WNC HOUSING TAX CREDIT FUND VI, L.P.,
SERIES 7
[GRAPHIC OMITTED]
Supplement Dated February 4, 2000
To Prospectus Dated September 3, 1999
This supplement is part of, and should be read in conjunction with, the
prospectus of WNC Housing Tax Credit Fund VI, L.P., Series 7 dated September 3,
1999 and the supplement to prospectus dated September 3, 1999. The supplement
dated September 3, 1999 is not for use in all states.
TABLE OF CONTENTS
Page
Status of Series 7 Offering....................................................1
Local Limited Partnership Investments..........................................1
Management.....................................................................4
Federal Income Tax Considerations..............................................4
STATUS OF SERIES 7 OFFERING
As of the date hereof, Series 7 has received subscriptions in the amount of
$4,589,985 (4,590 Units), of which $342,000 currently is represented by investor
promissory notes.
LOCAL LIMITED PARTNERSHIP INVESTMENTS
Series 7 has identified for acquisition or acquired interests in: 2nd
Fairhaven, LLC, a Maryland limited liability company (Fairhaven); Red Oaks
Estates, L.P., a Mississippi limited partnership (Red Oaks); and School Square
Limited Partnership, a Minnesota limited partnership (School Square). These
entities are referred to herein as local limited partnerships.
Fairhaven owns the Fairhaven Manor II Apartments in Caroline County,
Maryland; Red Oaks owns the Red Oaks Apartments in Holly Springs, Mississippi;
and School Square owns the School Square Apartments in Albany, Minnesota.
WNC & Associates, Inc. believes that Series 7 is reasonably likely to
acquire or retain an interest in the local limited partnerships identified
herein. However, Series 7 may not do so as a result of one or more factors. For
example, a local limited partnership identified herein may fail to satisfy one
or more conditions precedent to the investment of Series 7. Series 7 may fail to
raise additional capital necessary to complete the purchase of the local limited
partnerships. Moreover, the terms of an acquisition may differ from those as
described. Accordingly, investors should not rely on the ability of Series 7 to
acquire or retain an investment in the local limited partnerships identified
herein on the indicated terms in deciding whether to invest in Series 7.
Series7supp1v4
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The following tables contain information concerning the local limited
partnerships identified herein and their respective properties:
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ACTUAL OR
ESTIMATED ESTIMATED PERMANENT
LOCAL PROJECT CONSTRUC- DEVELOP- MORTGAGE ANTICIPATED
LIMITED NAME AND TION MENT COST NUMBER OF BASIC LOAN AAGGREGATE
PARTNER- NUMBER LOCATION COMPLETION (INCLUDING APARTMENT MONTHLY PRINCIPAL TAX CREDITS
SHIP OF BUILDINGS OF PROPERTY DATE LAND COST) UNITS RENTS AMOUNT (1)
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
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FAIRHAVEN Fairhaven Federalsburg April 1999 $1,329,000 18 1BR $460 $1,000,000 $490,320
Manor (Caroline units RD (4)
II County),
Apartments Maryland RAP on all
units (3)
5 buildings
(2)
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- ----------- ------------- ------------ ------------ -------------- ------------- ------------- ------------ --------------
RED OAKS Red Oaks Holly October $1,022,000 8 1BR $305 $215,460 $341,200
Apartments Springs 2000 units $335 RD (4)
(Marshall 16 2BR
5 buildings County), units
(5) Mississippi
RAP on all
units (3)
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SCHOOL School Albany October $1,228,000 12 2BR $445 $988,000 $396,710
SQUARE Square (Stearns 2000 units $560 RD (4)
Apartments County), 5 3BR
Minnesota units
5 buildings
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<FN>
(1) Low income housing tax credits are available over a 10-year period. In the
first credit year, Series 7 will receive only that percentage of the annual
credit which corresponds to the number of months during which Series 7 was a
limited partner of the local limited partnership, and during which the apartment
complex was completed and in service. See the discussion under "The Low Income
Housing Tax Credit - Utilization of the Low Income Housing Tax Credit" in the
prospectus.
(2) This apartment complex is designed for senior citizens.
(3) The United States Department of Agriculture, Rural Development provides rent
subsidies known as Rental Assistance Payments (RAP) to certain projects. Funds
from such payments are applied to cover any difference between rents required to
be paid by tenants and the basic rent established for the applicable project.
