UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------
FORM 10-Q
|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 OF 1934 (No Fee Required)
For the transition period from __________ to __________
Commission File No. 0-28752
KAPSON SENIOR QUARTERS CORP.
----------------------------
(Exact name of Registrant as specified in its charter)
New York 11-3323503
------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
242 Crossways Park West
Woodbury, New York 11797
---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(516) 921-8900
(Registrant's telephone number, including area code)
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 |_|
As of April 30, 1997, there were 7,750,000 shares of the Registrant's Common
Stock outstanding.
<PAGE>
KAPSON SENIOR QUARTERS CORP.
INDEX
Page
----
PART I FINANCIAL INFORMATION
Kapson Senior Quarters Corp. Consolidated Balance Sheets 2
Consolidated Statements of Operations of Kapson Senior 3
Quarters Corp. for the Three Months Ended March 31,
1997 and the Combined Statements Operations of the
Kapson Group for the Three Months Ended March 31, 1996
Consolidated Statement of Cash Flows of Kapson Senior 4
Quarters Corp. for the Three Months Ended March 31,
1997 and the Combined Statements of Cash Flows of the
Kapson Group for the Three Months Ended March 31, 1996
Notes to Consolidated Financial Statements 5-7
Management's Discussion and Analysis of Financial Condition
and Results of Operations 8-12
PART II OTHER INFORMATION 13
Signatures 14
1
<PAGE>
KAPSON SENIOR QUARTERS CORP.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
ASSETS
March 31, 1997 December 31, 1996
-------------- -----------------
<S> <C> <C>
Current assets
Cash and cash equivalents $ 16,507,309 $ 16,053,307
Accounts receivable 77,795 80,329
Prepaid expenses and other current assets 898,407 574,733
Deferred income taxes 975,232 503,000
------------ ------------
Total current assets 18,458,743 17,211,369
Property and equipment, net 58,083,913 58,377,735
Facility development costs 2,312,604 1,190,727
Restricted cash 3,104,082 3,134,695
Deferred financing costs, net 2,556,589 2,595,407
Intangibles, net 4,727,563 4,821,842
Investment in joint ventures 545,727 551,829
Other assets 8,222,489 8,104,648
------------ ------------
Total assets $ 98,011,710 $ 95,988,252
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt $ 915,049 $ 943,658
Accounts payable and accrued expenses 3,169,256 3,294,040
Accrued interest 260,216 --
Deferred revenue 607,554 519,168
------------ ------------
Total current liabilities 4,952,075 4,756,866
Long-term debt 73,180,606 72,408,516
Loan payable 555,000 555,000
Resident security deposits 2,216,901 1,725,192
Deferred income taxes 2,542,000 2,542,000
Deferred interest payable 185,923 147,500
Construction retainage payable 747,316 613,057
------------ ------------
Total liabilities 84,379,821 82,748,131
------------ ------------
Minority interest 2,048,985 948,925
------------ ------------
Shareholders' equity
Common stock; $.01 par value, 30,000,000 shares 77,500 77,500
Additional paid-in capital 16,603,405 16,603,348
Accumulated deficit (5,098,001) (4,389,652)
------------ ------------
Total shareholders' equity 11,582,904 12,291,196
------------ ------------
Total liabilities and shareholders' equity $ 98,011,710 $ 95,988,252
============ ============
</TABLE>
The accompanying notes are an integral part of these consolidated
and combined financial statements.
2
<PAGE>
CONSOLIDATED STATEMENTS OF OPERATIONS OF KAPSON SENIOR QUARTERS CORP.
