FORM 10-K--ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(As last amended in Rel. No. 34-31905, eff 10/26/93.)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [Fee Required]
For the fiscal year ended December 31, 1995
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [No Fee Required]
For the transition period.........to.........
Commission file number 0-11002
CONSOLIDATED CAPITAL PROPERTIES IV
(Exact name of registrant as specified in its charter)
California 94-2768742
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification
No.)
One Insignia Financial Plaza, P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (864) 239-1000
Securities registered under Section 12(b) of the Act:
None
Securities registered under Section 12(g) of the Act:
Limited Partnership Units
(Title of class)
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 (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
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K ( 229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [X] (Amended by Exch Act Rel
No. 28869, eff. 5/1/91.)
State the aggregate market value of the voting partnership interests held by
non-affiliates computed by reference to the price at which the partnership
interests were sold, or the average bid and asked prices of such partnership
interests, as of a specified date within 60 days prior to the date of filing.
Market value information for the Registrant's partnership interests is not
available. Should a trading market develop for these interests, it is
management's belief that such trading would not exceed $25,000,000.
PART I
Item 1. Description of Business
Consolidated Capital Properties IV (the "Partnership") was organized on
September 22, 1981, as a limited partnership under the California Uniform
Limited Partnership Act. On December 18, 1981, the Partnership registered
with the Securities and Exchange Commission (the "SEC") under the Securities
Act of 1933 (File No. 2-74353) and commenced a public offering for sale of
$100 million of Units with the general partners' right to increase the
offering to $200 million. The Units represent equity interests in the
Partnership and entitle the holders thereof to participate in certain
allocations and distributions of the Partnership. The Partnership
subsequently filed a Form 8-A Registration Statement with the SEC and
registered under the Securities Exchange Act of 1934 (File No. 0-11002) on
March 28, 1983. The sale of Units closed on December 14, 1983, with 343,106
Units sold at $500 each, or gross proceeds of $171.5 million to the
Partnership. At the request of certain Limited Partners and in accordance
with its Partnership Agreement, the Partnership has retired a total of 323
Units as of December 31, 1995. The Partnership gave no consideration for
these Units.
By the end of fiscal year 1985, approximately 73% of the monies raised had
been invested in 48 properties. Of the remaining 27%, 11% was required for
organizational and offering expenses, sales commissions and acquisition fees,
and 16% was retained in Partnership reserves for project improvements and
working capital as required by the Partnership Agreement.
The General Partner of the Partnership is ConCap Equities, Inc., a Delaware
corporation (the "General Partner" or "CEI"). The principal place of business
for the Partnership and for the General Partner is One Insignia Financial
Plaza, Greenville, South Carolina 29602.
The Partnership's primary business and only industry segment is real estate
related operations. The Partnership was formed to acquire, own, operate and
ultimately dispose of income-producing real properties for the benefit of its
Limited Partners (herein so called; and together with the General Partner
shall be called the "Partners"). As of the close of fiscal year 1985, the
Partnership had completed its property acquisition stage and had acquired 48
properties. At December 31, 1995, the Partnership owned 18 income-producing
properties (or interests therein) and held one note receivable with respect to
a sold property. Prior to 1995, the Partnership had disposed of 30 properties
originally owned by the Partnership.
The real estate business is highly competitive. The Registrant's real
property investments are subject to competition from similar types of
properties in the vicinities in which they are located and the Partnership is
not a significant factor in its industry. In addition, various limited
partnerships have been formed by related parties to engage in business which
may be competitive with the Registrant.
The Registrant has no employees. Management and administrative services are
performed by affiliates of Insignia. The property manager is responsible for
the day-to-day operations of each property. The Managing General Partner has
also selected an affiliate of Insignia to provide real estate advisory and
asset management services to the Partnership. As advisor, such affiliates
provide all partnership accounting and administrative services, investment
management, and supervisory services over property management and leasing.
For a further discussion of property and partnership management, see "Item
12," which descriptions are herein incorporated by reference.
The Partnership is required by the Partnership Agreement to maintain working
capital reserves for contingencies. On September 25, 1995, the partners were
proxied and approved a reduction of the capital reserve requirements to $500
per apartment unit and $1.00 per square foot of gross leasable commercial
space owned by the Partnership, or approximately $2.2 million (See "Item 4.
Submission of Matters to a Vote of Security Holders"). In the event
expenditures are made from these reserves, operating revenue shall be
allocated to such reserves to the extent necessary to maintain the foregoing
level. Reserves, including cash and cash equivalents, and securities available
for sale at market, totaling approximately $14.2 million at December 31, 1995,
exceeded the Partnership's reserve requirements of approximately $2.2 million.
Such reserves include $570,000 of cash and cash equivalents restricted for use
at the Partnership's U.S. Department of Housing and Urban Development ("HUD")
financed property.
The Partnership currently owns and operates 17 apartment complexes and one
office building, which range in age from 12 to 25 years old, principally
located in the midwest, southeastern and southwestern United States. The
Partnership also holds one note receivable on a sold property which is
performing according to the note terms as of December 31, 1995.
The Partnership has made significant capital investments in its real estate
portfolio during the previous three years. These investments consisted of
selected property improvement and rehabilitation programs and expenditures to
cure deferred maintenance existing at certain of the properties. Capital
expenditures of $5.86 million are budgeted for the Partnership's properties in
1996.
Approximately $14.3 million of nonrecourse mortgage debt secured by the
Foothill Place Apartments and the Chimney Hill Apartments originally matured
in 1994. The Partnership exercised its option to extend the maturities until
September 1995, by paying a 1%, or $143,000, loan extension fee to the current
lender, as provided for in the loan agreement. In December 1995, these
properties along with five of the Partnership's other properties were
refinanced for 10 years with interest only payments due each month (See "Note
G" in the Notes to Consolidated Financial Statements in "Item 8").
Approximately $2.5 million of nonrecourse mortgage debt secured by the Metro
Centre Office Building, located in Southern California, matured July 1, 1995.
The property has historically had difficulty making its scheduled debt service
payments and since 1985, the property has made quarterly cash flow payments
pursuant to a modified and restructured loan agreement, however, no payments
were made in 1995. Given current economic conditions in Southern California,
property operations are not expected to improve sufficiently to enable the
Partnership to refinance the existing indebtedness under current market
conditions. In September 1995, a Notice of Default and Election to Sell Under
Deed of Trust was filed by the lender. The Partnership did not contest this
foreclosure notice and the property was foreclosed upon February 7, 1996.
Prior to March 1995, the Nob Hill Villa Apartments ("Nob Hill") secured two
nonrecourse mortgage notes totalling approximately $5.8 million. One of the
notes, a $3.8 million first lien mortgage, was scheduled to mature in November
1995. In March 1995, the General Partner refinanced these mortgage notes by
obtaining a new mortgage note of approximately $7.5 million secured by Nob
Hill. Under the terms of the refinancing agreement, the new mortgage note
bears interest at 9.2% and matures in April 2005.
Lake Forest Apartments secures a mortgage note guaranteed by the U.S.
Department of Housing and Urban Development ("HUD") and accrued interest
totalling approximately $4.2 million at December 31, 1995. Post Ridge
Apartments ("Post Ridge") secures a mortgage note and accrued interest
totalling approximately $4.4 million at December 31, 1995, which was formerly
guaranteed by HUD. Operating cash flow from Post Ridge has not supported its
scheduled debt service payments. As a result, in January 1991, the
Partnership suspended scheduled debt service for Post Ridge and the debt is
currently in default. Since 1991, the Partnership has remitted excess cash
flow from the properties' operations as debt service. During 1995, Post Ridge
has reduced its accrued interest payable from $395,000 at December 31, 1994,
to $171,000 at December 31, 1995. On March 28, 1995, this debt was sold to an
unaffiliated third party. Accordingly, since the closing of the sale on May 8,
1995, this debt is no longer regulated by HUD. The General Partner is
currently attempting to refinance this debt.
Upon the Partnership's formation in 1981, Consolidated Capital Equities
Corporation ("CCEC"), a Colorado corporation, was the corporate general
partner and Consolidated Capital Management Company ("CCMC"), a California
general partnership, was the non-corporate general partner. In 1988, through
a series of transactions, Southmark Corporation ("Southmark") acquired a
controlling interest in CCEC. In December 1988, CCEC filed for reorganization
under Chapter 11 of the United States Bankruptcy Code. In 1990, as part of
its reorganization plan, CEI acquired CCEC's general partner interests in the
Partnership and in 15 other affiliated public limited partnerships (the
"Affiliated Partnerships") and CEI replaced CCEC as managing general partner
in all 16 partnerships. The selection of CEI as the sole managing general
partner was approved by a majority of the Limited Partners in the Partnership
and in each of the Affiliated Partnerships pursuant to a solicitation of the
Limited Partners dated August 10, 1990. As part of this solicitation, the
Limited Partners also approved an amendment to the Partnership Agreement to
limit changes of control of the Partnership, and the conversion of CCMC from a
general partner to a limited partner, thereby leaving CEI as the sole general
partner of the Partnership.
All of CEI's outstanding stock is owned by GII Realty, Inc. In December 1994,
the parent of GII Realty, Inc., entered into a transaction (the "Insignia
Transaction") in which, among other things, MAE-ICC, Inc., a wholly owned
subsidiary of Metropolitan Asset Enhancement, L.P. ("MAE"), an affiliate of
Insignia Financial Group, Inc. ("Insignia") acquired an option (exercisable in
whole or in part from time to time) to purchase all of the stock of GII
Realty, Inc. and, pursuant to a partial exercise of such option, acquired
50.5% of that stock. As a part of the Insignia Transaction, MAE-ICC, Inc.
also acquired all of the outstanding stock of Partnership Services, Inc., an
asset management entity, and a subsidiary of Insignia acquired all of the
outstanding stock of Coventry Properties, Inc., a property management entity.
In addition, confidentiality, non-competition, and standstill arrangements
were entered into between certain of the parties. Those arrangements, among
other things, prohibit GII Realty's former sole shareholder from purchasing
Partnership Units for a period of three years. On October 24, 1995, MAE-ICC,
Inc. exercised the remaining portion of its option to purchase all of the
remaining outstanding capital stock of GII Realty, Inc.
