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 period ended March 31, 1995
------------------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to_____________
Commission file number 0-9026
MCNEIL REAL ESTATE FUND IX, LTD.
--------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 94-2491437
--------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240
--------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (214) 448-5800
------------------------
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 and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
<PAGE>
MCNEIL REAL ESTATE FUND IX, LTD.
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
----------- ------------
<S> <C> <C>
ASSETS
Real estate investments:
Land..................................................... $ 6,716,099 $ 6,716,099
Buildings and improvements............................... 80,814,658 80,388,616
---------- ----------
87,530,757 87,104,715
Less: Accumulated depreciation.......................... (45,208,318) (44,274,163)
----------- -----------
42,322,439 42,830,552
Cash and cash equivalents................................... 3,927,468 4,199,844
Cash segregated for security deposits....................... 480,401 494,801
Accounts receivable......................................... 57,022 64,464
Prepaid expenses and other assets........................... 168,942 211,266
Escrow deposits............................................. 1,775,144 1,561,384
Deferred borrowing costs, net of accumulated amorti-
zation of $538,410 and $487,931 at March 31, 1995
and December 31, 1994, respectively...................... 2,337,101 2,387,580
---------- -----------
$51,068,517 $51,749,891
========== ==========
LIABILITIES AND PARTNERS' DEFICIT
Mortgage notes payable...................................... $51,936,945 $52,098,952
Accounts payable............................................ 133,035 413,894
Accrued property taxes...................................... 1,147,733 934,733
Accrued interest............................................ 375,662 303,521
Other accrued expenses...................................... 176,123 192,952
Payable to affiliates - General Partner..................... 219,344 308,131
Security deposits and deferred rental revenue............... 507,791 498,709
---------- ----------
54,496,633 54,750,892
---------- ----------
Partners' deficit:
Limited partners - 110,200 limited partnership units
authorized; 110,170 limited partnership units
outstanding............................................ (1,027,162) (561,005)
General Partner.......................................... (2,400,954) (2,439,996)
---------- ----------
(3,428,116) (3,001,001)
$51,068,517 $51,749,891
========== ==========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND IX, LTD.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-----------------------------
1995 1994
---------- ----------
<S> <C> <C>
Revenue:
Rental revenue................................... $4,678,641 $4,412,484
Interest......................................... 66,454 69,603
--------- ---------
Total revenue.................................. 4,745,095 4,482,087
--------- ---------
Expenses:
Interest......................................... 1,209,446 1,249,311
Depreciation..................................... 934,155 805,728
Property taxes................................... 355,635 337,569
Personnel expenses............................... 710,447 628,874
Repair and maintenance........................... 501,311 461,353
Property management
fees - affiliates.............................. 233,284 219,827
Utilities........................................ 440,898 486,326
Other property operating
expenses....................................... 312,697 282,605
General and administrative....................... 38,924 19,056
General and administrative - affiliates.......... 183,169 182,793
--------- ---------
Total expenses................................. 4,919,966 4,673,442
--------- ---------
Net loss............................................ $ (174,871) $ (191,355)
========= =========
Net loss allocated to limited partners.............. $ (466,157) $ (247,069)
Net income allocated to General Partner............. 291,286 55,714
--------- ---------
Net loss............................................ $ (174,871) $ (191,355)
========= =========
Net loss per limited partnership unit............... $ (4.23) $ (2.24)
========= =========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND IX, LTD.
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
(Unaudited)
For the Three Months Ended March 31, 1995 and 1994
<TABLE>
<CAPTION>
Total
Partners'
General Limited Equity
Partner Partners (Deficit)
------------ ---------- ------------
<S> <C> <C> <C>
Balance at December 31, 1993.............. $(2,094,331) $ 454,140 $(1,640,191)
Net income (loss)......................... 55,714 (247,069) (191,355)
Contingent Management Incentive
Distribution........................... (33,246 - (33,246)
---------- ---------- ----------
Balance at March 31, 1994................. $(2,071,863) $ 207,071 $(1,864,792)
========== ========== ==========
Balance at December 31, 1994.............. $(2,439,996) $ (561,005) $(3,001,001)
Net income (loss)......................... 291,286 (466,157) (174,871)
Contingent Management Incentive
Distribution........................... (252,244) - (252,244)
---------- ---------- ----------
Balance at March 31, 1995................. $(2,400,954) $(1,027,162) $(3,428,116)
========== ========== ==========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND IX, LTD.
