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, 1997
[ ] 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, 1997
Assets
Cash and cash equivalents $ 3,375
Receivables and deposits 996
Other assets 477
Investment properties:
Land $ 6,765
Buildings and related personal property 40,638
47,403
Accumulated depreciation (21,255) 26,148
$ 30,996
Liabilities and Partners' Capital (Deficit)
Liabilities
Accounts payable $ 108
Tenants security deposit payable 132
Accrued property taxes 233
Other liabilities 210
Notes payable 22,004
Partners' Capital (Deficit):
Limited partners' (89,980 units issued and
outstanding) $ 9,439
General partner's (1,130) 8,309
$ 30,996
See Accompanying Notes to Consolidated Financial Statements
b) CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
Three Months Ended
March 31,
1997 1996
Revenues:
Rental income $ 2,084 $ 2,323
Interest and other income 114 100
Gain on disposal of property 1 626
Total revenue 2,199 3,049
Expenses:
Operating 1,220 1,441
Interest 527 621
Depreciation 395 463
General and administrative 51 109
Total expenses 2,193 2,634
Income before extraordinary loss 6 415
Extraordinary loss on early extinguishment of debt (233) (96)
Net (loss) income $ (227) $ 319
Net (loss) income allocated to general partners $ (5) $ 40
Net (loss) income allocated to limited partners (222) 279
Net (loss) income $ (227) $ 319
Net (loss) income per limited partnership unit:
Income before extraordinary loss $ .07 $ 4.15
Extraordinary loss (2.54) (1.05)
Net (loss) income per limited partnership unit $ (2.47) $ 3.10
Distribution per limited partnership unit $ -- $ 43.57
See Accompanying Notes to Consolidated Financial Statements
c) CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL (DEFICIT)
(Unaudited)
(in thousands, except unit data)
Limited
Partnership General Limited Total
Units Partner 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 three months
ended March 31, 1997 -- (5) (222) (227)
Partners' (deficit) capital at
March 31, 1997 89,980 $ (1,130) $ 9,439 $ 8,309
See Accompanying Notes to Consolidated Financial Statements
d) CENTURY PROPERTIES FUND XV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
Three Months Ended
March 31,
1997 1996
Cash flows from operating activities:
Net (loss) income $ (227) $ 319
Adjustments to reconcile net (loss) income to net
cash provided by operating activities:
Depreciation 395 463
Amortization of loan costs and leasing commissions 22 51
Gain on disposal of property (1) (626)
Extraordinary loss on early extinguishment of debt 233 96
Change in accounts:
Receivables and deposits 390 374
Other assets 4 206
Accounts payable (203) 196
Tenant security deposits (34) (41)
Accrued property taxes (322) (525)
Other liabilities (25) 121
Net cash provided by operating activities 232 634
Cash flows from investing activities:
Deposits to restricted escrows (41) (168)
Withdrawals from restricted escrows 37 22
Property improvements and replacements (346) (201)
Net proceeds from the sales of properties 5,372 4,154
Net cash provided by investing activities 5,022 3,807
Cash flows from financing activities:
Payments on mortgage principal (62) (121)
Satisfaction of mortgage note payable (2,578) (2,443)
Debt extinguishment costs (211) --
Loan costs (27) --
Distributions to partners -- (4,000)
Net cash used in financing activities (2,878) (6,564)
Net increase (decrease) in cash and cash equivalents 2,376 (2,123)
Cash and cash equivalents at beginning of period 999 5,008
Cash and cash equivalents at end of period $ 3,375 $ 2,885
Supplemental information:
Cash paid for interest $ 520 $ 589
See Accompanying Notes to Consolidated Financial Statements
e) CENTURY PROPERTIES FUND XV
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
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, a California corporation ("FCMC"
or 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, 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 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
co-general partners of the Partnership.
