FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Quarterly Transitional Report
(As last amended by 34-32231, eff. 6/3/93.)
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of The Securities
Exchange Act of 1934
For the quarterly period ended March 31, 1996
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period.........to.........
Commission file number 0-9242
CENTURY PROPERTIES FUND XIV
(Exact name of small business issuer as specified in its charter)
California 94-2535195
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Insignia Financial Plaza
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone number)
Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 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 .
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) CENTURY PROPERTIES FUND XIV
CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands, except unit data)
March 31, 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Assets
Cash and cash equivalents $ 8,746
Deferred costs, net 435
Other assets 938
Investment properties:
Real estate $ 33,066
Accumulated depreciation (15,133)
Allowance for impairment of value (883) 17,050
$ 27,169
Liabilities and Partners' Capital
Liabilities
Accrued expenses and other liabilities $ 1,416
Mortgage notes payable 19,963
Partners' Capital:
General partners $ 61
Limited partners (64,806 units issued and
outstanding) 5,729 5,790
$ 27,169
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
b) CENTURY PROPERTIES FUND XIV
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Revenues:
Rental income $ 1,863 $ 2,073
Other income 165 84
Gain on sale of properties 2,947 --
Total revenues 4,975 2,157
Expenses:
Operating 910 992
Mortgage interest 586 565
Depreciation 295 383
General and administrative expenses 132 75
Total expenses 1,923 2,015
Income before extraordinary loss 3,052 142
Extraordinary loss on extinguishment of
debt (315) --
Net income $ 2,737 $ 142
Net income allocated to general partners (2%) $ 55 $ 3
Net income allocated to limited partners (98%) 2,682 139
$ 2,737 $ 142
Net income per limited partnership unit:
Income before extraordinary loss $ 46.15 $ 2.14
Extraordinary loss on extinguishment of
debt (4.76) --
Net income per limited partnership unit $ 41.39 $ 2.14
Distributions per limited partnership unit $ 15.12 $ --
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
c) CENTURY PROPERTIES FUND XIV
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Limited
Partnership General Limited
Units Partners Partners Total
<S> <C> <C> <C> <C>
Original capital contributions 64,806 $ -- $ 64,806 $ 64,806
Partners' capital at
December 31, 1995 64,806 $ 26 $ 4,027 $ 4,053
Distributions to partners -- (20) (980) (1,000)
Net income for the three
months ended March 31, 1996 -- 55 2,682 2,737
Partners' capital at
March 31, 1996 64,806 $ 61 $ 5,729 $ 5,790
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
d) CENTURY PROPERTIES FUND XIV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income $ 2,737 $ 142
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation and amortization 329 429
Provision for doubtful receivables -- 5
Gain on sale of properties (2,947) --
Extraordinary loss on extinguishment of debt 315 --
Change in accounts:
Deferred costs (11) (18)
Other assets (33) 216
Accrued expenses and other liabilities 238 43
Net cash provided by operating activities 628 817
Cash flows from investing activities:
Property improvements and replacements (45) (376)
Proceeds from sale of properties 8,200 --
Net cash provided by (used in) investing
activities 8,155 (376)
Cash flows from financing activities:
Payments of mortgage notes payable (1,613) (55)
Distribution to partners (1,000) --
Net cash used in financing activities (2,613) (55)
Net increase in cash and cash equivalents 6,170 386
Cash and cash equivalents at beginning of period 2,576 714
Cash and cash equivalents at end of period $ 8,746 $ 1,100
Supplemental information:
Cash paid for interest $ 546 $ 526
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
e) CENTURY PROPERTIES FUND XIV
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note A - Basis of Presentation
The accompanying unaudited financial statements of Century Properties Fund XIV
(the "Partnership") have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the
opinion of the Managing General Partner, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three month period ended March 31, 1996,
are not necessarily indicative of the results that may be expected for the
fiscal year ending December 31, 1996. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Partnership's annual report on Form 10-K for the year ended December 31, 1995.
Certain reclassifications have been made to the 1995 information to conform to
the 1996 presentation.
Note B - Transactions with Affiliated Parties
The Partnership has no employees and is dependent on its general partners and
their affiliates for the management and administration of all partnership
activities. The Partnership Agreement provides for payments to affiliates for
services and as reimbursement of certain expenses incurred by affiliates on
behalf of the Partnership.
The following transactions with affiliates of Insignia Financial Group, Inc.
