<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period ended March 31, 1995
--------------------------------------------
OR
[ ] 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 0-10743
MCNEIL REAL ESTATE FUND XII, LTD.
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(Exact name of registrant as specified in its charter)
California 94-2717957
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (214) 448-5800
----------------------
Indicate by check mark whether the registrant, (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
<PAGE>
MCNEIL REAL ESTATE FUND XII, LTD.
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- ------- --------------------
BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
------------ ------------
<S> <C> <C>
ASSETS
Real estate investments:
Land..................................................... $ 6,280,580 $ 6,280,580
Buildings and improvements............................... 71,870,659 71,739,632
----------- -----------
78,151,239 78,020,212
Less: Accumulated depreciation and amortization......... (37,939,708) (37,105,195)
----------- ------------
40,211,531 40,915,017
Assets held for sale........................................ 12,497,334 12,724,693
Cash and cash equivalents................................... 2,192,808 3,313,765
Cash segregated for security deposits ...................... 305,364 303,436
Accounts receivable, less allowance for doubtful
accounts of $5,629 and $36,410 at March 31, 1995
and December 31, 1994, respectively...................... 275,442 317,559
Prepaid expenses and other assets........................... 209,167 258,668
Escrow deposits............................................. 1,052,886 896,234
Deferred borrowing costs, net of accumulated amorti-
zation of $695,269 and $652,691 at March 31, 1995
and December 31, 1994, respectively...................... 1,521,692 1,459,976
----------- -----------
$ 58,266,224 $ 60,189,348
=========== ===========
LIABILITIES AND PARTNERS' DEFICIT
Mortgage notes payable, net................................. $ 65,651,408 $ 68,152,522
Accounts payable............................................ 295,954 220,341
Accrued expenses............................................ 126,423 146,722
Accrued interest............................................ 860,820 1,680,833
Accrued property taxes...................................... 1,120,083 961,459
Advances from Southmark..................................... 33,296 32,690
Advances from affiliates - General Partner.................. 1,854,884 1,814,115
Payable to affiliates - General Partner..................... 6,307,046 5,926,684
Security deposits and deferred rental income................ 533,054 546,313
----------- -----------
76,782,968 79,481,679
----------- -----------
Partners' deficit:
Limited partners - 240,000 limited partnership units
authorized; 229,980 and 230,594 limited partnership
units issued and outstanding at March 30, 1995 and
December 31, 1994, respectively.......................... (8,860,493) (9,844,782)
General Partner.......................................... (9,656,251) (9,447,549)
----------- -----------
(18,516,744) (19,292,331)
----------- -----------
$ 58,266,224 $ 60,189,348
=========== ===========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL REAL ESTATE FUND XII, LTD.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-----------------------------
1995 1994
---------- ----------
<S> <C> <C>
Revenue:
Rental revenue................................... $4,684,000 $5,431,785
Interest......................................... 33,715 13,172
--------- ---------
Total revenue.................................. 4,717,715 5,444,957
--------- ---------
Expenses:
Interest......................................... 1,724,768 1,867,880
Interest - affiliates............................ 40,769 31,005
Depreciation and amortization.................... 1,069,629 1,145,877
Property taxes................................... 376,053 448,749
Personnel expenses............................... 609,755 718,484
Utilities........................................ 460,138 599,702
Repair and maintenance........................... 548,882 696,363
Property management fees - affiliates............ 233,793 267,973
Other property operating expenses................ 301,686 321,092
General and administrative....................... 34,324 42,528
General and administrative - affiliates.......... 120,016 129,468
--------- ---------
Total expenses................................. 5,519,813 6,269,121
--------- ---------
Net loss before extraordinary item.................. (802,098) (824,164)
Extraordinary gain on extinguishment of debt........ 1,838,192 -
--------- ---------
Net income (loss)................................... $1,036,094 $ (824,164)
========= =========
Net income (loss) allocable to limited partners..... $ 984,289 $ (782,956)
Net income (loss) allocable to General Partner...... 51,805 (41,208)
--------- ---------
Net income (loss)................................... $1,036,094 $ (824,164)
========= =========
Net income (loss) per limited partnership unit:
Income (loss) before extraordinary item............. $ (3.31) $ (3.40)
Extraordinary gain from extinguishment of debt 7.59 -
--------- ---------
Net income (loss) per limited partnership unit...... $ 4.28 $ (3.40)
========= =========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL REAL ESTATE FUND XII, LTD.
