-----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, Rvj1mqpIExyPGFqayuRD+9XaYOFGxtZfrLGO8EQpurf/YKJSnUnWOfSw1ZHgBhKW iw0OkTpCJNTB/T+5tRuWog== 0000810481-96-000005.txt : 19960515 0000810481-96-000005.hdr.sgml : 19960515 ACCESSION NUMBER: 0000810481-96-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960514 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MCNEIL REAL ESTATE FUND XXVII LP CENTRAL INDEX KEY: 0000810481 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE DEALERS (FOR THEIR OWN ACCOUNT) [6532] IRS NUMBER: 330214387 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-17173 FILM NUMBER: 96563370 BUSINESS ADDRESS: STREET 1: 13760 NOEL ROAD STREET 2: SUITE 700 LB70 CITY: DALLAS STATE: TX ZIP: 75240 BUSINESS PHONE: 2144485800 MAIL ADDRESS: STREET 2: 13760 NOEL ROAD SUITE 700 LB 70 CITY: DALLAS STATE: TX ZIP: 75240 FORMER COMPANY: FORMER CONFORMED NAME: SOUTHMARK PRIME PLUS L P DATE OF NAME CHANGE: 19920413 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the period ended March 31, 1996 ------------------------------------------------------ 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 0-17173 MCNEIL REAL ESTATE FUND XXVII, L.P. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 33-0214387 - -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 13760 Noel Road, Suite 700, LB70, Dallas, Texas, 75240 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code (214) 448-5800 ----------------------------- Indicate by check mark whether the registrant, (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes X No___ MCNEIL REAL ESTATE FUND XXVII, L.P. PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS - ---------------------------- BALANCE SHEETS (Unaudited)
March 31, December 31, 1996 1995 --------------- -------------- ASSETS - ------ Real estate investments: Land..................................................... $ 5,387,855 $ 5,387,855 Buildings and improvements............................... 26,737,148 26,635,813 -------------- ------------- 32,125,003 32,023,668 Less: Accumulated depreciation and amortization......... (7,425,905) (7,046,093) -------------- ------------- 24,699,098 24,977,575 -------------- ------------- Mortgage loan investment.................................... - 1,538,932 Less: Allowance for impairment.............................. - (177,161) -------------- ------------- - 1,361,771 Mortgage loan investments - affiliates...................... 1,283,364 2,235,902 Cash and cash equivalents .................................. 6,245,614 5,718,657 Cash segregated for security deposits and repurchase........ of limited partnership units............................. 82,999 407,565 Accounts receivable......................................... 304,599 299,835 Accrued interest receivable................................. 12,397 23,978 Deferred borrowing costs, net of accumulated amortization of $73,147 and $48,764 at March 31, 1996 and December 31, 1995, respectively................. 121,912 146,295 Prepaid expenses and other assets........................... 295,400 318,163 -------------- ------------- $ 33,045,383 $ 35,489,741 ============== ============= LIABILITIES AND PARTNERS' EQUITY (DEFICIT) - ------------------------------------------ Accounts payable and accrued expenses....................... $ 58,933 $ 68,471 Accrued property taxes...................................... 174,246 - Payable to limited partners................................. - 332,928 Payable to affiliates....................................... 378,684 253,044 Security deposits and deferred rental revenue............... 220,969 204,368 -------------- ------------- 832,832 858,811 -------------- ------------- Partners' equity (deficit): Limited partners - 10,000,000 limited partnership units authorized; 5,273,885 limited partnership units outstanding at March 31, 1996 andDecember 31, 1995..... 32,334,025 34,758,220 General Partner.......................................... (121,474) (127,290) -------------- ------------- 32,212,551 34,630,930 -------------- ------------- $ 33,045,383 $ 35,489,741 ============== =============
The financial information included herein has been prepared by management without audit by independent public accountants. See accompanying notes to financial statements. McNEIL REAL ESTATE FUND XXVII, L.P. STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended March 31, ---------------------------------- 1996 1995 --------------- --------------- Revenue: Rental revenue................................................. $ 1,935,883 $ 1,931,262 Interest income on mortgage loan investment.................... 85,285 53,772 Interest income on mortgage loan investments - affiliates...... 38,959 93,971 Other interest income.......................................... 82,693 89,943 Property tax refund............................................ - 30,515 ------------- ------------- Total revenue................................................ 2,142,820 2,199,463 ------------- ------------- Expenses: Interest....................................................... 24,382 186,878 Depreciation and amortization.................................. 