UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 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 0-9242
CENTURY PROPERTIES FUND XIV
(Exact name of Registrant as specified in its charter)
CALIFORNIA 94-2535195
------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
One Insignia Plaza, P.O. Box 1089
Greenville, South Carolina 29602
- ---------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (864) 239-1000
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Limited Partnership Units
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 ____
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ X ]
No market for the Limited Partnership Units exists and therefore a
market value for such Units cannot be readily determined.
DOCUMENTS INCORPORATED HEREIN BY REFERENCE:
Prospectus of Registrant dated June 25, 1979, and thereafter
supplemented incorporated in Parts I and IV.
CENTURY PROPERTIES FUND XIV
(A limited partnership)
PART I
Item 1. Business.
Century Properties Fund XIV (the "Registrant") was organized in 1978 as
a California limited partnership under the Uniform Limited Partnership Act of
the California Corporations Code. Fox Capital Management Corporation (the
"Managing General Partner"), a California corporation, and Fox Realty Investors
("FRI"), a California general partnership, are the general partners of the
Registrant.
The Registrant's Registration Statement, filed pursuant to the
Securities Act of 1933 (No. 2-63368), was declared effective by the Securities
and Exchange Commission on June 25, 1979. The Registrant marketed its securities
pursuant to its Prospectus dated June 25, 1979, and thereafter supplemented
(hereinafter the "Prospectus"). This Prospectus was filed with the Securities
and Exchange Commission pursuant to Rule 424(b) of the Securities Act of 1933.
The principal business of the Registrant is and has been to acquire,
hold for investment and ultimately sell income-producing real property. The
Registrant is a "closed" limited partnership real estate syndicate of the
unspecified asset type. For a further description of the business of the
Registrant, see the sections entitled "Risk Factors" and "Investment Objectives
and Policies" of the Prospectus filed pursuant to Rule 424(b) under the
Securities Act of 1933.
From June 1979 through December 1979, the Registrant offered and sold
$64,806,000 in Limited Partnership Units. The net proceeds of this offering were
used to purchase nineteen income-producing real properties, or interests
therein. The Registrant's original property portfolio was geographically
diversified with properties acquired in seven states. Two of these properties
were originally owned by joint ventures in which the Registrant had interests of
50.1 percent and 50 percent. In 1983, the Registrant acquired the joint venture
partner's 49.9 percent interest in one of these properties. In 1988, the
Registrant was assigned the joint venture partner's 50 percent interest in the
other property upon dissolution of the joint venture. In the period from 1985
through 1993, six apartment buildings, two shopping centers and one office
building have been sold or otherwise disposed of. The Registrant sold three of
its properties in 1995 and two properties in the first quarter of 1996 (see
"Property Matters"). Subsequent to the completion of the acquisition activities
in January 1981, the principal activity of the Registrant has been managing its
portfolio. See, "Item 2, Properties" for a description of the Registrant's
properties.
The Registrant is involved in only one industry segment, as described
above. The business of the Registrant is not seasonal. The Registrant does not
engage in any foreign operations or derive revenues from foreign sources.
Both the income and the expenses of operating the properties owned by
the Registrant are subject to factors outside the Registrant's control, such as
oversupply of similar rental facilities resulting from overbuilding, increases
in unemployment or population shifts, changes in zoning laws or changes in
patterns of needs of the users. Expenses such as local real estate taxes are
subject to change and cannot always be reflected in rental increases due to
market conditions or existing leases. The profitability and marketability of
developed real property may be adversely affected by changes in general and
local economic conditions and in prevailing interest rates, and favorable
changes in such factors will not necessarily enhance the profitability or
marketability of such property. Even under the most favorable market conditions
there is no guarantee that any property still owned by the Registrant can be
sold or, if sold, that such sale can be made upon favorable terms.
It is possible that legislation on the state or local level may be
enacted in the states where the Registrant's properties are located which may
include some form of rent control. There have been, and it is possible there may
be other, Federal, state and local legislation and regulations enacted relating
to the protection of the environment. The Managing General Partner is unable to
predict the extent, if any, to which such new legislation or regulations might
occur and the degree to which such existing or new legislation or regulations
might adversely affect the properties still owned by the Registrant.
The Registrant monitors its properties for evidence of pollutants,
toxins and other dangerous substances, including the presence of asbestos. In
certain cases environmental testing has been performed, which resulted in no
material adverse conditions or liabilities. In no case has the Registrant
received notice that it is a potentially responsible party with respect to an
environmental clean up site.
The Registrant maintains property and liability insurance on the
properties and believes such coverage to be adequate.
At this time it appears that the original investment objective of
capital growth from the inception of the Registrant will not be attained and
that investors will not receive a return of all their invested capital. The
extent to which invested capital is returned to investors is dependent upon the
success of the general partners' strategy as set forth in "Item 7" as well as
upon significant improvement in the performance of the Registrant's remaining
properties and the markets in which such properties are located and on the sales
price of the remaining properties. In this regard, some or all of the remaining
properties have been held longer than originally expected. The ability to hold
and operate these properties is dependent on the Registrant's ability to obtain
financing, refinancing or debt modification as required.
Property Matters
Wingren Plaza - On November 9, 1995 the Registrant sold its Wingren
Plaza property to an unaffiliated third party for $1,000,000. Net proceeds from
the sale were approximately $932,000. The Registrant recognized a $239,000 gain
on the sale of this property.
Duck Creek Shopping Center - On September 15, 1994, the Registrant
satisfied the loan encumbering Duck Creek Shopping Center in the amount of
$1,684,000.
On October 6, 1995, the Registrant sold its Duck Creek Shopping Center
property to an unaffiliated third party for $2,250,000. After closing expenses
of $138,000, net proceeds received by the Registrant were approximately
$2,112,000. The sale resulted in a loss for financial statement purposes of
$36,000.
Greenbriar Plaza - On September 12, 1995, the Registrant sold its
Greenbriar Plaza Shopping Center property to an unaffiliated third party for
$1,050,000. After closing expenses of $70,000, net proceeds received by the
Registrant were $980,000. For financial statement purposes, the sale resulted in
a loss of $556,000.
University Square - In April 1995, the Registrant received $250,000 as
a settlement with the City of Bozeman in connection with a right of way
agreement pertaining to the condemnation of part of the property at the
Registrant's University Square Shopping Center property. The condemnation will
enable the City of Bozeman and the State of Montana to undertake substantial
road improvements. In connection with the settlement, the Registrant acquired an
additional parcel of land. As a result of the condemnation, the Registrant was
required to construct new access roads to the property and move its shopping
center sign at a cost of approximately $100,000. See "Subsequent Events" for
information with respect to the sale of this property.
St. Charleston Village Apartments - On July 5, 1994, the Registrant
paid down $6,000 of the existing mortgage encumbering this property and
refinanced the remaining $6,300,000 balance with a new first mortgage loan in
such amount. The new loan requires monthly principal and interest payments of
approximately $55,000, bears interest at 9.88% per annum, is being amortized
over 30 years and matures on July 1, 2001. As required by the lender, the
Registrant established a repair reserve in the amount of $85,000 to ensure
payment of all expenses incurred in connection with the completion of certain
required renovations. In addition, the Registrant was required to establish a
replacement reserve in the amount of $52,000 and is required to make monthly
payments of $4,000 to this reserve. In connection with this refinancing, the
lender required that the property be placed in a single-asset entity.
Accordingly, the Registrant transferred ownership of this property to Century
St. Charleston, Limited Partnership, a wholly-owned subsidiary of the
Registrant. See "Item 8, Consolidated Financial Statements and Supplementary
Data, Note 4."
Sun River Apartments - On July 5, 1994, the Registrant paid down
$1,914,000 of the existing mortgage encumbering this property and refinanced the
remaining $6,368,000 balance with a new first mortgage loan in such amount. The
new loan requires monthly principal and interest payments of approximately
$55,000, bears interest at 9.88% per annum, is being amortized over 30 years and
matures on July 1, 2001. As required by the lender, the Registrant established a
repair reserve in the amount of $193,000 to ensure payment of all expenses
incurred in connection with the completion of certain required renovations. In
addition, the Registrant was required to establish a replacement reserve in the
amount of $67,000 and is required to make monthly payments of $6,000 to this
reserve. In connection with this refinancing, the lender required that the
property be placed in a single-asset entity. Accordingly, the Registrant
transferred ownership of this property to Century Sun River, Limited
Partnership, a wholly-owned subsidiary of the Registrant. See "Item 8,
Consolidated Financial Statements and Supplementary Data, Note 4."
Torrey Pines Village Apartments - On July 5, 1994, the Registrant paid
down $189,000 of the existing mortgage encumbering this property and refinanced
the remaining $3,750,000 balance with a new first mortgage loan in such amount.
The new loan requires monthly principal and interest payments of approximately
$33,000, bears interest at 9.88% per annum, is being amortized over 30 years and
matures on July 1, 2001. As required by the lender, the Registrant established a
repair reserve in the amount of $94,000 to ensure payment of all expenses
incurred in connection with the completion of certain required renovations. In
addition, the Registrant was required to establish a replacement reserve in the
amount of $34,000 and is required to make monthly payments of $3,000 to this
reserve. In connection with this refinancing, the lender required that the
property be placed in a single-asset entity. Accordingly, the Registrant
transferred ownership of this property to Century Torrey Pines, Limited
Partnership, a wholly-owned subsidiary of the Registrant. See "Item 8,
Consolidated Financial Statements and Supplementary Data, Note 4."
Subsequent Events
University Square Shopping Center - The Registrant sold its University
Square Shopping Center property on February 12, 1996 for $4,850,000. Net
proceeds to the Registrant after satisfaction of closing costs and closing
adjustments were approximately $4,775,000. The sale resulted in a gain of
approximately $1,500,000 for financial statement purposes.
Broadway Trade Center - On March 7, 1996, the Registrant sold its
Broadway Trade Center property for $3,825,000. Net proceeds to the Registrant
after satisfaction of closing costs and closing adjustments were approximately
$1,900,000. The sale resulted in a gain of approximately $1,250,000 for
financial statement purposes.
Employees
Services are performed for the Registrant at its apartment complexes by
on-site personnel all of whom are employees of NPI-AP Management, L.P.
("NPI-AP"), an affiliate of the Managing General Partner, which directly manages
the Registrant's apartment complexes. All payroll and associated expenses of
such on-site personnel are fully reimbursed by the Registrant to NPI-AP.