STATEMENTS OF CASH FLOWS
(Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------------------
1995 1994
----------- ------------
<S> <C> <C>
Cash flows from operating activities:
Cash received from tenants........................ $ 4,697,131 $ 4,378,569
Cash paid to suppliers............................ (2,193,723) (1,539,015)
Cash paid to affiliates........................... (419,490) (397,719)
Interest received................................. 66,454 69,603
Interest paid..................................... (1,076,784) (1,270,201)
Property taxes paid and escrowed.................. (409,878) (442,001)
Deferred borrowing costs paid..................... - (7,498)
---------- ----------
Net cash provided by operating activities............ 663,710 791,738
---------- ----------
Cash flows from investing activities:
Additions to real estate investments.............. (426,042) (301,533)
---------- ----------
Cash flows from financing activities:
Principal payments on mortgage notes
payable......................................... (172,050) (209,884)
Contingent Management Incentive
Distribution.................................... (337,994) (96,000)
---------- ----------
Net cash used in financing activities................ (510,044) (305,884)
---------- ----------
Net increase (decrease) in cash and
cash equivalents.................................. (272,376) 184,321
Cash and cash equivalents at beginning of
period............................................ 4,199,844 5,754,907
---------- ----------
Cash and cash equivalents at end of period........... $ 3,927,468 $ 5,939,228
========== ==========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND IX, LTD.
STATEMENTS OF CASH FLOWS
(Unaudited)
Reconciliation of Net Loss to Net Cash Provided by
Operating Activities
<TABLE>
<CAPTION>
Three Months Ended
March 31,
---------------------------------
1995 1994
---------- ----------
<S> <C> <C>
Net loss............................................. $(174,871) $(191,355)
-------- --------
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation...................................... 934,155 805,728
Amortization of deferred borrowing costs.......... 50,479 50,513
Amortization of mortgage discounts................ 10,043 9,269
Changes in assets and liabilities:
Cash segregated for security deposits........... 14,400 (27,448)
Accounts receivable............................. 7,442 (502)
Prepaid expenses and other assets............... 42,324 26,525
Escrow deposits................................. (213,760) 240,072
Deferred borrowing costs........................ - (7,498)
Accounts payable................................ (280,859) 2,173
Accrued property taxes.......................... 213,000 17,791
Accrued interest................................ 72,141 (80,672)
Other accrued expenses.......................... (16,829) (74,962)
Payable to affiliates - General Partner......... (3,037) 4,901
Security deposits and deferred rental
revenue....................................... 9,082 17,203
-------- --------
Total adjustments............................. 838,581 983,093
-------- --------
Net cash provided by operating activities............ $ 663,710 $ 791,738
======== ========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND IX, LTD.
Notes to Financial Statements
(Unaudited)
March 31, 1995
NOTE 1.
- -------
McNeil Real Estate Fund IX, Ltd. (the "Partnership") is a limited partnership
organized under the laws of the State of California to invest in real property.
The general partner of the Partnership is McNeil Partners, L.P. (the "General
Partner"), a Delaware limited partnership affiliated with Robert A. McNeil
("McNeil"). The Partnership is governed by an amended and restated limited
partnership agreement ("Amended Partnership Agreement") that was adopted
September 20, 1991. The principal place of business for the Partnership and the
General Partner is 13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240.
In the opinion of management, the financial statements reflect all adjustments
necessary for a fair presentation of the Partnership's financial position and
results of operations. All adjustments were of a normal recurring nature.
However, the results of operations for the three months ended March 31, 1995 are
not necessarily indicative of the results to be expected for the year ending
December 31, 1995.
NOTE 2.
- -------
The financial statements should be read in conjunction with the financial
statements contained in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 1994, and the notes thereto, as filed with the
Securities and Exchange Commission, which is available upon request by writing
to McNeil Real Estate Fund IX, Ltd., c/o McNeil Real Estate Management, Inc.,
Investor Services, 13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240.
NOTE 3.
- -------
Certain prior period amounts within the accompanying financial statements have
been reclassified to conform with current year presentation.
NOTE 4.
- -------
The Partnership pays property management fees equal to 5% of the gross rental
receipts of the Partnership's properties to McNeil Real Estate Management, Inc.
("McREMI"), an affiliate of the General Partner, for providing property
management and leasing services for the Partnership's properties.
The Partnership reimburses McREMI for its costs, including overhead, of
administering the Partnership's affairs.
