SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter ended
September 30, 2000 Commission file #0-8716
JMB INCOME PROPERTIES, LTD. - V
(Exact name of registrant as specified in its charter)
Illinois 36-2897158
(State of organization) (IRS Employer Identification No.)
900 N. Michigan Ave., Chicago, IL 60611
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code 312/915-1987
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 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 [ ]
<PAGE>
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Financial Statements . . . . . . . . . . . . . . . . . 3
Item 2. Management's Discussion and
Analysis of Financial Condition and
Results of Operations. . . . . . . . . . . . . . . . . 12
PART II OTHER INFORMATION
Item 5. Other Information. . . . . . . . . . . . . . . . . . . 15
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . 16
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JMB INCOME PROPERTIES, LTD. - V
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 2000 AND DECEMBER 31, 1999
(UNAUDITED)
ASSETS
------
SEPTEMBER 30, DECEMBER 31,
2000 1999
------------- -----------
Current assets:
Cash and cash equivalents. . . . . . . $ 6,458,630 6,318,944
Interest, rents and
other receivables. . . . . . . . . . 103,240 94,796
Prepaid expenses . . . . . . . . . . . 55,898 27,903
----------- -----------
Total current assets . . . . . . 6,617,768 6,441,643
----------- -----------
Investment property:
Land . . . . . . . . . . . . . . . . . 1,949,914 1,949,914
Buildings and improvements . . . . . . 11,410,962 11,399,502
----------- -----------
13,360,876 13,349,416
Less accumulated depreciation. . . . . 7,313,289 7,115,991
----------- -----------
Total investment property,
net of accumulated
depreciation . . . . . . . . . 6,047,587 6,233,425
Deferred expenses. . . . . . . . . . . . 54,810 70,625
----------- -----------
$12,720,165 12,745,693
=========== ===========
<PAGE>
JMB INCOME PROPERTIES, LTD. - V
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED BALANCE SHEETS - CONTINUED
LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
-----------------------------------------------------
SEPTEMBER 30, DECEMBER 31,
2000 1999
------------ -----------
Current liabilities:
Current portion of long-term debt. . . $ 431,255 401,561
Accounts payable . . . . . . . . . . . 1,785,596 1,791,513
Accrued interest . . . . . . . . . . . 147,326 149,694
Accrued real estate taxes. . . . . . . 187,934 --
----------- -----------
Total current liabilities. . . . 2,552,111 2,342,768
Tenant security deposits . . . . . . . . 28,325 14,986
Long-term debt, less current
portion. . . . . . . . . . . . . . . . 18,080,933 18,408,189
----------- -----------
Commitments and contingencies
Total liabilities. . . . . . . . 20,661,369 20,765,943
Venture partner's subordinated
equity in venture. . . . . . . . . . . 12,355,504 11,938,602
Partners' capital accounts (deficits):
General partners:
Capital contributions. . . . . . . . 1,000 1,000
Cumulative net earnings (loss) . . . 4,266,135 4,264,078
Cumulative cash distributions. . . . (5,857,362) (5,835,971)
----------- -----------
(1,590,227) (1,570,893)
----------- -----------
Limited partners (38,505 interests):
Capital contributions,
net of offering costs. . . . . . . 34,926,505 34,926,505
Cumulative net earnings (loss) . . . 33,641,356 33,574,828
Cumulative cash distributions. . . . (87,274,342) (86,889,292)
----------- -----------
(18,706,481) (18,387,959)
----------- -----------
Total partners' capital
accounts (deficits). . . . . . (20,296,708) (19,958,852)
----------- -----------
$12,720,165 12,745,693
=========== ===========
See accompanying notes to consolidated financial statements.
