UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report August 26, 1998
GRIFFIN REAL ESTATE FUND-II, A LIMITED PARTNERSHIP
MINNESOTA
Commission file number 0-11200
IRS Employer Identification No. 41-1398390
510 Marquette Avenue, Suite 300, Minneapolis, MN 55402
Registrant's telephone number: (612) 338-2828
<PAGE>
Item 2. Acquisition or disposition of assets
DISPOSITION OF LUNNONHAUS VILLAGE APARTMENTS
OF GOLDEN, COLORADO
On August 26, 1998, Griffin Real Estate Fund-II, A Limited Partnership sold the
Lunnonhaus Village Apartments to Fairfield Lunnonhaus, L.P.
Description of Property
Lunnonhaus Village Apartments is a 285 unit apartment complex located at 17600
West 14th Avenue, Golden, Colorado. The property was originally acquired by
Griffin Real Estate Fund-II on May 6, 1982 for $8,340,000. A down payment of
$2,250,000 was made with the balance of $6,090,000 financed by assuming a first
mortgage loan of $4,815,021 and by a second mortgage of $1,274,979. In February,
1987 the mature second mortgage was extinguished and replace with a new
$1,745,000 second mortgage, which in turn was extinguished on April 30, 1990
with the lender accepting $400,000 in full satisfaction of the $1,744,376
principal plus accrued interest of $189,289.
Sale of Property
The Lunnonhaus Village Apartments sales price of $14,200,000 cash was arrived at
through negotiations with the buyer who had no material relationship to Griffin
Real Estate Fund-II, to any affiliates of Griffin Real Estate Fund-II, to its
General Partner, or to any associates of its General Partner. With the proceeds
of the sale, the mortgage principal balance of $3,692,651, accrued interest of
$18,761, prepayment charges of $3,676 and sales costs were paid.
Item 7. Financial Statements and Exhibits
The following documents are filed as part of this report:
Proforma financial information.
1
<PAGE>
GRIFFIN REAL ESTATE FUND-II,
A LIMITED PARTNERSHIP
BALANCE SHEETS
DECEMBER 31, 1997
<TABLE>
<CAPTION>
*After
ASSETS: Actual Adjustment Disposition Proforma
- ------- ------------ ------------ ------------
<S> <C> <C> <C>
Cash and cash equivalents $ 628,333 $ (10,002) $ 618,331
Real estate tax escrow deposits 224,511 (146,416) 78,095
Receivables and other assets 19,784 (13,567) 6,217
------------ ------------ ------------
Total 872,628 (169,985) 702,643
------------ ------------ ------------
PROPERTY AND EQUIPMENT:
Land 1,529,374 (714,045) 815,329
Buildings and improvements 16,430,929 (8,882,394) 7,548,535
Furniture and equipment 1,339,243 (540,539) 798,704
------------ ------------ ------------
Total 19,299,546 (10,136,978) 9,162,568
Less accumulated depreciation 10,292,116 (5,526,987) 4,765,129
------------ ------------ ------------
Property and equipment - net 9,007,430 (4,609,991) 4,397,439
------------ ------------ ------------
Deferred expenses less accumulated
amortization - $188,078 22,240 -- 22,240
------------ ------------ ------------
TOTAL ASSETS $ 9,902,298 $ (4,779,976) $ 5,122,322
============ ============ ============
LIABILITES AND PARTNERS' EQUITY:
- --------------------------------
LIABILITES:
Accounts payable:
Affiliate $ 8,657 $ -- $ 8,657
Other 477,675 (180,914) 296,761
Security deposits 90,063 (71,548) 18,515
Accrued interest 60,576 (21,978) 38,598
Mortgage notes payable 9,031,201 (3,767,673) 5,263,528
------------ ------------ ------------
Total liabilities 9,668,172 (4,042,113) 5,626,059
------------ ------------ ------------
PARTNERS' EQUITY:
General Partner (462,914) (36,893) (499,807)
Limited Partners 697,040 (700,970) (3,930)
------------ ------------ ------------
Total Partners' Equity 234,126 (737,863) (503,737)
------------ ------------ ------------
TOTAL LIABILITIES AND
PARTNERS' EQUITY $ 9,902,298 $ (4,779,976) $ 5,122,322
============ ============ ============
</TABLE>
* The after disposition proforma represents the historical operations of the
Partnership which does not include assets or liabilities relating to the
disposed property.
