<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 quarterly period ended March 31, 1994
..............................................
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 0-10831
.......................................................
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
..............................................................................
(Exact name of registrant as specified in its charter)
California 94-2744492
..............................................................................
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5520 LBJ Freeway, Suite 430, Dallas, Texas 75240
..............................................................................
(Address of principal executive offices) (Zip code)
(214) 702-0027
..............................................................................
(Registrant's telephone number, including area code)
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
---- -----
Index to Exhibits: 10
Total Pages: 19
-1-
<PAGE>
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- - ------ --------------------
BALANCE SHEETS
(unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
ASSETS 1994 1993
- - ------ --------- ------------
<S> <C> <C>
Real estate, net of accumulated depreciation........... $ 5,064 $ 5,140
--------- --------
Net investment in Master Loan.......................... 91,786 91,746
--------- --------
Cash and cash equivalents.............................. 398 222
United States Treasury Notes (Treasury Notes) at cost
(market - $8,316 in 1994 and $10,905 in 1993)....... 7,991 10,391
Due from affiliates.................................... 1,023 559
Other assets........................................... 377 384
--------- --------
$106,639 $108,442
======== ========
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
- - ------------------------------------------
Accounts payable and accrued expenses.................. $ 102 $ 177
Distributions payable.................................. 348 332
-------- --------
450 509
-------- --------
Commitment (Note 4)....................................
Partners' equity (deficit):
Limited Partners - 199,046 units outstanding........ 106,494 108,220
General Partner..................................... (305) (287)
-------- --------
106,189 107,933
-------- --------
$106,639 $108,442
======== ========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of the financial statements.
-2-
<PAGE>
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
INCOME STATEMENT
(unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
----------------------------
1994 1993
-------- ---------
<S> <C> <C>
Revenues:
Rental income............................ $ 314 $ 292
Income on investment in Master Loan
from affiliate.......................... 474 1,628
Interest on investments.................. 167 250
------ ------
Total revenues.......................... 955 2,170
------ ------
Costs and expenses:
Property operations...................... 144 152
Depreciation............................. 104 102
Administrative........................... 138 245
------ ------
Total costs and expenses (a)............ 386 499
------ ------
Income from operations.................... 569 1,671
Other income.............................. 50 -
Gain on sale of Treasury Note............. - 17
------ ------
Net income................................ $ 619 $1,688
====== ======
Net income per Limited Partnership Unit:
Income from operations................... $ 2.83 $ 8.31
Other income............................. .25 -
Gain on sale of Treasury Notes........... - .09
------ ------
Net income............................... $ 3.08 $ 8.40
====== ======
Distributions per Limited Partner-
ship Unit................................ $11.75 $14.25
====== ======
</TABLE>
[FN]
(a) Costs and expenses include $103,000 to related parties for the three months
ended March 31, 1994, and 1993. See supplemental information with respect
to related party transactions in Notes 2 and 3 of the financial statements.
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of the financial statements.
-3-
<PAGE>
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
(unaudited)
For the Three Months Ended March 31, 1994 and 1993
(in thousands)
<TABLE>
<CAPTION>
TOTAL
GENERAL LIMITED PARTNERS'
PARTNER PARTNERS EQUITY (DEFICIT)
--------- ----------- ----------------
<S> <C> <C> <C>
Balance at December 31, 1992....... $(163) $120,575 $120,412
Net income......................... 17 1,671 1,688
Distributions...................... (29) (2,836) (2,865)
----- -------- --------
Balance at March 31, 1993.......... $(175) $119,410 $119,235
===== ======== ========
Balance at December 31, 1993....... $(287) $108,220 $107,933
Net income......................... 6 613 619
Distributions...................... (24) (2,339) (2,363)
----- -------- --------
Balance at March 31, 1994.......... $(305) $106,494 $106,189
===== ======== ========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of the financial statements.
