- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20459
FORM 10-QSB
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
--- OF THE SECURITIES EXCHANGE ACT OF 1994
For the Quarterly period ending March 31, 1997
__ TRANSITION REPORT PURSUANT TO SECTION 12 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1994
For the Transition period from ____ to ____
Commission file number 0-27108
REGENT ASSISTED LIVING, INC.
(Exact name of registrant as specified in its charter)
OREGON 93-1171049
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
Suite 1000
121 SW Morrison St.
Portland, Oregon 97204
(Address of principal executive offices)
503-227-4000
(Registrant's telephone number, including area code)
Indicated by check mark whether Registrant (1) has filed all reports to be filed
by section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that Registrant was required to
file such reports), and (2) has been subject to such filing requirements for the
past 90 days.
Yes X No
--- ---
Shares of Registrant's Common Stock, No par value,
outstanding at May 1, 1997 - 4,633,000
- --------------------------------------------------------------------------------
<PAGE>
REGENT ASSISTED LIVING, INC.
FORM 10-QSB
March 31, 1997
INDEX
Page
----
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of December 31, 1996
and March 31, 1997 ...........................................................3
Condensed Consolidated Statements of Operations for the three months
ended March 31, 1996 and 1997 ................................................4
Condensed Consolidated Statements of Cash Flows for the three months
ended March 31, 1996 and 1997 ................................................5
Notes to Condensed Consolidated Financial Statements .........................6
Item 2. Management's Discussion and Analysis or Plan of Operation ...........9
Page 2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
REGENT ASSISTED LIVING, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
March 31,
December 31, 1997
1996 (Unaudited)
----------- -----------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $8,650,817 $6,481,215
Investments 2,939,448
Accounts receivable 173,976 156,661
Prepaid expenses 101,148 97,187
Construction advances receivable 1,125,315 241,694
----------- -----------
Total current assets 12,990,704 6,976,757
Property and equipment, net 17,383,668 23,504,673
Investment in joint venture 263,579 283,741
Restricted cash 1,646,485 2,278,520
Deferred income tax benefit 304,300 271,200
Other assets 588,948 535,933
----------- -----------
Total assets $33,177,684 $33,850,824
=========== ===========
LIABILITIES
Current liabilities:
Current portion of long-term debt $150,950 $154,714
Accounts payable and other accrued expenses 2,348,369 2,653,553
Accrued payroll 335,155 323,702
Accrued interest 57,530 57,285
----------- -----------
Total current liabilities 2,892,004 3,189,254
Long-term debt 9,753,846 10,497,973
Other liabilities 474,423 422,069
----------- -----------
Total liabilities 13,120,273 14,109,296
----------- -----------
SHAREHOLDERS' EQUITY
Preferred stock, no par value, 5,000,000 shares authorized;
1,666,667 shares issued and outstanding 9,349,841 9,349,841
Common stock, no par value, 25,000,000 shares authorized;
4,633,000 shares issued and outstanding 10,808,703 10,808,703
Accumulated deficit (101,133) (417,016)
----------- -----------
Total shareholders' equity 20,057,411 19,741,528
----------- -----------
Total liabilities and shareholders' equity $33,177,684 $33,850,824
=========== ===========
The accompanying notes are an integral part of these condensed consolidated
financial statements.
</TABLE>
Page 3
<PAGE>
<TABLE>
<CAPTION>
REGENT ASSISTED LIVING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Three Months Ended
March 31, 1996 March 31, 1997
------------------ ------------------
<S> <C> <C>
Revenues:
Rental and service $3,228,130 $3,336,347
Management fee 44,394 43,922
----------- -----------
Total revenues 3,272,524 3,380,269
----------- -----------
Operating expenses:
Residence operating expenses 1,968,689 2,136,277
General and administrative 472,613 712,204
Lease expense 689,312 706,200
Depreciation and amortization 58,714 68,785
----------- -----------
Total operating expenses 3,189,328 3,623,466
----------- -----------
Operating income (loss) 83,196 (243,197)
Interest income 116,862 148,779
Interest expense, net (128,779) (101,228)
Other income, net 4,490 5,263
----------- -----------
Income (loss) before income taxes 75,769 (190,383)
Income tax (provision) benefit (28,792) 24,500
----------- -----------
Net income (loss) $46,977 ($165,883)
=========== ===========
Earnings (loss) per common share $0.01 ($0.07)
=========== ===========
Weighted average common shares outstanding 4,633,000 4,633,000
=========== ===========
The accompanying notes are an integral part of these condensed consolidated
financial statements.