See "Other Government Assistance Programs" in the prospectus.
(4) The United States Department of Agriculture, Rural Development will provide
the mortgage loan for a term of 30 years at a market rate of interest prior to
reduction of the interest rate by a mortgage interest subsidy to an annual rate
of 1%. Principal and interest will be payable monthly based on a 50-year
amortization schedule. Outstanding principal and interest will be due on
maturity of the loan.
(5) This apartment complex is a rehabilitation property.
</FN>
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Federalsburg (Fairhaven): Federalsburg is in Caroline County, Maryland at
the intersection of State Highways 307, 315 and 318. It is approximately 60
miles southeast of Annapolis. The population is approximately 30,000. The major
employers for Federalsburg residents are Solo Cup Company, Maryland Plastics and
Pillsbury.
Holly Springs (Red Oaks): Holly Springs is in Marshall County, Mississippi
at the intersection of U.S. Highway 78 and State Highway 7. It is approximately
25 miles southeast of Memphis, Tennessee. The population is approximately
30,000. The major employers for Holly Springs residents are Mulay Plastics
Company, Farr Company and Marshall County Correctional Facility.
Albany (School Square): Albany is in Stearns County, Minnesota, on
Interstate Highway 94. It is approximately 50 miles northwest of Minneapolis.
The population is approximately 119,000. The major employers for Albany
residents are Albany Public Schools, Albany Area Hospital, and Kraft Foods.
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SHARING
RATIOS:
ALLOCATIONS
LOCAL LOCAL LOCAL GENERAL SHARING RATIOS: (4) SERIES 7's
LIMITED GENERAL PROPERTY PARTNER CASH FLOW (3) AND SALE OR CAPITAL
PARTNERSHIP PARTNER(S) MANAGER (1) DEVELOPMENT REFINANCING CONTRIBUTION
FEE (2) PROCEEDS (5)
<S> <C> <C> <C> <C> <C> <C>
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FAIRHAVEN Larry C. Cabell $164,800 WNC: $750 99.98/.01/.01 $356,860
Porter (7) Corporation LGP: $2,422 40/60
(7) The balance:
Carter 30/70
Chinnis (7)
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- ---------------- --------------- ---------------- --------------- ---------------- --------------- ----------------
RED OAKS SEMC, Inc. Southeastern $47,986 WNC: greater 99.98/.01/.01 $245,640
(8) Management of 15% or $505 91/9
Company, The balance:
Inc. (9) 99/1
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SCHOOL Bradley V. Sand $159,544 WNC: $1,000 99.98/.01/.01 $293,550
SQUARE Larson (10) Companies, Inc. LGP: $2,212 50/50
(11) The balance:
30/70
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<FN>
(1) Each local limited partnership will employ either its local general
partner(s) or an affiliate of its local general partner(s), or a third party, as
a property manager for leasing and management of the apartment complex. The
maximum fee payable is determined pursuant to lender regulations.
(2) Each local limited partnership will pay its local general partner(s) or an
affiliate of its local general partner(s) a development fee in the amount set
forth, for services incident to the development and construction of the
apartment complex. Services include: negotiating the financing commitments for
the apartment complex, securing necessary approvals and permits for the
development and construction of the apartment complex, and obtaining allocations
of low income housing tax credits. This payment will be made in installments
after receipt of each installment of the capital contributions made by Series 7.
(3) Reflects the amount of the net cash flow from operations, if any, to be
distributed to Series 7 (WNC) and the local general partner(s) (LGP) of each
local limited partnership for each year of operations. Net cash flow generally
is equal to the excess of revenues over expenses, including the property
manager's fee.
(4) Subject to certain special allocations, reflects the respective
percentage interests in profits, losses and low income housing tax credits of
(i) Series 7, (ii) WNC Housing, L.P., an affiliate of WNC & Associates, Inc.
which is the special limited partner, and (iii) the local general partner(s).
(5) Reflects the percentage interests in any net cash proceeds from sale or
refinancing of the apartment complex of (i) Series 7, and (ii) the local general
partner(s). Net cash proceeds from sale or refinancing of the apartment complex
is equal to the sale proceeds less payment of the mortgage loan and other local
limited partnership obligations.