Pursuant to a management agreement, NPI-AP provides certain property management
services to the Registrant in addition to providing on-site management. With
respect to the Registrant's commercial properties, management is performed by
unaffiliated third party management companies pursuant to management agreements
with such third parties.
Change in Control
From March 1988 through December 1993, the Registrant's affairs were
managed by Metric Management, Inc. ("MMI") or a predecessor. On December
16, 1993, the services agreement with MMI was modified and, as a result thereof,
the Managing General Partner began directly providing real estate advisory and
asset management services to the Registrant. As advisor, such affiliate provides
all partnership accounting and administrative services, investment management,
and supervisory services over property management and leasing.
On December 6, 1993, the shareholders of the Managing General Partner
entered into a Voting Trust Agreement with NPI Equity Investments II, Inc. ("NPI
Equity II") pursuant to which NPI Equity II was granted the right to vote 100%
of the outstanding stock of the Managing General Partner. In addition, NPI
Equity II became the managing partner of FRI. As a result, NPI Equity II
indirectly became responsible for the operation and management of the business
and affairs of the Registrant and the other investment partnerships originally
sponsored by the Managing General Partner and/or FRI. The individuals who had
served previously as partners of FRI and as officers and directors of the
Managing General Partner contributed their general partnership interests in FRI
to a newly formed limited partnership, Portfolio Realty Associates, L.P.
("PRA"), in exchange for limited partnership interests in PRA. The shareholders
of the Managing General Partner and the prior partners of FRI, in their capacity
as limited partners of PRA, continue to hold indirectly certain economic
interests in the Registrant and such other investment limited partnerships, but
have ceased to be responsible for the operation and management of the Registrant
and such other partnerships.
On August 10, 1994, an affiliate of Apollo Real Estate Advisors, L.P.
("Apollo") obtained general and limited partnership interests in NPI-AP.
On October 12, 1994, Apollo acquired one-third of the stock of National
Property Investors, Inc. ("NPI"), the parent corporation of NPI Equity II.
Pursuant to the terms of the stock acquisition, Apollo was entitled to designate
three of the seven directors of the Managing General Partner and NPI Equity II.
In addition, the approval of certain major actions on behalf of the Registrant
required the affirmative vote of at least five directors of the Managing General
Partner.
On August 17, 1995, the stockholders of NPI entered into an agreement
to sell to IFGP Corporation, a Delaware corporation, an affiliate of Insignia
Financial Group, Inc., a Delaware corporation ("Insignia"), all of the issued
and outstanding common stock of NPI, for an aggregate purchase price of
$1,000,000. NPI is the sole shareholder of NPI Equity II, the general partner of
FRI, and the entity which controls the Managing General Partner. 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, NPI Equity II and
the Managing General Partner resigned and IFGP Corporation caused new officers
and directors of each of those entities to be elected. See "Item 10, Directors
and Executive Officers of the Registrant."
The Tender Offer
On October 12, 1994, affiliates of Apollo acquired (i) one-third of the
stock of the respective general partners of DeForest Ventures I L.P. ("DeForest
I") and DeForest Ventures II L.P. and (ii) an additional equity interest in
NPI-AP (bringing its total equity interest in such entity to one-third). NPI-AP
is a limited partner of DeForest I which was formed for the purpose of making
tender offers for limited partnership units in the Registrant as well as eleven
affiliated limited partnerships.
On January 19, 1996, DeForest I and certain of its affiliates sold all
of its interest in the Registrant to Riverside Drive L.L.C. ("Riverside"), an
affiliate of Insignia. Pursuant to a Schedule 13-D filed by Riverside with the
Securities and Exchange Commission, Riverside acquired 26,615.0543 limited
partnership units or approximately 41% of the total limited partnership units of
the Registrant for an aggregate purchase price of $6,204,700. (See "Item 12,
Security Ownership of Certain Beneficial Owners and Management.")
Competition
The Registrant is affected by and subject to the general competitive
conditions of the residential, office and commercial real estate rental
industries. Many of the Registrant's properties which are or were located in oil
industry dependent and other weakened markets have been adversely affected by
unfavorable economic conditions in these markets. In addition, each of the
Registrant's properties competes in an area which normally contains numerous
other real properties which may be considered competitive.
Item 2. Properties.
A description of the properties in which the Registrant has an
ownership interest is as follows. The Registrant owns all of its remaining
properties in fee:
Date of
Name and Location Purchase Type Size
- ----------------- -------- --------- ---------
Torrey Pines Village Apartments 09/79 Apartment 204 units
1200 S. Torrey Pines Building
Las Vegas, Nevada
St. Charleston Village 09/79 Apartment 312 units
Apartments Building
6501 W. Charleston Boulevard
Las Vegas, Nevada
Sun River Apartments 11/80 Apartment 334 units
505 W. Baseline Road Building
Tempe, Arizona
University Square Shopping(1) 12/79 Shopping 127,000
Center Center sq. ft.
23rd Avenue and Babcock Street
Bozeman, Montana
The Oaks Shopping Center 09/80 Shopping 82,000
SWC Phelan Boulevard and Center sq. ft.
Dowlen Road
Beaumont, Texas
Date of
Name and Location Purchase Type Size
- ----------------- -------- ---------- ------
Gateway Park 10/80 Industrial 33,000
6401 Golden Gate Park Park sq. ft.
Dublin, California
Broadway Trade Center (2) 01/81 Industrial 121,000
SWC Broadway and Boardwalk Park sq. ft.
San Antonio, Texas
- --------------------
(1) Property was sold in February 1996.
(2) Property was sold in March 1996
See, "Item 8 Consolidated Financial Statements and Supplementary Data"
for information regarding any encumbrances to which the properties of the
Registrant are subject.
The following chart sets forth the average occupancy at the
Registrant's remaining properties for the years ended December 31, 1995, 1994,
1993, 1992 and 1991:
OCCUPANCY SUMMARY
Average
Occupancy Rate (%)
for the Year Ended
December 31,
---------------------------------
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
Torrey Pines Village Apartments 96 95 92 92 93
St. Charleston Village Apartments 96 97 92 91 93
Gateway Park 89 90 86 87 94
The Oaks Shopping Center 74 89 96 93 88
Sun River Apartments 99 97 94 92 92
SIGNIFICANT TENANTS (1)
December 31, 1995
<TABLE>
<CAPTION>
Annualized
Square Nature of Expiration Base Rent Renewal
Footage Business of Lease Per Year(2) Options(3)
------- ------------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C>
The Oaks Shopping Center
World's Gym 25,560 Grocery Store 2005 $92,549 2-5 Yr
Walgreens 11,500 Drug Store 2014 $51,750 -
Gateway Park
Gallucci
Enterprises 3,680 Auto Repair 1997 $37,424 -
Lewis Navarro 3,960 Auto Repair 1997 $27,576 -
Smithkline 7,845 Medical Lab 1996 $85,623 -
Office
</TABLE>
------------------
(1) Tenant occupying 10% or more of total rentable square footage of
property.
(2) Represents annualized base rent excluding additional rent due as
operating expense reimbursements, percentage rents and future
contractual escalations.
(3) The first amount represents the number of renewal options. The second
amount represents the length of each option.
Item 3. Legal Proceedings.
Lawrence M. Whiteside, on behalf of himself and all others
similarly situated, v. Fox Capital Management Corporation et, al., Superior
Court of the State of California, San Mateo County, Case No. 390018.
("Whiteside")
Bonnie L. Ruben and Sidney Finkel, on behalf of themselves and all
others similarly situated, v. DeForest Ventures I L.P., DeForest Capital I
Corporation, MRI Business Properties Fund, Ltd. II, MRI Business Properties
Fund, Ltd. III, NPI Equity Investments II, Inc., Montgomery Realty Company-84,
MRI Associates, Ltd. II, Montgomery Realty Company-85 and MRI Associates, Ltd.
III, United States District Court, Northern District of Georgia, Atlanta
Division("Ruben").
Roger L. Vernon, individually and on behalf of all similarly situated
persons v. DeForest Ventures I L.P. et. al., Circuit Court of Cook County,
County Departments, Chancery Division, Case No. 94CH0100592. ("Vernon")
James Andrews, et al., on behalf of themselves and all others similarly
situated v. Fox Capital Management Corporation, et al., United States District
Court, Northern District of Georgia, Atlanta Division, Case No.
1-94-CV-3351-JEC. ("Andrews")
In the fourth quarter of fiscal 1994, limited partners in certain
limited partnerships affiliated with the Registrant, commenced actions against,
among others, the Managing General Partner. The actions alleged, among other
things, that the tender offers made by DeForest Ventures I L.P. ("DeForest I")
and DeForest Ventures II L.P. ("DeForest II") in October 1994 constituted (a) a
breach of the fiduciary duty owed by the Managing General Partner to the limited
partners of the Registrant, and (b) a breach of, and an inducement to breach,
the provisions of the Partnership Agreement of the Registrant. The actions,
which had been brought as class actions on behalf of limited partners sought
monetary damages in an unspecified amount and, in the Whiteside action, to
enjoin the tender offers. The temporary restraining order sought in the
Whiteside action was denied by the court on November 3, 1994, and on November
18, 1994, the court denied Whiteside a preliminary injunction.
On March 16, 1995, the United States Court for the Northern District
of Georgia, Atlanta, Division, entered an order which granted preliminary
approval to a settlement agreement (the "Settlement Agreement") in the Ruben and
Andrews actions, conditionally certified two classes for purpose of settlement,
and authorized the parties to give notice to the classes of the terms of the
proposed settlement. Plaintiffs counsel in the Vernon and Whiteside action
joined in the Settlement Agreement as well. The Settlement Agreement received
final approval on May 19, 1995 and the actions were dismissed subject to
satisfaction of the terms of the Settlement Agreement. The two certified classes
constituted all limited partners of the Registrant and the eighteen other
affiliated partnerships who either tendered their units in connection with the
October tender offers or continued to hold their units in the Registrant and the
other affiliated partnerships. Pursuant to the terms of the Settlement
Agreement, which were described in the notice sent to the class members in March
1995, (and more fully described in the Amended Stipulation of Settlement
submitted in the court on March 14, 1995) all claims which either were made or
could have been asserted in any of the class actions would be dismissed with
prejudice and/or released. In consideration for the dismissal and/or release of
such claims, among other things, DeForest I paid to each unit holder who
tendered their units in the Registrant an amount equal to 15% of the original
tender offer price less attorney's fees and expenses. In addition, DeForest I
commenced a second tender offer on June 2, 1995 for an aggregate number of units
of the Registrant (including the units purchased in the initial tender)
constituting up to 49% of the total number of units of the Registrant at a price
equal to the initial tender price plus 15% less attorney's fees and expenses.
