves. As part of the Partnership's ongoing attempt to maximize the return to the Unitholders, the Partnership is exploring the possibility of selling the Florida #6 Mini-Warehouse. During each of the nine months ended September 30, 1996 and 1995, cash distributions of $1,000,000 were paid to the partners. 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. JOHNSTOWN/CONSOLIDATED INCOME PARTNERS By: CONCAP EQUITIES, INC. 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: November 4, 1996 17 EX-27 2
5 This schedule contains summary financial information extracted from Johnstown Consolidated Income Partners 1996 Third Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000787621 JOHNSTOWN CONSOLIDATED INCOME PARTNERS 1,000 9-MOS DEC-31-1996 SEP-30-1996 1,429 447 54 0 0 0 13,664 5,803 10,373 0 1,856 0 0 0 8,195 10,373 0 1,676 0 0 1,545 0 139 0 0 0 0 0 0 131 1.01 0 Registrant has an unclassified balance sheet. Multiplier is 1.
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