379,812 371,013 Property taxes................................................. 213,576 219,920 Personnel costs................................................ 188,032 182,492 Utilities...................................................... 112,623 109,917 Repairs and maintenance........................................ 146,599 129,951 Property management fees - affiliates.......................... 106,043 108,127 Other property operating expenses.............................. 150,860 164,643 General and administrative..................................... 13,323 7,793 General and administrative - affiliates........................ 225,952 259,453 ------------- ------------- Total expenses............................................... 1,561,202 1,740,187 Net income..................................................... $ 581,618 $ 459,276 ============= ============= Net income allocable to limited partners....................... $ 575,802 $ 454,683 Net income allocable to General Partner........................ 5,816 4,593 ------------- -------------- Net income..................................................... $ 581,618 $ 459,276 ============= ============= Net income per weighted average hundred limited partnership units............................................ $ 10.92 $ 8.56 ============= ============= Distributions per weighted average hundred limited partnership units............................................ $ 56.88 $ - ============= =============
The financial information included herein has been prepared by management without audit by independent public accountants. See accompanying notes to financial statements. MCNEIL REAL ESTATE FUND XXVII, L.P. STATEMENTS OF PARTNERS' EQUITY (DEFICIT) (Unaudited) For the Three Months Ended March 31, 1996 and 1995
Total General Limited Partners' Partner Partners Equity --------------- ---------------- --------------- Balance at December 31, 1994.............. $ (157,447) $ 32,105,597 $ 31,948,150 Net income................................ 4,593 454,683 459,276 ------------- --------------- -------------- Balance at March 31, 1995................. $ (152,854) $ 32,560,280 $ 32,407,426 ============= =============== ============== Balance at December 31, 1995.............. $ (127,290) $ 34,758,220 $ 34,630,930 Distributions............................. - (2,999,997) (2,999,997) Net income................................ 5,816 575,802 581,618 ------------- --------------- -------------- Balance at March 31, 1996................. $ (121,474) $ 32,334,025 $ 32,212,551 ============= =============== ==============
The financial information included herein has been prepared by management without audit by independent public accountants. See accompanying notes to financial statements. MCNEIL REAL ESTATE FUND XXVII, L.P. STATEMENTS OF CASH FLOWS (Unaudited) Increase in Cash and Cash Equivalents
Three Months Ended March 31, ----------------------------------------- 1996 1995 ----------------- ---------------- Cash flows from operating activities: Cash received from tenants........................ $ 1,923,725 $ 1,945,420 Cash paid to suppliers............................ (581,060) (552,063) Cash paid to affiliates........................... (206,355) (329,619) Interest received................................. 167,978 95,554 Interest received from affiliates................. 50,542 124,726 Interest paid..................................... - (176,307) Property taxes paid............................... (39,330) (19,439) Property tax refund............................... - 30,515 --------------- -------------- Net cash provided by operating activities............ 1,315,500 1,118,787 --------------- -------------- Cash flows from investing activities: Additions to real estate investments.............. (101,335) (113,874) Proceeds from collection of mortgage loan investment...................................... 1,361,771 64,099 Proceeds from collection of mortgage loan investments - affiliates........................ 952,538 972,000 --------------- -------------- Net cash provided by investing activities............ 2,212,974 922,225 --------------- -------------- Cash flows from financing activities: Net decrease in cash segregated for repurchase of limited partnership units......... 331,408 332,786 Principal payments on mortgage note payable......................................... - (36,393) Repurchase of limited partnership units........... (332,928) (332,931) Distributions paid................................ (2,999,997) - --------------- -------------- Net cash used in financing activities................ (3,001,517) (36,538) --------------- -------------- Net increase in cash and cash equivalents............ 526,957 2,004,474 Cash and cash equivalents at beginning of period............................................ 5,718,657 7,196,410 --------------- -------------- Cash and cash equivalents at end of period........... $ 6,245,614 $ 9,200,884 =============== ==============
The financial information included herein has been prepared by management without audit by independent public accountants. See accompanying notes to financial statements. MCNEIL REAL ESTATE FUND XXVII, L.P. STATEMENTS OF CASH FLOWS (Unaudited) Reconciliation of Net Income to Net Cash Provided by Operating Activities