Furthermore, under the terms of the Settlement Agreement, the Managing General
Partner agreed, among other things, to provide the Registrant a credit line of
$150,000 per property which would bear interest at the lesser of the prime rate
plus 1% and the rate permitted under the partnership agreement of the
Registrant. The second tender offer closed on June 30, 1995.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of security holders during the period
covered by this Report.
PART II
Item 5. Market for the Registrant's Equity and Related Security
Holder Matters.
The Limited Partnership Unit holders are entitled to certain
distributions as provided in the Partnership Agreement. Cash distributions to
unit holders through March 1, 1996, have ranged from $335 to $358 for each
$1,000 of original investment. No market for Limited Partnership Units exists,
nor is any expected to develop.
As of March 1, 1996, the approximate number of holders of Limited
Partnership Units was 3,707.
The Registrant made no cash distributions during the year ended
December 31, 1994. On October 17, 1995, the Registrant 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 Registrant's 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.
Item 6. Selected Financial Data.
The following represents selected financial data for the Registrant for
the years ended December 31, 1995, 1994, 1993, 1992 and 1991. The data should be
read in conjunction with the Consolidated Financial Statements included
elsewhere herein. This data is not covered by the independent auditors' report.
For the Year Ended December 31,
------------------------------------------------
1995 1994 1993 1992 1991
-------- --------- -------- -------- -------
(Amounts in thousands except per unit data)
TOTAL REVENUES $ 9,241 $ 8,219 $ 11,530 $ 9,060 $11,071
======== ========= ======== ======== =======
NET INCOME (LOSS) $ 206 $ (969) $ 2,054 $ (4,520) $(2,662)
======== ========= ======== ======== =======
NET INCOME (LOSS) PER LIMITED
PARTNERSHIP UNIT(1) $ 2.22 $ (14.66) $ 29.04 $ (68.36) $(45.84)
======== ========= ======== ======== =======
TOTAL ASSETS $ 26,485 $ 29,675 $ 34,661 $ 40,483 $45,473
======== ========= ======== ======== =======
LONG-TERM OBLIGATIONS:
Notes Payable $ 21,254 $ 21,480 $ 25,516 $ 32,800 $33,227
======== ========= ======== ======== =======
CASH DISTRIBUTIONS PER
LIMITED PARTNERSHIP UNIT $ 46.31 - - - -
========= ========= ======== ======== =======
(1) $1,000 original contribution per unit, based on weighted average units
outstanding during the year after giving effect to net income (loss)
allocated to the general partners.
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
Liquidity and Capital Resources
As of March 8, 1996, the Registrant's real estate properties consist of
two commercial properties located in California and in Texas and three
residential apartment complexes located in Nevada and Arizona. The properties
are leased to tenants subject to leases with original lease terms ranging from
six months to one year for residential properties and with remaining lease terms
of up to nineteen years for commercial properties. The Registrant receives
rental income from its properties and is responsible for operating expenses,
administrative expenses, capital improvements and debt service payments. As of
March 8, 1996, fourteen of the nineteen properties originally purchased by the
Registrant were sold or otherwise disposed. The Registrant is currently
marketing selected properties for sale.
The Registrant's St. Charleston Village, Torrey Pines Village and The
Oaks properties experienced negative cash flow for the year ended December 31,
1995, due to significant capital improvements. The remaining properties
generated positive cash flow for the year ended December 31, 1995. As described
in "Item 8 - Consolidated Financial Statements and Supplemental Data, Note 6",
the Registrant sold Wingren Plaza, Duck Creek Shopping Center and Greenbriar
Shopping Center during 1995. The aggregate sales price for these properties was
$4,300,000. After aggregate closing costs of $276,000, net proceeds received by
the Registrant were $4,024,000. In April 1995, the Registrant reached a
settlement with the City of Bozeman in the amount of $250,000 in connection with
a right of way agreement pertaining to the condemnation of part of the property
at the Registrant's University Square Shopping Center property. The condemnation
will enable the City of Bozeman and the State of Montana to undertake
substantial road improvements. An additional parcel of land was acquired in the
settlement which will enable development of an out parcel with separate access
to the shopping center. The Registrant was required to construct new access
roads to the property and to move its shopping center sign at a cost of
approximately $100,000. In May 1995, the Registrant accepted $330,000 as a
release of the assignor's guarantee from a vacating tenant at the Registrant's
The Oaks Shopping Center property. In July 1995, the vacant space was re-leased
for a ten year period, commencing November 1, 1995, at similar terms and
conditions as the previous tenant.
On February 12, 1996, the Registrant sold its University Square
Shopping Center property to an unaffiliated third party for $4,850,000. After
closing expenses of approximately $75,000, the Registrant received net proceeds
of approximately $4,775,000. For financial statement purposes, the Registrant
will recognize a gain on sale of property of approximately $1,500,000 during the
first quarter of 1996.
On March 7, 1996, the Registrant sold its Broadway Trade Center
property to an unaffiliated third party for $3,825,000. After repayment of the
first, second and third mortgages totaling approximately $1,640,000 and closing
expenses of $285,000, the Registrant received net proceeds of approximately
$1,900,000. For financial statement purposes, the Registrant will recognize a
gain on sale of property of approximately $1,250,000 during the first quarter of
1996.
The Registrant uses working capital reserves provided from any
undistributed cash flow from operations and sales proceeds as its primary source
of liquidity. For the long term, cash from operations and sales proceeds will
remain the Registrant's primary source of liquidity. In order to preserve
working capital reserves required for necessary capital improvements to
properties and to provide resources for potential refinancing of properties with
balloon payments (with maturity dates beginning in 1996), cash distributions
from operations remained suspended during 1995 as they were in prior years. On
October 17, 1995, however, the Registrant 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 Registrant's Greenbriar Plaza 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 primarily from the proceeds received from the sale of the Registrant's
Wingren Plaza property. The Registrant will distribute substantially all the
proceeds from the sale of University Square Shopping Center and Broadway Trade
Center.
The level of liquidity based upon cash and cash equivalents improved by
$1,862,000 at December 31, 1995, as compared to 1994. The Registrant's
$2,907,000 of cash provided by investing activities and $2,276,000 of cash
provided by operating activities was partially offset by $3,321,000 of cash used
in financing activities. Cash provided by investing activities resulted from net
proceeds received from the sale of the Registrant's Greenbriar Plaza, Duck Creek
and Wingren Plaza shopping center properties, which was partially offset by
$1,117,000 of improvements to real estate, primarily at the Registrant's St.
Charleston Village and Torrey Pines Village apartment properties. The capital
improvement program began in 1994 and was completed during the fourth quarter of
1995. The project was funded by cash flow from operations and established
replacement reserves and working capital reserves. Cash used in financing
activities consisted of $3,062,000 of cash distributions to partners from the
proceeds received from the sale of Greenbriar Plaza and Duck Creek shopping
center properties and $259,000 in notes payable principal payments. All other
increases (decreases) in certain assets and liabilities are the result of the
timing of receipt and payment of various operating activities.
Working capital reserves are invested in a money market account or in
repurchase agreements secured by United States Treasury obligations. The
Managing General Partner believes that, if market conditions remain relatively
stable, cash flow from operations, when combined with working capital reserves,
will be sufficient to fund required capital improvements and regular debt
service payments until May 1996, when balloon payments (including deferred
interest) of $2,841,000 are due on the Registrant's The Oaks Shopping Center
property. The Registrant will attempt to extend the due date of the loans or
find replacement financing. Although the Managing General Partner is confident
that the loans can be refinanced, if the loans are not refinanced or extended,
or the property is not sold, the Registrant could lose this property through
foreclosure. If the property is lost through foreclosure, the Registrant would
not recognize a loss for financial reporting purposes.
As required by the terms of the settlement of the actions brought
against, among others, DeForest Ventures I L.P. ("DeForest I") relating to the
tender offer made by DeForest I in October 1994 (the "First Tender Offer") for
units of limited partnership interest in the Registrant and certain affiliated
partnerships, DeForest I commenced a second tender offer (the "Second Tender
Offer") on June 2, 1995, for units of limited partnership interest in the
Registrant. Pursuant to the Second Tender Offer, DeForest I acquired an
additional 2,188 units of the Registrant which, when added to the units acquired
during the First Tender Offer, represented approximately 41% of the total number
of outstanding units of the Registrant. Also in connection with the settlement,
an affiliate of the Managing General Partner has made available to the
Registrant a credit line of up to $150,000 per property owned by the Registrant.
The Registrant 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 Registrant's only unused source of liquidity.
On January 19, 1996, the stockholders of NPI, the sole shareholder of
NPI Equity II, sold to IFGP Corporation all of the issued and outstanding stock
of NPI. In addition, an affiliate of Insignia purchased the limited partnership
units held by DeForest I and certain of its affiliates. IFGP Corporation caused
new officers and directors of NPI Equity II and the Managing General Partner to
be elected. The Managing General Partner does not believe these transactions
will have a significant effect on the Registrant's liquidity or results of
operations. See "Item 1 Business-Change in Control".
At this time it appears that the original investment objective of
capital growth from the inception of the Registration will not be attained and
that investors will not receive a return of all their invested capital. The
extent to which invested capital is returned to investors is dependent upon the
performance of the Registrant's remaining properties and the markets in which
such properties are located and on the sales price of the remaining properties.
In this regard, some or all of the remaining properties have been held longer
than originally expected. The ability to hold and operate these properties is
dependent on the Registrant's ability to obtain financing, refinancing or debt
modification as required.
Real Estate Market
The business in which the Registrant is engaged is highly competitive,
and the Registrant is not a significant factor in its industry. Each investment
property is located in or near a major urban area and, accordingly, competes for
rentals not only with similar properties in its immediate area but with hundreds
of similar properties throughout the urban area. Such competition is primarily
on the basis of location, rents, services and amenities. In addition, the
Registrant competes with significant numbers of individuals and organizations
(including similar partnerships, real estate investment trusts and financial
institutions) with respect to the sale of improved real properties, primarily on
the basis of the prices and terms of such transactions.
Results of Operations
1995 Compared to 1994
Operating results improved by $1,175,000 for the year ended December
31, 1995, as compared to 1994, due to an increase in revenues of $1,022,000 and
a decrease in expenses of $153,000. Operating results improved primarily due to
improved operations at the Registrant's properties, which was offset by the
aggregate net loss on the sale of the Registrant's Greenbriar Plaza Shopping
Center, Duck Creek Shopping Center and Wingren Plaza properties.