<PAGE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - V
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(UNAUDITED)
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
-------------------------- --------------------------
2000 1999 2000 1999
----------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
Income:
Rental income. . . . . . . . . . . . . . . . . . . $1,252,495 1,301,666 3,778,673 4,339,536
Interest income. . . . . . . . . . . . . . . . . . 104,327 76,181 291,078 420,654
---------- ---------- ---------- ----------
1,356,822 1,377,847 4,069,751 4,760,190
---------- ---------- ---------- ----------
Expenses:
Mortgage and other interest. . . . . . . . . . . . 442,791 452,081 1,335,533 1,450,594
Depreciation . . . . . . . . . . . . . . . . . . . 65,783 1,044,702 197,298 1,044,702
Property operating expenses. . . . . . . . . . . . 650,036 645,412 1,843,584 2,202,971
Professional services. . . . . . . . . . . . . . . 9,584 3,484 82,855 61,327
Amortization of deferred expenses. . . . . . . . . 5,272 5,271 15,815 18,514
Management fees to Corporate General Partners. . . 21,392 -- 21,392 --
General and administrative . . . . . . . . . . . . 21,358 21,118 86,745 110,593
---------- ---------- ---------- ----------
1,216,216 2,172,068 3,583,222 4,888,701
---------- ---------- ---------- ----------
140,606 (794,221) 486,529 (128,511)
Venture partner's share of
venture's operations . . . . . . . . . . . . . . . (133,737) (66) (417,944) (118,676)
---------- ---------- ---------- ----------
Earnings (loss) before gain
on sale of investment
property. . . . . . . . . . . . . . . . . . 6,869 (794,287) 68,585 (247,187)
Gain on sale of investment property. . . . . . . . . -- -- -- 5,998,474
---------- ---------- ---------- ----------
Earnings (loss) before
extraordinary item. . . . . . . . . . . . . 6,869 (794,287) 68,585 5,751,287
Extraordinary item - write-off of
unamortized deferred financing costs . . . . . . . -- -- -- (174,784)
---------- ---------- ---------- ----------
Net earnings (loss) . . . . . . . . . . . . . $ 6,869 (794,287) 68,585 5,576,503
========== ========== ========== ==========
<PAGE>
JMB INCOME PROPERTIES, LTD. - V
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF OPERATIONS - CONTINUED
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
-------------------------- --------------------------
2000 1999 2000 1999
----------- ---------- ----------- ----------
Net earnings (loss) per
limited partnership interest:
Earnings (loss) before gain on sale
of investment property . . . . . . . . . $ .17 (20.01) 1.73 (6.23)
Gain on sale of investment property. . . . -- -- -- 84.68
Extraordinary item . . . . . . . . . . . . -- -- -- (4.49)
---------- ---------- ---------- ----------
Net earnings (loss) per limited
partnership interest. . . . . . . . . . . . $ .17 (20.01) 1.73 73.96
========== ========== ========== ==========
Cash distributions per limited
partnership interest. . . . . . . . . . . . $ 10.00 -- 10.00 375.00
========== ========== ========== ==========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
JMB INCOME PROPERTIES, LTD. - V
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 2000 AND 1999
(UNAUDITED)
2000 1999
----------- -----------
Cash flows from operating activities:
Net earnings (loss). . . . . . . . . . . . $ 68,585 5,576,503
Items not requiring (providing)
cash or cash equivalents:
Depreciation . . . . . . . . . . . . . . 197,298 1,044,702
Amortization of deferred expenses. . . . 15,815 18,514
Venture partner's share of
venture's operations . . . . . . . . . 417,944 118,676
Gain on sale of investment
property . . . . . . . . . . . . . . . -- (5,998,474)
Extraordinary item . . . . . . . . . . . -- 174,784
Rental income applied to construction
loan payable . . . . . . . . . . . . . -- (17,166)
Changes in:
Interest, rents and other receivables. . (8,444) 174,779
Prepaid expenses . . . . . . . . . . . . (27,995) 15,310
Accrued rents receivable . . . . . . . . -- 5,003
Accounts payable . . . . . . . . . . . . (5,917) (98,105)
Accrued interest . . . . . . . . . . . . (2,368) (62,334)
Accrued real estate taxes. . . . . . . . 187,934 187,205
Tenant security deposits . . . . . . . . 13,339 (9,439)
------------ -----------
Net cash provided by (used in)
operating activities . . . . . . 856,191 1,129,958
Cash flows from investing activities:
Additions to investment properties . . . . (11,460) (205,760)
Proceeds from sale of
investment property. . . . . . . . . . . -- 24,216,567
------------ -----------
Net cash provided by (used in)
investing activities . . . . . . (11,460) 24,010,807
------------ -----------
Cash flows from financing activities:
Principal payments on construction
loan . . . . . . . . . . . . . . . . . . -- (2,785,460)
Principal payments on long-term debt . . . (297,562) (4,431,224)
Venture partner's contributions to
venture. . . . . . . . . . . . . . . . . 621,655 621,748
Distributions to venture partners. . . . . (622,697) (622,698)
Distributions to general partners. . . . . (21,391) (2,737,744)
Distributions to limited partners. . . . . (385,050) (14,439,375)
------------ -----------
Net cash provided by (used in)
