FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or 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 0-9680
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)
June 30, 1997
<TABLE>
<CAPTION>
<S> <C> <C>
Assets
Cash and cash equivalents $ 3,758
Receivables and deposits 727
Other assets 571
Investment properties:
Land $ 6,765
Buildings and related personal property 40,830
47,595
Accumulated depreciation (21,632) 25,963
$ 31,019
Liabilities and Partners' Capital (Deficit)
Liabilities
Accounts payable $ 93
Tenant security deposits payable 129
Accrued property taxes 457
Other liabilities 220
Mortgage notes payable 21,941
Partners' Capital (Deficit):
Limited partners' (89,980 units issued and
outstanding) $ 9,311
General partners' (1,132) 8,179
$ 31,019
<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 Six Months Ended
June 30, June 30,
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Revenues:
Rental income $ 2,083 $ 2,235 $ 4,167 $ 4,558
Other income 101 108 215 208
Gain on sale of properties -- -- 1 626
Total revenue 2,184 2,343 4,383 5,392
Expenses:
Operating 1,315 1,500 2,535 2,941
Interest 518 603 1,045 1,224
Depreciation 386 473 781 936
General and administrative 95 92 146 201
Total expenses 2,314 2,668 4,507 5,302
(Loss) income before
extraordinary loss (130) (325) (124) 90
Extraordinary loss on
extinguishment of debt -- -- (233) (96)
Net loss $ (130) $ (325) $ (357) $ (6)
Net (loss) income allocated
to general partners $ (2) $ (6) $ (7) $ 34
Net loss allocated
to limited partners (128) (319) (350) (40)
$ (130) $ (325) $ (357) $ (6)
Net (loss) income per limited
partnership unit:
Net (loss) income before
extraordinary loss $ (1.42) $ (3.55) $ (1.35) $ .60
Extraordinary loss on
extinguishment of debt -- -- (2.54) (1.05)
Net loss per limited
partnership unit $ (1.42) $ (3.55) $ (3.89) $ (.45)
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)
Limited
Partnership General Limited Total
Units Partners' Partners' Capital
Original capital contribution 89,980 $ -- $ 89,980 $ 89,980
Partners' (deficit) capital
at December 31, 1996 89,980 $ (1,125) $ 9,661 $ 8,536
Net loss for the six months
ended June 30, 1997 -- (7) (350) (357)
Partners' (deficit) capital at
June 30, 1997 89,980 $ (1,132) $ 9,311 $ 8,179
See Accompanying Notes to Consolidated Financial Statements
d) CENTURY PROPERTIES FUND XV
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 loss $ (357) $ (6)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation 781 936
Amortization of loan costs and leasing commissions 42 93
Gain on sale of properties (1) (626)
Loss on disposal of property 18 --
Extraordinary loss on extinguishment of debt 233 96
Change in accounts:
Receivables and deposits 417 405
Other assets (74) 27
Accounts payable (217) (15)
Tenant security deposits payable (37) (49)
Accrued property taxes (98) (307)
Other liabilities (15) 107
Net cash provided by operating activities 692 661
Cash flows from investing activities:
Deposits to restricted escrows (89) (113)
Withdrawals from restricted escrows 327 47
Property improvements and replacements (433) (691)
Proceeds from property sales 5,203 4,154
Net cash provided by investing activities 5,008 3,397
Cash flows from financing activities:
Mortgage principal payments (125) (237)
Satisfaction of mortgage notes payable (2,578) (2,443)
Debt extinguishment costs (211) --
Loan costs (27) (6)
Distribution to partners -- (4,000)
Net cash used in financing activities (2,941) (6,686)
Net increase (decrease) in cash and cash equivalents 2,759 (2,628)
Cash and cash equivalents at beginning of period 999 5,008
Cash and cash equivalents at end of period $ 3,758 $ 2,380
Supplemental information:
Cash paid for interest $ 1,018 $ 1,158
<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 of Century Properties Fund XV
(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 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.