With respect to the remaining properties, rental revenues increased by
$568,000 primarily due to an increase in rental rates at the Registrant's St.
Charleston Village Apartments, Torrey Pines Village Apartments, Broadway Trade
Center and University Square Shopping Center properties which were slightly
offset by a decrease in rental rates at the the Registrant's Gateway Park
property. Although physical occupancy at the Registrant's The Oaks Shopping
Center property decreased, the Registrant was able to maintain rental revenue
for the period due to the amortization of the payment received, pursuant to the
release of the assignor's guarantee, from a vacating tenant as rental income
until such time that the space was re-leased. In July 1995, the vacant space was
re-leased for a ten year period, commencing November 1, 1995, at similar terms
and conditions as the previous tenant. Occupancy remained relatively constant at
the Registrant's other properties. In addition, interest and other income
increased by $422,000 due to net proceeds received from a right of way
settlement involving the Registrant's University Square Shopping Center property
and the balance of the proceeds received for the release of the assignor's
guarantee from a vacating tenant at the Registrant's The Oaks Shopping Center
property, which was partially offset by a decrease of $45,000 in interest income
due to a decrease in average working capital reserves available for investment.
With respect to the remaining properties, expenses decreased due to
decreases in operating expense of $242,000 and interest expense of $126,000,
which were slightly offset by an increase in depreciation expense of $25,000.
Operating expenses decreased primarily due to decreased repairs and maintenance
costs at the Registrant's St. Charleston and Sun River Apartments properties.
Interest expense declined due to the write-off of deferred refinancing costs in
the prior year in connection with the refinancing of the mortgages encumbering
the Registrant's St. Charleston Village, Sun River and Torrey Pines Village
Apartments properties and mortgage principal amortization. Depreciation expense
increased primarily due to the effect of fixed asset additions at the
Registrant's St. Charleston Village Apartments and Torrey Pines Village
Apartments properties. In addition, general and administrative expenses
decreased by $154,000 due to a reduction in asset management costs, effective
July 1, 1994.
1994 Compared to 1993
Operating results declined by $3,023,000 for the year ended December
31, 1994, as compared to 1993, due to the disposition of the Registrant's
Cedarwood Apartments, Market Place and Village Square Shopping Center properties
during 1993. With respect to the remaining properties, operating results
declined by $376,000 for the year ended December 31, 1994, as compared to 1993.
With respect to the remaining properties, revenues increased due to an
increase in rental revenue of $483,000 primarily due to increases in occupancy
and rental rates at the Registrant's St. Charleston Village, Sun River and
Torrey Pines Village Apartments residential complexes and an increase in
occupancy at Broadway Trade Center, which were partially offset by a decline in
occupancy at The Oaks Shopping Center. Rental revenue remained relatively
constant at all of the Registrant's other properties. In addition, interest and
other income decreased by $16,000 due to a decline in average working capital
reserves available for investment.
With respect to the remaining properties, expenses increased due to
increases in operating expenses of $987,000 and depreciation expense of $98,000,
which were partially offset by a decrease in interest expense of $31,000.
Operating expenses increased due to significant repair and maintenance expenses
incurred in connection with the refinancing of mortgages encumbering St.
Charleston Village, Sun River and Torrey Pines Village Apartments. Depreciation
expense increased due to the effect of fixed asset additions. Interest expense
declined primarily due to mortgage principal amortization, the paydown of the
Sun River Apartments mortgage and the pay-off of the Duck Creek Shopping Center
mortgage, which were partially offset by interest rate increases on the
mortgages encumbering the Registrant's St. Charleston Village, Torrey Pines
Village and Sun River Apartments properties. In addition, general and
administrative expenses decreased by $211,000 primarily due to the reduction in
asset management costs, effective July 1, 1994.
Item 8. Consolidated Financial Statements and Supplementary Data.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 1995
INDEX
<TABLE>
<CAPTION>
Page
-----
<S> <C>
Independent Auditors' Reports............................................................................................ F - 2
Consolidated Financial Statements:
Balance Sheets at December 31, 1995 and 1994........................................................................ F - 4
Statements of Operations for the Years Ended December 31, 1995, 1994 and 1993....................................... F - 5
Statements of Partners' Equity for the Years Ended
December 31, 1995, 1994 and 1993................................................................................. F - 6
Statements of Cash Flows for the Years Ended December 31, 1995, 1994 and 1993....................................... F - 7
Notes to Consolidated Financial Statements.......................................................................... F - 8
Financial Statement Schedule:
Schedule III - Real Estate and Accumulated Depreciation at December 31, 1995................................. F - 21
</TABLE>
Financial statements and financial statement schedules not included have been
omitted because of the absence of conditions under which they are required or
because the information is included elsewhere in the consolidated financial
statements.
To the Partners
Century Properties Fund XIV
Greenville, South Carolina
Independent Auditors' Report
We have audited the accompanying consolidated balance sheets of Century
Properties Fund XIV (a limited partnership) (the "Partnership") and its
subsidiaries as of December 31, 1995 and 1994, and the related consolidated
statements of operations, partners' equity and cash flows for the years then
ended. Our audits also included the additional information supplied pursuant to
Item 14(a)(2). These consolidated financial statements are the responsibility of
the Partnership's management. Our responsibility is to express an opinion on
these consolidated financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
consolidated financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Century Properties
Fund XIV and its subsidiaries as of December 31, 1995 and 1994, and the results
of its operations and its cash flows for the years then ended in conformity with
generally accepted accounting principles. Also in our opinion, the related
financial statement schedule, when considered in relation to the basic
consolidated financial statements taken as a whole, presents fairly, in all
material respects, the information set forth therein.
Imowitz Koenig & Co., LLP
Certified Public Accountants
New York, N.Y.
February 12, 1996, except for Notes 10 and 11, which are dated March 7, 1996
INDEPENDENT AUDITORS' REPORT
Century Properties Fund XIV:
We have audited the accompanying statements of operations, partners' equity and
cash flows of Century Properties Fund XIV (a limited partnership) (the
"Partnership") for the year ended December 31, 1993. These financial statements
are the responsibility of the Partnership's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the results of operations and cash flows of the Partnership for the
year ended December 31, 1993 in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
San Francisco, California
March 18, 1994
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------------
1995 1994
------------- -------------
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 2,576,000 $ 714,000
Other assets 905,000 1,136,000
Real Estate:
Real estate 43,879,000 53,142,000
Accumulated depreciation (19,115,000) (21,751,000)
Allowance for impairment of value (2,304,000) (4,205,000)
------------- -------------
Real estate, net 22,460,000 27,186,000
Deferred costs, net 544,000 639,000
------------- -------------
Total assets $ 26,485,000 $ 29,675,000
============= =============
LIABILITIES AND PARTNERS' EQUITY
Notes payable $ 21,254,000 $ 21,480,000
Deferred interest, accrued expenses and other liabilities 1,178,000 1,286,000
------------- -------------
Total liabilities 22,432,000 22,766,000
------------- -------------
Contingencies
Partners' Equity:
General partners 26,000 25,000
Limited partners (64,806 units outstanding at
December 31, 1995 and 1994) 4,027,000 6,884,000
------------- -------------
Total partners' equity 4,053,000 6,909,000
------------- -------------
Total liabilities and partners' equity $ 26,485,000 $ 29,675,000
============= =============
</TABLE>
See notes to consolidated financial statements.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------------
1995 1994 1993
------------ ------------ -------------
<S> <C> <C> <C>
Revenues:
Rental $ 8,434,000 $ 8,073,000 $ 8,643,000
Interest and other income 568,000 146,000 162,000
Gain on sale of properties 239,000 - 2,725,000
------------ ------------ ------------
Total revenues 9,241,000 8,219,000 11,530,000
------------ ------------ ------------
Expenses (including $637,000 and $373,000 paid to
the general partners and affiliates in 1995 and 1994):
Operating 4,359,000 4,651,000 4,162,000
Interest 2,230,000 2,504,000 2,973,000
Depreciation 1,546,000 1,571,000 1,625,000
General and administrative 308,000 462,000 673,000
Loss on sale of properties 592,000 - 43,000
------------ ------------ ------------
Total expenses 9,035,000 9,188,000 9,476,000
------------ ------------ ------------
Net income (loss) $ 206,000 $ (969,000) $ 2,054,000
============ ============ ============
Net income (loss) per limited partnership unit $ 2.22 $ (14.66) $ 29.04
============ ============ ============
Distributions per limited partnership unit $ 46.31 $ - $ -
============ ============ ============
</TABLE>
See notes to consolidated financial statements.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
CONSOLIDATED STATEMENTS OF PARTNERS' EQUITY
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
General
partners' Limited Total
(deficit) partners' partners'
equity equity equity
----------- ----------- -----------
Balance - January 1, 1993 $ (128,000) $ 5,952,000 $ 5,824,000
Net income 172,000 1,882,000 2,054,000
----------- ----------- -----------
Balance - December 31, 1993 44,000 7,834,000 7,878,000
Net loss (19,000) (950,000) (969,000)
----------- ----------- -----------
Balance - December 31, 1994 25,000 6,884,000 6,909,000
Net income 62,000 144,000 206,000
Cash distributions (61,000) (3,001,000) (3,062,000)
----------- ----------- -----------
Balance - December 31, 1995 $ 26,000 $ 4,027,000 $ 4,053,000
=========== =========== ===========
See notes to consolidated financial statements.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------------
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 206,000 $ (969,000) $ 2,054,000
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation and amortization 1,744,000 1,871,000 1,850,000
Gain on sale of properties (239,000) - (2,725,000)
Loss on sale of properties 592,000 - 43,000
Provision for doubtful receivables 10,000 - 107,000
Deferred costs paid (150,000) (547,000) (177,000)
Changes in operating assets and liabilities:
Other assets 221,000 (564,000) 6,000
Deferred interest, accrued expenses and other liabilities (108,000) 19,000 (63,000)
----------- ----------- -----------
Net cash provided by (used in) operating activities 2,276,000 (190,000) 1,095,000
----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Net proceeds from sale of properties 4,024,000 - 6,419,000
Additions to real estate (1,117,000) (795,000) (411,000)
Proceeds from note receivable - 50,000 -
----------- ----------- -----------
Net cash provided by (used in) investing activities 2,907,000 (745,000) 6,008,000
----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Distribution to partners (3,062,000) - -
Satisfaction of notes payable - (20,211,000) (3,330,000)
Notes payable proceeds - 16,418,000 -
Notes payable principal payments (259,000) (275,000) (408,000)
----------- ----------- -----------
Net cash (used in) financing activities (3,321,000) (4,068,000) (3,738,000)
----------- ----------- -----------
Increase (Decrease) in Cash and Cash Equivalents 1,862,000 (5,003,000) 3,365,000
Cash and Cash Equivalents at Beginning of Year 714,000 5,717,000 2,352,000
----------- ----------- -----------
Cash and Cash Equivalents at End of Year $ 2,576,000 $ 714,000 $ 5,717,000
=========== =========== ===========
Supplemental Disclosure of Cash Flow Information:
Interest paid in cash during the year $ 2,073,000 $ 2,200,000 $ 2,790,000
=========== =========== ===========
Supplemental Disclosure of Non-cash Investing
and Financing Activities:
Disposition of rental properties in 1995 and 1993, See Note 6.
