FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
(As last amended by 34-32231, eff. 6/3/93.)
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of The Securities
Exchange Act of 1934
For the quarterly period ended March 31, 1996
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period.........to.........
Commission file number 0-9680
CENTURY PROPERTIES FUND XV
(Exact name of small business issuer as specified in its charter)
California 94-2625577
(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 issuer (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 XV
CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands, except unit data)
March 31, 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Assets
Cash and cash equivalents $ 2,885
Deferred costs, net 511
Other assets 1,249
Investment properties:
Land $ 7,511
Buildings and related personal property 46,944
54,455
Less accumulated depreciation (22,734) 31,721
$ 36,366
Liabilities and Partners' Capital (Deficit)
Liabilities
Accrued expenses and other liabilities $ 1,047
Mortgages payable 23,292
Partners' Capital (Deficit):
Limited partners (89,980 units outstanding) $ 13,082
General partners (1,055) 12,027
$ 36,366
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
b) CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Revenues:
Rental income $ 2,410 $ 3,334
Interest income 13 18
Gain on disposal of property 626 --
Total revenues 3,049 3,352
Expenses:
Operating 1,441 1,639
Interest 621 994
Depreciation 463 587
General and administrative 109 63
Total expenses 2,634 3,283
Income before minority interest in joint
venture's operations and extraordinary loss 415 69
Minority interest in joint venture's
operations -- (38)
Income before extraordinary loss 415 31
Extraordinary loss on early extinguishment
of debt (96) --
Net income $ 319 $ 31
Net income allocated to general partners $ 40 $ 1
Net income allocated to limited partners 279 30
Net income $ 319 $ 31
Net loss per limited partnership unit:
Net income before extraordinary loss $ 4.15 $ .33
Extraordinary loss (1.05) --
Net loss per limited partnership unit $ 3.10 $ .33
Distribution per limited partnership unit $ 43.57 $ --
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
c) CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL (DEFICIT)
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Limited
Partnership General Limited Total
Units Partners Partners Capital
<S> <C> <C> <C> <C>
Partners' (deficit) capital at
December 31, 1995 89,980 $(1,015) $ 16,723 $ 15,708
Distributions paid -- (80) (3,920) (4,000)
Net income for the three
months ended March 31, 1996 -- 40 279 319
Partners' (deficit) capital at
March 31, 1996 89,980 $(1,055) $ 13,082 $ 12,027
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
d) CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income $ 319 $ 31
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation 463 587
Amortization of loan costs and leasing commissions 51 140
Gain on disposal of property (626) --
Extraordinary loss on early extinguishment of debt 96 --
Minority interest in joint venture's operations -- 38
Change in accounts:
Deferred costs (72) (22)
Other assets 508 (297)
Accrued expenses and other liabilities (251) 249
Net cash provided by operating
activities 488 726
Cash flows from investing activities:
Property improvements and replacements (201) (515)
Proceeds from sale of property 4,154 --
Net cash provided by (used in)
investing activities 3,953 (515)
Cash flows from financing activities:
Mortgage principal repayments (2,564) (168)
Joint venture partner distributions -- (30)
Distribution to partners (4,000) --
Net cash used in financing activities (6,564) (198)
Net increase in cash and cash equivalents (2,123) 13
Cash and cash equivalents at beginning of period 5,008 1,606
Cash and cash equivalents at end of period $ 2,885 $ 1,619
Supplemental information:
Interest paid $ 589 $ 871
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
e) CENTURY PROPERTIES FUND XV
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note A - Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of the Managing General Partner, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three month period ended March 31,
1996, are not necessarily indicative of the results that may be expected for the
fiscal year ending December 31, 1996. For further information, refer to the
financial statements and footnotes thereto included in the Partnership's annual
report on Form 10-K for the year ended December 31, 1995.
Certain reclassifications have been made to the 1995 information to conform to
the 1996 presentation.
Note B - Transactions with Affiliated Parties
Century Properties XV (the "Partnership") has no employees and is dependent on
Fox Capital Management Corporation ("FCMC" or the "Managing General Partner")
and its affiliates for the management and administration of all partnership
activities. The Partnership Agreement provides for payments to affiliates for
services and as reimbursement of certain expenses incurred by affiliates on
behalf of the Partnership.
