-----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, FkNgDgQQsdlM9dUsCf0RQA1+c/T6l1XfqIZZct4nZfAAlA+ak2ceB2M0+uPEqzKL przigN1PwqEODHyodpsRpw== 0000927016-99-002937.txt : 19990816 0000927016-99-002937.hdr.sgml : 19990816 ACCESSION NUMBER: 0000927016-99-002937 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990630 FILED AS OF DATE: 19990813 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COPLEY PENSION PROPERTIES VI CENTRAL INDEX KEY: 0000824209 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 042988542 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-17807 FILM NUMBER: 99686778 BUSINESS ADDRESS: STREET 1: 255 FRANKLIN STREET CITY: BOSTON STATE: MA ZIP: 02110 BUSINESS PHONE: 6175781200 MAIL ADDRESS: STREET 1: 399 BOYLSTON STREET CITY: BOSTON STATE: MA ZIP: 02116 FORMER COMPANY: FORMER CONFORMED NAME: NEW ENGLAND PENSION PROPERTIES VI DATE OF NAME CHANGE: 19880113 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ----------------------------------------- For Quarter Ended June 30, 1999 Commission File Number 0-17807 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP (Exact name of registrant as specified in its charter) Massachusetts 04-2988542 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 225 Franklin Street, 25th Fl. Boston, Massachusetts 02110 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (617) 261-9000 ---------------------------------------------------------------------------- Former name, former address and former fiscal year if changed since last report 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 twelve (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 COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP FORM 10-Q FOR QUARTER ENDED JUNE 30, 1999 PART I FINANCIAL INFORMATION COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP BALANCE SHEETS
June 30, 1999 December 31, 1998 (Unaudited) (Audited) -------------- ------------------ ASSETS Real estate investments: Joint ventures $1,626,262 $1,649,433 Property, net 4,237,430 4,242,783 ---------- ---------- 5,863,692 5,892,216 Cash and cash equivalents 2,530,757 2,605,486 ---------- ---------- $8,394,449 $8,497,702 ========== ========== LIABILITIES AND PARTNERS' CAPITAL Accounts payable $ 72,514 $ 115,195 Accrued management fee 15,304 17,595 Deferred disposition fees 1,369,577 1,369,577 ---------- ---------- Total liabilities 1,457,395 1,502,367 ---------- ---------- Partners' capital: Limited partners ($228.20 per unit; 160,000 units authorized, 48,788 units issued and outstanding) 6,923,804 6,981,503 General partners 13,250 13,832 ---------- ---------- Total partners' capital 6,937,054 6,995,335 ---------- ---------- $8,394,449 $8,497,702 ========== ==========
(See accompanying notes to unaudited financial statements) COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended Six Months Ended Three Months Ended Six Months Ended June 30, 1999 June 30, 1999 June 30, 1998 June 30, 1998 ------------------ ---------------- ------------------ ---------------- INVESTMENT ACTIVITY Property rentals $188,760 $372,015 $173,530 $ 352,050 Property operating expenses (44,682) (99,133) (62,206) (108,140) Depreciation and amortization (15,201) (48,052) (36,327) (73,237) -------- -------- -------- ---------- 128,877 224,830 74,997 170,673 Joint venture earnings 48,097 99,635 373,036 779,993 -------- -------- -------- ---------- Total real estate activity 176,974 324,465 448,033 950,666 -------- -------- -------- ---------- Interest on cash equivalents and short-term investments 31,314 73,463 45,465 91,597 -------- -------- -------- ---------- Total investment activity 208,288 397,928 493,498 1,042,263 -------- -------- -------- ---------- PORTFOLIO EXPENSES Management fee 15,304 30,608 50,299 100,598 General and administrative 38,316 92,956 48,304 105,724 -------- -------- -------- ---------- 53,620 123,564 98,603 206,322 -------- -------- -------- ---------- Net income $154,668 $274,364 $394,895 $ 835,941 ======== ======== ======== ========== Net income per limited partnership unit $ 3.14 $ 5.57 $ 8.01 $ 16.96 ======== ======== ======== ========== Cash distributions per limited partnership unit $ 3.14 $ 6.75 $ 10.32 $ 21.20 ======== ======== ======== ========== Number of limited partnership units outstanding during the period 48,788 48,788 48,788 48,788 ======== ======== ======== ==========
(See accompanying notes to unaudited financial statements) COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP STATEMENTS OF PARTNERS' CAPITAL (DEFICIT) (Unaudited)