("Insignia"), National Property Investors, Inc. ("NPI"), and affiliates of NPI
were charged to expense in 1996 and 1995:
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Property management fees (included in operating
expenses) $ 62,000 $ 64,000
Reimbursement for services of affiliates (included
in general and administrative and operating expenses) 77,000 36,000
</TABLE>
For the period from January 19, 1996, to March 31, 1996, the Partnership insured
its properties under a master policy through an agency and insurer unaffiliated
with the Managing General Partner. An affiliate of the Managing General Partner
acquired, in the acquisition of a business, certain financial obligations from
an insurance agency which was later acquired by the agent who placed the current
year's master policy. The current agent assumed the financial obligations to
the affiliate of the Managing General Partner who received payments on these
obligations from the agent. The amount of the Partnership's insurance premiums
accruing to the benefit of the affiliate of the Managing General Partner by
virtue of the agent's obligations is not significant.
The general partners of the Partnership are Fox Realty Investors ("FRI"), a
California general partnership, and Fox Capital Management Corporation ("FCMC"),
a California Corporation.
On December 6, 1993, the shareholders of FCMC entered into a Voting Trust
Agreement with NPI Equity Investments II, Inc. ("NPI Equity" or the "Managing
General Partner") pursuant to which NPI Equity was granted the right to vote 100
percent of the outstanding stock of FCMC and NPI Equity became the managing
general partner of FRI. As a result, NPI Equity became responsible for the
operation and management of the business and affairs of the Partnership and the
other investment partnerships originally sponsored by FCMC and/or FRI. NPI
Equity is a wholly-owned subsidiary of NPI. The shareholders of FCMC and the
partners in FRI retain indirect economic interests in the Partnership and such
other investment limited partnerships, but have ceased to be responsible for the
operation and management of the Partnership and such other partnerships.
On August 17, 1995, the stockholders of NPI entered into an agreement to sell to
IFGP Corporation, a Delaware corporation, an affiliate of Insignia, a Delaware
corporation, all of the issued and outstanding common stock of NPI for an
aggregate purchase price of $1,000,000. The closing of the transactions
contemplated by the above mentioned agreement (the "Closing") occurred on
January 19, 1996.
Upon the Closing, the officers and directors of NPI and NPI Equity resigned and
IFGP Corporation caused new officers and directors of each of those entities to
be elected.
Note C - Disposition of Rental Properties
On March 7, 1996, the Partnership sold Broadway Trade Center, located in San
Antonio, Texas, to an unaffiliated third party for $3,825,000. After repayment
of the first, second, and third mortgages totaling $1,591,000 and closing
expenses of $244,000 the net proceeds received by the Partnership were
$1,990,000. As a result of the loans being paid in full, an extraordinary loss
representing the remaining unamortized mortgage discount of $315,000 was
recorded. For financial statement purposes, the sale resulted in a gain of
$1,531,000. The Partnership had previously recorded a $1,421,000 provision for
impairment of value for the property.
On February 12, 1996, the Partnership sold University Square, located in
Bozeman, Montana, to an unaffiliated third party for $4,850,000. After closing
expenses of $231,000, the net proceeds received by the Partnership were
$4,619,000. For financial statement purposes, the sale resulted in a gain of
$1,416,000.
On November 9, 1995, the Partnership sold Wingren Plaza, located in Dallas,
Texas, for $1,000,000. After closing expenses of $68,000, the net proceeds
received by the Partnership were $932,000. For financial statement purposes,
the sale resulted in a gain of $239,000. The Partnership had previously
recorded a $1,901,000 provision for impairment of value in 1991.
On October 6, 1995, the Partnership sold Duck Creek Shopping Center, located in
Garland, Texas, for $2,250,000. After closing expenses of $138,000, the net
proceeds received by the Partnership were $2,112,000. For financial statement
purposes, the sale resulted in a loss of $36,000.
On September 12, 1995, the Partnership sold Greenbriar Plaza Shopping Center,
located in Duncanville, Texas, for $1,050,000. After closing expenses of
$70,000, the net proceeds received by the Partnership were $980,000. For
financial statement purposes, the sale resulted in a loss of $556,000.
Note D - Subsequent Events
On April 26, 1996, the Partnership sold The Oaks Shopping Center, located in
Beaumont, Texas. The buyer of the property assumed the outstanding debt on the
property, and the Partnership received proceeds of $1,000.