-4-
<PAGE>
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
STATEMENTS OF CASH FLOWS
(unaudited)
Increase (decrease) in Cash and Cash Equivalents
(in thousands)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
------------------------------------------
1994 1993
------------- ---------------
<S> <C> <C>
Cash flows from operating activities:
Cash received from tenants........................... $ 318 $ 287
Cash paid to suppliers (a)........................... (397) (259)
Interest received (b)................................ 220 2,157
Other income received................................ 50 -
------- -------
Net cash provided by operating activities............. 191 2,185
------- -------
Cash flows from investing activities:
Additions to real estate............................. (28) -
Advances on Master Loan.............................. (40) (340)
Proceeds from sale of Treasury Notes................. 4,720 616
Purchase of Treasury notes........................... (2,320) -
------- -------
Net cash provided by investing activities............. 2,332 276
------- -------
Cash flows from financing activities:
Distributions to partners............................ (2,347) (2,837)
------- -------
Net increase (decrease) in cash and cash equivalents.. 176 (376)
Cash and cash equivalents, at beginning of period..... 222 1,877
------- -------
Cash and cash equivalents, at end of period........... $ 398 $ 1,501
======= =======
</TABLE>
[FN]
(a) Payments to related parties totaling $103,000 for the three months ended
March 31, 1994 and 1993, respectively, are included in cash paid to
suppliers.
(b) Payments from related parties totaling approximately $261,000 for the
three months ended March 31, 1993, are included in interest received.
See supplemental information with respect to related party
transactions in Notes 2 and 3 of the financial statements.
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of the financial statements.
-5-
<PAGE>
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
Notes to Financial Statements
March 31, 1994
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
- - ------------------------------
The financial statements reflect all adjustments necessary for a fair
presentation of the financial position of Consolidated Capital Institutional
Properties (the "Partnership") and the results of its operations. All
adjustments were of a normal recurring nature. However, the results of
operations for the three months ended March 31, 1994, are not necessarily
indicative of the results to be expected for the year ending December 31, 1994.
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, 1993 (the "1993 Annual Report"), and the notes thereto,
as filed with the Securities and Exchange Commission, which is available upon
request by writing to the General Partner, ConCap Equities, Inc. ("CEI"),
Investor Relations, 5520 LBJ Freeway, Suite 430, Dallas, Texas 75240.
Income per Partnership Unit
- - ---------------------------
Income per Unit is computed by dividing net income allocated to the Unitholders
by the number of Units outstanding. Per Unit information has been computed
based on 199,046 and 199,051 Units outstanding for the three months ended March
31, 1994 and 1993, respectively.
NOTE 2 - RELATED PARTY TRANSACTIONS
- - -----------------------------------
The Partnership has paid property management fees equal to 5% of collected gross
rental revenues ("Rental Revenues") for property management services in each of
the three month periods ended March 31, 1994 and 1993. A portion of such
property management fees equal to 4% of Rental Revenues has been paid to the
property management company performing day-to-day property management services
and the portion equal to 1% of Rental Revenues has been paid to Partnership
Services, Inc. ("PSI") for advisory services related to day-to-day property
operations. During the three months ended March 31, 1993, day-to-day property
management services were provided to the Partnership's property by an
unaffiliated management company. In July 1993, Coventry Properties, Inc.
("Coventry"), an affiliate of the General Partner, assumed day-to-day property
management responsibilities for the Partnership's property under the same
management fee arrangement as the unaffiliated management company. Fees paid to
PSI and Coventry have been reflected in the table below as compensation to
related parties:
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
-----------------------------------
COMPENSATION 1994 1993
- - ------------ ------------- ------------
<S> <C> <C>
(in thousands)
Charged to property operations expense:
Property management fees........... $ 16 $ 3
===== ====
</TABLE>
The Partnership Agreement provides for reimbursement to the general partner and
its affiliates for costs incurred in connection with administration of
Partnership activities and for reimbursement to Coventry for expenses related to
property operations (primarily salaries and related costs for on-site property
personnel). The General Partner and its affiliates, including Coventry,
received reimbursements included in the following table:
-6-
<PAGE>
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
--------------------
REIMBURSEMENT 1994 1993
- - ------------- --------- ---------
(in thousands)
<S> <C> <C>
Charged to property operations expenses:
Reimbursement of direct property expense............. $ 31 $ -
Charged to administrative expenses:
Reimbursement of administrative expenses (including
payroll reimbursements)............................. 56 100
----- ---------
$ 87 $ 100
===== =========
</TABLE>
In addition to the compensation and reimbursements described above, interest
payments are received from and loan advances are made to Consolidated Capital
Equity Partners ("CCEP") pursuant to the New Master Loan Agreement, which is
described more fully in the 1993 Annual Report. See Note 3.