</TABLE>
Page 4
<PAGE>
<TABLE>
<CAPTION>
REGENT ASSISTED LIVING, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended Three Months Ended
March 31, 1996 March 31, 1997
------------------ ------------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $46,977 ($165,883)
Adjustments to reconcile net income (loss) to net cash
used in operating activities:
Depreciation and amortization 58,714 68,785
Changes in other assets and liabilities:
Accounts receivable 18,915 17,315
Prepaid expenses (47,510) 3,961
Restricted cash 76,364
Deferred income taxes 33,100
Other assets (18,843) 51,301
Accounts payable and other accrued expenses (215,790) (152,928)
Other liabilities (77,854) (52,354)
----------- -----------
Net cash used in operating activities (159,027) (196,703)
----------- -----------
Cash flows from investing activities:
Purchase of property and equipment (1,933,492) (6,188,076)
Increase in construction related accounts payable 1,072,803
Maturity of investments, net 1,952,542 2,939,448
Investment in joint venture (20,162)
Deposits to replacement reserve account (16,200)
----------- -----------
Net cash provided by (used in) investing activities 19,050 (2,212,187)
----------- -----------
Cash flows from financing activities:
Construction advances 883,621
Restricted cash for financing arrangements (615,835)
Proceeds from issuance of long-term debt 784,018
Payments on long-term debt (24,401) (36,127)
Preferred stock issuance costs (600,159)
Preferred stock dividends (176,230)
----------- -----------
Net cash provided by (used in) financing activities (24,401) 239,288
----------- -----------
Net decrease in cash and cash equivalents (164,378) (2,169,602)
Cash and cash equivalents, beginning of period 7,585,952 8,650,817
----------- -----------
Cash and cash equivalents, end of period $7,421,574 $6,481,215
=========== ===========
The accompanying notes are an integral part of these condensed consolidated
financial statements.
</TABLE>
Page 5
<PAGE>
REGENT ASSISTED LIVING, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Operations and Summary of Significant Accounting Policies:
The Company
Regent Assisted Living, Inc. (the Company) is an owner, operator, and
developer of private-pay assisted living communities. Assisted living is
part of a spectrum of long-term care services that provide a combination
of housing, personal services and health care designed to respond to
elderly individuals who require assistance with activities of daily living
in a manner that promotes maximum independence.
On December 26, 1995, the Company sold 1,400,000 shares of common stock to
the public at a price of $7.50 per share in an initial public offering
(the Offering). Concurrently, the Company sold an additional 233,000
shares at a price of $7.50 per share to Mr. Bowen. The Company realized
net proceeds of $10,756,563 from these transactions.
On December 16, 1996, the Company completed the sale of 1,283,785
shares of Series A Preferred Stock and 382,882 shares of Series B
Preferred Stock for the aggregate price of $10,000,000.
The results of operations for the three months ended March 31, 1996 and
1997 reflect the operations of three assisted living communities (Regency
Park, Sterling Park and Sunshine Villa) and the property management
services provided to one community (Park Place). As of May 1, 1997, an
additional 21 assisted living and special needs communities
are in various stages of development.
The Company also provides management and administrative services for Bowen
Property Management Co., Bowen Financial Services Corp., Bowen Development
Company and Bowen Condominium Marketing, Inc. (collectively, the Bowen
Companies), all of which are Oregon corporations and are wholly owned by
Mr. Bowen. These services are provided pursuant to the terms of an
Administrative Services Agreement described in Note 3.
Basis of Presentation
The condensed consolidated financial statements include the accounts of
the Company and its majority owned subsidiary. All significant
inter-company accounts and transactions have been eliminated in
consolidation.
Page 6
<PAGE>
REGENT ASSISTED LIVING, INC.
NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS, Continued
1. Operations and Summary of Significant Accounting Policies, Continued:
The accompanying unaudited condensed consolidated financial statements as
of March 31, 1997, and for the three month periods ended March 31, 1996
and 1997 have been prepared in conformity with generally accepted
accounting principles. The financial information as of December 31, 1996,
is derived from the Company's Form 10-KSB for the year ended December 31,
1996. Certain information or disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission. In the opinion of
management, the accompanying condensed consolidated financial statements
include all adjustments necessary (which are of a normal and recurring
nature) for the fair presentation of the results of the interim periods
presented. The accompanying condensed consolidated financial statements
should be read in conjunction with the Company's audited consolidated
financial statements for the year ended December 31, 1996, included in the
Company's Form 10-KSB for the year ended December 31, 1996.
Operating results for the three months ended March 31, 1997, are not
necessarily indicative of the results that may be expected for the
entire fiscal year ending December 31, 1997, or any portion thereof.
2. Property and Equipment:
Property and equipment are stated at cost and consist of the following:
<TABLE>
<CAPTION>
December 31, March 31,
1996 1997
------------ ------------
<S> <C> <C>
Land $ 1,100,000 $ 1,100,000
Buildings and improvements 6,520,556 6,602,685
Furniture and equipment 530,540 582,859
Construction in progress 9,456,006 15,509,634
------------ ------------
17,607,102 23,795,178
Less accumulated depreciation 223,434 290,505
------------ ------------
Total property and equipment, net $ 17,383,668 $ 23,504,673
============ ============
Land, buildings and certain furniture and equipment serve as collateral
for long-term debt.
</TABLE>
Page 7
<PAGE>
REGENT ASSISTED LIVING, INC.
NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS, Continued
3. Administrative Services Agreement:
The Company has entered into an agreement with the Bowen Companies, all of
which are Oregon corporations controlled by Mr. Bowen, whereby the Company
will provide each of the Bowen Companies executive assistance, accounting
and financial management services, legal and administrative assistance,
insurance, management information services, and other management services
as required by the Bowen Companies. Under the terms of the agreement, the
Company will be reimbursed at its cost on a monthly basis for all services
provided.
4. Earnings (Loss) Per Common Share:
The computation of fully diluted earnings (loss) per share for each of the
periods was antidilutive; as such, no presentation of fully diluted
earnings (loss) per share has been included in the condensed consolidated
statements of operations. Earnings (loss) attributable to common stock
includes a deduction of preferred stock dividends declared, which totaled
$150,000 for the three month period ended March 31, 1997.
Page 8
<PAGE>
ITEM 2. Management's Discussion and Analysis or Plan of Operation.
Overview
The Company
The Company reported a net loss of $165,883, or $.07 per share, on revenue of
$3,380,269 for the quarter ended March 31, 1997.
The Company operated three communities pursuant to long-term leases and managed
a fourth community during the three month period ending March 31, 1997. The
Company leases Regency Park, a 140-bed assisted living community in Portland,
Oregon, Sterling Park, a 192- bed community in Redmond, Washington, and Sunshine
Villa, a 126-bed community located in Santa Cruz, California for total
operations of 458 beds. The Company also manages Park Place, a 112- bed
community in Portland, Oregon from which the Company derives a management fee.
As of May 1, 1997, the Company had commenced management of a 70-bed community in
Citrus Heights California from which the Company will derive a management fee,
and the Company has placed under contract a 48-bed community in Boise, Idaho
which it intends to purchase. Also as of May 1, 1997, the Company has commenced
construction on the following twelve new communities:
Expected
Projected Quarter Leased Or
Location No. of Beds Opening Owned
-------- ----------- ------- -----
Boise, Idaho 136 2nd-97 Leased
Folsom, California 123 3rd-97 Owned
San Antonio, Texas 133 3rd-97 Leased
Roseville, California 108 4th-97 Owned
Clovis, California 129 4th-97 Leased
Rio Rancho, New Mexico 114 4th-97 Owned*
Bakersfield, California 131 4th-97 Owned
Eugene, Oregon 125 4th-97 Owned
Vacaville, California 127 4th-97 Owned
Tucson, Arizona 136 1st-98 Owned
Henderson, Nevada 134 1st-98 Owned
Austin, Texas 136 1st-98 Owned
* The Company's community in Rio Rancho will be owned by a limited
liability company in which the Company has a 90 percent interest. The
Company will manage the community.