Note E - Pro Forma Financial Information
The following pro forma consolidated balance sheet as of March 31, 1996, and the
pro forma consolidated statement of operations for the twelve months ended
December 31, 1995, and the three months ended March 31, 1996, give effect to the
sale of The Oaks Shopping Center. The adjustments related to the pro forma
consolidated balance sheet assume the transaction was consummated at March 31,
1996, while the adjustments to the pro forma consolidated income statements
assume the transaction was consummated at the beginning of the year presented.
The sale occurred on April 26, 1996.
The pro forma adjustments required are to eliminate the assets, liabilities and
operating activity of The Oaks Shopping Center and to reflect consideration
received for the property.
These pro forma adjustments are not necessarily reflective of the results that
actually would have occurred if the sale had been in effect as of and for the
period presented or what may be achieved in the future.
Note E - Pro Forma Financial Information (continued)
PRO FORMA CONSOLIDATED BALANCE SHEET
March 31, 1996
<TABLE>
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
<S> <C> <C> <C>
Assets
Cash and cash equivalents $ 8,746 $ 1 $ 8,747
Deferred costs, net 435 (70) 365
Other assets 938 (60) 878
Investment properties:
Real estate 33,066 (5,499) 27,567
Accumulated depreciation (15,133) 1,949 (13,184)
Allowance for impairment of value ( 883) 883 --
Real estate, net 17,050 (2,667) 14,383
$ 27,169 $ (2,796) $ 24,373
Liabilities and Partners' Equity
Liabilities
Accrued expenses and other liabilities $ 1,416 $ (715) $ 701
Mortgage notes payable 19,963 (2,164) 17,799
21,379 (2,879) 18,500
Partners' Capital 5,790 83 5,873
$ 27,169 $ (2,796) $ 24,373
</TABLE>
Note E - Pro Forma Financial Information (continued)
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Year Ended December 31, 1995
<TABLE>
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
<S> <C> <C> <C>
Revenues:
Rental $ 8,434 $ (519) $ 7,915
Other income 568 (330) 238
Gain on sale of properties 239 -- 239
Total revenues 9,241 (849) 8,392
Expenses:
Operating 4,359 (249) 4,110
Mortgage interest 2,230 (231) 1,999
Depreciation 1,546 (134) 1,412
General and administrative 308 -- 308
Loss on sale of properties 592 -- 592
Total expenses 9,035 (614) 8,421
Net income (loss) $ 206 $ (235) $ (29)
Net income (loss) per limited
partnership unit $ 2.22 $ (3.55) $ (1.33)
</TABLE>
Note E - Pro Forma Financial Information (continued)
PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 1996
<TABLE>
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
<S> <C> <C> <C>
Revenues:
Rental $ 1,863 $ (183) $ 1,680
Other income 165 (1) 164
Gain on sale of properties 2,947 -- 2,947
Total revenues 4,975 (184) 4,791
Expenses:
Operating 910 (63) 847
Mortgage interest 586 (57) 529
Depreciation 295 (34) 261
General and administrative 132 -- 132
Total expenses 1,923 (154) 1,769
Income before extraordinary loss 3,052 (30) 3,022
Extraordinary loss on extinguishment
of debt (315) -- (315)
Net income $ 2,737 $ (30) $ 2,707
Net income per limited partnership unit:
Net income before extraordinary loss $ 46.15 $ (.45) $ 45.70
Extraordinary loss on extinguishment
of debt (4.76) -- (4.76)
Net income per limited partnership unit $ 41.39 $ (.45) $ 40.94
</TABLE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's remaining investment properties consist of three residential
apartment complexes and one commercial property. The following table sets forth
the average occupancy of the properties for the three months ended March 31,
1996 and 1995:
Average
Occupancy
Property 1996 1995
Torrey Pines Village Apartments 94% 96%
Las Vegas, Nevada
St. Charleston Village Apartments 96% 95%
Las Vegas, Nevada
Gateway Park 94% 93%
Dublin, California
Sun River Apartments 98% 98%
Tempe, Arizona
The Partnership earned net income for the three months ended March 31, 1996, of
approximately $2,737,000 compared to $142,000 for the corresponding period of
1995. The increase in net income is attributable to the gain on the sale of the
Broadway Trade Center and the University Square Shopping Center properties.