financing activities . . . . . . (705,045) (24,394,753)
------------ -----------
Net increase (decrease) in cash
and cash equivalents . . . . . . 139,686 746,012
Cash and cash equivalents,
beginning of year. . . . . . . . 6,318,944 5,859,549
------------ -----------
Cash and cash equivalents,
end of period. . . . . . . . . . $ 6,458,630 6,605,561
============ ===========
<PAGE>
JMB INCOME PROPERTIES, LTD. - V
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
CONSOLIDATED STATEMENTS OF CASH FLOWS - Continued
2000 1999
----------- -----------
Supplemental disclosure of cash flow
information:
Cash paid for mortgage and
other interest . . . . . . . . . . $ 1,337,901 1,436,685
============ ===========
Non-cash investing and financing
activities:
Rental income applied to
construction loan payable. . . . . . $ -- 17,166
============ ===========
See accompanying notes to consolidated financial statements.
<PAGE>
JMB INCOME PROPERTIES, LTD. - V
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000 AND 1999
(UNAUDITED)
GENERAL
Readers of this quarterly report should refer to the Partnership's
audited financial statements for the year ended December 31, 1999 which are
included in the Partnership's 1999 Annual Report, as certain footnote
disclosures which would substantially duplicate those contained in such
audited financial statements have been omitted from this report.
The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
The Partnership adopted Statement of Financial Accounting Standards
No. 121 "Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to be Disposed of" ("SFAS 121") as required in the first
quarter of 1996. The Partnership's policy is to consider a property to be
held for sale or disposition when the Partnership has committed to a plan
to sell such property and active marketing activity has commenced or is
expected to commence in the near term. The Partnership has concluded that
it may dispose of a property by no longer funding operating deficits or
debt service requirements thus allowing the lender to realize upon its
security. In accordance with SFAS 121, any properties identified as "held
for sale or disposition" are no longer depreciated. The Partnership's
commitment to a plan for sale or disposal has not resulted in a sale or
disposition. As a result, the Partnership made an adjustment to record
depreciation expense as of June 30, 1999 that would have been recognized
had the 301 North Main and Phillips Buildings not been considered "held for
sale or disposition". Further, the Partnership has begun to record
depreciation expense for the 301 North Main Building and Phillips Building
commencing July 1, 1999. The results of operations for the property that
was sold was ($154,577) for the nine months ended September 30, 1999.
Certain amounts in the 1999 consolidated financial statements have
been reclassified to conform with the 2000 presentation.
TRANSACTIONS WITH AFFILIATES
Fees, commissions and other expenses required to be paid by the
Partnership to the General Partners and their affiliates as of
September 30, 2000 and for the nine months ended September 30, 2000 and
1999 were as follows:
Unpaid at
September 30,
2000 1999 2000
------- ------- -------------
Property management and
leasing fees . . . . . . . . . . . . $55,723 93,181 1,683,626
Management fees to Corporate
General Partners . . . . . . . . . . 21,392 -- --
Insurance commissions. . . . . . . . . 14,281 8,494 --
Reimbursement (at cost) for
out-of-pocket expenses . . . . . . . 244 38 --
------- ------- ---------
$91,640 101,713 1,683,626
======= ======= =========
<PAGE>
All amounts deferred or currently payable to the General Partners and
their affiliates do not bear interest. The General Partners and their
affiliates have deferred receipt of property management and leasing fees
pursuant to the venture agreement for the 301 North Main Building and
Phillips Building. Prior to 1995, an affiliate of the Managing General
Partner provided management and leasing services. In December 1994, the
affiliate sold all of its assets and assigned its interest in the
management contracts, including the one for the 301 North Main Building and
Phillips Building to an unaffiliated third party. In connection with such
sale, an affiliate of the General Partners guaranteed payment to the
unaffiliated third party of the portion of the fees currently deferred due
to a provision in the venture agreement for the 301 North Main and Phillips
Buildings. Any such guaranteed amounts are paid to such unaffiliated third
party when earned and the General Partners and its affiliates continue to
be entitled to receive such deferred fees. As of September 30, 2000, the
General Partners and their affiliates have deferred receipt of
approximately $1,645,000 (approximately $41 per interest) of such property
management and leasing fees. Such amounts are deferred until the sale or
disposition of the property or upon the termination of the property
management agreement and are expected to be paid at that time. All amounts
due affiliates are reflected in accounts payable in the accompanying
consolidated financial statements.