FOR THE THREE MONTHS ENDED MARCH 31, 1997
AND THE COMBINED STATEMENTS OF OPERATIONS OF THE KAPSON GROUP
FOR THE THREE MONTHS ENDED MARCH 31, 1996
(Unaudited)
1997 1996
---- ----
Revenues:
Assisted living revenues $ 7,228,468 $ 3,872,648
Management fees 292,503 225,125
----------- -----------
Total revenues 7,520,971 4,097,773
----------- -----------
Operating expenses:
Assisted living operating expenses 5,093,055 2,532,708
Rent 384,375 --
General and administrative 1,079,561 519,931
Depreciation 578,716 374,606
----------- -----------
Total operating expenses 7,135,707 3,427,245
----------- -----------
Operating income 385,264 670,528
Equity in income (loss) from joint ventures (6,102) --
Interest income 193,326 44,797
Interest expense (1,829,157) (1,153,342)
Other expense, net (23,851) (3,512)
----------- -----------
Loss before minority interest (1,280,520) (441,529)
Minority interest in net loss of partnerships 99,940 50,501
----------- -----------
Loss before income taxes (1,180,580) (391,028)
Benefit for income taxes 472,232 --
----------- -----------
Net loss $ (708,348) $ (391,028)
=========== ===========
Loss per share $ (0.09)
===========
Weighted average number of common shares outstanding 7,750,000
===========
Unaudited pro forma data:
Loss before income taxes $ (391,028)
Benefit for income taxes 156,411
-----------
Pro forma net loss $ (234,617)
===========
Pro forma loss per share $ (0.05)
===========
Pro forma weighted average number of common shares 4,758,000
===========
The accompanying notes are an integral part of these consolidated
and combined financial statements.
3
<PAGE>
CONSOLIDATED STATEMENT OF CASH FLOWS OF KAPSON SENIOR QUARTERS CORP.
FOR THE THREE MONTHS ENDED MARCH 31, 1997
AND THE COMBINED STATEMENTS OF CASH FLOWS OF THE KAPSON GROUP
FOR THE THREE MONTHS ENDED MARCH 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (708,348) $ (391,028)
Adjustments to reconcile net loss to net cash
(used in) provided by:
Depreciation 578,716 374,606
Amortization 161,807 56,388
Deferred income taxes (472,232) --
Minority interest in net loss of combined partnerships (99,940) (50,501)
Equity in income (loss) from investment in joint ventures 6,102 --
Changes in other assets and liabilities:
Accounts receivable 2,534 25,337
Prepaid expenses and other current assets (315,537) (2,065,831)
Restricted cash (18,091) (188,683)
Other assets (117,785) 26,779
Accounts payable and accrued expenses (133,997) (349,652)
Accrued interest 260,216 (92,102)
Resident security deposits 491,709 96,702
Deferred interest payable 38,423 35,500
Deferred revenue 88,386 32,007
------------ -----------
Net cash used in operating activities (238,037) (2,490,478)
------------ -----------
Cash flows from investing activities:
Increase in restricted mortgage escrow funds 48,704 33,230
Purchases and development of property and equipment (1,272,535) (3,115,104)
Sale of minority interests 1,200,000 1,200,000
------------ -----------
Net cash used in investing activities (23,831) (1,881,874)
------------ -----------
Cash flow from financing activities:
Proceeds from issuance of long-term debt 955,081 4,245,194
Principal payment of long-term debt (211,600) (101,422)
Proceeds from loan -- (107,197)
Deferred financing costs (27,611) (94,444)
Distributions to shareholders and partners of the Predecessor -- (1,204,585)
------------ -----------
Net cash provided by financing activities 715,870 2,737,546
------------ -----------
Net increase (decrease) in cash and cash equivalents 454,002 (1,634,806)
Cash and cash equivalents, beginning of period 16,053,307 3,392,318
------------ -----------
Cash and cash equivalents, end of period $ 16,507,309 $ 1,757,512
============ ===========
Cash paid during the year for:
Interest $ 1,568,941 $ 999,159
============ ===========
</TABLE>
The accompanying notes are an integral part of these consolidated
and combined financial statements.