Under terms of the Amended Partnership Agreement, the Partnership is paying a
Management Incentive Distribution ("MID") to the General Partner. The maximum
MID is calculated as 1% of the tangible asset value of the Partnership. The
maximum MID percentage decreases subsequent to 1999. Tangible asset value is
determined by using the greater of (i) an amount calculated by applying a
capitalization rate of 9% to the annualized net operating income of each
property or (ii) a value of $10,000 per apartment unit to arrive at the
property tangible asset value. The property tangible asset value is then added
to the book value of all other assets excluding intangible items. Prior to
July 1, 1993, the MID consisted of two components: (i) the fixed portion
which was payable without respect to the net income of the Partnership and was
equal to 25% of the maximum MID (the "Fixed MID") and (ii) a contingent portion
which was payable only to the extent of the lesser of the Partnership's excess
cash flow, as defined, or net operating income (the "Entitlement Amount") and
is equal to up to 75% of the maximum MID (the "Contingent MID").
<PAGE>
Effective July 1, 1993, the General Partner amended the Amended Partnership
Agreement as a settlement to a class action complaint. This amendment eliminates
the Fixed MID and makes the entire MID payable to the extent of the Entitlement
Amount. In all other respects, the calculation and payment of the MID will
remain the same.
Fixed MID was payable in limited partnership units ("Units") unless the
Entitlement Amount exceeded the amount necessary to pay the Contingent MID, in
which case, at the General Partner's option, the Fixed MID was paid in cash to
the extent of such excess.
Contingent MID will be paid to the extent of the Entitlement Amount, and may be
paid (i) in cash, unless there is insufficient cash to pay the distribution in
which event any unpaid portion not taken in Units will be deferred and is
payable, without interest, from the first available cash and/or (ii) in Units. A
maximum of 50% of the MID may be paid in Units. The number of Units issued in
payment of the MID is based on the greater of $50 per Unit or the net tangible
asset value, as defined, per Unit.
Any amount of the MID that is paid to the General Partner in Units will be
treated as if cash was distributed to the General Partner and then
contributed to the Partnership by the General Partner. The Fixed MID was
treated as a fee payable to the General Partner by the Partnership for services
rendered. The Contingent MID represents a return of equity to the General
Partner for increasing cash flow, as defined, and accordingly is treated as a
distribution.
Compensation, reimbursements and distributions paid to or accrued for the
benefit of the General Partner and its affiliates are as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------------------
1995 1994
--------- --------
<S> <C> <C>
Charged to other assets:
Property management fees - affiliates............. $233,284 $219,827
Charged to general and administrative -
affiliates:
Partnership administration...................... 183,169 182,793
------- -------
$416,453 $402,620
======= =======
Charged to General Partner's deficit:
Contingent Management Incentive
Distribution.................................... $252,244 $ 33,246
======= =======
</TABLE>
NOTE 5.
- -------
The Partnership filed claims with the United States Bankruptcy Court for the
Northern District of Texas, Dallas Division (the "Bankruptcy Court") against
Southmark for damages relating to improper overcharges, breach of contract and
breach of fiduciary duty. The Partnership settled these claims in 1991, and such
settlement was approved by the Bankruptcy Court.
An Order Granting Motion to Distribute Funds to Class 8 Claimants dated April
14, 1995 was issued by the Bankruptcy Court. In accordance with the Order, in
May 1995, the Partnership received in full satisfaction of its claims, $53,573
in cash, and common and preferred stock in the reorganized Southmark currently
valued at approximately $17,335, which amounts represent the Partnership's
pro-rata share of Southmark assets available for Class 8 Claimants.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
- ------- -----------------------------------------------------------
AND RESULTS OF OPERATIONS
-------------------------
The Partnership was formed to acquire, operate and ultimately dispose of a
portfolio of income-producing real properties. At March 31, 1995, the
Partnership owned fourteen apartment properties. All but one of the
Partnership's properties are subject to mortgage notes.
RESULTS OF OPERATIONS
- ---------------------
Revenue:
Rental revenue for the three months ended March 31, 1995 increased $266,157 or
6.0% compared to the same period of 1994. Rental revenues increased at thirteen
of the Partnership's fourteen properties. The Partnership raised base rental
rates an average of 3.7% at all of its properties. Increases in base rental
rates were partially offset by lower average occupancy rates at Berkley Hills,
Cherry Hills, Forest Park Village, Heather Square, Meridian West, Pennbrook
Place, Ruskin Place, and Westgate. Average occupancy rates at the remainder of
the properties increased or remained the same. Rental revenue decreased 1.6% at
Meridian West Apartments due to large layoffs at the area's primary employer,
Boeing, and a generally flat economy.