BRISTOL MALL
On February 17, 1999, the Partnership sold the Bristol Mall to an
unaffiliated third party. The purchase price of the Property was
$24,577,000. Upon closing, the Partnership received cash of approximately
$17,400,000 (net of closing costs but before prorations). The cash
received by the Partnership was also net of the repayment of the mortgage
loan secured by the Property of approximately $4,100,000 and repayment of
the construction loan of approximately $2,800,000. The Partnership
recognized a gain of approximately $6,000,000 and $7,600,000 for financial
reporting and Federal income tax purposes in 1999, respectively. In
addition, in connection with the sale of the Property and as is customary
in such transactions, the Partnership agreed to certain representations,
warranties and covenants with stipulated survival periods which expired on
November 17, 1999 with no liability to the Partnership. The property was
classified as held for sale as of September 30, 1997 and therefore was not
subject to continued depreciation from such date for financial reporting
purposes.
301 NORTH MAIN BUILDING AND PHILLIPS BUILDING
Occupancy at 301 N. Main Building (formerly the Wachovia Bank
Building) and Phillips Building was 46% at September 30, 2000. The
buildings are generating cash flow for the joint venture. Prior to
December 31, 1995, substantially all of the 301 North Main Building was
leased to one tenant, the Wachovia Bank. Commencing in the third quarter
of 1998 and continuing through mid-1999, the Wachovia Bank vacated
substantially all of its space in the 301 North Main Building
(approximately 200,000 square feet). The remaining space leased at
September 30, 2000 to the Wachovia Bank (approximately 8,200 square feet)
is leased pursuant to short-term leases. The Partnership cannot predict if
Wachovia Bank will renew such leases upon expiration or not. The Wachovia
Bank has announced that it intends to vacate the space it currently leases
in the Phillips Building (approximately 269,000 square feet) upon the
expiration of such lease in February 2002.
Re-leasing the vacant space in the building would likely require major
renovation to the building as well as significant tenant improvements
which, in turn, would be contingent upon the Partnership obtaining
financing for these tenant replacement costs. Unless replacement tenants
are secured on acceptable terms for the currently vacant space and the
anticipated vacancy in February 2002 of 100% of the Phillips Building
(approximately 269,000 square feet), the office building will not generate
<PAGE>
sufficient cash flow to service the debt payments of the mortgage loan, or
be able to refinance such mortgage loan upon its maturity in November 2001.
Furthermore, it is unlikely that the Partnership will commit any additional
funds to the property due to the low likelihood of achieving a return on
such funds. This will likely result in the Partnership no longer having an
ownership interest in the two office buildings. This action would result
in a gain for financial reporting and Federal and state income tax purposes
with no corresponding distributable proceeds. Additionally, the
Partnership could be required to remit to the state tax authorities
withholding for income taxes due as a result of the sale of the properties
or its surrender to the mortgage lender. This withholding amount is
currently estimated to be approximately $650,000.
The joint venture continues to market the property for sale. However,
due to the limited cash flow generated by the property and the short-term
nature of the major tenant lease, it is not expected that a sale would
generate any significant proceeds to the joint venture or the Partnership.