Pursuant to a series of transactions which closed during 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 charged to expense during the three month periods ended March 31, 1997
and 1996 (dollar amounts in thousands):
For the Three Months Ended
March 31,
1997 1996
Property management fees (included in operating
expenses) $ 105 $ 116
Reimbursement for services of affiliates, including
approximately $6,000 in construction services
reimbursements (included in operating expenses
and general and administrative expenses 35 71
For the period from January 19, 1996 to March 31, 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 payable, closing costs and related
expenses, the Partnership received proceeds of approximately $2,314,000. The
carrying value of the investment property at the time of the sale was
approximately $5,164,000. For financial statement purposes, the sale resulted
in a gain of approximately $1,000. For financial statement purposes, the payment
of the mortgage payable resulted in an extraordinary loss on early
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 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 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 Farmers Lane Plaza which resulted in
a reported gain of approximately $3,618,000. During the first quarter of 1996,
the Partnership paid approximately $225,000 in additional costs in connection
with the sale. These costs were reported as a loss on the disposition of
property for the three month period ended March 31, 1996.
NOTE D - DISTRIBUTIONS
During the three month period ended March 31, 1997, the Partnership did not make
any distributions to the partners.
During the three month period ended March 31, 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.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's investment properties consist of three residential apartment
complexes. The following table sets forth the average occupancy of the
properties for each of the three month periods ended March 31, 1997 and 1996:
Average
Occupancy
Property 1997 1996
Lakeside Place Apartments 92% 90%
Houston, Texas
Summerhill Apartments 89% 93%
Dallas, Texas
Preston Creek Apartments 95% 96%
Dallas, Texas
The Managing General Partner attributes the decrease in occupancy at Summerhill
to new construction and increased competition in the market.
The Partnership's net loss for the three month period ended March 31, 1997, was
approximately $227,000, versus net income of approximately $319,000 for the
corresponding period of 1996. The decrease in income is primarily attributable
to the gain on the sale which was recognized in 1996 of the investment property
Northbank Office Complex as discussed in "Item 1. Note C - Disposition of Rental
Properties". Also contributing to the decrease in net income was the
extraordinary loss on early extinguishment of debt in connection with the sale
of Phoenix Business Park in 1997 of $233,000, versus an extraordinary loss on
early 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, operating expenses decreased at Preston Creek Apartments and
maintenance expenses decreased at Preston Creek Apartments and Lakeside Place
Apartments. The decrease in operating expenses at Preston Creek is primarily
due to decreased utility expenses, especially for water. The decrease in
maintenance expenses at Preston Creek Apartments and Lakeside Place Apartments
is primarily due to decreased interior and exterior building improvements.
Included in operating expenses are approximately $50,000 in major repair and
maintenance costs, versus $59,000 for the corresponding period in 1996. The
majority of these costs are attributable to the above mentioned renovations and
improvements. Interest expense decreased due to the debt refinancing for
Preston Creek property in the fourth quarter of 1996. General and administrative
expenses decreased during the three month period ended March 31, 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 March 31, 1997, the Partnership has unrestricted cash of approximately
$3,375,000 compared to approximately $2,885,000 at March 31, 1996. Net cash
provided by operating activities decreased due to the timing of payments related
to accounts payable and other liabilities. This was partially offset by the
decrease in property tax bills for Preston Creek Apartments. Net cash provided
by investing activities increased due to an increase in the net proceeds from
the sales of properties. Net cash used in financing activities decreased due to
the distribution paid to the partners in the first quarter of 1996 with no
corresponding activity in the first quarter of 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 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 $22,004,000 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. The Partnership distributed approximately
$4,000,000 to partners during the first quarter of 1996. The Managing General
Partner plans to make a distribution of the proceeds from the sale of Phoenix
Business Park in 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 March 31, 1997.
SIGNATURE
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 XV
By: FOX CAPITAL MANAGEMENT CORPORATION
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: May 14, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XV 1997 First Quarter 10-QSB and is qualified in its entirety by
reference to such 10-QSB.
</LEGEND>
<CIK> 0000314690
<NAME> CENTURY PROPERTIES FUND XV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 3,375
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 47,403
<DEPRECIATION> (21,255)
<TOTAL-ASSETS> 30,996
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 22,004
0
0
<COMMON> 0
<OTHER-SE> 8,309
<TOTAL-LIABILITY-AND-EQUITY> 30,996
<SALES> 0
<TOTAL-REVENUES> 2,199
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,193
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 527
<INCOME-PRETAX> 6
<INCOME-TAX> 0
<INCOME-CONTINUING> 6
<DISCONTINUED> 0
<EXTRAORDINARY> (233)
<CHANGES> 0
<NET-INCOME> (227)
<EPS-PRIMARY> (2.47)<F2>
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
<F2>Multiplier is 1.
</FN>
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