FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Quarterly Transitional Report
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of The Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1997
[ ] 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 small business issuer as specified in its charter)
California 94-2535195
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Insignia Financial Plaza
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone number)
Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes X .
No .
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) CENTURY PROPERTIES FUND XIV
CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands, except unit data)
June 30, 1997
<TABLE>
<CAPTION>
<S> <C> <C>
Assets
Cash and cash equivalents $ 2,519
Receivables and deposits 583
Other assets 399
Investment properties:
Land $ 2,775
Buildings and related personal property 25,439
28,214
Less accumulated depreciation (14,328) 13,886
$17,387
Liabilities and Partners' Deficit
Liabilities
Accounts payable $ 17
Tenant security deposit payable 162
Accrued property taxes 54
Other liabilities 221
Mortgage notes payable 17,635
Partners' Deficit
General partners' $ --
Limited partners' (64,806 units issued and
outstanding) (702) (702)
$17,387
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
b) CENTURY PROPERTIES FUND XIV
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Revenues:
Rental income $1,465 $1,430 $2,936 $3,293
Other income 91 167 182 332
Gain on sale of properties -- 65 -- 3,012
Total revenues 1,556 1,662 3,118 6,637
Expenses:
Operating 746 813 1,367 1,723
Interest 447 478 895 1,064
Depreciation 232 234 460 529
General and administrative 74 119 126 251
Total expenses 1,499 1,644 2,848 3,567
Income before extraordinary loss 57 18 270 3,070
Extraordinary loss on
extinguishment of debt -- -- -- (315)
Net income $ 57 $ 18 $ 270 $2,755
Net income allocated
to general partners (2%) $ 1 $ -- $ 5 $ 55
Net income allocated
to limited partners (98%) 56 18 265 2,700
$ 57 $ 18 $ 270 $2,755
Net income per limited
partnership unit:
Income before extraordinary loss $ .86 $ .27 $ 4.08 $46.42
Extraordinary loss on
extinguishment of debt -- -- -- (4.76)
Net income per limited
partnership unit $ .86 $ .27 $ 4.08 $41.66
Distributions per limited
partnership unit $ -- $ -- $ -- $15.12
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
c) CENTURY PROPERTIES FUND XIV
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' DEFICIT
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Limited
Partnership General Limited
Units Partners' Partners' Total
<S> <C> <C> <C> <C>
Original capital contributions 64,806 $ -- $64,806 $64,806
Partners' deficit at
December 31, 1996 64,806 $ (5) $ (967) $ (972)
Net income for the six
months ended June 30, 1997 -- 5 265 270
Partners' deficit at
June 30, 1997 64,806 $ -- $ (702) $ (702)
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
d) CENTURY PROPERTIES FUND XIV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1997 1996
<S> <C> <C>
Cash flows from operating activities:
Net income $ 270 $ 2,755
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 460 529
Amortization of loan costs, discounts and
lease commissions 39 53
Gain on sale of properties -- (3,012)
Extraordinary loss on extinguishment of debt -- 315
Change in accounts:
Receivables and deposits 98 100
Other assets 4 (82)
Accounts payable (114) 66
Tenant security deposit payable (1) (80)
Accrued property taxes 2 (72)
Other liabilities (20) 140
Net cash provided by operating activities 738 712
Cash flows from investing activities:
Property improvements and replacements (192) (157)
Deposits to restricted escrows (80) (76)
Withdrawals from restricted escrows 136 42
Proceeds from sale of properties -- 8,158
Net cash (used in) provided by investing
activities (136) 7,967
Cash flows from financing activities:
Mortgage principal payments (68) (1,635)
Distributions to partners -- (1,000)
Net cash used in financing activities (68) (2,635)
Net increase in cash and cash equivalents 534 6,044
Cash and cash equivalents at beginning of period 1,985 2,576
Cash and cash equivalents at end of period $2,519 $ 8,620
Supplemental disclosure of cash flow information:
Cash paid for interest $ 862 $ 1,005
Supplemental disclosure of non-cash operating and
financial activities:
Accrued interest assumed by purchaser of The Oaks $ -- $ 677
Mortgage notes payable assumed by purchaser of The Oaks $ -- $ 2,173
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
e) CENTURY PROPERTIES FUND XIV
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited financial statements of Century Properties Fund XIV
(the "Partnership") have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-QSB and Item 310(b) of Regulation S-B. Accordingly,
they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the
opinion of Fox Capital Management Corporation ("FCMC" or the "Managing General
Partner"), a California corporation, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three and six month periods ended June 30,
1997, are not necessarily indicative of the results that may be expected for the
fiscal year ending December 31, 1997. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Partnership's annual report on Form 10-KSB for the year ended December 31, 1996.
Certain reclassifications have been made to the 1996 information to conform to
the 1997 presentation.
NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has no employees and is dependent on its general partners and
their affiliates for the management and administration of all partnership
activities. The Partnership Agreement provides for payments to affiliates for
services and as reimbursement of certain expenses incurred by affiliates on
behalf of the Partnership.