On May 18, 2000, the Partnership's joint venture received a non-
binding offer from an unaffiliated third party to purchase the 301 North
Main Building and the Phillips Building, which offer was later withdrawn.
In September of 2000, the Partnership's joint venture received a non-
binding offer from a different unaffiliated third party to purchase the 301
North Main Building and the Phillips Building. The prospective purchaser
is currently performing its due diligence review of the properties.
However, as the transaction is subject to final documentation and the
buyer's due diligence review, there can be no assurance that this sale will
be consummated.
In 1986, the Partnership's venture partner had agreed to contribute
$10,700,000, before applicable interest, to the venture pursuant to a
payment schedule from the closing date through August 1, 1996, when it
would owe the balance of its obligation (approximately $7,600,000). The
venture partner has continued to make contributions (from its share of the
property's cash flow) based on the old payment schedule rather than making
the balloon payment in August 1996 as required. As a result, the venture
partner is currently approximately $6,952,000 in arrears for such
contributions as of the date of this report. The venture partner's
obligation to make such payment is secured only by its interest in the
venture. In the fourth quarter of 1996, the Partnership notified the
venture partner of its default effective August 1996. As a result of such
default, the venture partner's share of distributions of cash flow
generated subsequent to 1996, except as provided below, was retained by the
venture. In December 1999, the Partnership and the venture partner entered
into an agreement (the "Option Agreement"), effective January 1, 1999,
under which the Partnership was given the option to purchase the venture
partner's interest on or before January 31, 2002. If the Partnership
exercises its option, the purchase price for the interest would be $230,000
and the Partnership would release the venture partner from its obligation
to make contributions as discussed above. As a result of the negotiations,
and in consideration of the venture partner granting a full release to the
Partnership and the venture, the Partnership and venture partner also
concurrently entered into a forbearance agreement, under which the
Partnership agreed to not pursue its legal remedies against the venture
partner for its default related to such obligation until November 1, 2000,
subject to further extension. Though the Partnership may now pursue such
legal remedies, they are of little practical value at present because the
venture partner's obligations are secured by the venture partner's interest
in the venture. The Partnership continues to reserve all of its rights in
this regard, and may determine at a later date to pursue such remedies.
Additionally, the venture agreement was amended to: (1) convert the
venture partner's minority general partnership interest in the venture to a
limited partnership interest; (2) provide that no further distributions of
cash flow will be made to the venture partner after December 1999, at which
<PAGE>
time $200,000, representing the venture partner's final distribution of
cash flow from operations and reserves, was distributed to the venture
partner; and (3) provide that the venture partner (assuming the option
under the option agreement is not exercised) would receive 30% of any net
sale proceeds (as defined) if the gross sale price of the property is
$40,000,000 or greater. Under the Option Agreement, upon the closing of
the purchase of such interest, the venture partner would also release the
Partnership and the venture from any and all claims that the venture
partner may have against the Partnership and the venture, including,
without limitation, any amounts which may have accrued or been
distributable prior to such closing date, and the Partnership and the
venture would release the venture partner from any further liabilities
under the venture agreement, including, without limitation, the
aforementioned obligation to make additional capital contributions. The
Partnership expects that it would exercise the option to purchase the
venture partner's interest immediately prior to the sale or other
disposition of the property by the venture.
The venture agreement had been previously amended effective for fiscal
year 1998 and, as a result of the December 1999 amendment referred to
above, again for all subsequent years. Per the amendments, profits and
losses are allocated based on the ratio of distributions (actual
distributions plus any distributions deemed to have been made) to the
partners, approximately 75% and 90% to the Partnership and 25% and 10% to
the venture partner for the nine months ended September 30, 2000 and 1999,
respectively. For financial reporting and Federal income tax purposes, the
venture continues to report the payments of approximately $830,000 annually
on the obligation referred to above as deemed to be made (and contributed
for financial reporting purposes only) to the venture partner.
ADJUSTMENTS
In the opinion of the Managing General Partner, all adjustments
(consisting solely of normal recurring adjustments) necessary for a fair
presentation have been made to the accompanying figures as of September 30,
2000 and for the three and nine months ended September 30, 2000 and 1999.