Interest revenue decreased 5% for the three months ended March 31, 1995
compared to the same period last year due to a decrease in cash balances
invested in interest-bearing accounts.
Expenses:
Partnership expenses increased $246,524 or 5.3% for the first quarter of 1995
compared to the first quarter of 1994. Expenses increased at thirteen of the
Partnership's fourteen properties. The increased expenses were concentrated in
depreciation, personnel expenses and other property operating expenses.
Depreciation expense increased $128,427 or 15.9% for the first quarter of 1995
compared to first quarter of 1994. The increase is due to the $4.4 million of
capital improvements placed in service at the Partnership's properties since
March 31, 1994. These improvements generally are being depreciated over lives
ranging from five to ten years.
Personnel expenses increased $81,573 or 13.0% for the first quarter of 1995
compared to the first quarter of 1994. This increase was due to an increase in
compensation paid to on-site personnel at all of the properties.
Other property operating expenses increased $30,092 or 10.6% for the first
quarter of 1995 compared to the first quarter of 1994. The increase is due to
additional insurance coverage required at the five properties with mortgages
that were refinanced on June 24, 1993, through the Real Estate Mortgage
Investment Conduit.
General and administrative expenses doubled during the first quarter of 1995.
Fees paid for audit services were significantly higher for the first quarter of
1995 compared to the first quarter of 1994.
All other expense items decreased a total of 2.2% for the first quarter of
1995 compared to the first quarter of 1994.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Partnership reported a loss of $174,871 for the first quarter of 1995, an
improvement of $16,484 from the loss recorded for the first quarter of 1994.
Cash generated by operations remained positive, due to large non-cash expenses,
principally depreciation. However, cash generated by operations decreased
$128,028 to $663,710, principally due to increases in cash paid to suppliers.
The large increase in cash paid to suppliers was partially offset by increased
receipts from tenants and decreased expenditures for interest.
<PAGE>
The Partnership continues to invest significant resources into capital
improvements at its properties. During the first quarter, capital improvement
expenditures increased $124,509 or 41% compared to the year earlier quarter. The
Partnership has budgeted an additional $1.7 million of capital improvement
expenditures for the balance of 1995.
The Partnership also increased its expenditures in the financing area.
Management Incentive Distributions ("MID") incurred by the Partnership were
higher as improved operating results increased the entitlement amount, the
trigger for the payment of MID. Increased MID distributions were partially
offset by a decrease in the scheduled principal payments on the Partnership's
mortgage notes.
Short Term Liquidity:
Due to the refinancing transactions of 1994 and 1993, the Partnership began 1995
with adequate cash reserves. These reserves will be needed to address continuing
capital improvement needs in light of aging condition of the Partnership's
properties. The Partnership has budgeted $2.1 million for capital improvements
for 1995 in addition to the $9.9 million of capital improvements made during the
past three years. The General Partner believes these capital improvements are
necessary to allow the Partnership to increase its rental revenues in the
competitive markets in which the Partnership's properties operate. These
expenditures also allow the Partnership to reduce certain repair and
maintenance expenses from amounts that would otherwise be incurred.
At March 31, 1995, the Partnership held $3,927,468 of cash and cash equivalents,
down $272,376 from the balance at end of 1994. The General Partner anticipates
that cash generated from operations for the remainder of 1995 will be sufficient
to fund the Partnership's budgeted capital improvements and to repay the current
portion of the Partnership's mortgage notes. However, 1995 cash flow from
operations likely will not be adequate to pay the MID due to the General
Partner. The Partnership will use its cash reserves to pay the MID. The General
Partner considers the Partnership's cash reserves adequate for anticipated
operations for the remainder of 1995.
Long Term Liquidity:
For the long term, property operations will remain the primary source of funds.
In this regard, the General Partner expects that the $9.9 million of capital
improvements made by the Partnership during the past three years will yield
improved cash flow from operations in 1995. Furthermore, the General Partner has
budgeted an additional $2.1 million of capital improvements for 1995. If the
Partnership's cash position deteriorates, the General Partner may elect to defer
certain of the capital improvements, except where such improvements are expected
to increase the competitiveness or marketability of the Partnership's
properties.