The general partners of the Partnership are Fox Realty Investors ("FRI"), a
California general partnership, and FCMC.
Pursuant to a series of transactions which closed during 1996, affiliates of
Insignia Financial Group, Inc. ("Insignia") acquired (i) control of NPI Equity
Investments II, Inc. ("NPI Equity"), the managing general partner of FRI, and
(ii) all of the issued and outstanding shares of stock of FCMC. NPI Equity is a
wholly-owned subsidiary of National Property Investors, Inc. ("NPI"). In
connection with these transactions, affiliates of Insignia appointed new
officers and directors of NPI Equity and FCMC.
The following transactions with affiliates of Insignia, NPI, and affiliates of
NPI were incurred during the six month periods ended June 30, 1997 and 1996 (in
thousands):
For the Six Months Ended
June 30,
1997 1996
Property management fees (included in operating
expenses) $ 145 $ 133
Reimbursement for services of affiliates
(included in operating expenses and general and
administrative expenses) 68 127
For the period from January 19, 1996 to June 30, 1997, the Partnership insured
its properties under a master policy through an agency and insurer unaffiliated
with the Managing General Partner. An affiliate of the Managing General Partner
acquired, in the acquisition of a business, certain financial obligations from
an insurance agency which was later acquired by the agent who placed the current
year's master policy. The current agent assumed the financial obligations to the
affiliate of the Managing General Partner who received payments on these
obligations from the agent. The amount of the Partnership's insurance premiums
accruing to the benefit of the affiliate of the Managing General Partner by
virtue of the agent's obligations is not significant.
NOTE C - DISPOSITION OF INVESTMENT PROPERTIES
On April 26, 1996, the Partnership sold The Oaks Shopping Center, located in
Beaumont, Texas. The buyer of the property assumed the outstanding debt on the
property and the Partnership received net proceeds of $1,000. As a result of
the sale, the Partnership paid a disposition fee of approximately $16,000. For
financial statement purposes, the sale resulted in a gain of $65,000. The
Partnership had previously recorded a $883,000 provision for impairment of value
in 1992.
On March 7, 1996, the Partnership sold Broadway Trade Center located in San
Antonio, Texas, to an unaffiliated third party for $3,825,000. After repayment
of the first, second, and third mortgages totaling $1,591,000 and closing
expenses of $244,000, the net proceeds received by the Partnership were
$1,990,000. As a result of the loans being paid in full, an extraordinary loss
representing the remaining unamortized mortgage discount of $315,000 was
recorded. For financial statement purposes, the sale resulted in a gain of
$1,531,000. The Partnership had previously recorded a $1,421,000 provision for
impairment of value for the property.
On February 12, 1996, the Partnership sold University Square, located in
Bozeman, Montana, to an unaffiliated third party for $4,850,000. After closing
expenses of $231,000, the net proceeds received by the Partnership were
$4,619,000. For financial statement purposes, the sale resulted in a gain of
$1,416,000.
NOTE D - 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 consolidated
financial statements due to uncertainty regarding collectability.
NOTE E - DISTRIBUTIONS
On January 11, 1996, the Partnership distributed approximately $980,000 ($15.12
per limited partner unit) to the limited partners and approximately $20,000 to
the general partners from the proceeds from the sale of Wingren Plaza in 1995.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's remaining investment properties consist of three residential
apartment complexes and one commercial property. The following table sets forth
the average occupancy of the properties for each of the six month periods ended
June 30, 1997 and 1996:
Average
Occupancy
Property 1997 1996
Torrey Pines Village Apartments 93% 93%
Las Vegas, Nevada
St. Charleston Village Apartments 94% 95%
Las Vegas, Nevada
Gateway Park 100% 94%
Dublin, California
Sun River Apartments 96% 97%
Tempe, Arizona
The Managing General Partner attributes the increase in occupancy at Gateway
Park to the expansion of two tenants. Each tenant expanded their leased space
by 1,200 square feet in 1996. The property also was able to re-lease space
vacated by a former tenant, bringing occupancy at the property to 100%.
The Partnership's net income for the three and six months ended June 30, 1997,
was approximately $57,000 and $270,000, respectively, compared to net income of
approximately $18,000 and $2,755,000 for the corresponding periods ended June
30, 1996. The decrease in net income for the six months ended June 30, 1997, is
attributable to the gain on the sale of the Broadway Trade Center, University
Square Shopping Center, and The Oaks Shopping Center properties in the first six
months of 1996. Other income decreased primarily due to a decrease in interest
income as a result of lower cash balances. Rental revenues also decreased as a
result of the Partnership owning fewer properties in 1997. Partially offsetting
the decrease in revenues was the decrease in operating, interest, and
depreciation expenses attributable to the property sales in 1996. As noted in
"Item 1. Note B - Transactions with Affiliated Parties," the Partnership
reimburses the Managing General Partner and its affiliates for its costs
involved in the management and administration of all partnership activities.