NOTE 3 - NET INVESTMENT IN MASTER LOAN
- - --------------------------------------
Interest due to the Partnership according to the terms of the New Master Loan
Agreement but not recognized in the income statements totaled approximately $6.2
million and $4.4 million for the three months ended March 31, 1994, and 1993,
respectively. At March 31, 1994, such cumulative unrecognized interest totaling
approximately $92.4 million was not included in the balance of the investment in
Master Loan.
In February 1994, the Partnership advanced $40,000 to CCEP as an advance on the
Master Loan. CCEP then advanced $40,000 to New Carlton House Partners as an
advance on the note receivable secured by the Carlton House Apartment and Office
Building ("Carlton House") to pay the remaining balance of 1993 property taxes.
NOTE 4 - COMMITMENT
- - -------------------
The Partnership is required by the Partnership Agreement to maintain working
capital reserves for contingencies of not less than 5% of Net Invested Capital,
as defined in the Partnership Agreement. Reserves, including cash and cash
equivalents and Treasury Notes (at market), totaling approximately $8.7 million,
were greater than the reserve requirement of $8 million at March 31, 1994.
NOTE 5 - PARTNERS' EQUITY (DEFICIT)
- - -----------------------------------
During March 1994, the General Partner paid distributions of distributable cash
from operations of approximately $2.3 million or $11.75 per Unit to Limited
Partners, and accrued a matching general partner distribution of approximately
$24,000.
NOTE 6 - OTHER INCOME
- - ---------------------
As described in the 1993 Annual Report, the Partnership (and simultaneously 15
affiliated partnerships) entered claims in Southmark Corporation's Chapter 11
bankruptcy proceeding in 1991. These claims related to Southmark Corporation's
activities while it exercised control (directly, or indirectly through its
affiliates) over the Partnership. The U.S. Bankruptcy Court set the
Partnership's and the affiliated partnerships' allowed claim at $11 million, in
aggregate. In March 1994, The Partnership received $50,000 in cash, 909 shares
of Southmark Corporation Redeemable Series A Preferred Stock and 6,651 shares of
Southmark Corporation New Common Stock representing the Partnership's share of
the recovery based on its pro rata portion of claims filed.
-7-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- - ------ ---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
RESULTS OF OPERATIONS
- - ---------------------
Property Operations:
- - -------------------
For the three months ended March 31, 1994, rental revenues increased $22,000 or
8% over 1993 due to increased rental rates at the Loft Apartments.
Property operations expense decreased $8,000 or 5% for 1994 compared with 1993
primarily because higher average occupancies resulted in reduced leasing costs
and vacant units' maintenance costs. Real estate taxes increased by
approximately $8,000 due to a tax refund received in the first part of 1993.
Administrative Expenses:
Administrative expenses for the three months ended March 31, 1994, decreased
$107,000 or 44% from 1993 because of lower insurance costs and a decrease in
administrative overhead costs.
Income on Investment in Master Loan:
Income on the investment in Master Loan is based on operations of CCEP's
properties which secure the Master Loan. The following table summarizes the
sources of income on the investment in Master Loan with respect to CCEP's
operations during the three months ended March 31, 1994 and 1993, respectively:
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
----------------------
1994 1993
---------- ----------
<S> <C> <C>
Funds provided by property operations................ $ 4,487 $ 4,471
Funds used for property operations (includes admin-
istrative expenses)................................. (3,165) (2,688)
Debt service payments on underlying notes payable.... (266) (310)
------- -------
Net funds from property operations................... 1,056 1,473
Collection of note receivable........................ - 150
------- -------
Total funds from operations.......................... 1,056 1,623
Advance on Carlton House note receivable............. (589) -
Net investing activity............................... 7 5
------- -------
Net funds provided................................... $ 474 $ 1,628
======= =======
Master Loan activity:
Interest income...................................... $ 474 $ 1,628
------- -------
$ 474 $ 1,628
======= =======
</TABLE>
Income from the investment in the Master Loan decreased $1.2 million or 71% in
the three months ended March 31, 1994 from 1993. Funds provided by operations
of the CCEP properties were comparable for the three months ended March 31, 1994
with 1993. Funds used for property operations increased $477,000 or 18% in 1994
because of increases in replacements and refurbishments and an increase in
general property expenses. Debt service payments to third-party lien holders
decreased $44,000 due to the maturity and payoff of a note payable the third
quarter of 1993 and elimination of mortgage interest participation. In March
1994, CCEP advanced $589,000 to New Carlton House Partners, as an advance on the
Carlton House Note, to pay Carlton House's 1994 property taxes in an effort to
protect CCEP's interest in the property. As discussed in the 1993 Annual
Report, all cash flows generated by Carlton House are reinvested in the
property.