Page 9
<PAGE>
An additional nine new communities were under varying stages of development as
of May 1, 1997. If all 21 communities are developed and the Boise community is
acquired, total operations of the Company will increase by approximately 2,260
beds to a total of 2,900 beds. Also, with the intent of securing additional
sites on which to build new communities, the Company is currently engaged in
negotiations to acquire several additional sites and is pursuing joint venture
opportunities with parties who control parcels of land in strategic markets. All
costs associated with the development of these communities have been capitalized
as "Construction in Progress" as disclosed in Note 2 to the condensed
consolidated financial statements.
Operating results for the three month period ended March 31, 1997, are not
necessarily indicative of future financial performance as the Company intends
to expand its operating base of communities.
Three Months Ended March 31, 1997 Compared to Three Months Ended March 31,
1996
Revenues. For the three month period ended March 31, 1997, revenues were
$3,380,269 compared to $3,272,524 in the three month period ended March 31,
1996. The Company operated three communities and managed a fourth in both
quarters. The increase in revenue of $107,745 or 3.3 percent, is due primarily
to the Company's continuing focus on increasing occupancies and accurately
assessing the services provided to residents. Overall occupancy at all three of
the Company's communities increased to an average of 98.5 percent for the three
month period ended March 31, 1997, whereas it was 95.7 percent for the same
period in 1996.
Residence Operating Expenses. Residence operating expenses were $2,136,277 for
the three month period ended March 31, 1997, and $1,968,689 for the same period
in 1996. The increase of $167,588 is due primarily to the combined impact of
slightly higher than expected operating costs for 1997 with lower than expected
operating costs for 1996. In addition, the current period includes $30,300 of
start-up costs for the Company's new 136-bed Boise community. Residence
operating expenses, after adjustment for the start-up costs, totaled 63.1
percent and 61.0 percent of rental and service revenues for the three month
periods ended March 31, 1997 and 1996, respectively.
General and Administrative Expenses. General and administrative expenses were
$712,204 for the three month period ended March 31, 1997, compared to $472,613
for the three month period ended March 31, 1996. The increase of $239,591 is due
primarily to the increase in development activities by the Company, including
payroll and related costs primarily resulting from staffing increases related to
the implementation of the Company's strategy for rapid growth.
Lease Expense. Lease expense for the Company's leased communities was
$706,200 for the three month period ended March 31, 1997, and was $689,312
for the same period for 1996.
Depreciation and Amortization. Depreciation and amortization expense was
$68,785 for the three month period ended March 31, 1997, compared to $58,714 for
the three month period ended March 31, 1996.
Page 10
<PAGE>
Interest Income. Interest income increased in the three month period ended March
31, 1997, to $148,779, from $116,862 for the same period in 1996. The increase
in interest income is due to the Company's investment of the net proceeds from
its sale of preferred stock in December, 1996, whereas interest income for the
first quarter of 1996 resulted from the investment of the Company's net proceeds
of its initial public offering. All investments of cash and cash equivalents are
in high quality, short term securities placed with institutions with high credit
ratings.
Interest Expense. Interest expense decreased in the three month period ended
March 31, 1997, to $101,228, from $128,379 for the three month period ended
March 31, 1996. The Company capitalized $113,421 of interest charges incurred
during the three months ended March 31, 1997. The capitalized interest offset
substantially higher interest costs incurred by the Company in the current
period arising from an increased borrowing in connection with the Sunshine Villa
sale/leaseback financing.
Net Income (loss). Net operating results decreased to a loss of $165,883 during
the three month period ended March 31, 1997, from net income of $46,977 for the
same period in 1996. The decrease in net results is primarily due to an increase
in general and administrative expenses (as discussed above) and a decrease in
residence operating profits (operating income before general and administrative
expense, less interest expense) of $59,251, offset by an increase in interest
income of $31,917.