STATEMENTS OF PARTNERS' DEFICIT
(Unaudited)
For the Three Months Ended March 31, 1995 and 1994
<TABLE>
<CAPTION>
Total
General Limited Partners'
Partner Partners Deficit
------------ ------------- -------------
<S> <C> <C> <C>
Balance at December 31, 1993.............. $(8,456,354) $(13,138,511) $(21,594,865)
Net loss.................................. (41,208) (782,956) (824,164)
Contingent Management Incentive
Distribution........................... (288,097) - (288,097)
---------- ----------- -----------
Balance at March 30, 1994................. $(8,785,659) $(13,921,467) $(22,707,126)
========== =========== ===========
Balance at December 31, 1994.............. $(9,447,549) $ (9,844,782) $(19,292,331)
Net income................................ 51,805 984,289 1,036,094
Contingent Management Incentive
Distribution........................... (260,507) - (260,507)
---------- ----------- -----------
Balance at March 31, 1995................. $(9,656,251) $ (8,860,493) $(18,516,744)
========== =========== ===========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL REAL ESTATE FUND XII, LTD.
STATEMENTS OF CASH FLOWS
(Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------------------------
1995 1994
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Cash received from tenants........................ $ 4,693,480 $ 5,418,190
Cash paid to suppliers............................ (1,845,895) (2,329,260)
Cash paid to affiliates........................... (233,954) (998,494)
Interest received................................. 33,715 13,172
Interest paid..................................... (1,498,730) (1,721,522)
Interest paid to affiliates....................... - (470,489)
Property taxes paid............................... (360,706) (817,767)
Deferred borrowing costs paid..................... (104,294) (31,966)
---------- ----------
Net cash provided by (used in)
operating activities.............................. 683,616 (938,136)
---------- ----------
Cash flows used in investing activities:
Additions to real estate investments.............. (138,784) (213,577)
---------- ----------
Cash flows from financing activities:
Proceeds from refinancing of mortgage
notes payable................................... 334,062 -
Principal payments on mortgage notes
payable......................................... (1,999,851) (472,698)
Repayment of mortgage loans from affiliates....... - (1,603,135)
Advances from affiliates - General Partner........ - 6,000
Repayment of advances from affiliates -
General Partner................................. - (1,206,664)
---------- ----------
Net cash used in financing activities................ (1,665,789) (3,276,497)
---------- ----------
Net decrease in cash and cash equivalents............ (1,120,957) (4,428,210)
Cash and cash equivalents at beginning of
period............................................ 3,313,765 4,938,029
---------- ----------
Cash and cash equivalents at end of period........... $ 2,192,808 $ 509,819
========== ==========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL REAL ESTATE FUND XII, LTD.
STATEMENTS OF CASH FLOWS
(Unaudited)
Reconciliation of Net Income (Loss) to Net Cash Provided by
Operating Activities
<TABLE>
<CAPTION>
Three Months Ended
March 31,
--------------------------------
1995 1994
---------- -----------
<S> <C> <C>
Net income (loss).................................... $1,036,094 $ (824,164)
--------- ---------
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization..................... 1,069,629 1,145,877
Amortization of deferred borrowing costs.......... 42,578 29,180
Amortization of discounts on mortgage
notes payable................................... 102,743 49,011
Net interest added on advances from
affiliates - General Partner.................... 40,769 23,904
Net interest added on advances from
Southmark....................................... 606 433
Extraordinary gain on extinguishment
of debt......................................... (1,838,192) -
Changes in assets and liabilities:
Cash segregated for security deposits........... (1,928) 96,922
Accounts receivable............................. 42,117 (92,005)
Prepaid expenses and other assets............... 49,501 25,696
Escrow deposits................................. (156,652) (388,369)
Deferred borrowing costs........................ (104,294) (31,966)
Accounts payable................................ 75,613 13,884
Accrued expenses................................ (20,299) (109,611)
Accrued interest................................ 80,111 (395,654)
Accrued property taxes.......................... 158,624 104,681
Payable to affiliates - General Partner......... 119,855 (601,053)
Security deposits and deferred rental ..........