The General Partner has established a revolving credit facility, not to exceed
$5,000,000 in the aggregate, which will be available on a "first-come,
first-served" basis to the Partnership and other affiliated partnerships if
certain conditions are met. Borrowings under the facility may be used to fund
deferred maintenance, refinancing obligations and working capital needs. There
is no assurance that the Partnership will receive additional funds from the
facility because no amount will be reserved for any particular partnership. As
of March 31, 1995, $2,102,530 remained available from the facility; however,
additional funds could become available as other partnerships repay borrowings.
As an additional source of liquidity, the General Partner may, from time to
time, attempt to sell Partnership properties judged to be mature considering the
circumstances of the market in which the properties are located, as well as the
Partnership's need for liquidity. However, there can be no guarantee that the
Partnership will be able to sell any of its properties for an amount sufficient
to retire the related mortgage note and still provide cash proceeds to the
Partnership, or that such proceeds could be timed to coincide with the liquidity
needs of the Partnership. Currently, no Partnership properties are being
marketed for sale.
<PAGE>
Distributions:
With the exception of the MID, distributions to partners have been suspended
since 1986 as part of the General Partner's policy of maintaining adequate
cash reserves. Distributions to Unit holders will remain suspended for the
foreseeable future. The General Partner will continue to monitor the cash
reserves and working capital needs of the Partnership to determine when cash
flows will support distributions to the Unit holders. MID for the first quarter
for 1995 amounted to $252,244.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
- ------- -----------------
The Partnership is not a party to, nor are any of the Partnership's properties
the subject of, any material pending legal proceedings, other than ordinary
litigation routine to the Partnership's business.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
<TABLE>
<CAPTION>
(a) Exhibits.
Exhibit
Number Description
<S> <C>
4. Amended and Restated Partnership Agreement, dated
November 12, 1991. (Incorporated by reference to the
Quarterly Report on Form 10-Q for the quarter ended
March 31, 1991).
11. Statement regarding computation of net loss per
limited partnership unit: Net loss per limited
partnership unit is computed by dividing net loss
allocated to the limited partners by the number of
limited partnership units outstanding. Per unit
information has been computed based on 110,170
limited partnership units outstanding in 1995 and
1994.
27. Financial Data Schedule for the year ended December
31, 1994 and quarter ended March 31, 1995.
</TABLE>
(b) Reports on Form 8-K. There were no reports on Form 8-K filed during the
quarter ended March 31, 1995.
<PAGE>
McNEIL REAL ESTATE FUND IX, LTD.
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:
<TABLE>
<CAPTION>
McNEIL REAL ESTATE FUND IX, Ltd.
By: McNeil Partners, L.P., General Partner
By: McNeil Investors, Inc., General Partner
<S> <C>
May 12, 1995 By: /s/ Donald K. Reed
- --------------------------- -------------------------------------------------
Date Donald K. Reed
President and Chief Executive Officer
May 12, 1995 By: /s/ Robert C. Irvine
- --------------------------- -------------------------------------------------
Date Robert C. Irvine
Chief Financial Officer of McNeil Investors, Inc.
Principal Financial Officer
May 12, 1995 By: /s/ Brandon K. Flaming
- --------------------------- -------------------------------------------------
Date Brandon K. Flaming
Chief Accounting Officer of McNeil Real Estate
Management, Inc.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1994 DEC-31-1995
<PERIOD-END> DEC-31-1994 MAR-31-1995
<CASH> 4,199,844 3,927,468
<SECURITIES> 0 0
<RECEIVABLES> 64,464 57,022
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 87,104,715 87,530,757
<DEPRECIATION> (44,274,163) (45,208,318)
<TOTAL-ASSETS> 51,749,891 51,068,517
<CURRENT-LIABILITIES> 0 0
<BONDS> 52,098,952 51,936,945
<COMMON> 0 0
0 0
0 0
<OTHER-SE> (3,001,001) (3,428,116)
<TOTAL-LIABILITY-AND-EQUITY> 51,749,891 51,068,517
<SALES> 18,202,306 4,678,641
<TOTAL-REVENUES> 18,642,220 4,745,095
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 14,145,459 3,710,520
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 4,884,548 1,209,446
<INCOME-PRETAX> (387,787) (174,871)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (387,787) (174,871)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (387,787) (174,871)
<EPS-PRIMARY> 0 0
<EPS-DILUTED> 0 0
</TABLE>