The following transactions with affiliates of Insignia Financial Group, Inc.
("Insignia"), National Property Investors, Inc.("NPI"), and affiliates were
charged to expense in 1996 and 1995:
<TABLE>
<CAPTION>
For the Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Property management fees (included in operating
expenses) $116,000 $ 98,000
Reimbursement for services of affiliates (included
in general and administrative expenses) 71,000 36,000
</TABLE>
For the period from January 19, 1996 to March 31, 1996, the Partnership insured
its properties under a master policy through an agency and insurer unaffiliated
with the Managing General Partner. An affiliate of the Managing General Partner
acquired, in the acquisition of a business, certain financial obligations from
an insurance agency which was later acquired by the agent who placed the current
year's master policy. The current agent assumed the financial obligations to
the affiliate of the Managing General Partner who received payments on these
obligations from the agent. The amount of the Partnership's insurance premiums
accruing to the benefit of the affiliate of the Managing General Partner by
virtue of the agent's obligations is not significant.
Note B - Transactions with Affiliated Parties - continued
FCMC, a California corporation, and Fox Realty Investors ("FRI"), a California
general partnership, are the general partners of the Partnership.
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") pursuant to which NPI Equity was granted the right to vote 100% of the
outstanding stock of the Managing General Partner of FRI. In addition NPI
Equity became the managing partner of FRI. As a result, NPI Equity 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.
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, all of the issued and outstanding common
stock of NPI for an aggregate purchase price of $1,000,000. NPI Equity is a
wholly owned subsidiary of NPI. 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 and FCMC
resigned and IFGP Corporation caused new officers and directors of each of those
entities to be elected.
Note C - Disposition of Rental Properties
On February 1, 1996, the Partnership sold its Northbank Office Complex property,
located in Eugene, Oregon to an unaffiliated third party for $4,605,000. After
payment of the mortgage totaling approximately $2,443,000 and closing expenses
of approximately $170,000, the net proceeds received by the partnership were
approximately $1,992,000. The carrying value of the property at the time of the
sale was approximately $3,472,000. For financial statement purposes, the sale
resulted in a gain on disposal of property of approximately $881,000 and an
extraordinary loss on early extinguishment of debt of approximately $96,000.
On December 29, 1995, the Partnership sold its Farmers Lane Plaza property,
located in Santa Rosa, California to an unaffiliated third party. The purchase
price for the property was $8,750,000. Net proceeds to the Partnership after
payment of closing costs and existing debt were approximately $3,995,000. The
sale resulted in a gain of $3,618,000. Subsequent to the closing, Farmers' Lane
paid $255,000 in additional costs in connection with the sale.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's investment properties consist of three residential apartment
complexes and one commercial property. The following table sets forth the
average occupancy of the properties for the three months ended March 31, 1996
and 1995:
Average
Occupancy
Property 1996 1995
Lakeside Place Apartments 90% 94%
Houston, Texas
Summerhill Apartments 93% 96%
Dallas, Texas
Preston Creek Apartments 96% 96%
Dallas, Texas
Phoenix Business Park
Atlanta, Georgia 95% 85%
The Managing General Partner attributes the increase in occupancy at Phoenix
Business Park to a tenant expanding their leased space and to the improved curb
appeal and continued economic growth attributable to the Olympic games coming to
the Atlanta area this year. The Managing General Partner attributes the
decrease in occupancy at Lakeside Place Apartments to low mortgage rates and new
construction of both apartments and houses in the area.
The Partnership's net income for the three months ended March 31, 1996, was
approximately $319,000 versus $31,000 for the corresponding period of 1995. The
increase in net income is primarily attributable to the gain on the sale of the
investment property Northbank Office Complex as discussed in "Item 1. Financial
Statements - Note C". Also contributing to the increase in net income was the
decreases in all expenses except for general and administrative. The decrease
in expenses was due to both the sale of Northbank Office Complex on February 1,
1996, and the sale of Farmers Lane Plaza on December 29, 1995. The remaining
properties have all experienced improved operations except for Lakeside which
has encountered decreased occupancy as discussed above and had some unusual
maintenance items this quarter. In addition, Phoenix Business Park has had
improved operations for the three months ended March 31, 1996, in comparison to
the three months ended March 31, 1995 largely due to a tenant expanding their
leased space. Offsetting the increase in net income is a decrease in revenue
resulting from the sales of the investment properties as discussed above. In
addition, general and administrative expenses increased due to costs associated
with the operation of two administrative offices in addition to the relocation
of the administrative offices during the three months ended March 31, 1996.