Item 2. Description of Property
The Partnership originally acquired 48 properties of which eleven (11) were
sold, ten (10) were conveyed to lenders in lieu of foreclosure, and nine (9)
were foreclosed upon by the lenders in fiscal years prior to 1995. As of
December 31, 1995, the Partnership owned seventeen (17) apartment complexes
and one (1) office building and held one (1) note receivable on sold property
as noted below. Additional information about the properties is found in "Item
8 - Financial Statements and Supplementary Data."
<TABLE>
<CAPTION>
Date of
Property Purchase Type of Ownership Use
<S> <C> <C> <C>
The Apartment (a) 04/84 Fee ownership subject Residential Apartments
Omaha, Nebraska to first mortgage. 204 units
Arbour East (a) 09/83 Fee ownership subject Residential Apartments
Nashville, Tennessee to first mortgage. 350 units
Briar Bay Racquet Club (a) 09/82 Fee ownership subject Residential Apartments
Miami, Florida to first mortgage 194 units
Chimney Hill (a) 08/82 Fee ownership subject Residential Apartments
Marietta, Georgia to first mortgage 326 units
Citadel (a) 05/83 Fee ownership subject Residential Apartments
El Paso, Texas to first mortgage 260 units
Citadel Village (a) 12/82 Fee ownership subject Residential Apartments
Colorado Springs, to first mortgage 122 units
Colorado
Foothill Place (a) 08/85 Fee ownership subject Residential Apartments
Salt Lake City, Utah to first mortgage 450 units
</TABLE>
<TABLE>
<CAPTION>
Date of
Property Purchase Type of Ownership Use
<S> <C> <C> <C>
Knollwood (a) 07/82 Fee ownership subject Residential Apartments
Nashville, Tennessee to first mortgage. 326 units
Lake Forest (a) 04/84 Fee ownership subject Residential Apartments
Omaha, Nebraska to first mortgage. 312 units
Nob Hill Villa (a) 04/83 Fee ownership subject Residential Apartments
Nashville, Tennessee to first mortgage 472 units
Overlook (a) 11/85 Fee ownership subject Residential Apartments
Memphis, Tennessee to first mortgage 252 units
Point West (a) 11/85 Fee ownership subject Residential Apartments
Charleston, South to first mortgage 120 units
Carolina
Post Ridge (a) 07/82 Fee ownership subject Residential Apartments
Nashville, Tennessee to first mortgage 150 units
Rivers Edge (a) 04/83 Fee ownership subject Residential Apartments
Auburn, Washington to first mortgage. 120 units
South Port (b) 11/83 Fee ownership subject Residential Apartments
Tulsa, Oklahoma to first mortgage 240 units
Stratford Place (a) 08/85 Fee ownership subject Residential Apartments
Austin, Texas to first mortgage 223 units
Village East (a) 12/82 Fee ownership subject Residential Apartments
Cimarron Hills, to first mortgage 137 units
Colorado
Metro Centre (a) 06/85 Fee ownership subject Office Building
Fountain Valley, to first mortgage 36,079 sq.ft.
California
<FN>
(a) The Partnership does not own direct fee title to the property. However,
the Partnership owns all of the partnership interests in limited
partnerships which owns the property.
(b) South Port Apartments is owned by a joint-venture partnership between
the Partnership and an outside partner. The Partnership holds a majority
interest in the joint-venture partnership.
</TABLE>
Schedule of Properties:
(dollar amounts in thousands)
<TABLE>
<CAPTION>
Gross
Carrying Accumulated Federal
Property Value Depreciation Rate Method Tax Basis
<S> <C> <C> <C> <C> <C>
The Apartments $ 7,746 $5,007 5-18 yr S/L $ 2,548
Arbour East Apartments 11,385 8,436 5-18 yr S/L 3,079
Briar Bay Racquet
Club Apartments 7,552 5,399 5-18 yr S/L 2,544
Chimney Hills Apartments 10,181 8,119 5-18 yr S/L 2,859
Citadel Apartments 7,330 5,488 5-18 yr S/L 1,697
Citadel Village
Apartments 3,684 3,042 5-18 yr S/L 1,263
Foothill Place Apartments 14,628 7,089 5-18 yr S/L 8,659
Knollwood Apartments 9,624 7,957 5-18 yr S/L 1,952
Lake Forest Apartments 7,793 4,696 5-18 yr S/L 2,374
Metro Centre Office
Building 1,605 1,076 4-28 yr S/L 2,237
Nob Hill Villa Apartments 11,541 9,028 5-18 yr S/L 2,517
Overlook Apartments 4,100 2,744 5-15 yr S/L 1,890
Point West Apartments 2,846 1,944 5-40 yr S/L 1,613
Post Ridge Apartments 3,975 3,208 5-18 yr S/L 867
Rivers Edge Apartments 3,123 2,177 5-18 yr S/L 1,088
South Port Apartments 7,768 5,135 5-18 yr S/L 2,483
Stratford Place
Apartments 7,167 3,226 5-20 yr S/L 2,994
Village East Apartments 3,170 2,523 5-18 yr S/L 580
Totals $125,218 $86,294 $43,244
</TABLE>
See "Note A" in the Notes to Consolidated Financial Statements in "Item 8" for
a description of the Partnership's depreciation policy.
Schedule of Mortgages:
<TABLE>
<CAPTION>
Principal Principal
Balance At Stated Balance
December 31, Interest Period Maturity Due At
Property 1995 Rate Amortized Date Maturity
(dollar amounts in thousands)
<S> <C> <C> <C> <C> <C>
The Apartments $ 3,543 8.34% 7 years 9/00 $ 3,244
Arbour East Apartments 5,650 6.95% 10 years 12/05 5,650
Briar Bay Racquet Club 3,500 6.95% 10 years 12/05 3,500
Chimney Hills Apartments 5,400 6.95% 10 years 12/05 5,400
Citadel Apartments 4,904 8.38% 7 years 10/00 4,488
Citadel Village Apartments 2,450 6.95% 10 years 12/05 2,450
Foothill Place Apartments 10,100 6.95% 10 years 12/05 10,100
Knollwood Apartments 6,780 6.95% 10 years 12/05 6,780
Lake Forest Apartments 4,212 7.50% 31.5 years 8/13 N/A
Metro Centre Office Building 2,497 11.50% 10 years 7/95 2,497
Nob Hill Villa Apartments 7,447 9.20% 10 years 4/05 6,250
Overlook Apartments 1,904 10.50% 25 years 12/98 1,817
Point West Apartments 496 9.13% 25 years 5/01 N/A
Post Ridge Apartments 4,242 9.75% 35 years 7/22 N/A
Rivers Edge Apartments 2,068 8.40% 7 years 9/00 1,895
South Port Apartments 3,509 10.85% 15 years 7/01 3,167
Stratford Place Apartments 2,697 8.65% 25 years 9/00 2,478
Village East Apartments 2,150 6.95% 10 years 12/05 2,150
$73,549 $61,866
</TABLE>
The notes payable represent borrowings on the properties purchased by the
Partnership. The notes are non-recourse, and are collateralized by deeds of
trust on the investment properties. The notes mature (except the Metro Centre
note discussed below) between 1998 and 2022 bear interest at rates ranging
from 6.95% to 11.50%.
Approximately $2.5 million of nonrecourse mortgage debt secured by the Metro
Centre Office Building, located in Southern California, matured July 1, 1995.
The property has historically had difficulty making its scheduled debt service
payments and since 1985, the property has made quarterly cash flow payments
pursuant to a modified and restructured loan agreement, however, no payments
were made in 1995. Given current economic conditions in Southern California,
property operations are not expected to improve sufficiently to enable the
Partnership to refinance the existing indebtedness under current market
conditions. In September 1995, a Notice of Default and Election to Sell Under
Deed of Trust was filed by the lender. The Partnership did not contest this
foreclosure notice and the property was foreclosed upon February 7, 1996.
Note Receivable on Sold Property:
As of December 31, 1995
Underlying
Note Mortgage
Collateral Property Receivable Debt
(in thousands)
Denbigh Village
Apartment complex - 138 units
Newport News, Virginia $ 1,155 $ 1,286
When the Denbigh Village Apartments was sold in August 1994, the Partnership
accepted a promissory note which matures in March 1996. See "Item 7 -
Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Item 8 - Financial Statements and Supplementary Data," for
further discussion of the Denbigh Village Apartments sale and the note
receivable by the Partnership.
Denbigh Village Apartments secures two underlying mortgage notes. The balance
of the first mortgage is approximately $550,000 at December 31, 1995, has a
stated interest rate of 9.5% and matures in December 2002. The balance of the
second mortgage is approximately $736,000, has a stated interest rate of 9.5%
and matures in December of 1998.
Schedule of Rental Rates and Occupancy:
<TABLE>
<CAPTION>
Average Annual Average Annual
Rental Rates Occupancy
Per Unit or Sq.Ft.
1995 1994 1995 1994
<S> <C> <C> <C> <C>
The Apartments $5,639 5,560 95% 94%
Arbour East Apartments 6,220 5,615 97% 98%
Briar Bay Racquet Club Apartments 8,055 8,214 93% 79%
Chimney Hill Apartments 6,901 6,306 96% 98%
Citadel Apartments 6,676 6,500 92% 96%
Citadel Village Apartments 7,050 6,716 98% 97%
Foothill Place Apartments 6,919 6,601 98% 97%
Knollwood Apartments 6,649 6,216 98% 97%
Lake Forest Apartments* 5,662 5,559 97% 96%
Nob Hill Villa Apartments 5,183 4,650 98% 98%
Overlook Apartments 3,767 3,608 88% 94%
Point West Apartments 5,046 5,000 90% 88%
Post Ridge Apartments 8,143 7,297 97% 99%
Rivers Edge Apartments 6,242 6,140 93% 93%
South Port Apartments 5,282 5,169 84% 83%
Stratford Place Apartments 6,321 6,005 93% 93%
Village East Apartments 5,435 5,003 99% 98%
Metro Centre Office Building** 16.50 14.34 49% 61%
</TABLE>
As noted under "Item 1. Description of Business", the real estate industry is
highly competitive. All of the properties of the Partnership are subject to
competition from other residential apartment complexes and office buildings in
the area. The General Partner believes that all of the properties are
adequately insured. Except for the Metro Centre Office Building which was
lost in foreclosure on February 7, 1996, the properties' lease terms are for
one year or less and no tenant leases 10% or more of the available rental
space.
