-----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, QDbv8Nt49SreQBlKz0xvTL5aK1W/O0QknSQavxxb/dyPdUx70Kqb6V1NteXXPQ/r 0D3xVdRKtOU+WAB+9UVUNw== 0000830056-96-000002.txt : 19960816 0000830056-96-000002.hdr.sgml : 19960816 ACCESSION NUMBER: 0000830056-96-000002 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960814 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED INVESTORS INCOME PROPERTIES CENTRAL INDEX KEY: 0000830056 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 431483942 STATE OF INCORPORATION: MO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-17646 FILM NUMBER: 96612011 BUSINESS ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLZ STREET 2: P O BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 BUSINESS PHONE: 8032391000 MAIL ADDRESS: STREET 1: ONE INSIGNIA FINANCIAL PLAZA STREET 2: P.O. BOX 1089 CITY: GREENVILLE STATE: SC ZIP: 29602 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 June 30, 1996 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT For the transition period from.........to......... Commission file number 0-17646 UNITED INVESTORS INCOME PROPERTIES (Exact name of small business issuer as specified in its charter) Missouri 43-1483942 (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) UNITED INVESTORS INCOME PROPERTIES BALANCE SHEET (Unaudited) (in thousands, except unit data) June 30, 1996 Assets Cash and cash equivalents: Unrestricted $ 710 Restricted--tenant security deposits 51 Accounts receivable 18 Escrows for taxes 110 Other assets 53 Investment properties: Land $ 1,862 Buildings and related personal property 10,196 12,058 Less accumulated depreciation (2,428) 9,630 Investment in Joint Venture 673 $11,245 Liabilities and Partners' Capital (Deficit) Liabilities Accounts payable $ 20 Tenant security deposits 51 Accrued taxes 29 Other liabilities 73 Partners' Capital (Deficit) General partner $ (23) Limited partners (61,063 units issued and outstanding) 11,095 11,072 $11,245 See Accompanying Notes to Financial Statements b) UNITED INVESTORS INCOME PROPERTIES STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except unit data)
Three Months Ended Six Month Ended June 30, June 30, 1996 1995 1996 1995 Revenues: Rental income $ 407 $ 365 $ 791 $ 734 Other income 31 23 59 52 Total revenues 438 388 850 786 Expenses: Operating 132 124 248 234 General and administrative 23 19 39 36 Maintenance 47 64 94 102 Depreciation 88 85 175 170 Property taxes 38 37 76 78 Total expenses 328 329 632 620 Equity in income of joint venture 12 8 18 19 Net income $ 122 $ 67 $ 236 $ 185 Net income allocated to general partner (1%) $ 1 $ 1 $ 2 $ 2 Net income allocated to limited partners (99%) 121 66 234 183 $ 122 $ 67 $ 236 $ 185 Net income per limited partnership unit $ 1.98 $ 1.09 $ 3.83 $ 3.00 See Accompanying Notes to Financial Statements
c) UNITED INVESTORS INCOME PROPERTIES STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT) (Unaudited) (in thousands, except unit data)
Limited Partnership General Limited Units Partner Partners Total Original capital 61,063 $ -- $ 15,266 $ 15,266 Partners' capital (deficit) December 31, 1995 61,063 $ (22) $ 11,166 $ 11,144 Partners' distributions (3) (305) (308) Net income for the six months ended June 30, 1996 -- 2 234 236 Partners' capital (deficit) June 30, 1996 61,063 $ (23) $ 11,095 $ 11,072 See Accompanying Notes to Financial Statements
d) UNITED INVESTORS INCOME PROPERTIES STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Six Months Ended June 30, 1996 1995 Cash flows from operating activities: Net income $ 236 $ 185 Adjustments to reconcile net income to net cash provided by operating activities: Equity in net income of joint venture (18) (19) Depreciation 175 170 Amortization of lease commissions 2 -- Change in accounts: Restricted cash (4) (4) Accounts receivable (3) (3) Escrows for taxes (62) (47) Other assets (4) 31 Accounts payable 9 62 Tenant security deposit liabilities 4 2 Accrued taxes 29 28 Other liabilities 35 12 Net cash provided by operating activities 399 417 Cash flows from investing activities: Property improvements and replacements (18) (20) Distributions from joint venture -- 4 Net cash used in investing activities (18) (16) Cash flows from financing activities: Partners' distributions (308) (347) Net cash used in financing activities (308) (347) Net increase in cash and cash equivalents 73 54 Cash and cash equivalents at beginning of period 637 868 Cash and cash equivalents at end of period $ 710 $ 922 See Accompanying Notes to Financial Statements
e) UNITED INVESTORS INCOME PROPERTIES NOTES TO FINANCIAL STATEMENTS (Unaudited) Note A - Basis of Presentation The accompanying unaudited financial statements of United Investors Income Properties ("The Partnership") 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 the General Partner (United Investors Real Estate, Inc.), 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-KSB for the fiscal year ended December 31, 1995. Certain reclassifications have been made to the 1995 information to conform to the 1996 presentation. Note B - Basis of Accounting The financial statements include the Partnership's operating divisions, Bronson Place Apartments, Defoors Crossing Apartments, Meadow Wood Apartments, and Peachtree Corners Medical Building. In addition, the Partnership owns a 35% interest in Corinth Square Associates ("Corinth"). The Partnership reflects its interest in Corinth utilizing the equity method whereby the original investment is increased by