Finally, in 1996 the Partnership reported an extraordinary loss on early
extinguishment of debt in connection with the sale of Northbank with no such
loss in 1995.
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 expenses. As part of
this plan, the Managing General Partner attempts to protect the Partnership from
the burden of inflation-related increases in expenses by increasing rents and
maintaining a high overall occupancy level. However, due to changing market
conditions, which can result in the use of rental concessions and rental
reductions to offset softening market conditions, there is no guarantee that the
Managing General Partner will be able to sustain such a plan.
At March 31, 1996, the partnership had unrestricted cash of approximately
$2,885,000 compared to $1,619,000 at March 31, 1995. Net cash provided by
operating activities decreased primarily as a result of the gain on the disposal
of property and the decrease in accrued expenses and other liabilities due to
timing of payments and prepaid rental income from tenants. The decreases were
offset by the increase in net income as discussed above. Net cash provided by
investing activities increased as a result of the proceeds received from the
sale of the investment property as discussed above. Net cash used in financing
activities increased resulting from the distributions paid to partners during
the first quarter of 1996 and the payoff of the mortgage encumbering the North
Bank Office Complex.
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 has no material capital programs scheduled to be performed in
1996, although certain routine capital expenditures and maintenance expenses
have been budgeted. These capital expenditures and maintenance expenses will be
incurred only if cash is available from operations or is received from the
capital reserve account.
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 property 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 mortgage
indebtedness of $23,292,000 is amortized over varying periods with maturity
dates from September 1999 to January 2010. The Managing General Partner
anticipates making a distribution in the second quarter of 1996 from proceeds
received on the sale of Northbank. The Partnership distributed approximately
$4,000,000 to the partners during the three months ended March 31, 1996 and
approximately $6,427,000 to the partners in 1995. At this time, it appears that
the original investment objective of capital growth from the inception of the
Partnership will not be attained and that investors will not receive a return of
all their invested capital.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibit 27, Financial Data Schedule, is filed as an exhibit to this report.
b) Reports on Form 8-K:
(i) Form 8-K dated January 19, 1996, was filed reporting the change in
control of the Partnership.
(ii) On January 10, 1996, a current report on Form 8-K was filed reporting
the sale of Farmer's Lane (Item 1. Acquisition or Disposition of
Assets.)
(iii) On February 15, 1996, a current report on Form 8-K was filed reporting
the sale of Northbank Complex (Item 1. Acquisition or Disposition of
Assets.)
SIGNATURE
In accordance with the requirements of the Exchange Act, the Registrant duly
caused this report to be signed on its behalf by the undersigned thereunto, duly
authorized.
CENTURY PROPERTIES FUND XV
By: FOX CAPITAL MANAGEMENT CORPORATION
A GENERAL PARTNER
By: /s/William H. Jarrard, Jr.
William H. Jarrard, Jr.
President and Director
By: /s/Ronald Uretta
Ronald Uretta
Principal Financial Officer
and Principal Accounting Officer
Date: May 15, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XV 1996 First Quarter 10-QSB and is qualified in its entirety by
referenec to such 10-QSB filing.
</LEGEND>
<CIK> 0000314690
<NAME> CENTURY PROPERTIES FUND XV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 2,885
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 54,455
<DEPRECIATION> 22,734
<TOTAL-ASSETS> 36,366
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 23,292
0
0
<COMMON> 0
<OTHER-SE> 12,027
<TOTAL-LIABILITY-AND-EQUITY> 36,366
<SALES> 0
<TOTAL-REVENUES> 3,049
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,634
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 621
<INCOME-PRETAX> 415
<INCOME-TAX> 0
<INCOME-CONTINUING> 415
<DISCONTINUED> 0
<EXTRAORDINARY> (96)
<CHANGES> 0
<NET-INCOME> 319
<EPS-PRIMARY> 3.10<F2>
<EPS-DILUTED> 0
<FN>
<F1>The Registrant has an unclassified balance sheet.
<F2>Amount not in thousands.
</FN>
</TABLE>