income........................................ (13,259) 15,098
--------- --------
Total adjustments............................. (352,478) (113,972)
--------- --------
Net cash provided by operating activities............ $ 683,616 $(938,136)
========= ========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
McNEIL REAL ESTATE FUND XII, LTD.
Notes to Financial Statements
(Unaudited)
March 31, 1995
NOTE 1.
- -------
McNeil Real Estate Fund XII, Ltd. (the "Partnership") was organized February 2,
1981 as a limited partnership organized under the provisions of the California
Uniform Limited Partnership Act. The general partner of the Partnership is
McNeil Partners, L.P. (the "General Partner"), a Delaware limited partnership,
an affiliate of Robert A. McNeil. The Partnership is governed by an amended and
restated limited partnership agreement, dated September 6, 1991 (the "Amended
Partnership Agreement"). The principal place of business for the Partnership and
the General Partner is 13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240.
In the opinion of management, the financial statements reflect all adjustments
necessary for a fair presentation of the Partnership's financial position and
results of operations. All adjustments were of a normal recurring nature.
However, the results of operations for the three months ended March 31, 1995 are
not necessarily indicative of the results to be expected for the year ending
December 31, 1995.
NOTE 2.
- -------
The financial statements should be read in conjunction with the financial
statements contained in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 1994, and the notes thereto, as filed with the
Securities and Exchange Commission, which is available upon request by writing
to McNeil Real Estate Fund XII, Ltd. c/o McNeil Real Estate Management, Inc.,
Investor Services, 13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240.
NOTE 3.
- -------
The accompanying financial statements have been prepared assuming that the
Partnership will continue as a going concern. The Partnership has suffered
recurring losses from operations and has a net Partners' deficit that raise
substantial doubt about its ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
NOTE 4.
- -------
Certain reclassifications have been made to prior period amounts to conform with
current period presentation.
NOTE 5.
- -------
The Partnership pays property management fees equal to 5% of the gross rental
receipts of the Partnership's properties to McNeil Real Estate Management, Inc.
("McREMI"), an affiliate of the General Partner, for providing property
management services for the Partnership's residential and commercial properties
and leasing services for its residential properties. McREMI may choose to
provide leasing services for the Partnership's commercial properties, in which
case McREMI will receive a property management fee from such commercial
properties equal to 3% of the property's gross rental receipts plus commissions
based on the prevailing market rate for such services where the property is
located.
The Partnership reimburses McREMI for its costs, including overhead, of
administering the Partnership's affairs.
Affiliates of the General Partner have advanced funds to the Partnership to meet
working capital requirements. These advances and mortgage loans accrue interest
at a rate equal to the prime lending rate plus 1%.
<PAGE>
Under terms of the Amended Partnership Agreement, the Partnership is paying a
Management Incentive Distribution ("MID") to the General Partner. The maximum
MID is calculated as 1% of the tangible asset value of the Partnership. The
maximum MID percentage decreases subsequent to 1999. Tangible asset value is
determined by using the greater of (i) an amount calculated by applying a
capitalization rate of 9% to the annualized net operating income of each
property or (ii) a value of $10,000 per apartment unit for residential property
and $50 per gross square foot for commercial property to arrive at the property
tangible asset value. The property tangible asset value is then added to the
book value of all other assets excluding intangible items. Prior to July 1,
1993, the MID consists of two components: (i) the fixed portion which is payable
without respect to the net income of the Partnership and is equal to 25% of the
maximum MID (the "Fixed MID") and (ii) a contingent portion which is payable
only to the extent of the lesser of the Partnership's excess cash flow, as
defined, or net operating income (the "Entitlement Amount") and is equal to up
to 75% of the maximum MID (the "Contingent MID").