</TABLE>
See notes to consolidated financial statements.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
Century Properties Fund XIV (the "Partnership") is a limited
partnership organized under the laws of the State of California to
acquire, hold for investment and ultimately sell income-producing real
estate. The Partnership currently owns two commercial properties
located in Texas and California and three residential apartment
complexes located in Nevada and Arizona. The general partners are Fox
Realty Investors ("FRI"), a California general partnership, and Fox
Capital Management Corporation ("FCMC"), a California Corporation. The
original capital contributions of $64,806,000 ($1,000 per unit) were
made by the limited partners, including 100 limited partnership units
purchased by FCMC.
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 National Property Investors, Inc. ("NPI,
Inc."). 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.
In October 1994 DeForest Ventures I L.P. ("DeForest I") made a tender
offer for limited partnership interests in the partnership, as well as
eleven affiliated limited partnerships. DeForest Ventures II, L.P.
("DeForest II") made tender offers for limited partnership interests in
seven affiliated limited partnerships. Shareholders who controlled
DeForest Capital I Corporation, the sole general partner of DeForest I,
also controlled NPI, Inc. As of December 31, 1995, DeForest I had
acquired approximately 41% of total limited partnership units of the
Partnership (see Note 10).
On January 19, 1996, the stockholders of NPI, Inc. sold all of
the issued and outstanding stock of NPI, Inc. to an affiliate of
Insignia Financial Group, Inc. ("Insignia"). In addition, an
affiliate of Insignia acquired the limited partnership interests of
the Partnership held by DeForest I and certain of its affiliates (see
Note 10).
Consolidation
The consolidated financial statements include the statements of the
Partnership and its wholly-owned subsidiaries formed in 1994 (see Note
4). All significant intercompany transactions and balances have been
eliminated.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from
those estimates.
Distributions
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 Partnership's Greenbriar Plaza Shopping
Center and Duck Creek Shopping Center properties (see Note 6). On
January 11, 1996, the Partnership 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 Partnership's Wingren Plaza
property.
Fair Value of Financial Instruments
In 1995, the Partnership implemented Statement of Financial Accounting
Standards ("SFAS") No. 107, "Disclosures about Fair Value of Financial
Instruments," as amended by SFAS No. 119, "Disclosures about Derivative
Financial Instruments and Fair Value of Financial Instruments," which
requires disclosure of fair value information about financial
instruments, whether or not recognized in the balance sheet, for which
it is practicable to estimate fair value. Fair value is defined in the
SFAS as the amount at which the instrument could be exchanged in a
current transaction between willing parties, other than in a forced or
liquidation sale. The Partnership believes that the carrying amount of
its financial instruments (except for long term debt) approximates fair
value due to the short term maturity of these instruments. The fair
value of the Partnership's long term debt, after discounting the
scheduled loan payments to maturity, approximates its carrying balance.
Cash and Cash Equivalents
The Partnership considers all highly liquid investments with an
original maturity of three months or less at the time of purchase to be
cash equivalents.
Concentration of Credit Risk
The Partnership maintains cash balances at institutions insured up to
$100,000 by the Federal Deposit Insurance Corporation. Balances in
excess of $100,000 are usually invested in repurchase agreements, which
are collateralized by United States Treasury obligations. Cash balances
exceeded these insured levels during the year. At December 31, 1995,
the Partnership had approximately $2,200,000 invested in overnight
repurchase agreements, secured by United States Treasury obligations,
which are included in cash and cash equivalents.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Real Estate
Real estate is stated at cost. Acquisition fees are capitalized as a
cost of real estate. In 1995, the Partnership adopted SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of ", which requires impairment losses to be
recognized for long-lived assets used in operations when indicators of
impairment are present and the undiscounted cash flows are not
sufficient to recover the asset's carrying amount. The impairment loss
is measured by comparing the fair value of the asset to its carrying
amount. The adoption of the SFAS had no effect on the Partnership's
financial statements.
Depreciation
Depreciation is computed by the straight-line method over estimated
useful lives ranging from 27.5 to 39 years for buildings and
improvements and six to seven years for furnishings.
Deferred Costs
Deferred costs represent deferred financing costs and deferred leasing
commissions. Deferred financing costs are amortized as interest expense
over the lives of the related loans, or expensed, if financing is not
obtained. Deferred leasing commissions are amortized over the life of
the applicable lease. Such amortization is charged to operating
expenses. At December 31, 1995 and 1994, accumulated amortization of
deferred costs totaled $245,000 and $336,000, respectively.
Net Income (Loss) Per Limited Partnership Unit
The net income (loss) per limited partnership unit is computed by
dividing net income (loss) allocated to the limited partners by 64,806
units outstanding.
Income Taxes
Taxable income or loss of the Partnership is reported in the income tax
returns of its partners. Accordingly, no provision for income taxes is
made in the financial statements of the Partnership.
2. TRANSACTIONS WITH THE GENERAL PARTNERS AND AFFILIATES
In accordance with the Partnership Agreement, the Partnership may be
charged by the general partners and affiliates for services provided to
the Partnership. From March 1988 to December 1992 such amounts were
assigned pursuant to a services agreement by the general partners and
affiliates to Metric Realty Services, L.P. ("MRS"), which performed
partnership management and other services for the Partnership.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
2. TRANSACTIONS WITH THE GENERAL PARTNERS AND AFFILIATES (Continued)
On January 1, 1993, Metric Management, Inc., ("MMI"), successor to MRS,
a company which is not affiliated with the general partners, commenced
providing certain property and portfolio management services to the
Partnership under a new services agreement. As provided in the new
services agreement, effective January 1, 1993, no reimbursements were
made to the general partners and affiliates after December 31, 1992.
Subsequent to December 31, 1992, reimbursements were made to MMI. On
December 16, 1993, the services agreement with MMI was modified and, as
a result thereof, NPI Equity began directly providing cash management
and other Partnership services on various dates commencing December 23,
1993. On March 1, 1994, an affiliate of NPI Equity commenced providing
certain property management services (see Notes 1 and 10). Related
party expenses for the years ended December 31, 1995, 1994 and 1993
were as follows:
1995 1994 1993
--------- --------- -------
Property management fees $ 262,000 $ 204,000 $ -
Real estate tax reduction fees 5,000 4,000 -
Reimbursement of expenses:
Partnership accounting and
investor services 186,000 153,000 -
Professional services - 12,000 -
--------- --------- -------
Total $ 453,000 $ 373,000 $ -
========= ========= =======
Property management fees and real estate tax reduction fees are
included in operating expenses. Reimbursed expenses are primarily
included in general and administrative expenses. In addition,
approximately $184,000 of insurance premiums which were paid to an
affiliate of NPI Inc., under a master insurance policy arranged by such
affiliate, are included in operating expenses for the year ended
December 31, 1995.
In accordance with the partnership agreement, the general partners were
allocated their two percent continuing interest in the Partnership's
net income (loss) and taxable income (loss). Gains from dispositions of
Partnership properties were allocated first to the general partners to
the extent of the deficit in their capital accounts at the time of the
dispositions, then two percent of the remainder.
On January 11, 1996, the general partners received a distribution of
$20,000, representing the general partners two percent interest in cash
available for distribution, which was primarily from the proceeds
received on the sale of the Partnership's Wingren Plaza property (see
Note 6). On October 17, 1995, the general partners received a
distribution of $61,000, representing the general partners two percent
interest in cash available for distribution which was primarily from
the proceeds received on the sale of the Partnership's Greenbriar Plaza
Shopping Center and Duck Creek Shopping Center properties. There were
no cash distributions to the general partners for the years ended
December 31, 1994 and 1993.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
3. REAL ESTATE
Real estate, at December 31, 1995 and 1994, is summarized as follows:
<TABLE>
<CAPTION>
Residential Commercial
Properties Properties Total
----------- ---------- -----
<S> <C> <C> <C>
1995:
Land $ 2,288,000 $ 3,436,000 $ 5,724,000
Buildings and improvements 20,258,000 14,589,000 34,847,000
Furnishings 3,180,000 128,000 3,308,000
------------ ------------ ------------
Total 25,726,000 18,153,000 43,879,000
Accumulated depreciation (12,334,000) (6,781,000) (19,115,000)
Allowance for impairment of value - (2,304,000) (2,304,000)
------------ ------------ ------------
Real estate, net $ 13,392,000 $ 9,068,000 $ 22,460,000
============ ============ ============
1994:
Land $ 2,288,000 $ 4,893,000 $ 7,181,000
Buildings and improvements 19,403,000 23,201,000 42,604,000
Furnishings 3,130,000 227,000 3,357,000
------------ ------------ ------------
Total 24,821,000 28,321,000 53,142,000
Accumulated depreciation (11,505,000) (10,246,000) (21,751,000)
Allowance for impairment of value - (4,205,000) (4,205,000)
------------ ------------ ------------
Real estate, net $ 13,316,000 $ 13,870,000 $ 27,186,000
============ ============ ============
</TABLE>
Subsequent to the balance sheet date, the Partnership sold its
University Square Shopping Center and Broadway Trade Center properties
(see Note 10).
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
4. NOTES PAYABLE
Individual rental properties are pledged as collateral for the related
notes payable. The notes are payable monthly and mature between 1996
and 2008. Interest rates on the notes ranged from 9.25 percent to 10.50
percent during the year ended December 31, 1995. Certain notes relating
to Broadway Trade Center had been discounted to yield interest at an
annual rate of 15 percent. Amortization of the discounted amounts
totaled $33,000,$32,000 and $40,000 for 1995, 1994 and 1993,
respectively. Principal payments at December 31, 1995 are required as
follows:
1996 $ 3,617,000
1997 175,000
1998 191,000
1999 211,000
2000 230,000
Thereafter 16,830,000
-----------
Total $21,254,000
===========
For Broadway Trade Center, which was sold in the first quarter of 1996,
the principal payments are reflected in 1996 regardless of their
original due date.