Three Months Ended March 31, ---------------------------------------- 1996 1995 ---------------- ---------------- Net income........................................... $ 581,618 $ 459,276 --------------- --------------- Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization..................... 379,812 371,013 Amortization of deferred borrowing costs.......... 24,383 10,571 Allowance for impairment of mortgage loan investment...................................... - (45,699) Changes in assets and liabilities: Cash segregated for security deposits........... (6,842) (303) Accounts receivable............................. (4,764) 1,465 Accrued interest receivable..................... 11,581 28,293 Prepaid expenses and other assets............... 22,763 23,454 Accounts payable and accrued expenses........... (9,538) 3,622 Accrued property taxes.......................... 174,246 200,481 Payable to affiliates........................... 125,640 37,961 Security deposits and deferred rental revenue....................................... 16,601 28,653 --------------- -------------- Total adjustments............................. 733,882 659,511 --------------- -------------- Net cash provided by operating activities............ $ 1,315,500 $ 1,118,787 =============== ==============
The financial information included herein has been prepared by management without audit by independent public accountants. See accompanying notes to financial statements. MCNEIL REAL ESTATE FUND XXVII, L.P. Notes to Financial Statements March 31, 1996 (Unaudited) NOTE 1. - ------- McNeil Real Estate Fund XXVII, L.P. (the "Partnership"), formerly known as Southmark Prime Plus, L.P., was organized by affiliates of Southmark Corporation ("Southmark") on January 16, 1987, as a limited partnership under the provisions of the Delaware Revised Uniform Limited Partnership Act to make short-term loans to affiliates of the general partner. The general partner of the Partnership is McNeil Partners, L.P. (the "General Partner"), a Delaware limited partnership, an affiliate of Robert A. McNeil ("McNeil"). The principal place of business for the Partnership and the General Partner is 13760 Noel Road, Suite 700, Dallas, Texas 75240. In the opinion of management, the financial statements reflect all adjustments necessary for a fair presentation of the Partnership's financial position and results of operations. All adjustments were of a normal recurring nature. However, the results of operations for the three months ended March 31, 1996 are not necessarily indicative of the results to be expected for the year ending December 31, 1996. NOTE 2. - ------- The financial statements should be read in conjunction with the financial statements contained in the Partnership's Annual Report on Form 10-K for the year ended December 31, 1995, and the notes thereto, as filed with the Securities and Exchange Commission, which is available upon request by writing to McNeil Real Estate Fund XXVII, L.P., c/o McNeil Real Estate Management, Inc., Investor Services, 13760 Noel Road, Suite 700, Dallas, Texas 75240. NOTE 3. - ------- The Partnership pays property management fees equal to 5% of the gross rental receipts for its mini-storage warehouses and 6% of gross rental receipts for its commercial properties to McNeil Real Estate Management, Inc. ("McREMI"), an affiliate of the General Partner, for providing property management services for the Partnership's mini-storage warehouses and commercial properties and leasing services for its mini-storage warehouses. McREMI may also choose to provide leasing services for the Partnership's commercial properties, in which case McREMI will receive property management fees from such commercial properties equal to 3% of the property's gross rental receipts plus leasing commissions based on the prevailing market rate for such services where the property is located. The Partnership reimburses McREMI for its costs, including overhead, of administering the Partnership's affairs. The Partnership is paying an asset management fee, which is payable to the General Partner. Through 1999, the asset management fee is calculated as 1% of the Partnership's tangible asset value. Tangible asset value is determined by using the greater of (i) an amount calculated by applying a capitalization rate of 9% to the annualized net operating income of each property or (ii) a value of $30 per gross square foot for mini-storage warehouses and $50 per gross square foot for commercial properties to arrive at the property tangible asset value. The property tangible asset value is then added to the book value of all other assets excluding intangible items. The fee percentage decreases subsequent to 1999. Total accrued but unpaid asset management fees of $143,884 were outstanding at March 31, 1996. Compensation and reimbursements paid to or accrued for the benefit of the General Partner or its affiliates are as follows:
