-----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, Q5QX2JnnV46F/COQX7dJdHe+53Ib71d1ipT4CVMlnBwOYpjN8PQQQQ8RuQfuDmkF XcTYcXY9TqrVfbfg0NsWiA== 0000830056-96-000004.txt : 19961113 0000830056-96-000004.hdr.sgml : 19961113 ACCESSION NUMBER: 0000830056-96-000004 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961112 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: 96657729 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 September 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) September 30, 1996 Assets Cash and cash equivalents: Unrestricted $ 627 Restricted-tenant security deposits 50 Accounts receivable 14 Escrow for taxes 110 Other assets 52 Investment properties: Land $ 1,862 Buildings and related personal property 10,303 12,165 Less accumulated depreciation (2,521) 9,644 Investment in Joint Venture 681 $11,178 Liabilities and Partners' Capital (Deficit) Liabilities Accounts payable $ 11 Tenant security deposits 50 Accrued taxes 18 Other liabilities 49 Partners' Capital (Deficit) General partner $ (22) Limited partners (61,063 units issued and outstanding) 11,072 11,050 $11,178 See Accompanying Notes to Financial Statements b) UNITED INVESTORS INCOME PROPERTIES 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 $ 415 $ 382 $1,206 $1,116 Other income 22 35 81 87 Total revenues 437 417 1,287 1,203 Expenses: Operating 122 114 370 348 General and administrative 18 22 57 58 Maintenance 43 74 137 177 Depreciation 93 89 268 259 Property taxes 37 37 113 114 Total expenses 313 336 945 956 Equity in income of joint venture 8 3 26 22 Net income $ 132 $ 84 $ 368 $ 269 Net income allocated to general partner (1%) $ 1 $ 1 $ 4 $ 3 Net income allocated to limited partners (99%) 131 83 364 266 $ 132 $ 84 $ 368 $ 269 Net income per limited partnership unit $ 2.15 $ 1.35 $ 5.96 $ 4.36 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 contributions 61,063 $ -- $ 15,266 $ 15,266 Partners' capital (deficit) at December 31, 1995 61,063 $ (22) $ 11,166 $ 11,144 Partners' distributions (4) (458) (462) Net income for the nine months ended September 30, 1996 -- 4 364 368 Partners' capital (deficit) at September 30, 1996 61,063 $ (22) $ 11,072 $ 11,050 See Accompanying Notes to Financial Statements
d) UNITED INVESTORS INCOME PROPERTIES STATEMENTS OF CASH FLOWS (Unaudited) (in thousands)
Nine Months Ended September 30, 1996 1995 Cash flows from operating activities: Net income $ 368 $ 269 Adjustments to reconcile net income to net cash provided by operating activities: Equity in net income of joint venture (26) (22) Depreciation 268 259 Amortization of lease commissions 4 -- Change in accounts: Restricted cash (3) (1) Accounts receivable 1 2 Escrows for taxes (62) (40) Other assets (5) (2) Accounts payable -- 36 Tenant security deposit liabilities 3 (5) Accrued taxes 18 20 Other liabilities 11 13 Net cash provided by operating activities 577 529 Cash flows from investing activities: Property improvements and replacements (125) (122) Distributions from joint venture -- 4 Net cash used in investing activities (125) (118) Cash flows from financing activities: Partners' distributions (462) (501) Net cash used in financing activities (462) (501) Net decrease in cash and cash equivalents (10) (90) Cash and cash equivalents at beginning of period 637 868 Cash and cash equivalents at end of period $ 627 $ 778 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 nine month periods 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. 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 nine months ended September 30, 1996 and 1995: Nine Months Ended September 30, 1996 1995 (in thousands) Property management fees $61 $58 Reimbursement for services of affiliates 24 23 Additionally, the Partnership paid $29,000 and $25,000 during the nine months ended September 30, 1996 and 1995, respectively, 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 September 30, 1996 and 1995: Average Occupancy Property 1996 1995 Bronson Place Apartments Mountlake Terrace, Washington 93% 91% Meadow Wood Apartments Medford, Oregon 94% 91% Defoors Crossing Apartments Atlanta, Georgia 96% 98% Peachtree Corners Medical Building Atlanta, Georgia 56% 20% The increase in occupancy at Meadow Wood Apartments is due to increased resident retention efforts at the property. The increase in occupancy at Peachtree Corners Medical Building is due to increased marketing efforts and property improvements made to attract quality, long-term tenants. At September 30, 1996, occupancy had increased to 74%. The Partnership realized net income of $368,000 for the nine months ended September 30, 1996, of which $132,000 was net income for the third quarter. The net income for the corresponding periods of 1995 was $269,000 and $84,000, respectively. The increase in net income for the nine months ended September 30, 1996, was primarily due to an increase in rental income resulting from increased rental rates at all of the residential properties. Also contributing to the increased rental income was the increase in occupancy at three of the Partnerships' properties. Net income also increased due to a decrease in maintenance expenses resulting from exterior painting costs at Defoors Crossing and Bronson Place during the third quarter of 1995. 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 September 30, 1996, the Partnership held unrestricted cash and cash equivalents of $627,000 compared to $778,000 at September 30, 1995. Net cash provided by operating activities increased as a result of the increase in rental income discussed above. Net cash used in financing activities decreased in 1996 due to a decrease in distributions made to partners during the nine months ended September 30, 1996, compared to the nine months ended September 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 $462,000 and $501,000 were made during the nine months ended September 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 September 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: November 8, 1996 EX-27 2
5 This schedule contains summary financial information extracted from United Investors Income Properties 1996 Third Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000830056 UNITED INVESTORS INCOME PROPERTIES 1,000 9-MOS DEC-31-1996 SEP-30-1996 627 0 14 0 0 0 12,165 2,521 11,178 0 0 0 0 0 11,050 11,178 0 1,287 0 0 945 0 0 0 0 0 0 0 0 368 5.96 0 Registrant has an unclassified balance sheet. Multiplier is 1.
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