4
<PAGE>
KAPSON SENIOR QUARTERS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. General
The accompanying unaudited interim financial statements of Kapson Senior
Quarters Corp. (the "Company") and the Kapson Group (the "Predecessor") have
been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission (the "SEC"). Certain information and note disclosures
normally included in annual financial statements have been condensed or omitted
pursuant to those rules and regulations. In the opinion of management, all
adjustments, consisting of normal, recurring adjustments considered necessary
for a fair presentation, have been included. Although management believes that
the disclosures made are adequate to ensure that the information presented is
not misleading, it is suggested that these financial statements be read in
conjunction with the financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1996. The results of the three months ended March 31, 1997 and 1996 are not
necessarily indicative of the results of operations for the entire year.
2. Operations
The Company
The Company is an owner, operator, lessee, manager and developer of assisted
living facilities for senior citizens which was incorporated under the General
Corporation Law of Delaware on June 7, 1996 by three individual equal owners
(the "Kaplans"). The Company was formed in order to consolidate and expand the
assisted living facility business of the Predecessor of which the Kaplans were
owners. The Company had no operations prior to October 1, 1996.
On October 1, 1996, the Company sold 3,550,000 shares of common stock to the
public at a price of $10 per share in an initial public offering (the
"Offering"). The Company realized net proceeds from the Offering of
approximately $29.6 million, after deducting offering costs of approximately
$5.9 million. Concurrently with the completion of the Offering, the Predecessor
contributed at its historical costs, its interests in its wholly owned, majority
and minority owned facilities and management agreements with respect to
facilities which were owned by unrelated parties to the Company in exchange for
4,150,000 shares of common stock of the Company. In addition, simultaneously
with the Offering, the Company declared and distributed approximately $6.0
million in cash to the owners of the Predecessor to satisfy tax liabilities
incurred by the owners pertaining to the transfer of the Predecessor interests
in the facilities to the Company. This distribution was funded through the
Offering proceeds.
5
<PAGE>
KAPSON SENIOR QUARTERS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited) (Cont'd)
The Predecessor
The Predecessor represents a combination of the businesses of Sub Chapter S
Corporations, Partnerships or Limited Liability Companies which owned all or
part of eleven assisted living facilities, additional facilities under
development (including joint venture interests), an entity that provides
facility management services to unrelated entities and an entity that provided
administrative support to the Predecessor entities and the Company.
Pro Forma Presentation
The pro forma presentation in the accompanying unaudited interim financial
statements reflect the issuance of all shares of common stock in connection with
the Offering, the contribution of the Predecessors businesses at historical cost
to the Company in exchange for the Company's common stock and final
distributions in connection with the Offering.
The pro forma benefit for income taxes for the Predecessor is based on the
historical financial data of the Predecessor as if the entities comprising the
Predecessor had operated as taxable corporations for all periods presented and
is recorded at the statutory rate in effect during the period (40%).
Earnings per share are not presented on an historical basis since the
Predecessor operated as a group of non-taxable entities. In addition, no shares
of common stock were issued until the Offering, therefore, disclosure of
historical earnings per share would not be meaningful.
Impact of Recently Issued Accounting Pronouncements
In March 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS No. 128"),
which establishes standards for computing and presenting earnings per share.
SFAS No. 128 will be effective for financial statements issued for periods
ending after December 15, 1997. Earlier application is not permitted. Management
believes that this change will not have any impact on the Company's financial
statements for the year ended December 31, 1997.
6
<PAGE>
KAPSON SENIOR QUARTERS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited) (Cont'd)
3. Joint Venture Agreements
In March 1997, the Company announced the formation of a joint venture through
which it intends to develop six assisted living facilities in North and South
Carolina. In addition, in March, the Company sold a 49.9% interest in Kapson
Briarcliff Manor, LLC to an unrelated party for $1.2 million.
In April 1997, the Company formed a joint venture in which the Company has a 51%
equity interest, to purchase a property in Albany, New York for $3.8 million.