Effective July 1, 1993, the General Partner amended the Amended Partnership
Agreement as a settlement to a class action complaint. This amendment eliminates
the Fixed MID portion and makes the entire MID payable to the extent of the
Entitlement Amount. In all other respects the calculation and payment of the MID
will remain the same.
Fixed MID was payable in limited partnership units ("Units") unless the
Entitlement Amount exceeded the amount necessary to pay the Contingent MID in
which case, at the General Partner's option, the Fixed MID was paid in cash to
the extent of such excess.
Contingent MID will be paid to the extent of the Entitlement Amount, and may be
paid (i) in cash, unless there is insufficient cash to pay the distribution in
which event any unpaid portion not taken in Units will be deferred and is
payable, without interest, from the first available cash and/or (ii) in Units. A
maximum of 50% of the MID may be paid in Units. The number of Units issued in
payment of the MID is based on the greater of $50 per Unit or the net tangible
asset value, as defined, per Unit.
Any amount of the MID that is paid to the General Partner in Units will be
treated as if cash is distributed to the General Partner and is then contributed
to the Partnership by the General Partner. The Fixed MID was treated as a fee
payable to the General Partner by the Partnership for services rendered. The
Contingent MID represents a return of equity to the General Partner for
increasing cash flow, as defined, and accordingly is treated as a distribution.
Compensation, reimbursements and distributions paid to or accrued for the
benefit of the General Partner and its affiliates are as follows:
<TABLE>
<CAPTION>
Three Months Ended
March 30,
-------------------------------
1995 1994
-------- --------
<S> <C> <C>
Charged to other assets:
Property management fees - affiliates................ $233,793 $267,973
Interest - affiliates................................ 40,769 31,005
Charged to general and administrative - affiliates:
Partnership administration........................ 120,016 129,468
------- --------
$394,578 $428,446
======= =======
Charged to General Partner's deficit:
Contingent MID.................................... $260,507 $288,097
======= =======
</TABLE>
<PAGE>
NOTE 6.
- -------
The Partnership filed claims with the United States Bankruptcy Court for the
Northern District of Texas, Dallas Division (the "Bankruptcy Court") against
Southmark for damages relating to improper overcharges, breach of contract and
breach of fiduciary duty. The Partnership settled these claims in 1991, and such
settlement was approved by the Bankruptcy Court.
An Order Granting Motion to Distribute Funds to Class 8 Claimants dated April
14, 1995 was issued by the Bankruptcy Court. In accordance with the Order, in
May 1995 the Partnership received in full satisfaction of its claims, $49,818 in
cash, and common and preferred stock in the reorganized Southmark currently
valued at approximately $16,000, which amounts represent the Partnership's
pro-rata share of Southmark assets available for Class 8 Claimants.
NOTE 7.
- -------
On March 24, 1995, the partnership refinanced the mortgage note payable on Plaza
Westlake. The new loan bears an interest rate of 9.5% and will mature January
31, 2000. Following is a summary of the transaction:
<TABLE>
<CAPTION>
<S> <C>
New loan proceeds...................... $ 4,000,000
Capital improvement account............ (300,000)
Existed debt retired................... (3,365,938)
----------
Cash proceeds from refinancing......... $ 334,062
==========
</TABLE>
In addition, the Partnership incurred loan costs of $102,294 relating to the
refinancing.
On February 26, 1995, the Partnership paid off the interest in net profits
on Buccaneer Village for retirement of $3,588,192 of debt. The debt was retired
at a discounted payoff of $1,750,000, which resulted in an extraordinary gain on
extinguishment of debt of $1,838,192.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------- ---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
FINANCIAL CONDITION
- -------------------
The Partnership was formed to acquire, operate and ultimately dispose of a
portfolio of income-producing properties. At March 31, 1995, the Partnership
owned nine apartment properties and two shopping centers. All of the
Partnership's properties are subject to mortgage notes.