-8-
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
- - -------------------------------
Three Months Ended March 31, 1994
- - ---------------------------------
The Partnership's net cash inflows, which totaled approximately $4.9 million
were generated from two primary sources: proceeds from the sale of Treasury
Notes of approximately $4.7 million and net cash provided by operations of
$191,000. The primary uses of cash for the same three-month period, totaling
approximately $4.7 million were distributions paid to Limited Partners of $2.3
million, purchase of Treasury notes of approximately $2.3 million, payment of
Master Loan advances of $40,000 and additions to real estate of $28,000.
The Partnership is required by the Partnership Agreement to maintain working
capital reserves for contingencies of not less than 5% of Net Invested Capital,
as defined in the Partnership Agreement. Reserves, including cash and cash
equivalents and Treasury Notes (at market), totaling approximately $8.7 million,
were greater than the reserve requirement of approximately $8 million at March
31, 1994.
Other Income
- - ------------
As described in the 1993 Annual Report, the Partnership (and simultaneously 15
affiliated partnerships) entered claims in Southmark Corporation's Chapter 11
bankruptcy proceeding in 1991. These claims related to Southmark Corporation's
activities while it exercised control (directly, or indirectly through its
affiliates) over the Partnership. The U.S. Bankruptcy Court set the
Partnership's and the Affiliated Partnership's allowed claim at $11 million, in
aggregate. In March 1994, The Partnership received $50,000 in cash, 909 shares
of Southmark Corporation Redeemable Series A Preferred Stock and 6,651 shares of
Southmark Corporation New Common Stock representing the Partnership's share of
the recovery based on its pro rata portion of claims filed.
Status of the Master Loan
- - -------------------------
In February 1994, the Partnership advanced $40,000 to CCEP as an advance on the
Master Loan. CCEP then advanced $40,000 to New Carlton House Partners as an
advance on the note receivable secured by the Carlton House Apartment and Office
Building ("Carlton House") to finalize all payments required in the payment in
1993 of Carlton House's delinquent property taxes.
CCEP Property Operations
- - ------------------------
For the three months ended March 31, 1994, CCEP's net loss totaled $6.7 million
on total revenues of $5.6 million primarily because CCEP's statements of
operations includes interest expense of approximately $6.7 million, attributable
to the Master Loan of which approximately $6.2 million represents interest
accrued in excess of required payments. CCEP recognizes interest expense on the
Master Loan obligation according to the note terms, although payments to the
Partnership are required only to the extent of excess cash flow, as defined in
the New Master Loan Agreement. CCEP will continue to generate operating losses
as a result of such interest accruals and noncash charges for depreciation.
Distributions
- - -------------
During March 1994, the General Partner paid distributions of distributable cash
from operations of approximately $2.3 million or $11.75 per Unit to Limited
Partners, and accrued a matching general partner distribution of approximately
$24,000.
-9-
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
- - ------ -----------------
Neither the Partnership, nor CCEP are parties to, nor are any of the
Partnership's or CCEP's properties the subject of, any material pending legal
proceedings as of March 31, 1994.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- - ------ --------------------------------
(a) Exhibits.
<TABLE>
<CAPTION>
S-K REFERENCE SEQUENTIAL
NUMBER DESCRIPTION PAGE NUMBER
------------- ----------- -----------
<S> <C> <C>
28.1 Consolidated Capital Equity Partners, L.P.,
unaudited Financial Statements for the three
months ended March 31, 1994 and 1993.