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reference is made to the notes to the accompanying financial
statements for additional information concerning the Partnership's
investments.
The board of directors of JMB Realty Corporation ("JMB") the Managing
General Partner of the Partnership, has established a special committee
(the "Special Committee") consisting of certain directors of JMB to deal
with all matters relating to tender offers for Interests in the
Partnership, including any and all responses to such tender offers.
On May 3, 2000 the Partnership was notified that certain unaffiliated
third parties commenced an unsolicited offer to the Limited Partners in the
Partnership to purchase up to 15,402 Interests in the Partnership
(approximately 40% of the outstanding Interests) at a price of $80 per
Interest. This offer, which was originally scheduled to expire on June 9,
2000, was amended to increase the purchase price to $115 per Interest and
extend the offer period through June 16, 2000. The Special Committee
expressed no opinion and remained neutral with respect to the offer as
initially made and as amended by such amendment for those Limited Partners
<PAGE>
who had no current or anticipated need for liquidity with respect to their
Interests and who were willing to continue bearing the economic risk of
retaining their Interests until the liquidation and termination of the
Partnership. However, the Special Committee recommended that all other
Limited Partners accept the initial and amended offers and tender their
Interests pursuant to such offers. The offer was amended a second time to
decrease the offer price to $90 per Interest and extend the tender offer
period to June 30, 2000. The Special Committee's recommendation did not
change as a result of this second amendment to the tender offer. The
tender offer, as amended, expired on June 30, 2000. As of the date of this
report, the Partnership is aware that, in the aggregate, 28.51% of the
outstanding Interests have been purchased by such unaffiliated third
parties either pursuant to such tender offers or through negotiated
purchases. It is possible that other offers for Interests may be made by
unaffiliated third parties in the future. However, there is no assurance
that any other third party will commence an offer for Interests, the terms
of any such offer or whether any such offer for Interests, if made, will be
consummated, amended or withdrawn.
At September 30, 2000, the Partnership and its consolidated venture
had cash and cash equivalents of approximately $6,459,000. Such funds are
available for distributions to partners, the purchase of the venture
partner's interest in the Wachovia Venture, payment of withholding for
taxes upon disposal of the 301 North Main and Phillips Buildings, and
working capital requirements, including the payment of deferred fees as
discussed below. Due to the re-leasing issues, the 301 North Main Building
and Phillips Building are not expected to be a significant source of future
liquidity.
The Partnership made a distribution of cash flow from operations of
approximately $385,000 ($10 per interest) to the Limited Partners and
approximately $21,000 to the General Partners on August 31, 2000. In
connection with this distribution, the General Partners received an
incentive management fee of approximately $21,000.
The General Partners and their affiliates have deferred payment of
certain property management and leasing fees of approximately $1,645,000
(approximately $41 per interest) as of September 30, 2000 pursuant to the
venture agreement for the 301 North Main Building and Phillips Building.
Such amounts are deferred until the sale or disposition of the property or
upon the termination of the property management agreement and are expected
to be paid at that time.
The joint venture that owns the 301 North Main and Phillips Buildings
is currently marketing these properties for sale. As described in the
Notes, the joint venture has entered into a non-binding letter of intent
with an unaffiliated third party to sell the buildings. The Partnership
intends to wind up its affairs and terminate as soon as practicable after
the sale or other disposition of those properties. While this may occur in
the current year, it is also possible that it may not occur until 2001 or
even later, depending upon whether the joint venture is able to sell the
buildings or, if not, whether the lender is willing to acquire ownership of
the buildings after maturity of the mortgage loan in November 2001. There
is no assurance that the joint venture will be able to sell the buildings
or, if so, the amount of proceeds that may be obtained from such sale.
RESULTS OF OPERATIONS
Significant variances between periods are primarily due to the sale of
the Bristol Mall in February 1999.
The increase in prepaid expenses at September 30, 2000 as compared to
December 31, 1999 is primarily due to the timing of payment for insurance
at the 301 North Main and Phillips Buildings.
The increase in accrued real estate taxes at September 30, 2000 as
compared to December 31, 1999 is primarily due to the timing of the payment
of real estate taxes at the 301 North Main and Phillips Buildings.