Liquidity and Capital Resources
At March 31, 1997, the Company had approximately $3.8 million of working
capital compared to approximately $10.1 million at December 31, 1996, a
decrease of $6.3 million primarily related to expenditures for development
activities.
Net cash used in operating activities totaled $196,703 for the three month
period ended March 31, 1997, which resulted primarily from a net loss of
$165,883.
Net cash used in investing activities totaled $2,212,187 for the three month
period ended March 31, 1997, comprised of $5,115,273 used in development
activities offset by $2,939,448 provided from the maturity of investments.
During the period, the Company incurred construction costs in Folsom,
California; Roseville, California; Rio Rancho, New Mexico; Bakersfield,
California; and conducted preliminary development activities related to fourteen
sites located in California, Oregon, Washington, Texas, Nevada, and Arizona. At
March 31, 1997, the aggregate purchase price for the Company's binding options
related to eight parcels of land was approximately $6,558,000. The Company has
paid initial deposits relating to these sites and has also completed the
demographic analysis and other preliminary due diligence for purposes of
developing assisted living communities at these sites.
Page 11
<PAGE>
Net cash provided by financing activities totaled $239,288 during the three
month period ended March 31, 1997, consisting of construction financing proceeds
totaling $1,667,639, offset by increases in restricted cash of $615,835, payment
of preferred stock issuance costs of $600,159 and payment of preferred stock
dividends of $176,230.
During the remainder of 1997, the Company intends to utilize current working
capital resources to develop and construct assisted living communities. The
Company intends to finance a substantial portion of the cost of developing each
new community through additional sale/leaseback transactions with real estate
investment trusts, as well as conventional financing with commercial banks,
pension funds, and other financial institutions.
The Company has completed four transactions with a real estate investment
trust pursuant to which the Company sold its Sunshine Villa community and
obtained approximately $23.4 million of lease financing for its Boise, San
Antonio and Clovis communities.
As of the end of the first quarter of 1997, the Company had completed the
following construction loans:
<TABLE>
<CAPTION>
Amount Community Lender
------ --------- ------
<S> <C> <C>
$ 6,850,000 Folsom, California US National Bank of Oregon
$ 5,935,000 Kenmore, Washington US National Bank of Oregon
$ 7,200,000 Bakersfield, California Guaranty Federal Bank, FSB
$ 7,700,000 Austin, Texas Guaranty Federal Bank, FSB
</TABLE>
During April 1996 the Company closed the following construction loans:
<TABLE>
<CAPTION>
Amount Community Lender
------ --------- ------
<S> <C> <C>
$ 6,450,000 Roseville, California Key Bank of Oregon
$ 6,255,000 Eugene, Oregon Wells Fargo
</TABLE>
The Company has also received commitments or expressions of intent to provide
the following construction financing:
<TABLE>
<CAPTION>
Amount Community Lender
------ --------- ------
<S> <C> <C>
$ 7,375,000 Rio Rancho, New Mexico Guaranty Federal Bank, FSB
$ 7,115,000 Tucson, Arizona Bank United of Texas, FSB
$ 6,930,000 Henderson, Nevada Bank United of Texas, FSB
$ 7,600,000 Vacaville, California US National Bank of Oregon
$ 15,000,000 Multiple locations * US National Bank of Oregon
* This loan facility will be for the construction of up to five Regent Court
stand-alone special needs communities.
</TABLE>
Page 12
<PAGE>
As of May 1, 1997, the Company has closed or received commitments or
expressions of intent for approximately $108,000,000 in sale/leaseback or
construction financing.
Each of the pending financing transactions is subject to a number of conditions,
including the negotiation and execution of definitive documents and the
satisfactory completion of due diligence on the related properties, and there is
no assurance that any of these financing transactions will be completed on the
terms proposed, or at all.