The decrease in general and administrative expenses during the three and six
month periods ended June 30, 1997, is directly attributable to the transition
and relocation of the administrative offices during the first quarter of 1996.
General and administrative expenses also decreased during 1997 due to a decrease
in professional fees incurred in the six months ended June 30, 1997, compared to
the corresponding period in 1996. During the six month period ended June 30,
1996, the Partnership incurred an extraordinary loss on extinguishment of the
Broadway Trade debt. The extraordinary loss represents the remaining
unamortized mortgage discount of the Broadway Trade debt at the time of its
payoff. Included in operating expenses for the six months ended June 30, 1997,
is approximately $39,000 of major repairs and maintenance comprised primarily of
parking lot repairs and major landscaping. Included in operating expenses for
the six months ended June 30, 1996, is approximately $161,000 of major repairs
and maintenance comprised primarily of exterior building repairs and major
landscaping.
With respect to the remaining properties, rental income increased by
approximately $96,000 for the six months ended June 30, 1997, compared to the
corresponding period of 1996, primarily due to an increase in rental rates at
Sun River. Operating expenses decreased for the six months ended June 30, 1997,
primarily due to a decrease in maintenance expense at St. Charleston Village
Apartments.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of its investment properties to
assess the feasibility of increasing rents, maintaining or increasing occupancy
levels and protecting the Partnership from increases in expense. As part of
this plan, the Managing General Partner attempts to protect the Partnership from
the burden of inflation-related increases in expenses by increasing rents and
maintaining a high overall occupancy level. However, due to changing market
conditions, which can result in the use of rental concessions and rental
reductions to offset softening market conditions, there is no guarantee that the
Managing General Partner will be able to sustain such a plan.
At June 30, 1997, the Partnership had unrestricted cash of approximately
$2,519,000 compared to approximately $8,620,000 at June 30, 1996. The decrease
is primarily the result of the distribution in the third quarter of 1996 of net
proceeds from the sales of the Partnership properties which occurred during the
first six months of 1996. Net cash provided by operating activities increased
slightly. Net cash used in investing activities increased due to the receipt of
proceeds from the sale of Broadway Trade Center and University Square Shopping
Center in 1996. Net cash used in financing activities decreased due to the
distribution of proceeds from the sale of Wingren Plaza in January of 1996.
Also contributing to the decrease in cash used in financing activities was the
payoff of the mortgage notes encumbering Broadway Trade Center when the property
was sold in 1996.
An affiliate of the Managing General Partner has made available to the
Partnership a credit line of up to $150,000 per property owned by the
Partnership. The Partnership has no outstanding amounts due under this line of
credit. Based on present plans, the Managing General Partner does not
anticipate the need to borrow in the near future. Other than cash and cash
equivalents, the line of credit is the Partnership's only unused source of
liquidity.
The Partnership's remaining commercial property, Gateway Park, is under contract
for sale. The sale, which is subject to the purchaser's due diligence and other
customary conditions, is expected to close during the third quarter of 1997.
Upon the sale of this property, it is anticipated that the proceeds will be
distributed.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Partnership. Such assets are currently
thought to be sufficient for any near-term needs of the Partnership. The
remaining mortgage indebtedness of approximately $17,635,000 matures at various
times with balloon payments due at maturity at which time the properties will
either be refinanced or sold. Future cash distributions will depend on the
levels of cash generated from operations, property sales, and the availability
of cash reserves. On January 11, 1996, the Partnership distributed
approximately $980,000 ($15.12 per unit) to the limited partners and
approximately $20,000 to the general partners from the proceeds received from
the sale of the Partnership's Wingren Plaza property. On July 3, 1996, the
Partnership distributed approximately $6,617,000 ($102.11 per unit) to the
limited partners and approximately $135,000 to the general partners. This
distribution primarily represented proceeds received from the sales of
University Square and Broadway Trade during the first quarter of 1996. No cash
distributions were made during the first six months of 1997. Currently, the
Managing General Partner is planning a distribution from cash reserves during
the third quarter of 1997.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibit 27, Financial Data Schedule, is filed as an exhibit to this
report.
b) Reports on Form 8-K: None filed during the quarter ended June 30, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CENTURY PROPERTIES FUND XIV
By: FOX CAPITAL MANAGEMENT CORPORATION
Its Managing General Partner
By: /s/William H. Jarrard, Jr.
William H. Jarrard, Jr.
President and Director
By: /s/Ronald Uretta
Ronald Uretta
Vice President and Treasurer
Date: August 6, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XIV 1997 Second Quarter 10-QSB and is qualified in its entirety
by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000278128
<NAME> CENTURY PROPERTIES FUND XIV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 2,519
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 28,214
<DEPRECIATION> 14,328
<TOTAL-ASSETS> 17,387
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 17,635
0
0
<COMMON> 0
<OTHER-SE> (702)
<TOTAL-LIABILITY-AND-EQUITY> 17,387
<SALES> 0
<TOTAL-REVENUES> 3,118
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,848
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 895
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 270
<EPS-PRIMARY> 4.08<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>
</TABLE>