Three Months Ended Six Months Ended Three Months Ended Six Months Ended June 30, 1999 June 30, 1999 June 30, 1998 June 30, 1998 ---------------------- --------------------------- ---------------------------- ----------------------- General Limited General Limited General Limited General Limited Partners Partners Partners Partners Partners Partners Partners Partners --------- ----------- -------------- ----------- -------------- ------------ --------- ------------ Balance at beginning of period $13,250 $6,923,877 $13,832 $6,981,503 $(49,452) $21,797,183 $(48,500) $21,891,360 Cash distributions (1,547) (153,194) (3,326) (329,319) (5,086) (503,492) (10,448) (1,034,305) Net income 1,547 153,121 2,744 271,620 3,949 390,946 8,359 827,582 -------- ---------- ------------- ---------- ------------- ----------- -------- ----------- Balance at end of period $13,250 $6,923,804 $13,250 $6,923,804 $(50,589) $21,684,637 $(50,589) $21,684,637 ======== ========== ============= ========== ============= =========== ======== ===========
(See accompanying notes to unaudited financial statements) COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP SUMMARIZED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended June 30, 1999 1998 ----------- ------------ Net cash provided by operating activities $257,916 $1,109,259 ----------- ------------ Cash flows from investing activities: Decrease in short-term investments, net -- 1,405,619 ----------- ------------ Cash flows from financing activity: Distributions to partners (332,645) (1,044,753) ----------- ------------ Net increase (decrease) in cash and cash equivalents (74,729) 1,470,125 Cash and cash equivalents: Beginning of period 2,605,486 2,105,728 ----------- ------------ End of period $2,530,757 $3,575,853 =========== ============
(See accompanying notes to unaudited financial statements) COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Unaudited) In the opinion of management, the accompanying unaudited financial statements contain all adjustments necessary to present fairly the Partnership's financial position as of June 30, 1999 and December 31, 1998 and its operations, its cash flows and partners' capital (deficit) for the three and six months ended June 30, 1999 and 1998. These adjustments are of a normal recurring nature. See notes to financial statements included in the Partnership's 1998 Annual Report on Form 10-K for additional information relating to the Partnership's financial statements. Note 1 - Organization and Business - ---------------------------------- Copley Pension Properties VI; A Real Estate Limited Partnership (the "Partnership") is a Massachusetts limited partnership organized for the purpose of investing primarily in newly constructed and existing income producing real properties. It primarily serves as an investment for qualified pension and profit sharing plans and other organizations intended to be exempt from federal income tax. The Partnership commenced operations in July 1988, and acquired the two real estate investments it currently owns prior to the end of 1991. It intends to dispose of its investments within eight to twelve years of their acquisition, and then liquidate; however, the managing general partner could extend the investment period if it is considered to be in the best interest of the limited partners. The Partnership has engaged AEW Real Estate Advisors, Inc. (the "Advisor") to provide asset management advisory services. Note 2 - Investments in Joint Ventures - -------------------------------------- Summarized Financial Information The following summarized financial information is presented for the Partnership's remaining joint venture: COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP
Assets and Liabilities ---------------------- June 30, 1999 December 31, 1998 ------------- ----------------- Assets Real property, at cost less accumulated depreciation of $866,875 and $832,160, respectively $2,386,509 $2,421,223 Other 32,468 30,891 ---------- ---------- 2,418,977 2,452,114 Liabilities 53,022 88,618 ---------- ---------- Net assets $2,365,955 $2,363,496 ========== ========== Results of Operations --------------------- Six Months Ended June 30, 1999 1998 ----------- ------------ Revenue: Rental income $243,948 $2,003,484 Other income -- 5,078 -------- ---------- 243,948 2,008,562 -------- ---------- Expenses: Operating expenses 59,293 649,508 Depreciation and amortization 34,715 350,328 -------- ---------- 94,008 999,836 -------- ---------- Net income $149,940 $1,008,726 ======== ==========
Liabilities and expenses exclude amounts owed and attributable to the Partnership and its affiliates on behalf of financing arrangements with the joint venture. COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP Note 3 - Property - ----------------- The following is a summary of the Partnership's remaining wholly-owned property:
June 30, 1999 December 31, 1998 -------------- ------------------ Land $ 2,770,056 $ 2,770,056 Buildings, improvements and other capitalized costs 4,908,078 4,903,218 Investment valuation allowance (1,500,000) (1,500,000) Accumulated depreciation and amortization (2,096,750) (2,048,698) Net operating liabilities 156,046 118,207 ----------- ----------- $ 4,237,430 $ 4,242,783 =========== ===========