(6) Series 7 normally will make its capital contributions to a local limited
partnership in stages, with each contribution due when certain conditions
regarding construction or operations of the apartment complex have been
fulfilled. In the case of a completed apartment complex, Series 7 may pay its
capital contributions in full at the time of its acquisition of the local
limited partnership. Series 7 expects to negotiate adjuster provisions providing
for a reduction in the capital contributions in the event the tax credits are
less than originally anticipated. See "Investment Policies" and "Terms of the
Local Limited Partnership Agreements" under "Investment Objectives and Policies"
in the prospectus.
(7) Since 1981 Larry C. Porter and Carter Chinnis have developed 16 low
income housing projects consisting of 522 units. They also serve as general
partners for those projects. Mr. Chinnis formed Cabell Corporation in Maryland
in 1977. Cabell Corporation is the management company for the projects developed
by Messrs. Porter and Chinnis. Mr. Porter has represented to Series 7 that he
had a net worth in excess of $400,000 as of June 1997. Mr. Chinnis has
represented to Series 7 that he had a net worth in excess of $5,000,000 as of
January 1999.
(8) SEMC, Inc., a Mississippi corporation, has developed 15 or more low
income housing projects since 1997. SEMC, Inc. has a nominally negative net
worth. Operating deficit and tax credit guarantees will be provided by Bobby
Little, Vice President of SEMC, Inc. Mr. Little has represented to Series 7 that
he had a net worth in excess of $1,000,000 as of December 1999.
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(9) Since 1997 Southeastern Management Company, Inc., a Mississippi
corporation, has managed more than 15 low income housing projects consisting of
538 units.
(10) Since 1975 Bradley V. Larson has developed 12 low income housing
projects consisting of 291 units. He also serves as general partner for those
projects. Mr. Larson has represented to Series 7 that he had a net worth in
excess of $2,000,000 as of January 2000.
(11) Sand Companies, Inc. manages eight or more low income housing projects
consisting of 210 apartment units.
</FN>
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MANAGEMENT
The officers of WNC & Associates, Inc. are as follows:
Wilfred N. Cooper, Sr. Chief Executive Officer, Chairman of the Board
John B. Lester, Jr. Vice Chairman of the Board
Wilfred N. Cooper, Jr. President, Chief Operating Officer, Secretary
David N. Shafer Executive Vice President, General Counsel
Michael L. Dickenson Vice President - Chief Financial Officer
Sylvester P. Garban Vice President - Institutional Investments
N. Paul Buckland Vice President - Acquisitions
Thomas J. Riha Vice President - Asset Management
David T. Turek Vice President - Originations
Biographical information for each of these persons is set forth in the
prospectus under "Management - WNC & Associates, Inc."
Effective December 1999 Raymond S. Olsen, age 58, has been appointed
President of WNC Management, Inc. His experience in acquisition, development and
management of commercial and multi-family residential real estate began in 1980.
Previously, he was President of Arizona Management Group, from 1998 to 1999, a
Vice President of United Dominion Realty Trust, a real estate investment trust,
from 1996 to 1998, and Director of Property Management for Gates, Hudson &
Associates, from 1994 to 1996. He is a former Vice President of the Apartment
and Office Building Association of Washington, D.C., and a former Executive Vice
President of the National Apartment Association. Mr. Olsen graduated from the
University of Southern California in 1971 with a Bachelor of Science degree, and
earned a Masters of Public Administration degree in 1974.
FEDERAL INCOME TAX CONSIDERATIONS
Tax Legislation
In December 1999 President Clinton signed into law the Ticket to Work
and Work Incentives Improvement Act of 1999. Included in that legislation is a
provision which repeals the installment method of tax accounting for accrual
method taxpayers. Series 7 is required to use the accrual method of accounting.
Accordingly, the installment method of accounting should be unavailable upon the
sale of an apartment complex or the sale of a local limited partnership
interest. See "Federal Income Tax Considerations - Treatment of Mortgage Loans"
in the prospectus.
Tax Shelter Registration Number
The taxpayer identification number and tax shelter registration number
of Series 7 are 33-0849814 and 99127000009, respectively. See "Federal Income
Tax Considerations - Tax Shelter Registration" in the prospectus.
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APPENDIX A TO PROSPECTUS
1. In the heading to the cover page there is a diamond-shaped graphic.