FCMC and Fox Realty Investors ("FRI"), a California general partnership, are the
general partners of the Partnership.
Pursuant to a series of transactions which closed during the first half of 1996,
affiliates of Insignia Financial Group, Inc. ("Insignia") acquired all of the
issued and outstanding shares of stock of FCMC, NPI Equity Investments II, Inc.
("NPI Equity"), the managing general partner of FRI, and 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) $ 212 $ 204
Reimbursement for services of affiliates
(included in operating expenses and
general and administrative expenses) 78 109
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 RENTAL PROPERTIES
On January 15, 1997, the Partnership sold Phoenix Business Park property,
located in Atlanta, Georgia, to an unrelated party for a contract price of
$5,600,000. After payment of the mortgage note payable, closing costs and
related expenses, the Partnership received proceeds of approximately $2,414,000.
The carrying value of the investment property at the time of the sale was
approximately $5,031,000. For financial statement purposes, the sale resulted
in a gain of approximately $1,000. For financial statement purposes, the payment
of the mortgage note payable resulted in an extraordinary loss on extinguishment
of debt of approximately $233,000.
On February 1, 1996, the Partnership sold Northbank Office Complex, located in
Eugene, Oregon, to an unaffiliated third party for $4,605,000. After payment of
the mortgage note payable and closing expenses, the net proceeds received by the
Partnership were approximately $1,992,000. The carrying value of the investment
property at the time of the sale was approximately $3,472,000. For financial
statement purposes, the sale resulted in a gain of approximately $881,000 and an
extraordinary loss on extinguishment of debt of approximately $96,000.
On December 29, 1995, the Partnership sold Farmers Lane Plaza which resulted in
a reported gain of approximately $3,618,000. During the first quarter of 1996,
the Partnership paid approximately $255,000 in additional costs in connection
with the sale. These costs were reported as a reduction in the gain on the sale
of properties during the six month period ended June 30, 1996.
NOTE D - DISTRIBUTIONS
During the six month period ended June 30, 1997, the Partnership did not make
any distributions to the partners.
During the six month period ended June 30, 1996, the Partnership distributed
approximately $3,920,000 ($43.57 per limited partnership unit) to the limited
partners and approximately $80,000 to the general partners. On July 3, 1996, the
Partnership distributed approximately $1,499,000 ($16.66 per limited partnership
unit) to the limited partners and $31,000 to the general partners from the
proceeds of the sale of Northbank Office Complex.
NOTE E - SUBSEQUENT EVENTS
In July 1997, the Partnership distributed approximately $2,845,000 ($31.62 per
limited partnership unit) to the limited partners and $58,000 to the general
partners from the remaining proceeds from the sale of Northbank Office Complex,
the proceeds from the sale of Phoenix Business Park and cash flows from
operations. In addition, a partnership management fee of approximately $3,000,
was paid to the general partners as required by the Partnership Agreement.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's remaining investment properties consist of three residential
apartment complexes. 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
Lakeside Place Apartments 94% 91%
Houston, Texas
Preston Creek Apartments 94% 96%
Dallas, Texas
Summerhill Apartments 89% 93%
Dallas, Texas
The Managing General Partner attributes the decreases in occupancy at Summerhill
to new construction and increased competition in the market.
The Partnership realized net losses of approximately $357,000 and $6,000 for the
six months ended June 30, 1997 and 1996, respectively. During the three months
ended June 30, 1997 and 1996, the Partnership realized net losses of
approximately $130,000 and $325,000, respectively. The increase in loss for the
six month period is primarily attributable to the gain on the sale, which was
recognized in 1996, of the Northbank Office Complex, as discussed in "Item 1.