Note 4 - Subsequent Events - ------------------------- Distributions of cash from operations relating to the quarter ended June 30, 1999 were made on July 29, 1999 in the aggregate amount of $154,742 ($3.14 per limited partnership unit). COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP Management's Discussion and Analysis of Financial Condition and - --------------------------------------------------------------- Results of Operations - --------------------- Liquidity and Capital Resources The Partnership completed its offering of units of limited partnership interest on December 31, 1988. A total of 48,788 units were sold. The Partnership received proceeds of $43,472,858, net of selling commissions and other offering costs, which have been used for investment in real estate and for the payment of related acquisition costs, or retained as working capital reserves. The Partnership made seven real estate investments; one investment was sold in each of 1990, 1994, 1997 and two investments were sold in 1998. Through June 30, 1999, capital of $37,654,578 ($771.80 per limited partnership unit) has been returned to the limited partners; $36,194,353 as a result of sales and $1,460,225, as a result of a discretionary reduction of original working capital previously held in reserves. At June 30, 1999, the Partnership had $2,530,757 in cash and cash equivalents, of which $154,742 was used for cash distributions to partners on July 29, 1999; the remainder is being retained as working capital reserves. The source of future liquidity and cash distributions to partners will primarily be cash generated by the Partnership's invested cash and cash equivalents and real estate investments, and proceeds from the sale of such investments. Based on an adjusted capital contribution of $228.20 per limited partnership unit, distributions of cash from operations relating to the first and second quarters of 1999 were made at the annualized rate of 5.5% while distributions of cash from operations relating to the first and second quarters of 1998 were made at the annualized rate of 6.25% on an adjusted capital contribution of $660.29. The carrying value of real estate investments in the financial statements is at depreciated cost, or if the investment's carrying value is determined not to be recoverable through expected undiscounted future cash flows, the carrying value is reduced to estimated fair market value. The fair market value of such investments is further reduced by the estimated cost of sale for properties held for sale. Carrying value may be greater or less than current appraised value. At June 30, 1999, the aggregate appraised value of the real estate investments exceeded their carrying value by approximately $2,200,000. The current appraised value of real estate investments has been estimated by the managing general partner and is generally based on a correlation of traditional appraisal approaches performed by the Advisor and independent appraisers. Because of the subjectivity inherent in the valuation process, the estimated current appraised value may differ significantly from that which could be realized if the real estate were actually offered for sale in the marketplace. COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP Year 2000 Readiness Disclosure - ------------------------------ The Year 2000 Issue is a result of computer programs being written using two digits rather than four to define the applicable year. Computer programs that have date-sensitive software may recognize a date using "00" as the year 1900 rather than the year 2000. This could result in a system failure or miscalculations causing disruptions of operations, including, among other things, a temporary inability to process transactions or engage in normal business operations. The Partnership relies on AEW Capital Management L.P. ("AEW Capital Management"), the parent of AEW Real Estate Advisors, Inc., to generate financial information and to provide other services, which are dependent on the use of computers. The Partnership has obtained assurances from AEW Capital Management that: . AEW Capital Management has developed a Year 2000 Plan (the "Plan") consisting of five phases: inventory, assessment, testing, remediation/repair and certification. . As of September 30, 1998, AEW Capital Management had completed the inventory and assessment phases of this Plan and had commenced the testing and remediation/repair of internal systems. . AEW Capital Management concluded the internal testing, remediation/repair and certifications of its Plan in June 1999. The Partnership also relies on joint venture partners