The average rental rate increase for Post Ridge Apartments was due to rate
increases throughout the year as leases were renewed.
The Briar Bay Racquet Club Apartments was devastated by Hurricane Andrew,
which resulted in the unusually low occupancy experienced for the year ended
December 31, 1994. Subsequent to the restorations and refurbishments done at
the property, the occupancy has returned to normal levels. Occupancy for the
Overlook Apartments decreased for the year ended December 31, 1995, compared
to the year ended December 31, 1994, due to increased competition in the
Memphis market. The Metro Centre Office Building's low occupancy is due to
the poor economic conditions in the Southern California area.
* Property is regulated by the U.S. Department of Housing and Urban
Development.
** Average annual rental rates and occupancy are based on square footage.
Schedule of Real Estate Taxes and Rates:
(dollar amounts in thousands)
1995 1995
Taxes Rate
The Apartments $140 2.8%
Arbour East Apartments 105 3.5%
Briar Bay Racquet Club Apartments 150 2.3%
Chimney Hill Apartments 109 3.4%
Citadel Apartments 161 2.8%
Citadel Village Apartments 19 6.5%
Foothill Place Apartments 166 1.6%
Knollwood Apartments 114 3.5%
Lake Forest Apartments 187 2.8%
Metro Centre Office Building* 23 1.0%
Nob Hill Villa Apartments 127 4.5%
Overlook Apartments 63 3.1%
Point West Apartments 30 31.6%
Post Ridge Apartments 54 3.5%
Rivers Edge Apartments 56 1.5%
South Port Apartments 50 12.6%
Stratford Place Apartments 106 2.4%
Village East apartments 12 6.3%
* Based on billing period of July 1, 1995 to June 30, 1996.
Item 3. Legal Proceedings
In November of 1994, C.E. and Berniece Patterson, each of whom is a limited
partner of the Partnership, filed an action in the United States District
Court for the Northern District of California seeking declaratory and
injunctive relief, but not monetary damages, alleging, among other things,
that a tender offer by LP 5 Acceptance Corporation for limited partnership
units of the Partnership violated the federal securities laws and the
partnership agreements and breached the general partner's fiduciary duties.
The complaint named ConCap Equities, Inc., the general partner of the
Partnership and others as defendants. These actions were filed by the
Pattersons as individuals and were not class actions. The tender offer was
terminated in December 1994. In December 1994, the complaint in this action
was amended to include Insignia, MAE and MAE-ICC, Inc. and others as
defendants in connection with a tender offer commenced in December 1994, by
Insignia CCP IV Acquisition, L.L.C. for limited partnership units of the
Partnership. On January 20, 1995, the District Court denied Plaintiffs'
motion for a preliminary injunction to enjoin the tender offer. The tender
offer closed on January 20, 1995, and the offeror purchased the tendered
units. C.E. and Berniece Patterson had also initiated other causes of action
against two affiliated entities, which held limited partnership units in
Consolidated Capital Properties III and Consolidated Capital Properties VI,
regarding other tender offers. On March 31, 1995, the parties to the above
referenced actions entered into a settlement agreement and a standstill
agreement for all actions pursuant to which (i) Plaintiffs filed a notice of
dismissal with respect to the first amended complaints in the actions; (ii)
Plaintiffs and defendants released each other from all claims which were or
could have been asserted in connection with the first amended complaints in
the actions; (iii) Plaintiffs and an affiliate known as MacKenzie Patterson,
Inc. ("MacKenzie") will refrain from certain activities relating to the
acquisition of limited partnership units in any partnership of which Insignia
or any of its affiliates is a general partner; (iv) Plaintiffs and their
affiliates granted to a subsidiary of Insignia a right of first refusal in
connection with the sale of limited partnership interests in the Partnership
by plaintiffs; and (v) Plaintiffs and their affiliates will assign to a
subsidiary of Insignia irrevocable proxies to vote any limited partnership
interests in the Consolidated Capital Properties VI acquired by MacKenzie as a
result of the tender offer by MacKenzie Patterson, Inc. and affiliates to
acquire limited partnership interests in Consolidated Capital Properties VI or
thereafter.
Except for the above proceedings, the Partnership is not a party to, nor are
any of the Partnership's properties the subject of, any material pending legal
proceedings, other than ordinary litigation routine to the Partnership's
business.
Item 4. Submission of Matters to a Vote of Security Holders
On September 25, 1995, the General Partner proxied the Limited Partners to
modify the Partnership Agreement for certain Proposals as defined in the proxy
statement.
The General Partner formulated the Proposals as a means of increasing
operational flexibility and improving Partnership operations. The Proposals
seek to achieve these goals by amending the Partnership Agreement to modify
certain existing capital reserves and mandatory distribution requirements as
well as certain property disposition limitations. Proposal 1 provides the
General Partner with additional flexibility in establishing the timing and
amount of distributions by modifying the requirements that the Partnership
maintain reserves equal to at least 5% of Invested Capital (which as of
September 30, 1995, required reserves of approximately $8.6 million) and
distribute Surplus Funds, up to the amount of any net economic gains realized
upon the sale of any Partnership assets, within 90 days of the close of the
fiscal year in which such gains are realized. Proposal 2 provides the General
Partner with the authority to take advantage of certain property disposition
opportunities by authorizing the General Partner to sell multiple properties
that represent less than 50% of the net book value of all of the Partnership's
properties as of the end of the most recently completed calendar quarter to
the same purchaser or its affiliates in any six-month period or any single
partnership property, without obtaining Limited Partner approval. Proposal 2
did not seek to modify the Partnership Agreement provision prohibiting
Partnership property sales to the General Partner or its affiliates.
This matter, originally open until October 25, 1995, was extended until
November 20, 1995 with both proposals being approved. In regards to Proposal
1, the Unitholders voted 54% in favor of the matter, 7% opposed or abstained
and 39% did not respond. In regards to Proposal 2, the Unitholders voted 51%
in favor of the matter, 9% opposed or abstained and 40% did not respond.
Accordingly, the Proposals were adopted with a majority of the outstanding
units approving them.
PART II
Item 5. Market for the Registrant's Units of Limited Partnership and Related
Security Holder Matters
(A) No established trading market for the Partnership's Units exists, nor
is one expected to develop.
(B) Title of Class Number of Unitholders of Record
Limited Partnership Units 14,343 as of December 31, 1995
(C) During 1995, the Partnership paid distributions attributable to cash
flow from operations of approximately $921,000 to the Partners.
Cumulative distributions to the Limited Partners since the inception
of the Partnership totaled approximately $24 million at December 31,
1995. No cash distributions were made to the Limited Partners during
the years ended December 31, 1994 or 1993. Also, see "Item 7 -
Management's Discussion and Analysis of Financial Condition and
Results of Operations". Subsequent to December 31, 1995, the
Partnership declared distributions to the Partners of approximately
$3.6 million attributable to cash flow from operations and
approximately $71,000 attributable from surplus funds.
(D) On January 20, 1995, an affiliate of the General Partner, Insignia CCP
IV Acquisition, L.L.C., closed an offer to purchase Units (the "Tender
Offer") for a cash price of $60.00 per Unit to Limited Partners of
record as of December 15, 1994. Approximately 3,370 Limited Partners
holding 64,343 Units (18.77% of total Units) accepted the Tender Offer
and sold their Units to Insignia CCP IV Acquisition, L.L.C. effective
January 20, 1995, for an aggregate sales price of approximately $3.9
million.
Item 6. Selected Financial Data
The following table sets forth a summary of certain financial data for the
Partnership. This summary should be read in conjunction with the
Partnership's consolidated financial statements and notes thereto appearing in
"Item 8 - Financial Statements and Supplementary Data."
<TABLE>
<CAPTION>
Years Ended December 31,
Consolidated Statements 1995 1994 1993 1992 1991
of Operations ( in thousands, except unit data)
<S> <C> <C> <C> <C> <C>
Revenues $ 27,380 $ 27,905 $ 27,263 $ 26,272 $ 26,054
Expenses (28,620) (32,325) (33,972) (33,931) (36,900)
Loss from operations (1,240) (4,420) (6,709) (7,659) (10,846)
Gain (loss) on dispositions
of real estate -- 9,523 -- 329 (1,619)
Reorganization expense -- -- (368) (261) (2,964)
Gain on sale of securities
available for sale -- -- 75 -- --
Income (loss) before
extraordinary items (1,240) 5,103 (7,002) (7,591) (15,429)
Extraordinary item 43 6,614 (272) 5,677 1,658
Net income (loss) $ (1,197) $ 11,717 $ (7,274) $ (1,914) $(13,771)
Net income (loss) per weighted
Limited Partnership Unit:
Loss from operations $ (3.47) $ (12.38) $ (18.78) $ (21.43) $(30.35)
Gain (loss) on dispositions
of real estate -- 26.67 -- .92 (4.53)
Reorganization expense -- -- (1.03) (.73) (8.29)
Gain on sale of securities
available for sale -- -- .21 -- --
Income (loss) before extraordinary
item (3.47) 14.29 (19.60) (21.24) (43.17)
Extraordinary item .12 18.52 (.76) 15.89 4.64
Net income (loss) $ (3.35) $ 32.81 $ (20.36) $ (5.35) $ (38.53)
Distributions per Limited
Partnership Unit: $ 2.58 $ -- $ -- $ -- $ --
Limited Partnership Units
outstanding 342,783 342,819 342,951 343,097 343,106
Consolidated Balance Sheets
Total assets $ 61,146 $ 56,812 $ 67,683 $ 75,387 $ 83,597
Notes and interest payable $ 76,336 $ 70,825 $ 92,525 $ 93,557 $101,087
</TABLE>
ITEM 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
INTRODUCTION
The operations of the Partnership primarily include owning, operating and
ultimately disposing of income-producing real properties for the benefit of
its Partners. Therefore, the following discussion of operations, liquidity
and capital resources will focus on these activities and should be read in
conjunction with "Item 8 - Financial Statements and Supplementary Data" and
the notes related thereto included elsewhere in this report.