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<PAGE>
GRIFFIN REAL ESTATE FUND-II,
A LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
*After Disposition
REVENUES: Actual Adjustment Proforma
- --------- ----------- ----------- -----------
<S> <C> <C> <C>
Rent (less apartment vacancies: 1997,
$268,496) $ 4,335,378 $(2,124,098) $ 2,211,280
Interest 45,414 (18,342) 27,072
Gain on sale of property
and equipment 4,953,337 -- 4,953,337
Other 208,541 (81,903) 126,638
----------- ----------- -----------
Total revenues 9,542,670 (2,224,343) 7,318,327
----------- ----------- -----------
EXPENSES:
Interest 903,543 (214,952) 688,591
Depreciation and amortization 803,521 (263,946) 539,575
Real Estate Taxes 470,006 (76,295) 393,711
Repairs and maintenance 662,336 (228,727) 433,609
Utilities 411,435 (216,333) 195,102
Salaries and employee benefits 458,340 (169,728) 288,612
Management fees to related parties 259,996 (111,773) 148,223
Administratiave 150,699 (46,623) 104,076
Insurance 108,003 (62,177) 45,826
Bad Debt 5,479 2,616 8,095
Other 5,518 (1,936) 3,582
----------- ----------- -----------
Total Expenses 4,238,876 (1,389,874) 2,849,002
----------- ----------- -----------
NET INCOME BEFORE
EXTRAORDINARY ITEM $ 5,303,794 $ (834,469) $ 4,469,325
EXTRAORDINARY ITEM -
LOSS ON DEBT EXTINGUISHMENT (142,121) -- (142,121)
----------- ----------- -----------
NET INCOME $ 5,161,673 $ (834,469) $ 4,327,204
=========== =========== ===========
NET INCOME ALLOCATED
TO GENERAL PARTNERS $ 144,640 $ (41,723) $ 102,917
=========== =========== ===========
NET INCOME ALLOCATED
TO LIMITED PARTNERS $ 5,017,033 $ (792,746) $ 4,224,287
=========== =========== ===========
PER UNIT:
NET INCOME BEFORE
EXTRAORDINARY ITEM $ 2,359.35 $ (362.81) $ 1,996.54
EXTRAORDINARY ITEM (63.23) -- (63.23)
----------- ----------- -----------
NET INCOME $ 2,296.12 $ (362.81) $ 1,933.31
=========== =========== ===========
</TABLE>
*The after disposition proforma represents the historical operations of the
Partnership which does not include operating income or expenses relating to the
disposed property, or the gain or loss on disposal.
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<PAGE>
GRIFFIN REAL ESTATE FUND-II,
A LIMITED PARTNERSHIP
CONDENSED BALANCE SHEETS
JUNE 30, 1998
<TABLE>
<CAPTION>
*After Disposition
ASSETS: Actual Adjustments Proforma
- ------- ------------ ------------ ------------
<S> <C> <C> <C>
Cash and cash equivalents $ 597,980 $ 10,500 $ 608,480
Receivables and other assets 327,051 (185,201) 141,850
------------ ------------ ------------
Total 925,031 (174,701) 750,330
------------ ------------ ------------
PROPERTY AND EQUIPMENT:
Land 1,529,374 (714,045) 815,329
Buildings and Improvements 16,467,188 (8,882,395) 7,584,793
Furniture and Equipment 1,339,244 (540,540) 798,704
Total 19,335,806 (10,136,980) 9,198,826
Less accumulated depreciation 10,626,099 (5,707,558) 4,918,541
------------ ------------ ------------
Property and Equipment - net 8,709,707 (4,429,422) 4,280,285
------------ ------------ ------------
TOTAL ASSETS $ 9,634,738 $ (4,604,123) $ 5,030,615
============ ============ ============
LIABILITIES AND PARTNERS' EQUITY:
- ---------------------------------
LIABILITIES:
Accounts payable and accrued
liabilities $ 539,761 $ (196,217) $ 343,544
Security Deposit 101,899 (72,235) 29,664
Mortgage notes payable 8,917,490 (3,711,735) 5,205,755
------------ ------------ ------------
Total liabilities 9,559,150 (3,980,187) 5,578,963
------------ ------------ ------------
PARTNERS' EQUITY:
General Partners (470,841) (31,197) (502,038)
Limited Partners 546,429 (592,739) (46,310)
------------ ------------ ------------
Total Partners' Equity 75,588 (623,936) (548,348)
------------ ------------ ------------
TOTAL LIABILITIES AND
PARTNERS' EQUITY $ 9,634,738 $ (4,604,123) $ 5,030,615
============ ============ ============
</TABLE>
*The after disposition proforma represents the historical operations of the
Partnership which does not include assets or liabilities relating to the
disposed property.
4
<PAGE>
GRIFFIN REAL ESTATE FUND -II,
A LIMITED PARTNERSHIP
CONDENSED STATEMENTS OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1998
(unaudited)
<TABLE>
<CAPTION>
*After Disposition
REVENUES: Actual Adjustments Proforma
- --------- ----------- ----------- -----------
<S> <C> <C> <C>
Rental Income $ 1,912,665 $(1,101,056) $ 811,609
Interest Income 18,084 (14,829) 3,255
Other Income 93,960 (48,035) 45,925
----------- ----------- -----------
Total Revenues 2,024,709 (1,163,920) 860,789
----------- ----------- -----------
OPERATING EXPENSES:
Operating Expenses 1,025,446 (417,596) 607,850
Interest Expense 359,371 (130,785) 228,586
Depreciation and amortization 338,430 (180,570) 157,860
----------- ----------- -----------
Total Operating Expenses 1,723,247 (728,951) 994,296
----------- ----------- -----------
NET INCOME (LOSS) 301,462 (434,969) (133,507)
NET INCOME (LOSS) ALLOCATED
TO GENERAL PARTNER 15,073 (21,748) (6,675)
----------- ----------- -----------
NET INCOME (LOSS) ALLOCATED
TO LIMITED PARTNERS $ 286,389 $ (413,221) $ (126,832)
=========== =========== ===========
NET (LOSS) INCOME $ 131.07 $ (189.12) $ (58.05)
=========== =========== ===========
</TABLE>
*The after disposition proforma represents the historical operations of the
Partnership which does not include operating income or expenses relating to the
disposed property, or the gain or loss on disposal.
5
<PAGE>
Signatures
Pursuant to the requirements of the Securities and Exchange Act o f 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GRIFFIN REAL ESTATE FUND II,
A LIMITED PARTNERSHIP
BY: INVESTMENT ASSOCIATES
ITS GENERAL PARTNER
Date: September 9, 1998 BY: /s/ Larry D. Fransen
-----------------------------------
Larry D. Fransen
General Partner
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