</TABLE>
(b) Reports on Form 8-K:
None.
-10-
<PAGE>
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
SIGNATURE PAGE
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.
CONSOLIDATED CAPITAL INSTITUTIONAL PROPERTIES
By: CONCAP EQUITIES, INC.
Its General Partner,
May 19, 1994 By: /s/ David C. Meek
- - --------------------- ------------------------------
Date David C. Meek
President
May 19, 1994 By: /s/ David K. Ronck
- - --------------------- ------------------------------
Date David K. Ronck
Vice President and Secretary
May 19, 1994 By: /s/ Patricia L. Campbell
- - --------------------- ------------------------------
Date Patricia L. Campbell
Vice President and Treasurer
(chief accounting officer)
-11-
<PAGE>
CONSOLIDATED CAPITAL EQUITY PARTNERS, L.P.
UNAUDITED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED
MARCH 31, 1994 AND 1993
-12-
<PAGE>
CONSOLIDATED CAPITAL EQUITY PARTNERS L.P.
BALANCE SHEETS
(unaudited)
(in thousands)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
ASSETS 1994 1993
- - ------ ----------- ----------------
<S> <C> <C>
Real estate, net of accumulated depreciation... $ 44,034 $ 45,140
Real estate assets of property in-substance
foreclosed, net of accumulated depreciation... 19,687 19,808
--------- ---------
63,721 64,948
Cash and cash equivalents...................... 3,156 2,429
Investments in limited partnerships............ 2,508 2,508
Other assets................................... 1,189 1,083
--------- ---------
$ 70,574 $ 70,968
========== =========
LIABILITIES AND PARTNERS' DEFICIT
- - ---------------------------------
Master Loan and interest payable to affiliate.. $ 220,045 $ 213,798
Notes and interest payable.................... 5,185 5,338
Due to affiliates............................. 1,051 620
Other liabilities............................. 1,756 1,897
--------- ---------
228,037 221,653
--------- ---------
Partners' deficit:
Limited Partners............................. (155,888) (149,178)
General Partner.............................. (1,575) (1,507)
--------- ---------
(157,463) (150,685)
--------- ---------
$ 70,574 $ 70,968
========= =========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of the financial statements.
-13-
<PAGE>
CONSOLIDATED CAPITAL EQUITY PARTNERS L.P.
STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
-------------------------------
1994 1993
-------- ----------------
<S> <C> <C>
Revenues:
Rental income.................. $ 5,592 $ 4,452
Interest....................... 7 154
------- -------
Total revenues................ 5,599 4,606
------- -------
Costs and expenses:
Interest (a)................... 6,809 6,138
Property operations............ 3,851 2,578
Depreciation................... 1,475 1,337
Administrative................. 242 199
------- -------
Total costs and expenses (b).. 12,377 10,252
------- -------
Net loss........................ $(6,778) $(5,646)
======= =======
</TABLE>
[FN]
(a) Interest expense includes approximately $6.7 million and $6 million to a
related party for the three months ended March 31, 1994 and 1993,
respectively.
(b) Costs and expenses include $519,000 and $169,000 to related parties for
the three months ended March 31, 1994 and 1993, respectively.
See supplemental information with respect to related party
transactions in Notes 2 and 3 of the financial statements.
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompaning notes are an integral part of the financial statements.
-14-
<PAGE>
CONSOLIDATED CAPITAL EQUITY PARTNERS L.P.
STATEMENTS OF PARTNERS' EQUITY (DEFICIT)
(unaudited)
For the Three Months Ended March 31, 1994 and 1993
(in thousands)
<TABLE>
<CAPTION>
TOTAL
GENERAL LIMITED PARTNERS'
PARTNER PARTNERS EQUITY (DEFICIT)
------- -------------- ----------------
<S> <C> <C> <C>
Balance at December 31, 1992.. $ (1,225) $(121,258) $(122,483)
Net loss...................... (56) (5,590) (5,646)
--------- ---------- ----------
Balance at March 31, 1993..... $ (1,281) $(126,848) $(128,129)
======== ========= =========
Balance at December 31, 1993.. $ (1,507) $(149,178) $(150,685)
Net loss...................... (68) (6,710) (6,778)
-------- --------- ---------
Balance at March 31, 1994..... $ (1,575) $(155,888) $(157,463)
========= ========= =========
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of the financial statements.