RESULTS OF OPERATIONS
The Partnership's loss from operations totaled approximately $1.2 million for
the year ended December 31, 1995, compared with losses from operations of
approximately $4.4 million and $6.7 million for 1994 and 1993, respectively.
The decreased loss from operations is due primarily to the foreclosure of the
Greenbriar and Westwood Apartments and the sale of the Denbigh Woods
Apartments during the third quarter of 1994. Unless future sales and/or
foreclosures of properties occur, it is expected that the Partnership will
continue to generate losses from operations, primarily because certain noncash
items are included in costs and expenses. Depreciation of the Partnership's
real estate investments and amortization of lease commissions, the primary
noncash expenses, totaled approximately $6.7 million for the year ended
December 31, 1995, and $7.3 million and $7.8 million for each of the years
ended December 31, 1994 and 1993, respectively.
As part of the ongoing business plan of the Partnership, the General Partner
monitors the rental market environment of each 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 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 General Partner will be able to sustain such a plan.
1995 Compared to 1994
Revenues:
Rental income decreased for the year ended December 31, 1995, compared to the
corresponding period ended December 31, 1994, due primarily to the sale and
foreclosures noted above. The rental income decreases were partially offset by
increased occupancy at the Briar Bay Racquet Club Apartments and rental
increases at several of the Partnership's apartment properties for the year
ended December 31, 1995. Interest and other income increased for the year
ended December 31, 1995, compared to the year ended December 31, 1994, due to
higher cash balances being available for investment in 1995 and the $185,000
casualty gain discussed below. Also, dividends of $61,000 were received on
the Partnership's investment in Southmark preferred stock during the year
ended December 31, 1995, compared to $36,000 during the year ended December
31, 1994 and, interest income of $97,000 was recognized in 1995 on the Denbigh
Woods note receivable compared to $36,000 in 1994.
In December of 1995, a fire occurred at the Overlook Apartments resulting in
four units being destroyed and eight units incurring smoke and water damage.
The total insurance proceeds anticipated to be received are approximately
$260,000. These proceeds are expected to exceed the total estimated costs of
replacing the units destroyed, resulting in a casualty gain of $106,000. In
1995, the Partnership also received insurance proceeds of $60,000 and $15,000
resulting from hail damage sustained in 1994 at the Citadel Village and
Village East Apartments, respectively. In addition, the Partnership received
an additional $4,000 insurance settlement of a fire at the Point West
Apartments which occurred in 1991. These four events resulted in a total
casualty gain of $185,000 in 1995.
Expenses:
Property operations, depreciation and amortization and interest expense
decreased for the year ended December 31, 1995, compared to the year ended
December 31, 1994, due primarily to the disposition of Greenbriar, Westwood
and Denbigh Woods Apartments in the third quarter of 1994. Administrative
expenses increased for the year ended December 31, 1995, compared to the year
ended December 31, 1994, due to increased legal, printing and postage costs
associated with the Partnership's required responses to various tender offers
(See "Item 3. Legal Proceedings") as well as increased expense reimbursements
related to the combined efforts of the Dallas and Greenville partnership
administration staffs during the transition period in the first and second
quarters of 1995. The reimbursements for the Dallas and Greenville offices
amounted to $306,000 and $282,000 respectively during the year ended December
31, 1995.
The increased costs related to the transition efforts were incurred to
minimize any disruption in the year-end reporting function including the
financial reporting and K-1 preparation and distribution. The General Partner
expects recurring administrative expenses to be reduced now that the
management transition is complete.
The extraordinary net gain from refinancing of $43,000 is the net of the
following two items:
A $250,000 gain on refinancing was realized during 1995, due to the
refinancing of Nob Hill Villa Apartments. Through this refinancing, a new
$7.5 million mortgage note which bears interest at 9.2% and matures in April
2005, was obtained. As a result of the refinancing, the Partnership realized
a $250,000 discount on the second mortgage resulting in an extraordinary gain
on refinancing (See "Note G" in the Notes to Consolidated Financial Statements
in "Item 8").
A $207,000 loss on refinancing was realized during 1995, due to the write-off
of unamortized loan costs and prepayment penalties paid on seven refinanced
properties (See "Note G" in the Notes to Consolidated Financial Statements in
"Item 8").
In 1995, the Partnership recognized a $200,000 loss on the write-down of the
carrying value of Metro Centre to its estimated net realizable value, due to
the decline in the Southern California Market.
1994 Compared to 1993
Revenues:
Rental income for 1994 increased slightly due to higher market rental rates at
several of the Partnership's properties increasing rental income approximately
$1.6 million offset by a $1.4 million decrease in rental revenues related to
the disposition of the Greenbriar, Denbigh Woods and Westwood Apartments in
1994. Investment income for 1994 increased because higher balances were
available for investment in 1994 and the Partnership recognized $36,000 of
interest on the Denbigh Woods note receivable.
The $9.5 million gain on disposition of real estate represents an $884,000
gain on sale of the Denbigh Woods Apartments in August 1994 (See "Note I" in
the Notes to Consolidated Financial Statements in "Item 8"), a $5.4 million
gain on the foreclosure of Westwood Apartments by HUD in September 1994, and a
gain of approximately $3.2 million due to the deed-in-lieu transfer of
Greenbriar Apartments to the lienholder in July 1994 (See "Note J" in the
Notes to Consolidated Financial Statements in "Item 8").
Other income realized in 1994, is due to the receipt of the Partnership's pro
rata share of the claims filed in Southmark's Chapter 11 bankruptcy
proceeding, and due to the recovery of a repair escrow relating to a property
that was previously sold (See "Note F" in the Notes to Consolidated Financial
Statements in "Item 8").
The $6.6 million gain on extinguishment of debt was due to extraordinary gains
of approximately $426,000 and $6.2 million related to the transfer of Westwood
Apartments and Greenbriar Apartments, respectively, to lienholders (See "Note
J" in the Notes to Consolidated Financial Statements in "Item 8").
Expenses:
Property operations expenses for 1994 decreased from 1993. The disposition of
the Greenbriar, Denbigh Woods and Westwood apartments in 1994 resulted in a
decrease in property operations expenses of approximately $1.1 million. This
decrease was partially offset by higher noncapital refurbishments, repairs,
and utility expenses at the Partnership's remaining properties. Interest
expense for 1994 decreased from 1993 due to approximately $12.1 million of
mortgage debt being refinanced in 1993 at lower interest rates and
approximately $15.9 million of mortgage debt being discharged in connection
with the 1994 property dispositions.
Administrative costs for 1994 decreased from 1993 primarily due to decreased
insurance expense and lower overhead costs allocated to the Partnership.
Reorganization expenses in 1993 represent legal fees and other professional
fees related to the Chapter 11 proceedings as discussed below. See also
discussion at "Liquidity and Capital Resources - Sale and Disposition of Real
Estate" below.
LIQUIDITY AND CAPITAL RESOURCES
A detailed discussion of the General Partner's current operating plan is
described in "Item 1 - Description of Business".
1995 Compared to 1994
As of December 31, 1995, the Partnership held unrestricted cash and cash
equivalents of approximately $10.9 million compared to approximately $4.3
million at December 31, 1994. Net cash provided by operating activities
increased primarily due to the absence of negative cash flows from the
properties disposed of in 1994, and an increase in accounts payable and
accrued expenses at the remaining properties. Net cash used in investing
activities increased primarily due to increased restricted escrow deposits and
increased property improvements and replacements. Net cash provided by
financing activities increased as a result of the refinancing of eight of the
Partnership's properties (See "Note G" in the Notes to Consolidated Financial
Statements in "Item 8"), partially offset by $921,000 of distributions to
partners in 1995.
1994 Compared to 1993
As of December 31, 1994, the Partnership held unrestricted cash and cash
equivalents of approximately $4.3 million compared to approximately $3.9
million at December 31, 1993. Net cash provided by operating activities
increased primarily due to the absence of negative cash flows from the
properties disposed of in the third quarter of 1994, as noted above. Net cash
used in investing activities increased primarily due to increased purchases of
securities and decreased proceeds from the sale of securities. Net cash used
in financing activities decreased primarily due to the refinancing of four of
the Partnership's properties in 1993 (See "Note C" in the Notes to
Consolidated Financial Statements in "Item 8").
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 meet 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 approximately $73.5 million matures at various
times with balloon payments due at maturity, at which time the properties will
either be refinanced or sold. Future cash distributions will depend on the
levels of net cash generated from operations, capital expenditure
requirements, property sales and the availability of cash reserves. During
1995, cash distributions of $921,000 were declared and paid. No cash
distributions were made in 1994 or 1993.
On January 20, 1995, an affiliate of the General Partner, Insignia CCP IV
Acquisition, L.L.C., closed an offer to purchase Units (the "Tender Offer")
for a cash price of $60.00 per Unit for Limited Partners of record as of
December 15, 1994. Approximately 3,370 Limited Partners holding 64,343 Units
(18.77% of total Units) accepted the Tender Offer and sold their Units to
Insignia CCP IV Acquisition, L.L.C. effective January 20, 1995, for an
aggregate sales price of approximately $3.9 million.
The Partnership is required by the Partnership Agreement to maintain working
capital reserves for contingencies. On September 25, 1995, the partners were
proxied and approved a reduction of the capital reserve requirements to $500
per apartment unit and $1.00 per square foot of gross leasable commercial
space owned by the Partnership, or approximately $2.2 million (See "Item 4 -
Submission of Matters to a Vote of Security Holders"). In the event
expenditures are made from these reserves, operating revenue shall be
allocated to such reserves to the extent necessary to maintain the foregoing
level. Reserves, including cash and cash equivalents, and securities available
for sale at market, totaling approximately $14.2 million at December 31, 1995,
exceeded the Partnership's reserve requirements of approximately $2.2 million.
Such reserves include $801,000 of cash and cash equivalents restricted for use
at the Partnership's U.S. Department of Housing and Urban Development ("HUD")
financed property.
Debt Maturities in 1995
Approximately $14.3 million of nonrecourse mortgage debt secured by the
Foothill Place Apartments and the Chimney Hill Apartments matured in 1994.