RESULTS OF OPERATIONS
- ---------------------
Revenue:
Rental revenue for the three months of 1995 was $4,684,000 as compared to
$5,431,785 for the same period in 1994. This decrease of $747,785 is primarily
due to the loss of $792,734 in rental revenue generated from Fox Run and Village
East, which were sold in December and November 1994, respectively. This decrease
was offset by rental increases at all of the remaining properties except
Sundance, Lamar Plaza and Plaza Westlake. The Wichita market where Sundance is
located continues to be depressed and without major capital improvements,
Sundance's occupancy will continue to deteriorate. The decline in revenue at
Lamar Plaza and Plaza Westlake is attributable to reduced percentage rents
earned and common area maintenance charges.
Interest income increased by $20,543 for the three months ended March 31, 1995
as compared to the same period last year. This increase is due to larger average
cash balances being invested in interest-bearing accounts.
<PAGE>
Expenses:
Partnership expenses decreased by $749,308 for the first three months of 1995 as
compared to the same period last year primarily due to the sale of Fox Run and
Village East in 1994 and Cedar Mill Crossing in December 1993. The effects from
these transactions were declines of $189,380 for interest, $135,639 for
depreciation, $46,284 for property taxes, $142,893 for personnel expenses,
$141,831 for utilities, $121,703 for repair and maintenance, $38,632 for
property management fees - affiliates, and $23,430 other property operating
expenses.
In addition to the sale of Fox Run, Village East, and Cedar Mill Crossing other
factors affected the level of expenses reported by the remaining properties.
Interest expense - affiliates increased by $9,764 or 31% due to an increases in
the prime rate used to calculate the interest expense on the advances.
General and administrative expense decreased by $8,205 or 19% for the three
months ending March 31, 1995 as compared to the same period in 1994 due to a
reduction in tax preparation and legal costs.
All other remaining expense categories remained comparable to the same period
last year.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The Partnership generated $636,616 through operating activities for the first
three months of 1995 as compared to a $938,136 use of cash for the first three
months of 1994. This increase in cash can be attributed to the reduction in
interest paid as a result of the sale of Cedar Mill in 1993. Also declines in
cash and interest paid to affiliates attributed to the increase in cash. In
January 1994, the Partnership used the proceeds from the sale of Cedar Mill to
pay down on the affiliate advances and the payment of the Fixed MID. The
Partnership also experienced a reduction in the cash paid to supplies and
property taxes paid but this decrease was somewhat offset by the reduction in
the cash received from tenants and the increase in deferred borrowing costs
paid.
The Partnership expended $138,784 and $213,577 for capital improvements to its
properties for the three months ended March 31, 1995 and 1994, respectively.
During the first quarter of 1995, the Partnership expended $1,665,789 for
financing activities as compared to $3,276,497 for the same period in 1994. This
reduction is primarily due to the payoff in 1994 of the mortgage loan from
affiliates and the pay down of the advances from affiliates. During 1995, the
Partnership received cash proceeds of $334,062 for the refinancing of Plaza
Westlake. The increase in the principal payments on mortgage notes is due to
$1,750,000 discounted payoff of the interest in net profits on Buccaneer
Village.
Short Term Liquidity:
At March 31, 1995, the Partnership held cash and cash equivalents of $2,192,808.
The General Partner considers the Partnership's cash reserves adequate for
anticipated operations for 1995.
In 1995, the Partnership's properties are expected to provide positive cash flow
from operations. Management will continue to address ongoing capital improvement
needs in light of the aging condition of the Partnership's properties. The
Partnership has budgeted approximately $1,948,000 for capital improvements for
1995. The General Partner believes these capital improvements are necessary to
allow the Partnership to increase its rental revenues in the competitive markets
in which the Partnership's properties operate. These expenditures also allow the
Partnership to reduce certain repairs and maintenance expenses from amounts that
would otherwise be incurred. During 1994, the Partnership began paying the
Contingent MID and anticipates to continue to make payments to the General
Partner in 1995.