7
<PAGE>
KAPSON SENIOR QUARTERS CORP.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
Prior to the Offering, the Company's facilities were owned, managed and/or
operated by one or more S corporations, limited partnerships or limited
liability companies of the Company's predecessor, The Kapson Group (the
"Predecessor"). The Kapson Group was a general partnership of which Glenn
Kaplan, Wayne Kaplan, and Evan Kaplan (collectively, the "Kaplans") were the
sole equal partners. As the Company is newly formed, all references to the
Company in connection with historical financial data or otherwise include the
Predecessor.
The historical financial statements of the Predecessor represent the combined
historical results of operations and financial condition of: (i) four facilities
that were wholly owned by the Predecessor (Senior Quarters at Stamford, Senior
Quarters at Huntington Station, Senior Quarters at Centereach I, and Senior
Quarters at Centereach II); (ii) two wholly owned facilities of the Predecessor
that were acquired on April 1, 1996 (Town Gate Manor and Town Gate East); (iii)
one facility that was wholly owned by the Predecessor but in which a 49.9%
interest was sold to an unrelated third party in April 1996 (Senior Quarters at
Chestnut Ridge); (iv) an entity through which the Predecessor controlled a 50%
interest (and in October, 1996 agreed to acquire the remaining 50% interest) in
a newly-developed facility in East Northport, New York (Senior Quarters at East
Northport) which began operations on March 15, 1996; (v) an entity through which
the Company owned a 23.75% minority interest in Change Bridge Inn; (vi) two
entities through which the Predecessor owned a minority interest in facilities
that were under construction (an 11% interest in Senior Quarters at Glen Riddle
and a 10% interest in Senior Quarters at Jamesburg); (vii) a management company
which received management fees from five related and four unrelated entities,
and (viii) an entity that provided administrative support to the Predecessor and
other affiliated entities.
The Company is an owner, operator, manager, and developer of assisted living
facilities. The Company was formed in order to consolidate and expand the
assisted living business of the Predecessor. The Company had no operations prior
to October 1, 1996.
New York State Assisted Living Program
In June 1993, the Company was awarded approximately 57% of the beds allocated to
Long Island under the State of New York Assisted Living Program ("ALP"). This
program is designed for residents who are eligible for Medicaid and who require
a higher acuity of care than is typically provided in assisted living
facilities. In support of the program, the Company dedicated a newly developed
facility in East Northport, New York, which opened in March 1996, and an
existing fully occupied facility in Centereach, New York (Senior Quarters at
Centereach I).
8
<PAGE>
In April 1997, due to excessive delays and higher than expected costs associated
with the ALP, the Company was unable to implement the program at these two
facilities and accordingly the Company has taken action to reduce the
incremental operating costs associated with the program at both facilities and
is returning their operations back to adult homes. Both facilities were
originally conceived and constructed as adult homes and hold licenses as adult
care facilities in New York. The Company has begun to accept private pay
residents to fill rooms held vacant in anticipation of the ALP at its East
Northport facility and will transition its Centereach facility, currently at 99%
occupancy, back to an adult home facility.
During the first quarter, losses incurred at the East Northport facility and
other incremental operating expenses associated with the program resulted in
higher than historical assisted living operating expenses as a percentage of
assisted living revenues and increased the Company's net loss.
Results of Operations
Three Months Ended March 31, 1997 Compared to Three Months Ended March 31, 1996.