The Partnership exercised its option to extend the debt maturities until
September 1995 by paying a 1% loan extension fee of $143,000 to the current
lender as provided for in the loan agreement. In September 1995, the
Partnership signed an extension agreement extending the maturity date of the
notes to June 1997. These properties and five of the Partnership's other
properties were refinanced in December of 1995 (See "Note G" in the Notes to
Consolidated Financial Statements in "Item 8").
Approximately $2.5 million of nonrecourse mortgage debt secured by the Metro
Centre Office Building, located in Southern California, matured July 1, 1995.
The property has historically had difficulty making its scheduled debt service
payments. Since 1985, the property has made quarterly cash flow payments
pursuant to a modified and restructured loan agreement however, no payments
were made in 1995. Given current economic conditions in Southern California,
property operations are not expected to improve sufficiently to enable the
Partnership to refinance the existing indebtedness under current market
conditions. In September 1995, a Notice of Default and Election to Sell Under
Deed of Trust was filed by the lender. The Partnership did not contest this
foreclosure notice, and the property was foreclosed on February 7, 1996.
Lake Forest Apartments secures a mortgage note guaranteed by the U.S.
Department of Housing and Urban Development ("HUD") and accrued interest
totalling approximately $4.2 million at December 31, 1995. Post Ridge
Apartments secures a mortgage note and accrued interest totalling
approximately $4.4 million at December 31, 1995, which was formerly guaranteed
by HUD. Operating cash flow from the Post Ridge Apartments has not supported
its scheduled debt service payments. As a result, in January 1991, the
Partnership suspended scheduled debt service for Post Ridge Apartments and the
debt is currently in default. Since 1991, the Partnership has remitted excess
cash flow from the properties' operations as debt service. During 1995, Post
Ridge reduced its accrued interest payable from $395,000 at December 31, 1994,
to $171,000 at December 31, 1995. On March 28, 1995, this debt was sold to an
unaffiliated third party. Accordingly, since the closing of the sale on May 8,
1995, this debt is no longer regulated by HUD. The General Partner is
currently attempting to refinance this debt.
Prior to March 1995, the Nob Hill Villa Apartments secured two nonrecourse
mortgage notes totaling approximately $5.8 million. One of the notes, a $3.8
million first lien mortgage, was scheduled to mature in November 1995. In
March 1995, the General Partner refinanced these mortgage notes by obtaining a
new mortgage note of approximately $7.5 million secured by Nob Hill Villa.
Under the terms of the refinancing agreement, the new mortgage note bears
interest at 9.2% and matures in April 2005.
Sale and Disposition of Real Estate
In August 1994, the Partnership sold the Denbigh Woods Apartments. In
connection with the sale, the Partnership accepted a $1.2 million wrap note
receivable and received net sales proceeds of approximately $900,000. The
wrap note receivable bears interest at an annual rate of 9%, requires monthly
payments of principal and interest totaling $11,814 and matures in March 1996.
The Partnership is currently under negotiations with the purchaser to extend
the wrap note until March 1997. The Partnership remains obligated under two
underlying first liens totaling approximately $1.3 million which are secured
by the Denbigh Woods Apartments. Pursuant to the sale contract, the
Partnership received, from the purchaser, a capital improvement escrow
totaling $150,000. Upon completion of certain repairs and capital
improvements at the property, the Partnership will reimburse the purchaser
from the escrow account. At December 31, 1995, the Partnership held a reserve
balance of $73,000. The Partnership recognized a gain of $884,000 on this
sale during 1994.
In January 1991, the Partnership suspended scheduled debt service on the HUD
financed loan secured by the Westwood Apartments because cash flow from the
property's operations did not support the scheduled payments, and because the
property was leveraged in excess of its economic value. The Partnership
submitted two workout proposals to HUD; however, HUD rejected both proposals.
In 1993, HUD notified the Partnership that it intended to foreclose on the
Westwood Apartments, and the General Partner informed HUD that it would
cooperate with HUD's planned sale of the property. In September 1994, the
property was foreclosed upon by HUD. The Partnership recognized a gain of
approximately $5.4 million on the disposition of the real estate and an
extraordinary gain of $426,000 on extinguishment of the related debt.
7
Greenbriar Associates Chapter 11 Proceeding
In December 1990, the Partnership ceased debt service on the note and interest
payable of $12.5 million secured by Greenbriar Apartments because the
property's operations did not support scheduled debt service payments. As a
result of the Partnership's nonperformance under the terms of the mortgage
note, the lien-holder moved to foreclose on the property in October 1991. In
December 1991, Greenbriar Associates, a wholly-owned limited partnership that
holds title to the Greenbriar Apartments, filed for Chapter 11 protection. In
March 1994, the General Partner, on behalf of Greenbriar Associates, executed
a deed-in-lieu of foreclosure after Greenbriar Associates was unable to obtain
the debt concessions proposed in its reorganization plan. In July 1994, the
property was transferred to the lienholder resulting in a net gain of
approximately $9.5 million on the property disposition and extinguishment of
debt.
Other Income
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 Bankruptcy Court set the Partnership's and the affiliated partnerships'
allowed claim at an aggregate $11 million. In March 1994, the Partnership
received 3,143 shares of Southmark Corporation Redeemable Series A Preferred
Stock and 22,985 shares of Southmark Corporation New Common Stock, with an
aggregate market value on the date of receipt of $23,000, and $172,000 in
cash, representing the Partnership's share of the recovery, based on its pro
rata share of the claims filed.
In July 1994, the Partnership was able to recover $199,000, representing the
refund of a repair escrow relating to a property that was previously sold.
The recovery has been recorded as other income in the accompanying statement
of operations.
Subsequent Events
Subsequent to December 31, 1995, the $484,000 balance of the first-lien note
secured by the Point West Apartments, with an original maturity of May 2001,
was paid off to retire debt with interest rates higher than the current market
rate. The Partnership realized a loss of $5,000 on the transaction resulting
from prepayment penalties paid on the early extinguishment of the debt.
Subsequent to December 31, 1995, the Partnership declared distributions to the
partners of approximately $3.6 million attributable to cash flow from
operations and approximately $71,000 attributable from surplus funds.
Item 8. Financial Statements and Supplementary Data
CONSOLIDATED CAPITAL PROPERTIES IV
LIST OF FINANCIAL STATEMENTS
Reports of Independent Auditors
Consolidated Balance Sheets - December 31, 1995 and 1994
Consolidated Statements of Operations - Years ended December 31,
1995, 1994 and 1993
Consolidated Statements of Changes in Partners Deficit - Years
ended December 31, 1995, 1994 and 1993
Consolidated Statements of Cash Flows - Years ended December 31,
1995, 1994 and 1993
Notes to Consolidated Financial Statements
Report of Ernst & Young LLP, Independent Auditors
The Partners
Consolidated Capital Properties IV
We have audited the accompanying consolidated balance sheet of Consolidated
Capital Properties IV as of December 31, 1995, and the related consolidated
statements of operations, changes in partners capital (deficit) and cash
flows for the year then ended. These financial statements are the
responsibility of the Partnership s management. Our responsibility is to
express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by the Partnership s management, as well as evaluating the
overall financial statement presentation. We believe that our audit provides
a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position
of Consolidated Capital Properties IV as of December 31, 1995, and the
consolidated results of its operations and its cash flows for the year then
ended, in conformity with generally accepted accounting principles.
/s/ ERNST & YOUNG LLP
Greenville, South Carolina
February 9, 1996
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Partners of
Consolidated Capital Properties IV:
We have audited the accompanying consolidated balance sheet of Consolidated
Capital Properties IV (a California limited partnership) as of December 31,
1994, and the related consolidated statements of operations, partners' deficit
and cash flows for the years ended December 31, 1994 and 1993. These
financial statements are the responsibility of the Partnership's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Consolidated Capital
Properties IV as of December 31, 1994, and the results of its operations and
its cash flows for the years ended December 31, 1994 and 1993, in conformity
with generally accepted accounting principles.