Note C - Disposition of Rental Properties". Also contributing to the increase
in net loss was the extraordinary loss on extinguishment of debt in connection
with the sale of Phoenix Business Park in 1997 of $233,000, versus an
extraordinary loss on extinguishment of debt of $96,000 in connection with the
sale of Northbank Office Complex in 1996. Overall, the decrease in rental
revenue and total expenses is the result of the sale of Northbank Office Complex
in February 1996 and the sale of Phoenix Business Park in January 1997. At the
remaining properties, rental income increased by approximately $148,000,
primarily at Lakeside Place Apartments, and operating expenses decreased by
approximately $184,000, primarily due to decreased maintenance expense. Included
in operating expenses for the remaining properties in the six months ended June
30, 1997, are approximately $92,000 in major repair and maintenance costs,
versus $364,000 for the corresponding period in 1996. The majority of these
costs are attributable to landscaping, parking lot repairs, and interior and
exterior building repairs at Lakeside Place in 1996. Interest expense at the
remaining properties decreased due to the debt refinancing for Preston Creek in
the fourth quarter of 1996. General and administrative expenses decreased
during the six month period ended June 30, 1997, primarily due to the transition
and relocation of the administrative offices during the first quarter of 1996.
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 June 30, 1997, the Partnership has unrestricted cash of approximately
$3,758,000 compared to approximately $2,380,000 at June 30, 1996. Net cash
provided by operating activities increased due to the timing of payments related
to accrued taxes. Net cash provided by investing activities increased due to an
increase in the proceeds from property sales. Also contributing to the increase
in cash provided by investing activities was an increase in withdrawals from
restricted escrows and a decrease in property improvements and replacements.
Net cash used in financing activities decreased due to the distribution paid to
the partners in the first six months of 1996 with no distributions being made in
the first six months of 1997. However, as stated below, the Partnership made a
$2,903,000 distribution to the partners in July 1997.
An affiliate of the Managing General Partner has made available to the
Partnership a credit line of up to $150,000 per property owned by the
Partnership. The Partnership has no outstanding amounts due under this line of
credit. Based on present plans, the Managing General Partner does not
anticipate the need to borrow in the near future. Other than cash and cash
equivalents the line of credit is the Partnership's only unused source of
liquidity.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Partnership. Such assets are currently
thought to be sufficient for any near-term needs of the Partnership. The
remaining mortgage indebtedness of $21,941,000 is amortized over varying periods
with maturity dates from July 2001 to December 2008. The Managing General
Partner has received an unsolicited offer to purchase Summerhill Apartments.
The Managing General Partner is currently evaluating this offer and will make a
determination in regard to the sale of this property. In July 1997, the
Partnership distributed approximately $2,845,000 ($31.62 per limited partnership
unit) to the limited partners and $58,000 to the general partners from the
remaining proceeds from the sale of Northbank Office Complex, the proceeds from
the sale of Phoenix Business Park and cash flows from operations. During the
six month period ended June 30, 1996, the Partnership distributed approximately
$3,920,000 ($43.57 per limited partnership unit) to the limited partners and
approximately $80,000 to the general partners. On July 3, 1996, the Partnership
distributed approximately $1,499,000 ($16.66 per limited partnership unit) to
the limited partners and $31,000 to the general partners from proceeds of the
sale of Northbank Office Complex.
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
In accordance with 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 XV
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: July 31, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XV 1997 Second Quarter 10-QSB and is qualified in its entirety
by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000314690
<NAME> CENTURY PROPERTIES FUND XV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 3,758
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 47,595
<DEPRECIATION> (21,632)
<TOTAL-ASSETS> 31,019
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 21,941
0
0
<COMMON> 0
<OTHER-SE> 8,179
<TOTAL-LIABILITY-AND-EQUITY> 31,019
<SALES> 0
<TOTAL-REVENUES> 4,383
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 4,507
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,045
<INCOME-PRETAX> (124)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> (233)
<CHANGES> 0
<NET-INCOME> (357)
<EPS-PRIMARY> (3.89)<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>
</TABLE>