advances to Corinth and the Partnership's share of Corinth earnings. The investment is reduced by distributions from Corinth and the Partnership's share of Corinth losses. Note C - Transactions with Affiliated Parties The Partnership has no employees and is dependent on the General Partner and its affiliates for the management and administration of all partnership activities. The Partnership Agreement provides for payments to affiliates for property management services based on a percentage of revenue and for reimbursement of certain expenses incurred by affiliates on behalf of the Partnership. Property management fees are included in operating expenses. The following payments were made to affiliates of the General Partner for each of the six months ended June 30, 1996 and 1995: Six Months Ended June 30, 1996 1995 (in thousands) Property management fees $40 $38 Reimbursement for services of affiliates 16 15 Additionally, the Partnership paid $29,000 to an affiliate of the General Partner for lease commissions related to new leases at the Partnership's commercial property. These lease commissions are included in other assets and amortized over the term of the respective leases. The Partnership insures 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 payments 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 D - Repurchase of Units The Partnership's partnership agreement contains a provision which states that the General Partner shall purchase up to 10% of the limited partnership units outstanding at the fifth anniversary date of the last Additional Closing Date and become a limited partner with respect to such units. Pursuant to this provision, the General Partner accepted repurchase notices representing approximately 1.5% of the limited partnership units and, during the third quarter of 1995, the transfer of 950 units was effected. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION The Partnership's investment properties consist of three apartment complexes and a commercial office building. The following table sets forth the average occupancy of the properties for the quarters ended June 30, 1996 and 1995: Average Occupancy Property 1996 1995 Bronson Place Apartments Mountlake Terrace, Washington 93% 88% Meadow Wood Apartments Medford, Oregon 93% 91% Defoors Crossing Apartments Atlanta, Georgia 96% 98% Peachtree Corners Medical Building Atlanta, Georgia 49% 20% The increase in occupancy at Bronson Place Apartments is due to increased rental concessions throughout 1995 and increased marketing efforts including periodical advertising which have resulted in new leases being signed. The increase in occupancy at Peachtree Corners Medical Building is due to increased marketing efforts and maintenance improvements made to attract quality, long- term tenants. At June 30, 1996, occupancy had increased to 70%. The Partnership realized net income of $236,000 for the six months ended June 30, 1996, of which $122,000 was income for the second quarter. The net income for the corresponding periods of 1995 was $185,000 and $67,000, respectively. The increase in net income, for the six months ended June 30, 1996, was primarily due to an increase in rental revenue resulting from increased rental rates at all of the residential properties. Also contributing to the increased rental revenue was the increase in occupancy at three of the Partnerships' properties. Other income increased as a result of greater lease cancellation fees at Defoors Crossing Apartments and higher parking fees at Meadow Wood Apartments during the first six months of 1996. As part of the ongoing business plan of the Partnership, the 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. 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 June 30, 1996, the Partnership held unrestricted cash and cash equivalents of $710,000 compared to $922,000 at June 30, 1995. Net cash provided by operating activities decreased due to the 1995 cashflow being favorably impacted by the release of $20,000 in excess cash from the tax escrow. These decreases are partially offset by the increase in rental and other income discussed above. Net cash used in financing activities decreased in 1996 due to a decrease in distributions made to partners during the six months ended June 30, 1996, compared to the six months ended June 30, 1995. 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. Distributions to partners of $308,000 and $347,000 were made during the six months ended June 30, 1996 and 1995, respectively. Future cash distributions will depend on the levels of net cash generated from operations, property sales and the availability of cash reserves. PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a) Exhibit 27 - Financial Data Schedule 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. UNITED INVESTORS INCOME PROPERTIES (A Missouri Limited Partnership) By: United Investors Real Estate, Inc., a Delaware corporation, its 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: August 14, 1996 EX-27 2
5 This schedule contains summary financial information extracted from United Investors Income Properties 1996 Second Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000830056 UNITED INVESTORS INCOME PROPERTIES 1,000 6-MOS DEC-31-1996 JUN-30-1996 710 0 18 0 0 0 12,058 2,428 11,245 0 0 0 0 0 11,072 11,245 0 850 0 0 632 0 0 0 0 0 0 0 0 236 3.83 0 The Registrant has an unclassified balance sheet. Multiplier is 1.
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