On July 5, 1994, the Partnership paid down $6,000 of the existing
mortgage encumbering the St. Charleston Village Apartments property and
replaced the remaining $6,300,000 balance with a new first mortgage.
The loan requires monthly payments of $55,000 at 9.88% interest and is
being amortized over 30 years. The loan matures on July 1, 2001 with a
balloon payment of $5,967,000. As specified in the loan agreement, the
Partnership was required to establish with the lender an escrow account
for taxes and insurance and a replacement reserve account for future
capital improvements. A premium is to be calculated under the terms of
the mortgage if the loan is prepaid. The Partnership incurred closing
costs and fees of $169,000 in connection with this refinancing. As part
of the agreement, the Partnership was required to transfer the assets
and liabilities of St. Charleston Village Apartments to a newly formed,
wholly-owned subsidiary, Century St. Charleston Limited Partnership.
On July 5, 1994, the Partnership paid down $1,914,000 of the existing
mortgage encumbering the Sun River Apartments property and replaced the
remaining $6,368,000 balance with a new first mortgage. The loan
requires monthly payments of $55,000 at 9.88% interest and is being
amortized over 30 years. The loan matures on July 1, 2001 with a
balloon payment of $6,032,000. As specified in the loan agreement, the
Partnership was required to establish with the lender an escrow account
for taxes and insurance and a replacement reserve account for future
capital improvements. A premium is to be calculated under the terms of
the mortgage if the loan is prepaid. The partnership incurred closing
costs and fees of $161,000 in connection with this refinancing. As part
of the agreement, the Partnership was required to transfer the assets
and liabilities of Sun River Apartments to a newly formed, wholly-owned
subsidiary, Century Sun River Limited Partnership.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
4. NOTES PAYABLE (Continued)
On July 5, 1994, the Partnership paid down $189,000 of the existing
mortgage encumbering the Torrey Pines Village Apartments property and
replaced the remaining $3,750,000 balance with a new first mortgage.
The loan requires monthly payments of $33,000 at 9.88% interest and is
being amortized over 30 years. The loan matures on July 1, 2001 with a
balloon payment of $3,545,000. As specified in the loan agreement, the
Partnership was required to establish with the lender an escrow account
for taxes and insurance and a replacement reserve account for future
capital improvements. A premium is to be calculated under the terms of
the mortgage if the loan is prepaid. The Partnership incurred closing
costs and fees of $111,000 in connection with this refinancing. As part
of the agreement, the Partnership was required to transfer the assets
and liabilities of Torrey Pines Village Apartments to a newly formed,
wholly-owned subsidiary, Century Torrey Pines Limited Partnership.
On September 15, 1994, the Partnership satisfied the $1,684,000
outstanding mortgage encumbering the Duck Creek Shopping Center.
In September 1993, the Partnership paid off the $200,000 second note on
The Oaks Shopping Center upon its maturity.
Amortization of deferred financing costs totaled $68,000, $164,000 and
$87,000 for 1995, 1994 and 1993, respectively.
5.MINIMUM FUTURE RENTAL REVENUES
Minimum future rental revenues from operating leases having
non-cancelable lease terms in excess of one year are as follows:
1996 $ 540,000
1997 366,000
1998 241,000
1999 163,000
2000 164,000
Thereafter 1,162,000
-------------
Total $ 2,636,000
=============
Subsequent to the balance sheet date, the Partnership sold its
University Square Shopping Center and Broadway Trade Center (see Note
10). The minimum future rental revenues from University Square Shopping
Center and Broadway Trade Center have been excluded.
Rental revenues include contingent rent of $38,000, $6,000 and $40,000
in 1995, 1994 and 1993, respectively.
Amortization of deferred leasing commissions totaled $97,000, $104,000
and $97,000 for 1995, 1994 and 1993, respectively.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
6. DISPOSITION OF RENTAL PROPERTIES
On November 9, 1995, the Partnership sold its Wingren Plaza property,
located in Dallas, Texas for $1,000,000. After closing expenses of
$68,000, the net proceeds received by the Partnership were $932,000.
The carrying value of the property at the time of sale was $693,000.
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 (see Note 8).
On October 6, 1995, the Partnership sold its Duck Creek Shopping Center
property, 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. The carrying value of the property at the time of sale was
$2,148,000. For financial statement purposes, the sale resulted in a
loss of $36,000.
On September 12, 1995, the Partnership sold its Greenbriar Plaza
Shopping Center property, located in Duncanville, Texas for $1,050,000.
After closing expenses of $70,000, the net proceeds received by the
Partnership were $980,000. The carrying value of the property at the
time of sale was $1,536,000. For financial statement purposes, the sale
resulted in a loss of $556,000.
In December 1993, The Village Square Shopping Center was disposed of
through foreclosure for $2,645,000 to the holder of the first deed of
trust on the property. The disposition value is comprised of the first,
second and third note balances totaling $2,316,000, and net liabilities
released upon disposition of $329,000. Total disposition costs were
$6,000. At the date of disposition of The Village Square Shopping
Center, the carrying amount of land and improvements and unamortized
leasing commissions, after the $352,000 provision for impairment of
value recognized in 1992, was $2,642,000. The loss on disposition was
$3,000.
In December 1993, The Market Place Shopping Center was disposed of
through foreclosure for $1,615,000 to the holder of the first deed of
trust on the property. The disposition value is comprised of the first,
second and third note balances totaling $1,506,000, and net liabilities
released upon foreclosure of $109,000. Total disposition costs were
$6,000. At the date of disposition on The Market Place Shopping Center,
the carrying amount of land and improvements and unamortized leasing
commissions and financing costs, after the $534,000 provision for
impairment of value recognized in 1992, was $1,649,000. The loss on
disposition was $40,000.
In May 1993, the Partnership sold Cedarwood Apartments, located in
Lakewood, Colorado for $6,600,000. After payment of the existing first
and second loan balances of approximately $2,547,000 and $583,000,
respectively, and expenses of the sale of $169,000, the net cash
proceeds to the Partnership was $3,301,000. The carrying value of the
property at the time of sale was $3,706,000. The gain on sale was
$2,725,000.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
7. NOTE RECEIVABLE FROM PROPERTY SALE
The Partnership has a purchase money note receivable in the amount of
$1,500,000 due in 1997. This note is not reported in the accompanying
financial statements due to uncertainty regarding collectability.
8. ALLOWANCE FOR IMPAIRMENT OF VALUE
At December 31, 1994, the Partnership's allowance for impairment of
value was $4,205,000 consisting of $883,000 on the Oaks Shopping
Center, $1,421,000 on Broadway Trade Center (see Note 10) and
$1,901,000 on Wingren Plaza. The allowance for impairment of value is
$2,304,000 at December 31, 1995 since the Partnership sold its Wingren
Plaza property on November 9, 1995 (see Note 6). Due to the current
real estate market it is reasonably possible that the Partnership's
estimate of fair value will change within the next year.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
9. RECONCILIATION TO INCOME TAX METHOD OF ACCOUNTING
The differences between the accrual method of accounting for income tax
reporting and the accrual method of accounting used in the consolidated
financial statements are as follows:
<TABLE>
<CAPTION>
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
Net income (loss) - financial statements $ 206,000 $ (969,000) $ 2,054,000
Differences resulted from:
Notes payable discount amortization 33,000 32,000 40,000
Interest income on notes receivable 97,000 89,000 83,000
Depreciation (510,000) (604,000) (934,000)
Unearned revenue (1,000) 4,000 (3,000)
Property dispositions - net 442,000 - 1,162,000
Other income - foreclosures - - 302,000
Other 75,000 57,000 (1,000)
----------- ----------- -----------
Net income (loss) - income tax method $ 342,000 $(1,391,000) $ 2,703,000
=========== =========== ===========
Taxable income (loss) per limited partnership
unit after giving effect to the allocation
to the general partners $ 5 $ (21) $ 40
=========== =========== ===========
Partners equity - financial statements $ 4,053,000 $ 6,909,000 $ 7,878,000
Differences resulted from:
Provision for impairment of value 2,304,000 4,205,000 4,205,000
Deferred gain on property sales 706,000 706,000 706,000
Sales commissions and organization costs 6,749,000 6,749,000 6,749,000
Notes payable discount amortization 790,000 757,000 725,000
Interest income on notes receivable 625,000 528,000 439,000
Construction interest and financing costs (770,000) (855,000) (904,000)
Reduction of rental properties due to
lease payments 1,239,000 1,472,000 1,472,000
Depreciation (11,228,000) (13,294,000) (12,690,000)
Unearned revenue 4,000 5,000 1,000
Other 13,000 23,000 15,000
----------- ----------- -----------
Partners' equity - income tax method $ 4,485,000 $ 7,205,000 $ 8,596,000
=========== =========== ===========
</TABLE>
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
10. SUBSEQUENT EVENTS
On January 19, 1996, the stockholders of NPI, Inc. sold all of the
issued and outstanding stock of NPI, Inc. to an affiliate of Insignia.
In addition, an affiliate of Insignia acquired the limited partnership
interests of the Partnership held by DeForest I and certain of its
affiliates (see Note 1). As a result of the transaction, the Managing
General Partner of the Partnership is controlled by Insignia. Insignia
affiliates now provide property and asset management services to the
Partnership, maintain its books and records and oversee its operations.
On February 12, 1996, the Partnership sold its University Square
Shopping Center Property, located in Bozeman, Montana for $4,850,000.
After closing expenses of approximately $75,000, the net proceeds
received by the Partnership were approximately $4,775,000. The
Partnership will recognize a gain of approximately $1,500,000 during
the first quarter of 1996.
On March 7, 1996, the Partnership sold its Broadway Trade Center
Property, located in San Antonio, Texas for $3,825,000. After repayment
of the first, second and third mortgages totaling approximately
$1,640,000 (including unamortized discount) and closing expenses of
$215,000, the net proceeds received by the Partnership were
approximately $1,970,000. The Partnership will recognize a gain of
approximately $1,250,000 during the first quarter of 1996.
11. PROFORMA FINANCIAL INFORMATION
The following pro forma consolidated balance sheet as of December 31,
1995, and the pro forma consolidated statement of operations for the
year then ended give effect to the sales of the Partnership's
University Square Shopping Center and Broadway Trade Center properties.