-15-
<PAGE>
CONSOLIDATED CAPITAL EQUITY PARTNERS L.P.
STATEMENTS OF CASH FLOWS
(unaudited)
Increase in Cash and Cash Equivalents
(in thousands)
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
-----------------------------------
1994 1993
----------- ------------------
<S> <C> <C>
Cash flows from operating activities:
Cash received from tenants.......................... $ 5,624 $ 4,471
Cash paid to suppliers (a).......................... (3,674) (2,390)
Interest received................................... 7 154
Interest paid (b)................................... (123) (2,047)
Property taxes paid................................. (746) (163)
------- -------
Net cash provided by operating activities............ 1,088 25
------- -------
Cash flows from investing activities:
Additions to real estate............................ (248) (65)
------- -------
Cash flows from financing activities:
Advances on Master Loan............................. 40 340
Principal payments on notes payable................. (153) (152)
------- -------
Net cash provided by (used in) financing activities.. (113) 188
------- -------
Net increase in cash and cash equivalents............ 727 148
Cash and cash equivalents, at beginning of period.... 2,429 998
------- -------
Cash and cash equivalents, at end of period.......... $ 3,156 $ 1,146
======= =======
</TABLE>
[FN]
(a) Payments to related parties totaling $519,000 and $169,000 for the three
months ended March 31, 1994 and 1993, respectively, are included in cash
paid to suppliers.
(b) Payments to related parties totaling $261,000 for the three months ended
March 31, 1993, are included in interest paid.
See supplemental information with respect to related party
transactions in Notes 2 and 3 of the financial statements.
The financial information included herein has been prepared by management
without audit by independent public accountants.
The accompanying notes are an integral part of the financial statements.
-16-
<PAGE>
CONSOLIDATED CAPITAL EQUITY PARTNERS L.P.
Notes to Financial Statements
March 31, 1994
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
- - ------------------------------
The financial statements reflect all adjustments necessary for a fair
presentation of the financial position of Consolidated Capital Equity Partners,
L.P. ("CCEP") and the results of its operations. All adjustments were of a
normal recurring nature. However, the results of operations for the three
months ended March 31, 1994, are not necessarily indicative of the results to be
expected for the year ending December 31, 1994.
The financial statements should be read in conjunction with the financial
statements contained Consolidated Capital Institutional Properties' ("CCIP")
Annual Report on Form 10-K for the year ended December 31, 1993 (the "1993
Annual Report"), and the notes thereto, as filed with the Securities and
Exchange Commission, which is available upon request by writing to CCIP's
general partner, ConCap Equities, Inc. ("CEI"), Investor Relations, 5520 LBJ
Freeway, Suite 430, Dallas, Texas 75240.
NOTE 2 - RELATED PARTY TRANSACTIONS
- - -----------------------------------
CCEP has paid property management fees equal to 5% of collected gross rental
revenues ("Rental Revenues") for property management services in each of the
three month periods ended March 31, 1994 and 1993. A portion of such property
management fees equal to 4% of Rental Revenues has been paid to the property
management companies performing day-to-day property management services and the
portion equal to 1% of Rental Revenues has been paid to Partnership Services,
Inc. ("PSI") for advisory services related to day-to-day property operations.
During the three months ended March 31, 1993, day-to-day property management
services were provided to CCEP's properties by unaffiliated management
companies. In July 1993, Coventry Properties, Inc. ("Coventry"), an affiliate
of CCEP's general partner, ConCap Holdings, Inc. ("CHI"), assumed day-to-day
property management responsibilities for two of CCEP's properties under the same
management fee arrangement as the unaffiliated management companies. Coventry
assumed day-to-day property management responsibilities for two additional CCEP
properties in January 1994. Fees paid to PSI and Coventry have been reflected
in the table below as compensation to related parties.