/s/ Arthur Andersen, LLP
Dallas, Texas
March 23, 1995
CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED BALANCE SHEETS
(in thousands, except unit data)
Years Ended December 31,
1995 1994
Assets
Cash and cash equivalents:
Unrestricted $ 10,865 $ 4,336
Restricted-tenant security deposits 665 338
Securities available for sale 2,637 4,343
Prepaid expenses and other assets 6,900 4,108
Note and interest receivable 1,155 1,189
Investment properties
Land 12,868 12,930
Buildings and related personal property 112,350 109,288
125,218 122,218
Less accumulated depreciation (86,294) (79,720)
38,924 42,498
$ 61,146 $ 56,812
Liabilities and Partners' (Deficit)
Liabilities
Accounts payable and accrued expenses $ 3,443 $ 2,502
Notes and interest payable 76,336 70,825
79,779 73,327
Partners' (Deficit)
General partners $ (5,951) $ (5,866)
Limited partners (342,783 units outstanding in
1995 and 1994, respectively) (12,682) (10,649)
(18,633) (16,515)
$ 61,146 $ 56,812
See Accompanying Notes to Consolidated Financial Statements
CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
<S> <C> <C> <C>
Revenues:
Rental income $ 26,266 $27,087 $26,913
Interest and other income 1,114 818 350
Total revenues 27,380 27,905 27,263
Expenses:
Property operations 13,717 16,092 16,625
Depreciation and amortization 6,673 7,328 7,763
Interest 6,544 8,025 8,517
Administrative 1,486 880 1,067
Write down of investment property 200 -- --
Total expenses 28,620 32,325 33,972
Loss from operations (1,240) (4,420) (6,709)
Gain on disposition of real estate -- 9,523 --
Reorganization expense -- -- (368)
Gain on sale of securities -- -- 75
Income (loss) before extraordinary
items (1,240) 5,103 (7,002)
Extraordinary gains from extinguishment
of debt -- 6,614 --
Extraordinary gain (loss), net from
refinancing of debt 43 -- (272)
Net income (loss) $ (1,197) $11,717 $(7,274)
Net income (loss) per weighted average
limited partnership unit:
Income (loss) before extraordinary
items $ (3.47) $ 14.29 $(19.60)
Extraordinary items .12 18.52 (.76)
Net income(loss) per weighted average
limited partnership unit $ (3.35) $ 32.81 $(20.36)
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENTS OF PARTNERS' DEFICIT
(in thousands)
<TABLE>
<CAPTION>
Limited Total
Partnership General Limited Partners'
Units Partner Partners (Deficit)
<S> <C> <C> <C> <C>
Original capital contributions 343,106 $ 1 $171,553 $171,554
Partners' deficit at
December 31, 1992 343,034 (6,044) (14,914) (20,958)
Abandonment of limited
partnership units (195) -- -- --
Net loss for the year ended
December 31, 1993 -- (291) (6,983) (7,274)
Partners' deficit
at December 31, 1993 342,839 (6,335) (21,897) (28,232)
Abandonment of limited
partnership units (56) -- -- --
Net income for the year ended
December 31, 1994 -- 469 11,248 11,717
Partners' deficit
at December 31, 1994 342,783 (5,866) (10,649) (16,515)
Net loss for the year ended
December 31, 1995 -- (48) (1,149) (1,197)
Distributions paid -- (37) (884) (921)
Partners' deficit at
December 31, 1995 342,783 $(5,951) $(12,682) $(18,633)
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (1,197) $11,717 $(7,274)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization of loan
costs, mortgage discounts and lease commissions 6,952 7,920 8,239
Gain on disposition of real estate -- (9,523) --
Write down of investment property 200 -- --
Casualty gains (185) -- --
Extraordinary gain from extinguishment of debt -- (6,614) --
Extraordinary loss from refinancing of debt -- -- 272
Extraordinary gain from refinancing of debt (43) -- --
Gain on sale of securities available for sale -- -- (75)
Southmark stock receipt -- (23) --
Change in accounts:
Restricted cash (327) 147 (130)
Prepaid expenses and other assets (561) (196) 79
Interest payable 85 -- 1,388
Accounts payable and accrued expenses 941 (93) 110
Net cash provided by operating activities 5,865 3,335 2,609
Cash flows from investing activities:
Property improvements and replacements (3,325) (1,708) (1,637)
Purchase of securities available for sale (7,176) (1,705) --
Proceeds from sale of securities available for sale 8,882 250 2,401
Proceeds from sale of real estate -- 881 --
Receipt of capital improvement escrow on sold real
estate -- 150 --
Principal receipts on notes receivable 33 11 --
Deposits to restricted escrows (2,323) -- (721)
Receipts from restricted escrows 1,138 -- 486
Net insurance proceeds from casualty gain 185 -- --
Net cash (used in) provided by investing
activities (2,586) (2,121) 529
</TABLE>
CONSOLIDATED CAPITAL PROPERTIES IV
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
(in thousands)
<TABLE>
<CAPTION>
Years Ended December 31,
1995 1994 1993
<S> <C> <C> <C>
Cash flows from financing activities:
Payments on notes payable (749) (783) (887)
Repayment of notes payable (37,106) -- (15,160)
Proceeds from long-term borrowings 43,530 -- --
Proceeds from refinancing -- -- 13,601
Prepayment penalties (179) -- (4)
Loan costs paid (1,325) -- (720)
Distributions to Partners (921) -- --
Net cash provided by (used in)
financing activities 3,250 (783) (3,170)
Net increase (decrease) in cash and cash equivalents 6,529 431 (32)
Cash and cash equivalents at beginning of year 4,336 3,905 3,937
Cash and cash equivalents at end of year $10,865 $ 4,336 $ 3,905
Supplemental disclosure of cash flow information:
Cash paid for interest $ 6,154 $ 6,651 $ 6,616
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
CONSOLIDATED CAPITAL PROPERTIES IV
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1995 and 1994
Note A - Organization and Summary of Significant Accounting Policies
Organization
Consolidated Capital Properties IV (the "Partnership"), a California limited
partnership, was formed on September 22, 1981, to acquire and operate
commercial and residential properties. Partnership operations commenced
February 16, 1982, the date on which impound requirements were met. As of
December 31, 1995, the Partnership operates 17 residential and 1 commercial
properties located in or near major urban areas in the United States.
Upon the Partnership's formation in 1981, Consolidated Capital Equities
Corporation ("CCEC"), a Colorado corporation, was the corporate general
partner and Consolidated Capital Management Company ("CCMC"), a California
general partnership, was the non-corporate general partner. In 1988, through
a series of transactions, Southmark Corporation ("Southmark") acquired
controlling interest in CCEC. In December 1988, CCEC filed for reorganization
under Chapter 11 of the United States Bankruptcy Code. In 1990, as part of
CCEC's reorganization plan, CEI acquired CCEC's general partner interests in
the Partnership and in 15 other affiliated public limited partnerships (the
"Affiliated Partnerships") and CEI replaced CCEC as managing general partner
in all 16 partnerships. The selection of CEI as the sole managing general
partner was approved by a majority of the limited partners in the Partnership
and in each of the Affiliated Partnerships pursuant to a solicitation of the
Limited Partners dated August 10, 1990. As part of this solicitation, the
Limited Partners also approved an amendment to the Partnership Agreement to
limit changes of control of the Partnership, and the conversion of CCMC from a
general partner to a limited partner, thereby leaving CEI as the sole general
partner of the Partnership.
All of CEI's outstanding stock is owned by GII Realty, Inc. In December 1994,
the parent of GII Realty, Inc., entered into a transaction (the "Insignia
Transaction") in which among other things, MAE-ICC, Inc., a wholly owned
subsidiary of Metropolitan Asset Enhancement, L.P. ("MAE"), an affiliate of
Insignia Financial Group, Inc. ("Insignia") acquired an option (exercisable in
whole or in part from time to time) to purchase all of the stock of GII
Realty, Inc. and, pursuant to a partial exercise of such option, acquired
50.5% of that stock. As a part of the Insignia Transaction, MAE-ICC, Inc.
also acquired all of the outstanding stock of Partnership Services, Inc., an
asset management entity, and a subsidiary of Insignia acquired all of the
outstanding stock of Coventry Properties, Inc., a property management entity.
In addition, confidentiality, non-competition, and standstill arrangements
were entered into between certain of the parties. Those arrangements, among
other things, prohibit GII Realty's former sole shareholder from purchasing
Partnership Units for a period of three years. On October 24, 1995, MAE-ICC,
Inc. exercised the remaining portion of its option to purchase all of the
remaining outstanding capital stock of GII Realty, Inc.
The principal place of business for the Partnership and for the General
Partner is One Insignia Financial Plaza, Greenville, South Carolina 29602.
Note A - Organization and Summary of Significant Accounting Policies (continued)
Consolidation
The consolidated financial statements include the Partnership's equity
interest in a joint-venture partnership which owns South Port Apartments. No
minority interest has been reflected for the joint venture partnership because
minority interests are limited to the extent of their equity capital, and
losses in excess of the minority interest equity capital are charged against
the Partnership's interest.
The Partnership's consolidated financial statements include the accounts of
its wholly-owned limited partnerships, certain other majority-owned limited
partnerships and the Partnership's majority interest in a joint venture
partnership. All intercompany transactions have been eliminated.
Cash and Cash Equivalents
For purposes of reporting cash flows, cash and cash equivalents include cash
on hand, demand deposits, money market funds, certificates of deposits and
U.S. Treasury Bills with original maturities of three months or less.
See "Notes C and J" for supplemental information with respect to noncash
investing and financing activity.
Restricted cash - tenant security deposits
The Partnership requires security deposits from new lessees for the duration
of the lease and such deposits are considered restricted cash. Deposits are
refunded when the tenant vacates, provided the tenant has not damaged its
space and is current on its rental payments.
Restricted assets
The Partnership maintained restricted U.S. Housing and Urban Development
("HUD") cash in unrestricted cash of approximately $801,000 and $639,000 at
December 31, 1995 and 1994, respectively. The Partnership maintained the
following cash balances in Prepaid expenses and other assets (amounts in
thousands):
As of December 31,
1995 1994
Tax and Insurance Escrows $1,235 $1,165
Repair and Maintenance Escrows 2,766 1,348
Note A - Organization and Summary of Significant Accounting Policies (continued)
Investments in Real Estate
Investment properties are generally stated at the lower of cost or estimated
fair value, which was determined using the net operating income of the
investment property capitalized at a rate deemed reasonable for the type of
property, adjusted for market conditions, physical condition of the property
and other factors to assess whether any permanent impairment in value has
occurred. During 1996, the Partnership will adopt FASB Statement No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets
to Be Disposed Of," which requires impairment losses to be recorded on long-
lived assets used in operations when indicators of impairment are present and
the undiscounted cash flows estimated to be generated by those assets are less
than the assets' carrying amount. The impairment loss is measured by
comparing the fair value of the asset to its carrying amount. The Partnership
expects that the adoption of FASB Statement No. 121 will not have a material
impact.
Depreciation
Buildings, improvements and furniture and fixtures are depreciated using the
straight-line method over the estimated useful lives of the assets, ranging
from 4 to 40 years.
Securities Available For Sale
In 1994, the Partnership adopted Statements of Financial Accounting Standards
No. 115, "Accounting for Certain Investments in Debt and Equity Securities."
As the fair value of securities available for sale ("Securities") approximate
their cost, any unrealized gains or losses are immaterial and therefore, have
not been recorded in the accompanying financial statements. Any such
adjustment would be recorded directly to Partners' Equity (Deficit) and would
not be reflected in the Statement of Operations. The cost of Securities sold
is determined using the specific identification method.
The Securities mature as follows:
Cost
Description (in thousands) Maturity
U.S. Treasury Notes $ 25 May 1996
U.S. Treasury Notes 2,098 November 1996
U.S. Treasury Notes 491 January 1997
Equity Securities 23 N/A
$2,637
Securities available for sale as of December 31, 1994 consist of $2,664,000 in
U.S. Treasury Notes, $1,656,000 in U.S. Treasury Bills and $23,000 in Equity
Securities.
Note A - Organization and Summary of Significant Accounting Policies (continued)
Rental Income
The Partnership leases its residential properties under short-term operating
leases. Lease terms are generally one year or less in duration. The
Partnership owns one commercial office building (Metro Centre Office Building)
which was foreclosed upon in 1996 (See "Note E").
Deferred Loan Fees
Deferred loan fees are amortized using the straight-line method over the lives
of the related mortgage notes. Unamortized deferred fees are included in
prepaid expenses and other assets.