and/or property managers to supply financial and other data with respect to its real properties. The Partnership is in the process of surveying these third party providers and assessing their compliance with Year 2000 requirements. To date, the Partnership is not aware of any problems that would materially impact its results of operations, liquidity or capital resources. However, the Partnership has not yet obtained written assurances that these providers would be Year 2000 compliant. The Partnership is developing a contingency plan in the event of a particular provider or system not being Year 2000 compliant. The inability of one of these providers to complete its Year 2000 resolution process could materially impact the Partnership. In addition, the Partnership is also subject to external forces that might generally affect industry and commerce, such as utility or transportation company Year 2000 compliance failures and related service interruptions. Given the nature of its operations, the Partnership will not incur any costs associated with Year 2000 compliance. All such costs are borne by AEW Capital Management and the property managers. COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP Results of Operations Operating Factors The Partnership's two industrial properties (Prentiss Copystar and Wilmington) were 100% leased at June 30, 1999 and June 30, 1998. Investment Results For the three and six months ended June 30, 1999, operating results from real estate operations were $176,974 and $324,465, respectively, compared to $448,033 and $950,666 for the comparable periods in 1998. The decreases of $271,059 and $626,201 for the comparative three and six month periods are primarily due to a decrease in joint venture earnings as a result of the sale of White Phonic on July 14, 1998 and the sale of Waterford Apartments on August 7, 1998. This is partially offset by an increase in operating performance at Wilmington Industrial due to an increase in market rates and lower professional fees. Interest on cash equivalents and short-term investments for the three and six months ended June 30, 1999, was $31,314 and $73,463, respectively, compared to $45,465 and $91,597 for the same periods in 1998. The decreases of approximately $14,000 and $18,000 for the comparative three and six month periods are primarily due to lower average investment balances in 1999, as a result of the sales of White Phonic and Waterford Apartments in July and August 1998, respectively. Operating cash flow decreased $851,343 between the six months ended June 30, 1998 and June 30, 1999, which is consistent with the decrease in operating activity discussed above. Portfolio Expenses The Partnership management fee is 9% of distributable cash flow from operations after any increase or decrease in working capital reserves as determined by the managing general partner. General and administrative expenses primarily consist of real estate appraisal, printing, legal, accounting and investor servicing fees. For the three and six months ended June 30, 1999, management fees were $15,304 and $30,608, respectively, compared to $50,299 and $100,598 for the comparable periods in 1998. The decreases in management fees for the respective three and six month periods are due to lower operational distributions as a result of the sales of White Phonic and Waterford Apartments. General and administrative expenses for the three and six months ended June 30, 1999 were $38,316 and $92,956, respectively, compared to $48,304 and $105,724 for the same periods in 1998. The decreases of approximately $10,000 is primarily to a decrease in legal and printing fees. This decrease is partially offset by an increase in state taxes. COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP FORM 10-Q FOR QUARTER ENDED JUNE 30, 1999 PART II OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K a. Exhibits: (27) Financial Data Schedule b. Reports on Form 8-K: No Current Reports on Form 8-K were filed during the quarter ended June 30, 1999. 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. COPLEY PENSION PROPERTIES VI; A REAL ESTATE LIMITED PARTNERSHIP (Registrant) August 13, 1999 /s/ Alison Husid Cutler ------------------------------- Alison Husid Cutler President, Chief Executive Officer And Director of Managing General Partner, Sixth Copley Corp. August 13, 1999 /s/ Karin J. Lagerlund -------------------------------- Karin J. Lagerlund Principal Financial and Accounting Officer of Managing General Partner, Sixth Copley Corp. EX-27 2 FINANCIAL DATA SCHEDULE
5 6-MOS DEC-31-1999 JUN-30-1999 2,530,757 0 0 0 0 2,530,757 5,863,692 0 8,394,449 87,818 1,369,577 0 0 0 6,937,054 8,394,449 471,650 545,113 99,133 99,133 171,616 0 0 274,364 0 274,364 0 0 0 274,364 5.57 5.57
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