The adjustments related to the pro forma consolidated balance sheet
assume the transactions were consummated at December 31, 1995, while
the adjustments to the pro forma consolidated income statement assume
the transactions were consummated at the beginning of the year
presented. The sales occurred on February 12, 1996 and March 7, 1996,
respectively.
The pro forma adjustments required are to eliminate the assets,
liabilities and operating activity of University Square Shopping Center
and Broadway Trade Center and to reflect consideration received for the
properties.
These pro forma adjustments are not necessarily reflective of the
results that actually would have occurred if the sales had been in
effect as of and for the period presented or what may be achieved in
the future.
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
11. PRO FORMA FINANCIAL INFORMATION (CONTINUED)
PRO FORMA CONSOLIDATED BALANCE SHEET
December 31, 1995
<TABLE>
<CAPTION>
Pro Forma
Historical Adjustments Pro Forma
------------- ------------- -------------
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents $ 2,576,000 $ - $ 2,576,000
Receivables and other assets 905,000 6,745,000 7,650,000
Real Estate:
Real estate 43,879,000 (10,861,000) 33,018,000
Accumulated depreciation (19,115,000) 4,233,000 (14,882,000)
Allowance for impairment of value (2,304,000) 1,421,000 (883,000)
------------- ------------- -------------
Real estate, net 22,460,000 (5,207,000) 17,253,000
Deferred costs, net 544,000 (93,000) 451,000
------------- ------------- -------------
Total assets $ 26,485,000 $ 1,445,000 $ 27,930,000
============= ============= =============
LIABILITIES AND PARTNERS' EQUITY
Notes payable $ 21,254,000 $ (1,283,000) $ 19,971,000
Deferred interest, accrued expenses and other liabilities 1,178,000 (112,000) 1,066,000
------------- ------------- -------------
Total liabilities 22,432,000 (1,395,000) 21,037,000
------------- ------------- -------------
Partners' Equity:
General partners 26,000 57,000 83,000
Limited partners 4,027,000 2,783,000 6,810,000
------------- ------------- -------------
Total partners' equity 4,053,000 2,840,000 6,893,000
------------- ------------- -------------
Total liabilities and partners' equity $ 26,485,000 $ 1,445,000 $ 27,930,000
============= ============= =============
</TABLE>
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
11. 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 $ 8,434,000 $ (1,543,000) $ 6,891,000
Interest and other income 568,000 (150,000) 418,000
Gain on sale of properties 239,000 - 239,000
------------ ------------- -------------
Total revenues 9,241,000 (1,693,000) 7,548,000
------------ ------------- -------------
Expenses:
Operating 4,359,000 (515,000) 3,844,000
Interest 2,230,000 (195,000) 2,035,000
Depreciation 1,546,000 (324,000) 1,222,000
General and administrative 308,000 - 308,000
Loss on sale of properties 592,000 - 592,000
------------ ------------- -------------
Total expenses 9,035,000 (1,034,000) 8,001,000
------------ ------------- -------------
Net income (loss) $ 206,000 $ (659,000) $ (453,000)
============ ============= =============
Net income (loss) per limited partnership unit $ 2.22 $ (9.96) $ (7.74)
============ ============= =============
Distributions per limited partnership unit $ 46.31 $ - $ 46.31
============ ============= =============
</TABLE>
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1995
<TABLE>
<CAPTION>
COLUMN COLUMN COLUMN COLUMN COLUMN COLUMN COLUMN COLUMN COLUMN
A B C D E F G H I
Cost Capitalized Gross Amount
Initial Cost Subsequent at Which Carried at
to Partnership to Acquisition Close of Period(1)
-------------- -------------- -----------------
Accum- Life
lated on which
Deprecia- Deprecia-
tion and Year tion is
Build- Build- Impair- of Date computed
ings and ings and ment of Con- of in latest
Encum- Improve- Improve- Carrying Improve- Total value struc- Acqui- statement of
Description brances Land ments ments Costs Land ments (2) (3) tion sition operations
- ----------- ------- ---- ------- ------ ------- ---- ------- ----- ------- ----- ------ ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
(Amounts in thousands)
PARTNERSHIP:
University Square
Shopping Center
Bozeman, Montana $ - $1,034 $ 4,565 $ 325 $ (511) $ 945 $ 4,468 $ 5,413 $ 2,219 12/80 12/79 6 - 39 Yrs
Gateway Park
Dublin, California 1,505 484 1,135 174 - 487 1,306 1,793 635 10/77 10/80 6 - 39 Yrs
The Oaks Shopping Center
Beaumont, Texas 2,175 1,146 3,599 1,147 (393) 1,278 4,221 5,499 2,797 4/81 9/80 6 - 39 Yrs
Broadway Trade Center
San Antonio, Texas 1,283 768 3,358 1,415 (93) 726 4,722 5,448 3,434 1978/ 1/81 6 - 39 Yrs
1979
SUBSIDIARIES:
Torrey Pines Village
Apartments
Las Vegas, Nevada 3,721 460 4,595 955 (52) 455 5,503 5,958 2,896 6/80 9/79 6 - 30 Yrs
St. Charleston Village
Apartments
Las Vegas, Nevada 6,251 751 7,322 1,344 (90) 743 8,584 9,327 4,608 7/80 9/79 6 - 30 Yrs
Sun River Apartments
Tempe, Arizona 6,319 1,102 8,770 669 (100) 1,090 9,351 10,441 4,830 9/81 11/80 6 - 30 Yrs
------- ------ ------- ------ ------- ------ ------- ------- -------
TOTAL $21,254 $5,745 $33,344 $6,029 $(1,239) $5,724 $38,155 $43,879 $21,419
======= ====== ======= ====== ======= ====== ======= ======= =======
</TABLE>
See accompanying notes.
SCHEDULE III
CENTURY PROPERTIES FUND XIV
(A Limited Partnership)
REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1995
<TABLE>
<CAPTION>
<S> <C>
NOTES:
(1) The aggregate cost for Federal income tax purposes is $44,921,000.
(2) Balance, January 1, 1993 $ 65,785,000
Improvements capitalized subsequent to acquisition 411,000
Cost of rental properties sold or disposed of (13,849,000)
------------
Balance, December 31, 1993 52,347,000
Improvements capitalized subsequent to acquisition 795,000
------------
Balance, December 31, 1994 53,142,000
Improvements capitalized subsequent to acquisition 1,117,000
Cost of rental properties sold or disposed of (10,380,000)
------------
Balance, December 31, 1995 $ 43,879,000
============
(3) Balance, January 1, 1993 $ 28,870,000
Additions charged to expense 1,625,000
Accumulated depreciation of rental properties sold or disposed of (5,224,000)
Allowance for impairment of value of rental properties disposed of (886,000)
------------
Balance, December 31, 1993 24,385,000
Additions charged to expense 1,571,000
------------
Balance, December 31, 1994 25,956,000
Additions charged to expense 1,546,000
Accumulated depreciation of rental properties sold or disposed of (4,182,000)
Allowance for impairment of value of rental properties sold (1,901,000)
------------
Balance, December 31, 1995 $ 21,419,000
============
(4) Encumbrances shown are net of discounts totaling $322,000.
</TABLE>
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosures.
Effective April 22, 1994, the Registrant dismissed its prior
Independent Auditors, Deloitte & Touche, LLP ("Deloitte") and retained as its
new Independent Auditors, Imowitz Koenig & Company, LLP. Deloitte's Independent
Auditors' Report on the Registrant's Consolidated Financial Statements for the
calendar year ended December 31, 1993 did not contain an adverse opinion or a
disclaimer of opinion, and were not qualified or modified as to uncertainty,
audit scope or accounting principles. The decision to change Independent
Auditors was approved by the Managing General Partner's Directors. During the
calendar year ended 1993 and through April 22, 1994 there were no disagreements
between the Registrant and Deloitte on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope of procedure which
disagreements if not resolved to the satisfaction of Deloitte, would have caused
it to make reference to he subject matter of the disagreements in connection
with its reports.
Effective April 22, 1994, the Registrant engaged Imowitz Koenig &
Company, LLP as its Independent Auditors. The Registrant did not consult Imowitz
Koenig & Company, LLP regarding any of the matters or events set forth in Item
304(a)(2)(i) and (ii) of Regulation S-K prior to April 22, 1994.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The Registrant does not have any officers or directors. The managing
general partner of the Registrant, Fox Capital Management Corporation (the
"Managing General Partner"), manages and controls substantially all of the
Registrant's affairs and has general responsibility and ultimate authority in
all matters affecting its business. NPI Equity Investments II, Inc., which
controls the Managing General Partner, is a wholly-owned affiliate of National
Property Investors, Inc., which in turn is owned by an affiliate of Insignia
(See "Item 1, Business - Change in Control"). Insignia is a full service real
estate service organization performing property management, commercial and
retail leasing, investor services, partnership administration, mortgage banking,
and real estate investment banking services for various entities. Insignia
commenced operations in December 1990 and is the largest manager of multifamily
residential properties in the United States and is a significant manager of
commercial property. It currently provides property and/or asset management
services for over 2,000 properties. Insignia's properties consist of
approximately 300,000 units of multifamily residential housing and approximately
64 million square feet of commercial space.
As of March 1, 1996, the names and positions held by the officers and
directors of the Managing General Partner are as follows:
Has served as a
Director and/or
Officer of the Managing
Name Positions Held General Partner since
- ---- -------------- ---------------------
William H. Jarrard, Jr. President and Director January 1996
Ronald Uretta Vice President and January 1996
Treasurer
John K. Lines, Esquire Vice President, January 1996
Secretary and Director
Thomas R. Shuler Director January 1996
Kelley M. Buechler Assistant Secretary January 1996
William H. Jarrard, Jr., age 49, has been President and a Director of
the Managing General Partner since January 1996. Mr. Jarrard has been a Managing
Director - Partnership Administration of Insignia since January 1991.
Ronald Uretta, age 40, has been Insignia's Chief Financial Officer and
Treasurer since January 1992. Since September 1990, Mr. Uretta has also served
as the Chief Financial Officer and Controller of Metropolitan Asset Group.
John K. Lines, Esquire, age 36, has been a Director and Vice President
and Secretary of the Managing General Partner since January 1996, Insignia's
General Counsel since June 1994, and General Counsel and Secretary since July
1994. From May 1993 until June 1994, Mr. Lines was the Assistant General Counsel
and Vice President of Ocwen Financial Corporation, West Palm Beach, Florida.