Revenues
Assisted living revenues increased to $7.2 million for the three months ended
March 31, 1997, compared to $3.9 million for the three months ended March 31,
1996, an increase of 84.6%. The increase is attributable to: (i) the rent-up of
Senior Quarters at Chestnut Ridge which opened on September 1, 1995 and Senior
Quarters at East Northport which opened on March 15, 1996 which contributed
revenue of $799,000 and $670,000, respectively; and (ii) the acquisition of Town
Gate East and Town Gate Manor on April 1, 1996 which contributed combined
revenue of $904,000, and (iii) leasing of Senior Quarters at Cranford which
contributed $1.2 million. Excluding Senior Quarters at Chestnut Ridge, Senior
Quarters at East Northport, Town Gate East and Town Gate Manor and Senior
Quarters at Cranford, assisted living revenues were approximately equivalent for
the three months ended March 31, 1997 and 1996. Management fee revenue increased
to $293,000 for the three months ended March 31, 1997, compared to $225,000 for
the three months ended March 31, 1996, an increase of 30.2%. The increase was
primarily attributable to Senior Quarters at Jamesburg, Senior Quarters at
Lynbrook and Senior Quarters at Glen Riddle which the Company assumed management
responsibility for on February 1, 1996, June 1, 1996, and June 19, 1996,
respectively.
Operating Expenses
Assisted living operating expenses increased to $5.1 million for the three
months ended March 31, 1997, compared to $2.5 million for the three months ended
March 31, 1996, an increase of 104%. As a percentage of assisted living
revenues, assisted living operating expenses were 70.8% and 64.1% for the three
months ended March 31, 1997 and 1996, respectively. The increase in assisted
living operating expenses as a percentage of assisted living revenues is
primarily attributable to the
9
<PAGE>
opening of Senior Quarters at East Northport and higher than expected costs
associated with ALP. Excluding expenses attributable to Senior Quarters at East
Northport and the ALP, assisted living operating expenses as a percentage of
assisted living revenues would have been 65.7% and 64.6% for the three months
ended March 31, 1997 and 1996, respectively.
General and Administrative Expense
General and administrative expense was $1.1 million for the three months ended
March 31, 1997, compared to $520,000 for the three months ended March 31, 1996.
As a percentage of total revenues, general and administrative expense was 14.7%
and 12.7% for the three months ended March 31, 1997 and 1996, respectively. The
increase is primarily the result of: (i) higher payroll and employee benefit
costs in connection with a strategic decision by the Company to invest in its
management and facility development capabilities in order to support future
growth through development, acquisition and management of additional facilities.
Interest Income
Interest income was $193,000 for the three months ended March 31, 1997, compared
to $45,000 for the three months ended March 31, 1996, an increase of 329%. The
increase is attributable to interest earned on the investment of the proceeds
from the Company's initial public offering.
Interest Expense
Interest expense was $1.8 million for the three months ended March 31, 1997,
compared to $1.2 million for the three months ended March 31, 1996, an increase
of 50.0%. The increase is attributable to: (i) the opening of Senior Quarters at
East Northport on March 15, 1996; and (ii) the debt incurred to finance the
acquisition of Town Gate East and Town Gate Manor on April 1, 1996.
Net Loss
Net loss was $708,000 for the three months ended March 31, 1997, compared to the
proforma net loss of $235,000 for the three months ended March 31, 1996. The
increase in net loss is primarily the result of operating losses at the East
Northport ALP facility, incremental costs incurred during the implementation of
ALP and, to a lesser extent, higher payroll and benefit costs in connection with
the Company's expansion plans. Excluding Senior Quarters at East Northport and
the incremental costs associated with the ALP, net loss would have been $131,000
and $205,000, on a proforma basis for the three months ended March 31, 1997 and
1996, respectively.
10
<PAGE>
Liquidity and Capital Resources
Net cash used in operating activities was $238,000 for the three months ended
March 31, 1997, compared to $2.4 million for the three months ended March 31,
1996. The decrease is primarily attributable to decreases in prepaid expenses
and other current assets and increases in resident security deposits, deferred
revenue and depreciation offset by the increase in net loss for the three months
ended March 31, 1997 over the prior period.
Net cash used in investing activities was $24,000 for the three months ended
March 31, 1997, compared to $1.9 million for the three months ended March 31,
1996. Substantially all of the cash used in investing activities for the three
months ended March 31, 1997 was for the development of new facilities offset by
the proceeds from the sale of minority interests. Net cash used in investing
activities was funded primarily through long-term debt.