Three Months Ended March 31, ---------------------------------------- 1996 1995 ---------------- --------------- Property management fees............................. $ 106,043 $ 108,127 Charged to general and administrative - affiliates: Partnership administration........................ 88,747 107,999 Asset management fee.............................. 137,205 151,454 --------------- -------------- $ 331,995 $ 367,580 =============== ==============
Under the terms of its amended partnership agreement, the Partnership is expressly permitted to make loans to affiliates of the General Partner, so long as such loans meet certain conditions, including that such loans bear interest at a rate of prime plus 2.5%, or prime plus 3.5% if the loan is junior to other indebtedness. These loans are secured by income-producing real estate and may be either junior or senior to other indebtedness secured by such property. The Partnership received repayments from affiliates of $952,538 and $972,000 during the first three months of 1996 and 1995, respectively. In order to induce the Partnership to lend funds to affiliates of the General Partner, the General Partner agreed to pay (i) the difference between the interest rate required by the Partnership's amended partnership agreement to be charged to affiliates and the interest rate actually paid by certain of those affiliates, and (ii) all points (1.5% or 2% if the loan is junior to other indebtedness), closing costs and expenses. The Partnership recorded interest income on affiliate loans of $38,959 and $93,971 for the three months ended March 31, 1996 and 1995, respectively, of which $6,794 and $6,719, respectively, was paid or payable by the General Partner. Payable to affiliates at March 31, 1996 and December 31, 1995 consisted primarily of a performance incentive fee of $141,647 accrued in prior years, Partnership general and administrative expenses, asset management fees and prepaid interest. Except for the performance incentive fee and prepaid interest, all accrued fees are due and payable from current operations. NOTE 4. - ------- On March 21, 1996, the mortgage loan investment plus accrued interest secured by A-Quality Mini-Storage, was paid off in full by the borrower. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND - ------- --------------------------------------------------------------- RESULTS OF OPERATIONS --------------------- FINANCIAL CONDITION - ------------------- There has been no significant change in the operations of the Partnership's properties since December 31, 1995. The Partnership reported net income for the first three months of 1996 of $581,618 as compared to $459,276 for the first three months of 1995. Revenues were $2,142,820 for the first three months of 1996, down from $2,199,463 for the same period in 1995. Expenses were $1,561,202 in 1996 as compared to $1,740,187 in 1995. Net cash provided by operating activities was $1,315,500 for the three months ended March 31, 1996, comparable to the $1,118,787 provided during the same three month period in 1995. The Partnership expended $101,335 for capital improvements, $1,520 for the repurchase of limited partnership units (net of a decrease in cash segregated for the repurchase of limited partnership units) and distributed $2,999,997 to the limited partners. The Partnership received $952,538 for repayment of affiliate loans and collected $1,361,771 of principal on its mortgage loan investment to an unaffiliated borrower, resulting in a net increase in cash and cash equivalents of $526,957 for the quarter ended March 31, 1996. RESULTS OF OPERATIONS - --------------------- Revenue: Total revenue decreased by $56,643 the first three months of 1996 as compared to the same period in the prior year, as discussed below. Rental revenue remained substantially the same for the first quarter of 1996 as compared to the first quarter of 1995. Rental revenue decreased slightly at One Corporate Center III office building due to a decrease in occupancy from 96% in the first quarter of 1995 down to 91% in the same period in 1996. Rental revenue also decreased at AAA Sentry and Margate mini-storages due to slight decreases in occupancy in 1996. Rental revenue increased at the remainder of the properties, mainly due to increases in rental rates. Interest income on the Partnership's mortgage loan investment to an unaffiliated borrower (the A-Quality Mini-Storage loan) increased by $31,513 for the three months ended March 31, 1996 in relation to the comparable period in the prior year. Interest income on mortgage loans investments - affiliates decreased by $55,012 for the quarter ended March 31, 1996 as compared to the same period in the prior year. The decrease was mainly the result of lower total loans outstanding in the first quarter of 1996. The Partnership had $1.3 million of loans outstanding at March 31, 1996 as compared to $2.2 million at March 31, 1995. In the first quarter of 1995, the Partnership received a $30,515 refund of prior years' property taxes for AAA Century Mini Storage as a result of an appeal filed on behalf of the property. No such tax refund was received in 1996. Expenses: Total expenses decreased by $178,985 for the first three months of 1996 as compared to the same period in the prior year, mainly due to a decrease in interest expense, as discussed below. Interest