Also, CCEP is subject to an Investment Advisory Agreement between CCEP and an
affiliate of CHI. This agreement provides for an annual fee, payable in monthly
installments, to an affiliate of CHI for advising and consulting services for
CCEP's properties. Advisory fees paid pursuant to this agreement are reflected
in the following table:
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
--------------------
COMPENSATION 1994 1993
- - ------------ -------- ---------
<S> <C> <C>
(in thousands)
Charged to property operations expenses:
Property management fees................. $ 164 $ 45
Charged to administrative expenses:
Investment advisory fee.................. 64 60
----- -----
$228 $ 105
===== =====
</TABLE>
The New Partnership Agreement, as defined in the 1993 Annual Report, provides
for reimbursement to the general partner and its affiliates for costs incurred
in connection with administration of CCEP's activities and for reimbursement to
Coventry for expenses related to property operations (primarily salaries and
related costs for on-site property personnel). CHI and its affiliates,
including Coventry, received reimbursements included in the following table:
-17-
<PAGE>
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31,
--------------------
REIMBURSEMENT 1994 1993
- - ------------- --------- ---------
<S> <C> <C>
(in thousands)
Charged to property operations expenses:
Reimbursement of direct property expense.. $ 223 $ -
Charged to administrative expenses:
Reimbursement of administrative expenses
(including payroll reimbursements).... 68 64
----- ---------
$ 291 $ 64
===== =========
</TABLE>
In addition to the compensation and reimbursements described above, interest
payments are made to and loan advances are received from CCIP pursuant to the
New Master Loan Agreement, which is described more fully in the 1993 Annual
Report. Such interest payments totaled $474,000 and $261,000 in the three
months ended March 31, 1994 and 1993, respectively. CCEP received advances
under the New Master Loan Agreement totaling $40,000 and $340,000 in the three
months ended March 31, 1994 and 1993, respectively.
NOTE 3 - MASTER LOAN AND ACCRUED INTEREST PAYABLE
- - -------------------------------------------------
In February 1994, CCIP advanced $40,000 to CCEP as an advance on the Master
Loan. CCEP then advanced $40,000 to New Carlton House Partners as an advance on
the note receivable secured by the Carlton House Apartment and Office Building
("Carlton House") to finalize all payments required in the payment in 1993 of
Carlton House's delinquent property taxes.
NOTE 8 - NOTE RECEIVABLE DEEMED IN-SUBSTANCE FORECLOSED
- - -------------------------------------------------------
As more fully described in the 1993 Annual Report, the Carlton House Note is
deemed in-substance foreclosed. Summarized below are the assets, liabilities and
partner's equity of New Carlton House Partners as of March 31, 1994 and December
31, 1993, and the results of its operations for the three month period ended
March 31, 1994, prepared on the same basis as CCEP's financial statements.
There were no results of operations for the three month period ended March 31,
1993, as Carlton House was not deemed in-substance foreclosed until September
30, 1993. Any intercompany balances between CCEP and the Carlton House have
been eliminated in CCEP's consolidated financial statements and the summarized
financial statements set forth below:
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
ASSETS 1994 1993
- - ------ ---------- ---------------
<S> <C> <C>
(in thousands)
Real estate:
Land.............................. $ 3,805 $ 3,805
Buildings and improvements........ 16,286 16,205
------- -------
20,091 20,010
Less: Accumulated depreciation.... (404) (202)
------- -------
19,687 19,808
Cash and cash equivalents.......... 1,214 997
Prepaid expenses and other assets.. 592 149
------- --------
$21,493 $20,954
======= =======
</TABLE>
-18-
<PAGE>
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
LIABILITIES AND PARTNERS' EQUITY 1994 1993
- - -------------------------------- --------- --------------
<S> <C> <C>
(in thousands)
Note and interest payable $ 50 $ 58
Other liabilities 627 474
------- -------
Total liabilities 677 532
------- -------
Partners' equity 20,816 20,422
------- -------
Total liabilities and partners' equity $21,493 $20,954
======= =======
</TABLE>
<TABLE>
<CAPTION>
FOR THE THREE MONTHS
ENDED MARCH 31, 1994
--------------------
<S> <C>
(in thousands)
Rental revenue........................... $ 1,122
-------
Costs and expenses:
Property operations..................... 1,073
Depreciation............................ 202
Interest................................ 4
Administrative.......................... 78
-------
Total costs and expenses................. 1,357
-------
Net loss................................. $ (235)
=======
</TABLE>
-19-