Lease Commissions
Lease commissions are capitalized and amortized using the straight-line method
over the life of the applicable lease. Unamortized lease commissions are
included in prepaid expenses and other assets.
Income Taxes
The Partnership is classified as a partnership for Federal income tax
purposes. Accordingly, no provision for income taxes is made in the financial
statements of the Partnership. Taxable income or loss of the Partnership is
reported in the income tax returns of its partners.
The tax basis of the Partnership's assets and liabilities is approximately
$28.4 million greater than the assets and liabilities as reported in the
financial statements at December 31, 1995.
Fair Value
In 1995, the Partnership implemented Statement of Financial Accounting
Standards No. 107, "Disclosure about Fair Value of Financial Instruments,"
which requires disclosure of fair value information about financial
instruments for which it is practicable to estimate that value. The carrying
amount of the Partnership's cash and cash equivalents approximates fair value
due to their short-term maturities. The Partnership estimates the fair value
of its fixed rate mortgages by discounted cash flow analysis based on
estimated borrowing rates currently available to the Partnership.
Allocation of Net Income and Net Loss
The Partnership Agreement provides for net losses and distributions of
distributable cash from operations to be allocated, generally 96% to the
Limited Partners and 4% to the general partner (inclusive of the special
limited partners).
Note A - Organization and Summary of Significant Accounting Policies (continued)
Net Income (Loss) Per Weighted Average Limited Partnership Unit
Net income (loss) per weighted average Limited Partnership Unit is computed by
dividing net income (loss) allocated to the Limited Partners by the weighted
average number of Units outstanding. Per Unit information has been computed
based on weighted average Units outstanding of 342,783, 342,819 and 342,951 for
the years ended December 31, 1995, 1994 and 1993, respectively.
Reclassification
Certain reclassifications have been made to the 1994 and 1993 information to
conform to the 1995 presentation.
Advertising Costs
Advertising costs of approximately $321,000, $375,000, and $380,000 in 1995,
1994 and 1993, respectively, are charged to expenses as incurred and are
included in operating expenses.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from those estimates.
Note B - Related Party Transactions
The Partnership has no employees and is dependent on the General Partner and
affiliates of Insignia for the management and administration of all of the
partnership activities, as provided in the Partnership Agreement.
The Partnership has paid the property management fees noted below based on
collected gross rental revenues ("Rental Revenues") for property management
services in each of the years ended December 31, 1995, 1994 and 1993,
respectively. For the year ended December 31, 1994, a portion of such property
management fees equal to 4% of Rental Revenues was paid to the property
management companies performing day-to-day property management services and a
portion equal to 1% of Rental Revenues was paid to Partnership Services, Inc.
("PSI") or its predecessor for advisory services related to day-to-day
property operations. Prior to July 1993, day-to-day property management
services were provided to the Partnership properties by unaffiliated
management companies. In July 1993, Coventry Properties, Inc. ("Coventry"),
an affiliate of the General Partner, assumed day-to-day property management
responsibilities for two of the Partnership's properties under the same
management fee arrangement as the unaffiliated management companies. Coventry
assumed day-to-day property management responsibilities for four additional
Partnership properties in January 1994. In late December 1994, an affiliate of
Insignia, assumed day-to-day property management responsibilities for fifteen
of the Partnership's eighteen properties. On February 15, 1995, an affiliate
of Insignia assumed day-to-day property management responsibilities for Lake
Forest and Post Ridge Apartments. South Port Apartments is currently managed
by an unaffiliated management company. Fees paid to Insignia and affiliates for
the year ended December 31, 1995, and fees paid to PSI and Coventry for the
years ended December 31, 1994 and 1993, have been reflected in the following
table as compensation to related parties in the applicable periods:
Years Ended December 31,
1995 1994 1993
(in thousands)
Property management fees $1,223 $570 $355
The Limited Partnership Agreement ("Partnership Agreement") provides for a
special management fee equal to 9% of the total distributions made to the
limited partners to be paid to the General Partner for executive and
administrative management services. The Partnership paid approximately
$80,000 to affiliates of the General Partner during 1995 under this provision
of the Partnership Agreement. No such fees were paid or accrued in 1994.
The Partnership Agreement also provides for reimbursement to the General
Partner and its affiliates for costs incurred in connection with the
administration of Partnership activities. The General Partner and its
affiliates, which includes Coventry for the twelve months ended December 31,
1994 and 1993, received reimbursements as reflected in the following table:
Years Ended December 31,
1995 1994 1993
(in thousands)
Reimbursement for services of affiliates $648 $505 $656
During the year ended December 31, 1995, the Partnership incurred
approximately $42,000 of expense reimbursements to an affiliate of the General
Partner related to evaluating the feasibility of refinancing the debt on
several of the Partnership's investment properties. The Partnership has also
paid this affiliate $123,000 of loan costs which were capitalized and included
in "Prepaid expenses and other assets" on the Consolidated Balance Sheet.
These loan costs related to the refinancing of eight of the Partnership's
properties (See "Note G").
In July 1995, the Partnership began insuring its properties under a master
policy through an agency and insurer unaffiliated with the General Partner.
An affiliate of the 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 General
Partner, who receives payment on these obligations from the agent. The amount
of the Partnership's insurance premiums accruing to the benefit of the affiliate
of the General Partner by virtue of the agent's obligations is not significant.
On January 20, 1995, an affiliate of the General Partner, Insignia CCP IV
Acquisition, L.L.C., closed an offer to purchase Units (the "Tender Offer")
for a cash price of $60.00 per Unit to Limited Partners of record as of
December 15, 1994. Approximately 3,370 Limited Partners holding 64,343 Units
(18.77% of total Units) accepted the Tender Offer and sold their Units to
Insignia CCP IV Acquisition, L.L.C. effective January 20, 1995, for an
aggregate sales price of approximately $3.9 million.
Note C - Notes and Interest Payable and Receivable
Notes Payable
<TABLE>
<CAPTION>
Principal Principal
Balance At Stated Balance
December 31, Interest Period Maturity Due At
Property 1995 Rate Amortized Date Maturity
(dollar amounts in thousands)
<S> <C> <C> <C> <C>
The Apartments $ 3,543 8.34% 7 years 9/00 $ 3,244
Arbour East Apartments 5,650 6.95% 10 years 12/05 5,650
Briar Bay Racquet Club 3,500 6.95% 10 years 12/05 3,500
Chimney Hills Apartments 5,400 6.95% 10 years 12/05 5,400
Citadel Apartments 4,904 8.38% 7 years 10/00 4,488
Citadel Village Apartments 2,450 6.95% 10 years 12/05 2,450
Foothill Place Apartments 10,100 6.95% 10 years 12/05 10,100
Knollwood Apartments 6,780 6.95% 10 years 12/05 6,780
Lake Forest Apartments 4,212 7.50% 31.5 years 8/13 N/A
Metro Centre Office Building 2,497 11.50% 10 years 7/95 2,497
Nob Hill Villa Apartments 7,447 9.20% 10 years 4/05 6,250
Overlook Apartments 1,904 10.50% 25 years 12/98 1,817
Point West Apartments 496 9.13% 25 years 5/01 N/A
Post Ridge Apartments 4,242 9.75% 35 years 7/22 N/A
Rivers Edge Apartments 2,068 8.40% 7 years 9/00 1,895
South Port Apartments 3,509 10.85% 15 years 7/01 3,167
Stratford Place Apartments 2,697 8.65% 25 years 9/00 2,478
Village East Apartments 2,150 6.95% 10 years 12/05 2,150
$73,549 $61,866
</TABLE>
Note C - Notes and Interest Receivable and Payable (continued)
The notes payable represent borrowings on the properties purchased by the
Partnership. The notes are non-recourse, and are collateralized by deeds of
trust on the investment properties. The notes mature between 1998 and 2022
bear interest at rates ranging from 6.95% to 11.50%.
Approximately $2.5 million of nonrecourse mortgage debt secured by the Metro
Centre Office Building, located in Southern California, matured July 1, 1995.
The property has historically had difficulty making its scheduled debt service
payments and since 1985, the property has made quarterly cash flow payments
pursuant to a modified and restructured loan agreement, however, no payments
were made in 1995. Given current economic conditions in Southern California,
property operations are not expected to improve sufficiently to enable the
Partnership to refinance the existing indebtedness under current market
conditions. In September 1995, a Notice of Default and Election to Sell Under
Deed of Trust was filed by the lender. The Partnership did not contest this
foreclosure notice and the property was foreclosed upon February 7, 1996.
The estimated fair value of the Partnership's aggregate debt excluding the
debt of the Metro Centre Office Building and Post Ridge Apartments is
approximately $68 million. This estimate represents a general approximation
of possible value and is not necessarily indicative of the amounts the
Partnership might pay in actual market transactions. Due to the difficulty of
forecasting the future cash flows of the Post Ridge Apartments and due to the
Metro Centre Office Building being foreclosed in February of 1996, the
Partnership has determined that it is not practicable to estimate the fair
value of these mortgages.
Note Receivable on Sold Property:
As of December 31, 1995
Underlying
Note Mortgage
Collateral Property Receivable Debt
(in thousands)
Denbigh Village
Apartment complex - 138 units
Newport News, Virginia $ 1,155 $ 1,286
When the Denbigh Village Apartments was sold in August 1994, the Partnership
accepted a promissory note which matures in March 1996 and has a 9% interest
rate. The Partnership is currently in negotiations with the purchaser to
extend the wrap note to April 1997. The estimated value of the note
receivable approximates its carrying value.
Note C - Notes and Interest Receivable and Payable (continued)
Denbigh Village Apartments secures two underlying mortgage notes. The balance
of the first mortgage is approximately $550,000 at December 31, 1995, has a
stated interest rate of 9.5% and matures in December 2002. The balance of the
second mortgage is approximately $736,000, has a stated interest rate of 9.5%
and matures in December of 1998.
The estimated fair value of the Partnership's underlying mortgage debt secured
by the Denbigh Village Apartments is approximately $1.4 million. This
estimate represents a general approximation of possible value and is not
necessarily indicative of the amounts the Partnership might pay in actual
market transactions.
Walnut Building Note Receivable
In September 1993, the $1.9 million note receivable secured by the 1500 Walnut
Office Building, located in Philadelphia, Pennsylvania, was determined to be
uncollectible and was written off. Since the aggregate note receivable was
fully reserved for possible loss in the year ended December 31, 1990, no gain
or loss was recognized on the transaction.
