-----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, WO5MLzGrd1Pz1mSPo3q0aHn1M9hTkGP86LdL01z6iPtFnYMo1gFx8CTaR7AEWNZO J1VbPwxCybTfDL3AaRkIBQ== 0000830056-97-000007.txt : 19970520 0000830056-97-000007.hdr.sgml : 19970520 ACCESSION NUMBER: 0000830056-97-000007 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970515 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: 97607159 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 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 March 31, 1997 [ ] 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) March 31, 1997 Assets Cash and cash equivalents: Unrestricted $ 711 Restricted-tenant security deposits 51 Accounts receivable 10 Escrows for taxes and insurance 102 Other assets 69 Investment properties Land $ 1,862 Buildings and related personal property 10,348 12,210 Less accumulated depreciation (2,707) 9,503 Investment in joint venture 628 $11,074 Liabilities and Partners' Capital (Deficit) Liabilities Accounts payable $ 24 Tenant security deposits 51 Accrued taxes 24 Other liabilities 21 Partners' Capital (Deficit) General partner $ (23) Limited partners (61,063 units issued and outstanding) 10,977 10,954 $11,074 See Accompanying Notes to Financial Statements b) UNITED INVESTORS INCOME PROPERTIES STATEMENTS OF OPERATIONS (Unaudited) (in thousands, except unit data) Three Months Ended March 31, 1997 1996 Revenues: Rental income $ 414 $ 384 Other income 22 28 Total revenues 436 412 Expenses: Operating 130 111 General and administrative 19 21 Maintenance 50 47 Depreciation 94 87 Property taxes 41 38 Total expenses 334 304 Equity in income of joint venture 4 6 Net income $ 106 $ 114 Net income allocated to general partners (1%) $ 1 $ 1 Net income allocated to limited partners (99%) 105 113 $ 106 $ 114 Net income per limited partnership unit $ 1.72 $ 1.85 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, 1996 61,063 $ (23) $ 11,025 $ 11,002 Partners' distributions (1) (153) (154) Net income for the three months ended March 31, 1997 -- 1 105 106 Partners' capital (deficit) at March 31, 1997 61,063 $ (23) $ 10,977 $ 10,954 See Accompanying Notes to Financial Statements
UNITED INVESTORS INCOME PROPERTIES STATEMENTS OF CASH FLOWS (Unaudited) (in thousands) Three Months Ended March 31, 1997 1996 Cash flows from operating activities: Net income $ 106 $ 114 Adjustments to reconcile net income to net cash provided by operating activities: Equity in net income of joint venture (4) (6) Depreciation 94 87 Amortization of lease commissions 2 -- Change in accounts: Restricted cash (2) (1) Accounts receivable (1) (4) Escrows for taxes (33) (41) Other assets 14 12 Accounts payable 7 8 Tenant security deposit liabilities 2 2 Accrued taxes 24 22 Other liabilities (1) (1) Net cash provided by operating activities 208 192 Cash flows from investing activities: Property improvements and replacements (23) (8) Distributions from joint venture 47 -- Net cash provided by (used in) investing activities 24 (8) Cash flows from financing activities: Partners' distributions (154) (154) Net cash used in financing activities (154) (154) Net increase in cash and cash equivalents 78 30 Cash and cash equivalents at beginning of period 633 637 Cash and cash equivalents at end of period $ 711 $ 667 See Accompanying Notes to Financial Statements 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 Investor Real Estate, Inc.), all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended March 31, 1997, are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 1997. 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, 1996. Certain reclassifications have been made to the 1996 information to conform to the 1997 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 decreased 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 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 Insignia for the three months ended March 31, 1997 and 1996 (in thousands): 1997 1996 Property management fees $ 20 $ 20 Reimbursement for services of affiliates 9 8 Additionally, the Partnership paid $5,000 during the three months ended March 31, 1996 to an affiliate of the General Partner for lease commissions at the Partnership's commercial property. These lease commissions are included in other assets and amortized over the terms 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. 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 each of the three months ended March 31, 1997 and 1996: Average Occupancy Property 1997 1996 Bronson Place Apartments Mountlake Terrace, Washington 95% 94% Meadow Wood Apartments Medford, Oregon 90% 94% Defoors Crossing Apartments Atlanta, Georgia 87% 94% Peachtree Corners Medical Building Atlanta, Georgia 74% 36% The increase in occupancy at Peachtree Corners Medical Building is due to increased marketing efforts and property improvements made during the second and third quarters of 1996, to attract quality long-term tenants. The decrease in occupancy at Meadow Wood and Defoors Crossings Apartments is due to increased competition and a favorable housing market in the local community. The Partnership realized net income of $106,000 for the three months ended March 31, 1997 compared to $114,000 for the corresponding period of 1996. The decrease in net income was due to increases in operating and depreciation expenses. Operating expenses increased due to higher costs associated with utilities and rental concessions. Depreciation expenses increased due to tenant improvements related to the increase in occupancy at Peachtree, during the second and third quarters of 1996. Also contributing to the decrease in net income is a decrease in other income, specifically associated with lower lease cancellation fees at Defoors Crossing Apartments. Mitigating the expense increases is an increase in rental revenue attributable to increased occupancy at Peachtree Corners Medical Building. 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 March 31, 1997, the Partnership held unrestricted cash of $711,000 compared to $667,000 at March 31, 1996. Net cash provided by operating activities increased due to increased rental income and a decrease in deposits to tax and insurance escrows. Net cash provided by investing activities increased in 1997 due to cash distributions from the joint venture being received during the three months ended March 31, 1997, compared to no distributions in the three months ended March 31, 1996. 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 $154,000 were made during the three months ended March 31, 1997 and 1996. 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 March 31, 1997. 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: May 15, 1997 EX-27 2
5 This schedule contains summary financial information extracted from United Investors Income Properties 1997 First Quarter 10-QSB and is qualified in its entirety by reference to such 10-QSB filing. 0000830056 UNITED INVESTORS INCOME PROPERTIES 1,000 3-MOS DEC-31-1997 MAR-31-1997 711 0 10 0 0 0 12,210 2,707 11,074 0 0 0 0 0 10,954 11,074 0 436 0 0 334 0 0 0 0 0 0 0 0 106 1.72 0 Registrant has an unclassified balance sheet. Multiplier is 1.
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