expense decreased by $162,496 for the three months ended March 31, 1996 in relation to the respective period in the prior year. The decrease was due to the repayment of the Partnership's mortgage note payable in the third quarter of 1995. The interest expense recorded in 1996 represents amortization of deferred borrowing costs incurred in connection with obtaining a $5 million line of credit. Repairs and maintenance increased by $16,648 for the three months ended March 31, 1996 as compared to the same period in 1995. The increase was mainly due to a greater amount of snow removal costs being incurred at One Corporate Center I and One Corporate Center III office buildings due to heavy snowfall in the area in 1996. General and administrative expenses increased by $5,530 for the three months ended March 31, 1996 as compared to the same period in 1995. The increase is mainly due to an increase in audit expense. General and administrative - affiliates decreased by $33,501 for the three months ended March 31, 1996 as compared to the same period in 1995. The decrease is due to a lower amount of overhead expenses being allocated to the Partnership by McREMI. LIQUIDITY AND CAPITAL RESOURCES - ------------------------------- The Partnership generated $1,315,500 of cash through operating activities in the first three months of 1996 as compared to $1,118,787 for the same period in 1995. The Partnership received $1,361,771 of principal on its mortgage loan investment to an unaffiliated borrower in 1996 as compared to $64,099 in 1995. The increase was due to the balance of the mortgage loan investment being repaid in full by the borrower in the first quarter of 1996. The Partnership paid $36,393 in principal payments on its mortgage note payable in the three months ended March 31, 1995. No principal payments were made in 1996 since the loan was repaid in full in the third quarter of 1995. The Partnership distributed $2,999,997 to the limited partners in the first quarter of 1996. No distributions were paid to the limited partners in 1995. Short-term liquidity: At March 31, 1996, the Partnership held cash and cash equivalents of $6,245,614. This balance provides a reasonable level of working capital for the Partnership's immediate needs in operating its properties. For the Partnership as a whole, management projects positive cash flow from operations in 1996. The Partnership has budgeted $586,000 for necessary capital improvements for all properties in 1996 which is expected to be funded from available cash reserves or from operations of the properties. The Partnership distributed $2,999,997 to the limited partners in the first quarter of 1996. At the present time, the Partnership anticipates making additional distributions to the limited partners in 1996. Management is currently reviewing cash requirements to determine the amount and timing of such distributions. PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - ------- -------------------------------- (a) Exhibits. Exhibit Number Document Description ------- -------------------- 4.2 Amended and Restated Partnership Agreement of McNeil XXVII, L.P. dated March 30, 1992. (Incorporated by reference to the Current Report of the registrant on Form 8-K dated March 30, 1992, as filed on April 10, 1992). 10. Mutual Release and Settlement Agreement between Southmark Storage Associates Limited Partnership and McNeil Real Estate Fund XXVII, L.P. (incorporated by reference to the Quarterly Report of the registrant on Form 10-Q for the period ended March 31, 1995, as filed on May 15, 1995). 11. Statement regarding computation of Net Income per Hundred Limited Partnership Units. Net income per one hundred limited partnership units is computed by dividing net income allocated to the limited partners by the weighted average number of limited partnership units outstanding (expressed in hundreds). Per unit information has been computed based on 52,739 and 53,109 weighted average limited partnership units (in hundreds) outstanding in 1996 and 1995. 27. Financial Data Schedule for the quarter ended March 31, 1996. (b) Reports on Form 8-K. There were no reports on Form 8-K filed during the quarter ended March 31, 1996. MCNEIL REAL ESTATE FUND XXVII, L.P. SIGNATURES 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: McNEIL REAL ESTATE FUND XXVII, L.P. By: McNeil Partners, L.P., General Partner By: McNeil Investors, Inc., General Partner May 14, 1996 By: /s/ Donald K. Reed - -------------------- ----------------------------------------- Date Donald K. Reed President and Chief Executive Officer May 14, 1996 By: /s/ Ron K. Taylor - -------------------- ----------------------------------------- Date Ron K. Taylor Acting Chief Financial Officer of McNeil Investors, Inc. May 14, 1996 By: /s/ Carol A. Fahs - -------------------- ----------------------------------------- Date Carol A. Fahs Chief Accounting Officer of McNeil Real Estate Management, Inc. EX-27 2
5 3-MOS DEC-31-1996 MAR-31-1996 6,245,614 0 304,599 0 0 0 32,125,003 (7,425,905) 33,045,383 0 0 0 0 0 0 33,045,383 1,935,883 2,142,820 0 0 1,536,820 0 24,382 0 0 581,618 0 0 0 581,618 0 0
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