Partially offsetting the gain from the sales of Broadway Trade and University
Square was a decrease in rental revenues due to the Partnership owning fewer
properties. The decreases in operating and depreciation expense can also be
attributed to the property sales in 1995 and 1996. The increase in other income
is due to an increase in interest income as a result of higher average cash
balances. General and administrative expenses increased due to an increase in
expense reimbursements related to costs associated with the operation of two
offices during the first quarter of 1996 and the relocation of partnership
administration during this same period. During the three months ended March 31,
1996, the Partnership incurred an extraordinary loss on extinguishment of the
Broadway Trade debt. The extraordinary loss represents the remaining
unamortized mortgage discount of the Broadway Trade debt at the time of its pay
off.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of its investment properties to
assess the feasibility of increasing rents, maintaining or increasing occupancy
levels and protecting the Partnership from increases in expense. As part of
this plan, the Managing General Partner attempts to protect the Partnership from
the burden of inflation-related increases in expenses by increasing rents and
maintaining a high overall occupancy level. However, due to changing market
conditions, which can result in the use of rental concessions and rental
reductions to offset softening market conditions, there is no guarantee that the
Managing General Partner will be able to sustain such a plan.
At March 31, 1996, the Partnership had unrestricted cash of $8,746,000 compared
to $1,100,000 at March 31, 1995. Net cash provided by operating activities
decreased primarily as a result of a decrease in rental revenues as a result of
the property sales in 1995 and 1996. Net cash provided by investing activities
increased due to proceeds from the sale of Broadway Trade Center and University
Square Shopping Center. Net cash used in financing activities increased due to
a distribution of proceeds from the sale of Wingren Plaza in January 1996. Also
contributing to the increase in cash used in financing activities was the
increase in payments of mortgage notes payable as result of the payoff of the
first, second, and third mortgages of Broadway Trade Center at the time of the
property's sale.
An affiliate of the Managing General partner has made available to the
Partnership a credit line of up to $150,000 per property owned by the
Partnership. The Partnership has no outstanding amounts due under this line of
credit. Based on present plans, the Managing General Partner does not
anticipate the need to borrow in the near future. Other than cash and cash
equivalents, the line of credit is the Partnership's only unused source of
liquidity.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Partnership. Such assets are currently
thought to be sufficient for any near-term needs of the Partnership. The
remaining mortgage indebtedness after the sale of The Oaks in April 1996 of
$17,799,000 matures at various times with balloon payments due at maturity at
which time the properties will either be refinanced or sold. Future cash
distributions will depend on the levels of cash generated from operations,
property sales, and the availability of cash reserves. On October 17, 1995, the
Partnership distributed $3,001,000 ($46.31 per unit) to the limited partners and
$61,000 to the general partners from the proceeds of the sale of the Greenbriar
Plaza Shopping Center and Duck Creek Shopping Center properties. On January 11,
1996, the Registrant distributed $980,000 ($15.12 per unit) to the limited
partners and $20,000 to the general partners from the proceeds received from the
sale of the Registrant's Wingren Plaza property. The Managing General Partner
plans to make a distribution during the second quarter of 1996. The
distribution will be from proceeds received from the sales of University Square
and Broadway Trade during the first quarter of 1996. At this time it appears
that the original investment objective of capital growth will not be attained
and that investors will not receive a return of all their invested capital.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibit 27, Financial Data Schedule, is filed as an exhibit to this
report.
b) Reports on Form 8-K: A Form 8-K dated January 19, 1996, was filed
reporting the change in control of the Registrant. A Form 8-K dated
February 12, 1996, was filed reporting the sale of University Square
Shopping Center.
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.
CENTURY PROPERTIES FUND XIV
By: FOX CAPITAL MANAGEMENT CORPORATION
A General Partner
By: /s/William H. Jarrard, Jr.
William H. Jarrard, Jr.
President and Director
By: /s/Ronald Uretta
Ronald Uretta
Principal Financial Officer
and Principal Accounting Officer
Date: May 15, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XIV 1996 First Quarter 10-QSB and is qualified in its entirety
by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000278128
<NAME> CENTURY PROPERTIES FUND XIV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 8,746
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 32,183
<DEPRECIATION> 15,133
<TOTAL-ASSETS> 27,169
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 19,963
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 5,790
<SALES> 27,169
<TOTAL-REVENUES> 4,975
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,923
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 586
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 3,052
<DISCONTINUED> 0
<EXTRAORDINARY> (315)
<CHANGES> 0
<NET-INCOME> 2,737
<EPS-PRIMARY> 41.39
<EPS-DILUTED> 0
<FN>
<F1>The Registrant has an unclassified balance sheet.
</FN>
</TABLE>