From October 1991 until May 1993, Mr. Lines was a Senior Attorney with Banc One
Corporation, Columbus, Ohio. From May 1984 until October 1991, Mr. Lines was an
attorney with Squire Sanders & Dempsey, Columbus, Ohio.
Thomas R. Shuler, age 50, has been Managing Director - Residential
Property Management of Insignia since March 1991 and Executive Managing Director
of Insignia and President of Insignia Management Services since July 1994.
Kelley M. Buechler, age 38, has been Assistant Secretary of the
Managing General Partner since January 1996 and Assistant Secretary of Insignia
since 1991.
No family relationships exist among any of the officers or directors of
the Managing General Partner.
Each director and officer of the Managing General Partner will hold
office until the next annual meeting of stockholders of the Managing General
Partner and until his successor is elected and qualified.
Item 11. Executive Compensation.
The Registrant is not required to and did not pay any compensation
to the officers or directors of the Managing General Partner. The Managing
General Partner does not presently pay any compensation to any of its
officers or directors. (See "Item 13, Certain Relationships and Related
Transactions.")
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The Registrant is a limited partnership and has no officers or
directors. The Managing General Partner has discretionary control over most of
the decisions made by or for the Registrant in accordance with the terms of the
Partnership Agreement. The Managing General Partner directly owns 100 limited
partnership units in the Registrant.
The following table sets forth certain information regarding limited
partnership units of the Registrant owned by each person who is known by the
Registrant to own beneficially or exercise voting or dispositive control over
more than 5% of the Registrant's limited partnership units, by each of the
Managing General Partner's directors and by all directors and executive officers
of the Managing General Partner as a group as of March 1, 1996.
Name and address of Amount and nature of
Beneficial Owner Beneficial Ownership % of Class
- ---------------- -------------------- ----------
Riverside Drive LLC (1) 26,615.0543(2) 41
All directors and
executive officers as
a group (5 persons) - -
- ----------------
(1) The business address for Riverside Drive L.L.C. is One Insignia Financial
Plaza, Greenville, South Carolina 29602.
(2) Based upon information supplied to the Registrant by Riverside Drive L.L.C.
There are no arrangements known to the Registrant, the operation of
which may, at a subsequent date, result in a change in control of the
Registrant.
Item 13. Certain Relationships and Related Transactions.
In accordance with the Registrant's partnership agreement, the
Registrant may be charged by the general partners and affiliates for services
provided to the Registrant.
On January 1, 1993, Metric Management, Inc., ("MMI"), successor to MRS,
a company which is not affiliated with the general partners, commenced providing
certain property and portfolio management services to the Registrant under a new
services agreement. As provided in the new services agreement, effective January
1, 1993, no reimbursements were made to the general partners and affiliates
after December 31, 1992. Subsequent to December 31, 1992, reimbursements were
made to MMI. On December 16, 1993, the services agreement with MMI was modified
and, as a result thereof, NPI Equity II began directly providing cash management
and other Partnership services on various dates commencing December 23, 1993. On
March 1, 1994, an affiliate of NPI Equity II commenced providing certain
property management services (see Notes 1 and 10). Related party expenses for
the years ended December 31, 1995, 1994 and 1993 were as follows:
1995 1994 1993
--------- --------- ---------
Property management fees $ 262,000 $ 204,000 $ -
Real estate tax reduction fees 5,000 4,000 -
Reimbursement of expenses:
Partnership accounting and
investor services 186,000 153,000 -
Professional services - 12,000 -
--------- --------- ---------
Total $ 453,000 $ 373,000 $ -
========= ========= =========
Property management fees and real estate tax reduction fees are
included in operating expenses. Reimbursed expenses are primarily included in
general and administrative expenses. In addition, approximately $184,000 of
insurance premiums which were paid to an affiliate of NPI Inc., under a master
insurance policy arranged by such affiliate, are included in operating expenses
for the year ended December 31, 1995.
In accordance with the Registrant's partnership agreement, the general
partners were allocated their two percent continuing interest in the
Registrant's net income (loss) and taxable income (loss). Gains from
dispositions of the Registrant properties were allocated first to the general
partners to the extent of the deficit in their capital accounts at the time of
the dispositions, then two percent of the remainder.
On January 11, 1996, the general partners received a distribution of
$20,000, representing the general partners two percent interest in cash
available for distribution, which was primarily from the proceeds received on
the sale of the Registrant's Wingren Plaza property (see Note 6). On October 17,
1995, the general partners received a distribution of $61,000, representing the
general partners two percent interest in cash available for distribution which
was primarily from the proceeds received on the sale of the Registrant's
Greenbriar Plaza Shopping Center and Duck Creek Shopping Center properties.
There were no cash distributions to the general partners for the years ended
December 31, 1994 and 1993
As a result of its ownership of 26,615.0543 limited partnership units,
Riverside Drive L.L.C. ("Riverside") could be in a position to significantly
influence all voting decisions with respect to the Registrant. Under the
Partnership Agreement, unitholders holding a majority of the Units are entitled
to take action with respect to a variety of matters. When voting on matters,
Riverside would in all likelihood vote the Units it acquired in a manner
favorable to the interest of the Managing General Partner because of its
affiliation with the Managing General Partner. However, Riverside has agreed for
the benefit of non-tendering unitholders, that it will vote its Units: (i)
against any proposal to increase the fees and other compensation payable by the
Registrant to the Managing General Partner and any of its affiliates; and (ii)
with respect to any proposal made by the Managing General Partner or any of its
affiliates, in proportion to votes cast by other unitholders. Except for the
foregoing, no other limitations are imposed on Riverside's right to vote each
Unit acquired.
PART IV
Item 14. Exhibits, Financial Statements Schedules, and Reports on Form 8-K.
(a)(1)(2) Financial Statements and Financial Statements Schedules:
See "Item 8" of this Form 10-K for Financial Statements of the
Registrant, Notes thereto, and Financial Statements Schedules. (A
Table of Contents to Financial Statements and Financial
Statements Schedules is included in Item 8 and incorporated
herein by reference.)
(a)(3) Exhibits
2.1 NPI Stock Purchase Agreement, dated as of August 17, 1995,
incorporated by reference to the Registrant's Current Report on
Form 8-K dated August 17, 1995.
2.2 Partnership Units Purchase Agreement dated as of August 17,
1995 incorporated by reference to Exhibit 2.1 to Form 8-K filed
by Insignia Financial Group, Inc. ("Insignia") with the
Securities and Exchange Commission on September 1, 1995.
2.3 Management Purchase Agreement dated as of August 17, 1995
incorporated by reference to Exhibit 2.2 to Form 8-K filed by
Insignia with the Securities and Exchange Commission on September
1, 1995.
2.4 Limited Liability Company Agreement of Riverside Drive L.L.C.,
dated as of August 17, 1995 incorporated by reference to Exhibit
2.4 to Form 8-K filed by Insignia with the Securities and
Exchange Commission on September 1, 1995.
2.5 Master Indemnity Agreement dated as of August 17, 1995
incorporated by reference to Exhibit 2.5 to Form 8-K filed by
Insignia with the Securities and Exchange Commission on September
1, 1995.
3.4 Agreement of Limited Partnership, incorporated by reference to
Exhibit A to the Prospectus of the Registrant dated September
11, 1978 and thereafter supplemented, included in the
Registrant's Registration Statement on Form S-11 (Reg. No.
2-61526).
16 Letter dated April 27, 1994 from the Registrant's Former
Independent Auditors incorporated by reference to the
Registrant's Current Report on Form 8-K dated April 22, 1994.
(b) Reports on Form 8-K:
On January 10, 1996, a Current Report on Form 10-K was filed with
the Securities and Exchange Commission to provide for the sales
of Riverway, Hidden Valley, Central Forest ("Item 2. Acquisition
or Disposition of Assets").
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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 this 28 day of March,
1996.
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
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the date indicated.
Signature/Name Title Date
- -------------- ----- ----
/s/ William H. Jarrard, Jr. President and March 28, 1996
- --------------------------- Director
William H. Jarrard, Jr.
/s/ Ronald Uretta Principal Financial March 28, 1996
- ----------------- Officer and Principal
Ronald Uretta Accounting Officer
/s/ John K. Lines Director March 28, 1996
- -----------------
John K. Lines
Exhibit Index
Exhibit Page
- ------- ----
2.1 NPI Stock Purchase Agreement ................................ (1)
2.2 Partnership Units Purchase Agreement ........................ (2)
2.3 Management Purchase Agreement ............................... (3)
2.4 Limited Liability Company Agreement of Riverside Drive L.L.C. (4)
2.5 Master Indemnity Agreement .................................. (5)
3.4 Agreement of Limited Partnership ............................ (6)
16 Letter dated April 27, 1994 from the Registrant's Former
Independent Auditor's ....................................... (7)
- -------------------------------------------------
(1) Incorporated by reference to Exhibit 2 to the Registrant's Current Report
on Form 8-K dated August 17, 1995.
(2) Incorporated by reference to Exhibit 2.1 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.
(3) Incorporated by reference to Exhibit 2.2 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.
(4) Incorporated by reference to Exhibit 2.4 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.
(5) Incorporated by reference to Exhibit 2.5 to Form 8-K filed by Insignia
Financial Group, Inc. with the Securities and Exchange Commission on
September 1, 1995.
(6) Incorporated by reference to Exhibit A to the Prospectus of the Registrant
dated September 11, 1978 and thereafter supplemented, included in the
Registrant's Registration Statement on Form S-11 (Reg. No. No.
(No. 2-61526).
(7) Incorporated by reference to Exhibit 10 to the Registrant's Current Report
on Form 8-K dated April 22, 1994.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from Century
Properties Fund XIV and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 2,576,000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 43,879,000
<DEPRECIATION> (21,419,000) <F1>
<TOTAL-ASSETS> 26,485,000
<CURRENT-LIABILITIES> 0
<BONDS> 21,254,000
<COMMON> 0
0
0
<OTHER-SE> 4,053,000
<TOTAL-LIABILITY-AND-EQUITY> 26,485,000
<SALES> 0
<TOTAL-REVENUES> 8,673,000 <F2>
<CGS> 0
<TOTAL-COSTS> 6,497,000 <F3>
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,230,000
<INCOME-PRETAX> 206,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 206,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 206,000
<EPS-PRIMARY> 2.22
<EPS-DILUTED> 2.22
<FN>
<F1> Depreciation includes a $2,304,000 allowance for impairment of value.
<F2> Revenues include gain on sale of properties of $239,000.
<F3> Costs include loss on sale of properties of $592,000.
</FN>
</TABLE>