<PAGE>
The decrease in rental income for the three months ended September 30,
2000 as compared to the same period in 1999 is primarily due to a decrease
in occupancy at the 301 North Main Building. The decrease in rental income
for the nine months ended September 30, 2000 as compared to the same period
in 1999 is primarily due to the sale of the Bristol Mall in February 1999
and the decrease in occupancy at the 301 North Main Building.
The decrease in interest income for the nine months ended
September 30, 2000 as compared to the same period in 1999 is primarily due
to the temporary investment of the proceeds from the sale of the Bristol
Mall prior to the distribution of such proceeds to the General and Limited
Partners in May 1999. The increase in interest income for the three months
ended September 30, 2000 as compared to the same period in 1999 is
primarily due to the temporary investment of operating cash flow from the
301 North Main and Phillips buildings. A portion of such funds were
distributed to the Limited Partners and General Partners on August 31,
2000.
The decrease in depreciation for the three and nine months ended
September 30, 2000 as compared to the same periods in 1999 is due to the
commencement of continued depreciation at the 301 North Main and Phillips
Buildings as a result of the Partnership no longer classifying this
property as held for sale or disposition as of July 1, 1999, and the
Partnership making an adjustment in the third quarter of 1999 to record the
depreciation expense as of June 30, 1999 that would have been recognized
had the 301 North Main and Phillips Buildings not been considered to be
held for sale or distribution.
The increase in management fees to Corporate General Partner for the
three and nine months ended September 30, 2000 as compared to the same
periods in 1999 is a result of the distribution of cash flow from
operations to the General Partners and the Limited Partners in August 2000.
This incentive management fee is based upon a percentage of the aggregate
distribution of cash flow from operations.
The increase in professional services for the three and nine months
ended September 30, 2000 as compared to the same periods in 1999 is
primarily due to legal fees incurred in 2000 related to the Partnership's
response to the unsolicited tender offer, discussed above, by certain
unaffiliated third parties to purchase Interests in the Partnership.
The increase in venture partner's share of venture's operations for
the three and nine months ended September 30, 2000 as compared to the same
period in 1999 is due to the distribution of substantially all excess cash
flow to the Partnership from the Wachovia venture in February 1999. Per
the amendment of the venture agreement, profits and losses are allocated to
the Partnership and the venture partner based on their proportional share
of distributions made or deemed to be made.
<PAGE>
<TABLE>
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
OCCUPANCY
The following is a listing of approximate occupancy levels by quarter for the Partnership's investment
properties owned during 2000:
<CAPTION>
1999 2000
-------------------------------------- ------------------------------
At At At At At At At At
3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31
---- ---- ---- ----- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
301 North Main Building and
Phillips Building
Winston-Salem,
North Carolina. . . . . . . . . . 49% 47% 46% 46% 45% 46% 46%
</TABLE>
<PAGE>
PART IV
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
3-A.* The Prospectus of the Partnership dated August 15,
1977, as supplemented September 20, 1977, filed with the Commission
pursuant to Rules 424(b) and 424(c), is hereby incorporated herein by
reference. Certain pages of the Prospectus are incorporated herein by
reference.
3-B.* Amended and Restated Agreement of Limited Partnership
set forth as Exhibit A to the Prospectus, which is incorporated herein by
reference and which agreement is hereby incorporated herein by reference.
27. Financial Data Schedule
--------------------
* Previously filed as Exhibits 3-A and 3-B, respectively, to the
Partnership's Report for December 31, 1992 on Form 10-K of the Securities
Exchange Act of 1934 (File No. 0-8716) filed on March 19, 1993 and hereby
incorporated herein by reference.
(b) No reports on Form 8-K were filed during the last quarter of
the period covered by this report.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
JMB INCOME PROPERTIES, LTD. - V
BY: JMB Realty Corporation
(Managing General Partner)
By: GAILEN J. HULL
Gailen J. Hull, Senior Vice President
Date: November 10, 2000
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person in the capacity
and on the date indicated.
By: GAILEN J. HULL
Gailen J. Hull, Principal Accounting Officer
Date: November 10, 2000