The Company anticipates capital expenditures for 1997 will include additional
land acquisition costs, architectural fees, and other development costs related
to at least 19 assisted living communities and construction costs related to at
least seventeen new assisted living communities. The Company currently estimates
that its plan to develop at least 15 additional assisted living communities and
five Regent Court stand alone special needs communities by July 1, 1998,
including the communities described above that are under development, will
likely require additional financing prior to construction of the five Regent
Court communities. Such additional financing is in addition to the financing
described in the preceding paragraphs. Such financing may take the form of debt
or equity, including a public or private debt or equity offering by either the
Company or with respect solely to one or more new communities, or conventional
bank financing, or the use of sale/leaseback financing from real estate
investment trusts. The amount of such additional financing will be dependent
upon the amount of security deposits required under, and other terms of, the
sale/leaseback financing arrangements the Company expects to negotiate, the
performance of the Company's newly developed communities and existing
properties, and the extent to which the Company engages in development
activities for projects in addition to these 21 communities. If the Company is
unable to obtain additional required financing, or if such financing is not
available on acceptable terms, the Company believes that its plan to develop 21
new communities by the end of 1998 would likely be delayed or curtailed.
Page 13
<PAGE>
Forward-Looking Statements
The information set forth in this report in the sections entitled "Overview" and
"Liquidity and Capital Resources" regarding the Company's acquisition of sites
for development, the Company's development, construction, financing and opening
of new assisted living communities, and the Company's plans to develop,
construct and operate new Regent Court communities constitute "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933 and
is subject to the safe harbor created by that section. The development of
additional assisted living communities will involve a number of risks including,
without limitation, the risk that the Company will be unable to locate suitable
sites, risks relating to the inability to obtain, or delays in obtaining,
necessary zoning, land use, building, occupancy and other required governmental
permits and authorizations, risks that financing may not be available on
satisfactory terms, environmental risks, risks that construction costs may
exceed original estimates, risks that construction and lease-up may not be
completed on schedule, and risks relating to the competitive environment for
development. The foregoing risks could cause the Company to significantly delay
or curtail its planned growth and could cause one or more of the Company's new
communities to not be profitable. Additional factors that could cause results to
differ materially from those projected in the forward-looking statements
include, without limitation, the ability of the Company to raise additional
financing upon terms acceptable to the Company, increases in the costs
associated with new construction, competition, and acceptance of the Company's
prototype community in new geographic markets. The Company's growth strategy is
subject to the risk that occupancy rates at newly-developed communities may not
be achieved or sustained at expected levels, in which case, the Company will
experience greater than anticipated operating losses in connection with the
opening of new communities and the Company's need for additional financing to
meet its growth plans will likely increase. Furthermore, the Company's growth
will place increasing pressure on the Company's management controls and require
the Company to locate, train, assimilate, and retain additional community
managers and support staff. There is no assurance that the Company will be able
to manage this growth successfully.
SIGNATURE
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.
REGENT ASSISTED LIVING, INC.
By: STEVEN L. GISH Date: May 14, 1997
---------------------------------------
Steven L. Gish
Chief Financial Officer
Page 14
<PAGE>
EXHIBIT INDEX
Sequential
Ex. No. Description Page No.
- ------- ----------- --------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED BALANCE SHEET OF REGENT ASSISTED LIVING, INC. AS OF MARCH 31, 1997,
AND THE RELATED STATEMENT OF OPERATIONS FOR THE THREE MONTHS IN THE PERIOD
ENDED MARCH 31, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 6,481,215
<SECURITIES> 0
<RECEIVABLES> 425,355
<ALLOWANCES> 27,000
<INVENTORY> 0
<CURRENT-ASSETS> 6,976,757
<PP&E> 23,795,178
<DEPRECIATION> 290,505
<TOTAL-ASSETS> 33,850,824
<CURRENT-LIABILITIES> 3,189,254
<BONDS> 10,497,973
0
9,349,841
<COMMON> 10,808,703
<OTHER-SE> (417,016)
<TOTAL-LIABILITY-AND-EQUITY> 33,850,824
<SALES> 3,336,347
<TOTAL-REVENUES> 3,380,269
<CGS> 2,136,277
<TOTAL-COSTS> 3,623,466
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 101,228
<INCOME-PRETAX> (190,383)
<INCOME-TAX> (24,500)
<INCOME-CONTINUING> (165,883)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (165,883)
<EPS-PRIMARY> (.07)
<EPS-DILUTED> (.07)
</TABLE>