<PAGE>
During 1995, the Partnership is faced with mortgage principal payments and
mortgage maturities on Buccaneer Village, Lamar Plaza, Millwood Park, Palisades
at the Galleria, Plaza Westlake and Sundance, totaling approximately
$28,144,000. It is management's policy to negotiate extensions or arrange
refinancings for the mortgage notes that are due. In February 1995, the
Partnership paid off the interest in net profits on Buccaneer Village at a
discounted payoff of $1,750,000 for retirement of $3,588,192 of debt which
resulted in an extraordinary gain on extinguishment of debt of $1,838,192.
Additionally, management successfully refinanced Plaza Westlake on March 24,
1995. The new 5 year mortgage note in the amount of $4,000,000 retired the
maturing mortgage of $3,366,000 and yielded $334,062 in proceeds to the
Partnership. Management is currently negotiating the refinancing of Buccaneer
Village's first mortgage and Palisades at the Galleria. Management anticipates
closing on the refinancings by mid-year with expected proceeds to the
Partnership of approximately $3,500,000.
The remaining three properties with 1995 maturities, Lamar Plaza, Millwood Park
and Sundance, have maturing debt of $12,692,000 and are currently on the market
for sale. The General Partner believes that Lamar Plaza and Sundance cannot be
refinanced given their current level of debt. The General Partner does not
believe it would be in the Partnership's best interest to invest additional
money into these properties. Therefore in the event the Partnership is unable to
arrange a sale or extension of these loans, the Partnership may allow
foreclosure of these properties for full settlement of the debt. The foreclosure
of these properties would not have an adverse effect on the Partnership. The
mortgage note payable balance and net book value of Lamar Plaza are $3,926,758
and $3,097,651, respectively. The mortgage note payable balance and net book
value of Sundance are $7,928,429 and $6,088,776, respectively. The General
Partner believes it is in the best interest of the Partnership to market
Millwood Park for sale instead of refinancing the maturing mortgage. The
property would yield lesser proceeds through a refinancing and require
additional capital which would be a burden to cash reserves. The mortgage note
payable balance and the net book value of Millwood Park are $2,914,949 and
$3,310,908, respectively. The carrying value of all of these properties is below
what the General Partner estimates the net realizable value to be. There can be
no assurance that these sales/refinancings will occur to coincide with the
Partnership's cash needs.
Long Term Liquidity:
The Partnership's working capital needs have been supported by advances from
affiliates during the past several years. Some of that support was provided on a
short-term basis to meet monthly operating requirements, with repayment
occurring as funds became available; other advances were longer term in nature
due to lack of funds for repayment. Additionally, the General Partner has
allowed the Partnership to defer payment of MID and reimbursements until such
time as the Partnership 's cash reserves allow payments. During 1994, the
Partnership began to make repayments to the General Partner for advances and has
paid some of the accrued MID. The Partnership will continue to make such
payments as is allowed by cash reserves and cash flows of the Partnership.
However, the Partnership will not be able to repay the General Partner all
payables outstanding in the foreseeable future. The General Partner will
continue to defer the unpaid sums until the Partnership's cash reserves allow
such payments.
The General Partner has established a revolving credit facility not to exceed
$5,000,000 in the aggregate which is available on a "first-come, first-served"
basis to the Partnership and other affiliated partnerships if certain conditions
are met. Borrowings under the facility may be used to fund deferred maintenance,
refinancing obligations and working capital needs. There is no assurance that
the Partnership will receive additional funds under the facility because no
amounts will be reserved for any particular partnership. At March 31, 1995,
$2,102,530 remained available for borrowing under the facility; however,
additional funds could become available as other partnerships repay borrowings.
Should market conditions change and operations deteriorate, present cash
resources may be insufficient to meet current needs. Other than available
portions of the $5,000,000 revolving credit facility, discussed above, which may
not be available when required by the Partnership, the Partnership has no
existing lines of credit from outside sources. Other sources of working capital
may be required and no such other sources have been identified.