Net cash provided by financing activities was $716,000 for the three months
ended March 31, 1997, compared to $2.7 million for the three months ended March
31, 1996. Net cash provided by financing activities primarily consists of the
proceeds of long-term debt offset by principal repayments of long-term debt.
The Company currently has a $100 million acquisition, leasing and development
credit facility (the "Facility") with a lending institution, providing temporary
construction and permanent financing. The Company currently has drawn and
committed $50 million, with an additional $50 million remaining for future
financings under the Facility.
Indebtedness on two properties (Senior Quarters at Huntington Station and Senior
Quarters at Stamford) having a combined outstanding balance of $15.3 million
matures in February 1999, at which time all unpaid principal balances, if any,
become due and payable. The lending arrangements also contain an equity
participation feature payable at maturity in an amount which is the greater of
(a) $480,000 or (b) 25% of appraised market value over $17.5 million. The
Company expects to refinance such debt with the existing lender or with another
financing source.
The Company intends to finance its growth strategy for the next three to five
years through a variety of sources, including the remaining proceeds of the
Offering, bank and other financing, long-term operating leases with REITs,
future debt or equity offerings, joint ventures and other sources. To a limited
extent, the Company may also use other forms of financing such as taxable or
tax-exempt long-term debt, including publicly issued debt. Because the Company
intends to use such financing for its properties, the amount of its indebtedness
will increase as the Company pursues its growth strategy. As a result of
existing and future indebtedness, a substantial portion of the Company's cash
flow will be devoted to debt service. Further, increases in interest rates could
increase the Company's debt service obligations, and, alone or in combination
with a contraction in the overall availability of credit, could make it more
difficult for the Company to obtain future financing on commercially acceptable
terms.
11
<PAGE>
Note on Forward-Looking Statements
Certain information contained in this Form 10-Q are forward-looking statements.
Events could affect the Company's actual results and could cause such results to
differ materially from those expressed in any forward-looking statements made
by, or on behalf of, the Company in this Form 10-Q. Such events could include
effect of economic and market conditions, the availability of financing, general
real estate and construction risks, government regulation, competition and other
business risks common to assisted living operations.
12
<PAGE>
KAPSON SENIOR QUARTERS CORP.
PART II OTHER INFORMATION
Item l. Legal Proceedings
Litigation:
There have been no material developments with respect to litigation
that occurred during this reporting period.
Item 2. Changes in Securities
Not applicable.
Item 3. Defaults upon Senior Securities Not applicable
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
There was no Form 8-K filed during the first quarter period
ending March 31, 1997.
13
<PAGE>
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.
KAPSON SENIOR QUARTERS CORP.
May 9, 1997 /s/ Glenn Kaplan
------------------------------------
Glenn Kaplan
Chairman of the Board and
Chief Executive Officer
May 9, 1997 /s/ Raymond DioGuardi
------------------------------------
Raymond DioGuardi
Chief Financial Officer
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM COMBINED
BALANCE SHEETS AND COMBINED STATEMENTS OF OPERATIONS CONTAINED IN THE COMPANY'S
QUARTERLY REPORT ON FORM 10-Q FOR 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-END> MAR-31-1997
<CASH> 16,507
<SECURITIES> 0
<RECEIVABLES> 78
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 18,459
<PP&E> 69,392
<DEPRECIATION> 11,308
<TOTAL-ASSETS> 98,012
<CURRENT-LIABILITIES> 5,466
<BONDS> 0
0
0
<COMMON> 78
<OTHER-SE> 11,505
<TOTAL-LIABILITY-AND-EQUITY> 98,012
<SALES> 0
<TOTAL-REVENUES> 7,521
<CGS> 0
<TOTAL-COSTS> 7,136
<OTHER-EXPENSES> 24
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,829
<INCOME-PRETAX> (1,181)
<INCOME-TAX> 472
<INCOME-CONTINUING> (708)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (708)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