<PAGE>
Possible actions to resolve operating deficiencies include sales of properties,
refinancing or renegotiating terms of existing loans, deferring major capital
expenditures, except where improvements are expected to enhance the
competitiveness or marketability of the properties, or arranging additional
support from affiliates. Additional affiliate support is not assured, since
neither the General Partner nor any affiliates have obligations to make advances
in excess of any unused portion of the revolving credit facility discussed
above. Sales of properties are possibilities, however there is no assurance that
a sale can be completed, nor that a closing could be timed to coincide with the
Partnership's cash needs.
These conditions raise substantial doubt about the Partnership's ability to
continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of these uncertainties.
Distributions
With the exception of the Contingent MID, distributions to partners have been
suspended since 1986 as part of the General Partner's policy of maintaining
adequate cash reserves. Distributions to the limited partners will remain
suspended for the foreseeable future. The General Partner will continue to
monitor the cash reserves and working capital needs of the Partnership to
determine when cash flows will support distributions to the limited partners. A
distribution of $260,507 for the Contingent MID has been accrued by the
Partnership for the year ended March 31, 1995 for the General Partner.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits.
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<C> <S>
3.3 Amended and Restated Partnership Agreement,
dated September 6, 1991 (Incorporated by
reference to the Quarterly Report on Form
10-Q for the quarter ended September
30, 1991).
11. Statement regarding computation of net loss
per limited partnership unit: net loss per
limited partnership unit is computed by
dividing net loss allocated to the limited
partners by the number of limited
partnership units outstanding. Per unit
information has been computed based on
229,980 and 230,594 limited partnership
units outstanding in 1995 and 1994.
27. Financial Data Schedule for the year ended
December 31, 1994 and for the quarter ended
March 31, 1995.
</TABLE>
(b) Reports on Form 8-K. There were no reports on Form 8-K filed during
the quarter ended March 31, 1995.
<PAGE>
McNEIL REAL ESTATE FUND XII, LTD.
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:
<TABLE>
<CAPTION>
McNEIL REAL ESTATE FUND XII, Ltd.
By: McNeil Partners, L.P., General Partner
By: McNeil Investors, Inc., General Partner
<S> <C>
May 12, 1995 By: /s/ Donald K. Reed
- ---------------- -------------------------------------------------
Date Donald K. Reed
President and Chief Executive Officer
May 12, 1995 By: /s/ Robert C. Irvine
- ---------------- -------------------------------------------------
Date Robert C. Irvine
Chief Financial Officer of McNeil Investors, Inc.
Principal Financial Officer
May 12, 1995 By: /s/ Brandon K. Flaming
- ---------------- -------------------------------------------------
Date Brandon K. Flaming
Chief Accounting Officer of McNeil Real Estate
Management, Inc.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-1994 DEC-31-1995
<PERIOD-END> DEC-31-1994 MAR-31-1995
<CASH> 3,313,765 2,192,808
<SECURITIES> 0 0
<RECEIVABLES> 353,969 310,993
<ALLOWANCES> (36,410) (5,629)
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 78,020,212 78,151,239
<DEPRECIATION> (37,105,195) (37,939,708)
<TOTAL-ASSETS> 60,189,348 58,266,224
<CURRENT-LIABILITIES> 0 0
<BONDS> 68,152,522 65,651,408
<COMMON> 0 0
0 0
0 0
<OTHER-SE> 0 0
<TOTAL-LIABILITY-AND-EQUITY> 60,189,348 58,266,224
<SALES> 21,295,696 4,684,000
<TOTAL-REVENUES> 27,701,373 4,717,715
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 16,698,851 3,754,276
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 7,781,588 1,765,537
<INCOME-PRETAX> 3,220,934 (802,098)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 3,220,934 (802,098)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 246,149 1,838,192
<CHANGES> 0 0
<NET-INCOME> 3,467,083 1,036,094
<EPS-PRIMARY> 0 0
<EPS-DILUTED> 0 0
</TABLE>