Notes Payable Refinancing in 1993
In August and September 1993, the General Partner obtained refinancing of
approximately $12.1 million of mortgage debt secured by four of the
Partnership's properties. Approximately $10.4 million of the refinanced debt
had matured or was scheduled to mature by May 1993. In order to facilitate
the refinancing, title to the properties was transferred to four wholly-owned
limited partnerships in July 1993: Apartment Associates, River's Edge
Associates, Stratford Associates, and Citadel Associates. Under the terms of
the refinancing agreements, the new first-liens totaling approximately $13.6
million bear interest at rates ranging from 8.34% to 8.65% until the notes
mature in September and October 2000. The Partnership recognized an aggregate
loss on the refinancing transactions of $272,000, comprised primarily of a
write-off of $368,000 of an unamortized mortgage discount on one of the maturing
notes and a $100,000 discount for early repayment of another note.
Debt Service Moratorium on HUD Properties
The Lake Forest Apartments secures a HUD-financed mortgage note and accrued
interest aggregating approximately $4.2 million at December 31, 1995. Post
Ridge Apartments secures a mortgage note and accrued interest totalling
approximately $4.4 million at December 31, 1995, which was formerly guaranteed
by HUD. Operating cash flow from the Post Ridge Apartments has not supported
its scheduled debt payments. As a result, in January 1991, the Partnership
suspended scheduled debt service for Post Ridge and the debt is currently in
default. Since 1991, the Partnership remitted excess cash flow from the
properties' operations as debt service. During 1995, Post Ridge has reduced
its accrued interest payable from $395,000 at December 31, 1994 to $171,000 at
December 31, 1995. On March 28, 1995 this debt was sold to an unaffiliated
third party. Accordingly, since the closing of the sale on May 8, 1995, this
debt is no longer regulated by HUD. The Partnership is currently attempting
to refinance this debt.
Summary of Maturities Subsequent to December 31, 1995
Future annual principal payments required under the terms of notes payable are
as follows (Amounts in thousands):
Years Ended December 31,
1996 $ 576
1997 629
1998 3,205
1999 700
2000 12,781
Thereafter 50,205
68,096
Notes payable on which debt
service has ceased (a) $ 4,241
(b) 2,497
Total $74,834
(a) The maturity of the note payable secured by the Post Ridge Apartments has
been excluded from the summary of maturities by year because the
Partnership is not making scheduled principal payments on this note.
(b) The maturity of the note payable secured by Metro Centre has been excluded
from the summary of maturities by year because the property has been
foreclosed upon and no debt service payments will be made (See Note E).
Note D - Chapter 11 Proceeding
Briar Bay Associates
In August 1992, the Briar Bay Racquet Club Apartments, located in Miami,
Florida, suffered severe structural, interior, and roof damage and surrounding
landscape destruction as a result of Hurrican Andrew. The Briar Bay Racquet
Club Apartments was subject to mortgage notes payable totaling approximately
$4.5 million at December 31, 1992, of which $2.1 million matured in October
1992 and $2.4 million matured in February 1993. The General Partner was
negotiating to refinance the notes payable when the property was damaged by
the hurricane. Because of the extensive damage to the property, negotiations
related to the debt refinancing ceased, and the General Partner was unable to
secure a refinancing agreement. In September 1992, Briar Bay Associates, a
wholly-owned partnership that holds fee ownership to the Briar Bay Racquet Club
Apartments, filed for Chapter 11 protection. The General Partner believed that
a bankruptcy reorganization of Briar Bay Associates and of the property was the
most feasible method of obtaining a restructuring of the matured debt while the
Partnership maintained control of the property to ensure completion of its
rehabilitation.
In May 1993, the Partnership purchased Briar Bay Associates' three second-lien
notes payable aggregating $2.1 million, which had matured in October 1992, for
cash payments of $2.4 million representing all principal and unpaid interest due
under the note agreements and related legal fees. The purchase of the second-
lien notes allowed Briar Bay Associates to expedite confirmation of its
reorganization plan and begin rehabilitation of the property. In June 1993,
the Bankruptcy Court confirmed a consensual plan of reorganization for Briar Bay
Associates (the "Briar Bay Plan") pursuant to which the $2.4 million first lien
note which had matured in February 1993 was modified and extended. The new loan
agreement requires monthly payments based on an amortization period of 15
years and an annual interest rate of 10.25%. No gain or loss was recognized
on the Briar Bay Associates reorganization.
Greenbriar Associates
In December 1990, the Partnership ceased debt service on the note and interest
payable secured by Greenbriar Apartments because the property's operations did
not support scheduled debt service payments. As a result of the Partnership's
non-performance under the terms of the mortgage note, the lien-holder moved to
foreclose on the property in October 1991. In December 1991, Greenbriar
Associates, a wholly-owned limited partnership that holds title to the
Greenbriar Apartments, filed for Chapter 11 protection. Property management
services for the property were transferred to a management company employed by
the lender in December 1991. In March 1994, the General Partner, on behalf of
Greenbriar Associates, executed a deed-in-lieu of foreclosure after Greenbriar
Associates was unable to obtain the debt concessions proposed in its
reorganization plan. In July 1994, the property was transferred to the
lienholder resulting in a net gain of approximately $9.5 million on the
property disposition and extinguishment of debt.
Note D - Chapter 11 Proceeding (continued)
The 1994 results of operations for Greenbriar Associates are summarized in the
following table:
For the Period
From January 1 to
July 15, 1994
(in thousands)
Rental revenues $ 1,322
Costs and expenses:
Property operations 1,278
Depreciation 364
Interest 538
Total costs and expenses 2,180
Net loss $ (858)
Note E - Commitments and Contingencies
Commitments
The Partnership is required by the Partnership Agreement to maintain working
capital reserves for contingencies. On September 25, 1995, the partners were
proxied and approved a reduction of the capital reserve requirements to $500
per apartment unit and $1.00 per square foot of gross leasable commercial
space owned by the Partnership, or approximately $2.2 million (See "Item 4.
Submission of Matters to a Vote of Security Holders"). In the event
expenditures are made from these reserves, operating revenue shall be allocated
to such reserves to the extent necessary to maintain the foregoing level.
Reserves, including cash and cash equivalents, and securities available for sale
at market, totaling approximately $14.2 million at December 31, 1995, exceeded
the Partnership's reserve requirements of approximately $2.2 million. Such
reserves include $801,000 of cash and cash equivalents restricted for use at the
Partnership's U.S. Department of Housing and Urban Development ("HUD") financed
property.
Note E - Commitments and Contingencies (continued)
Contingencies
Approximately $2.5 million of nonrecourse mortgage debt secured by the Metro
Centre Office Building, located in Southern California, matured July 1, 1995.
The property has historically had difficulty making its scheduled debt service
payments. Since 1985, the property has made quarterly cash flow payments
pursuant to a modified and restructured loan agreement however, no payments
were made in 1995. Given current economic conditions in Southern California,
property operations are not expected to improve sufficiently to enable the
Partnership to refinance the existing indebtedness under current market
conditions. In September 1995, a "Notice of Default and Election to Sell
Under Deed of Trust" was filed by the lender. The Partnership did not contest
this foreclosure notice, and the property was foreclosed on February 7, 1996,
resulting in a gain on extinguishment of debt to the Partnership. The
property was written down by $200,000 to its estimated net realizable value at
December 31, 1995.
Greenbriar Associates, Ltd. ("Greenbriar Associates"), a wholly-owned limited
partnership that holds fee title to the Greenbriar Apartments, filed for
protection under Chapter 11 of the United States Bankruptcy Code ("Chapter
11") with the District of Arizona, Bankruptcy Court, in December 1991. This
Chapter 11 proceeding was dismissed in 1994.
Lake Forest Apartments secures a HUD-guaranteed mortgage note and accrued
interest totalling approximately $4.2 million at December 31, 1995. Post
Ridge Apartments secures a mortgage note and accrued interest totalling
approximately $4.4 million at December 31, 1995, which was formerly guaranteed
by HUD. Operating cash flow from the Post Ridge Apartments has not supported
its scheduled debt service payments. As a result, in January 1991, the
Partnership suspended scheduled debt service for Post Ridge Apartments and this
debt is currently in default. Since 1991, the Partnership has remitted excess
cash flow from the properties' operations as debt service. During 1995, Post
Ridge has reduced its accrued interest payable from $395,000 at December 31,
1994 to $171,000 at December 31, 1995. On March 28, 1995, this debt was sold
to an unaffiliated third party. Accordingly, since the closing of the sale on
May 8, 1995, this debt is no longer regulated by HUD. The General Partner is
currently attempting to refinance this debt.
Note F - Other Income
In 1991, the Partnership (and simultaneously other affiliated partnerships)
entered claims in the Southmark Corporation's Chapter 11 bankruptcy
proceeding. These claims related to the Southmark Corporation's activities
while it exercised control (directly, or indirectly through its affiliates)
over the Partnership. The Bankruptcy Court set the Partnership's and the
other affiliated partnerships' allowed claim at an aggregate $11 million. In
March 1994, the Partnership received 3,143 shares of Southmark Corporation
Redeemable Series A Preferred Stock and 22,985 shares of Southmark Corporation
New Common Stock with an aggregate market value on the date of receipt of
approximately $23,000 and $172,000 in cash, representing the Partnership's
share of the recovery, based on its pro rata share of the claims filed.
Note F - Other Income (continue)
In July 1994, the Partnership was able to recover $199,000, representing the
refund of a repair escrow relating to a property that was previously sold.
The recovery has been recorded as other income in the accompanying statement
of operations.
Note G - Note Refinancing
In March of 1995, the Partnership refinanced two nonrecourse mortgage notes
totalling approximately $5.8 million which were secured by the Nob Hill Villa
Apartments. Under the terms of the refinancing agreement, the new $7.5
million mortgage note bears interest at 9.2% and matures in April 2005. As a
result of the refinancing, the Partnership realized a $250,000 discount on the
second mortgage which resulted in an extraordinary gain on refinancing.
Total capitalized loan costs incurred in March 1995 for the refinancing
totaled $304,000 and are being amortized over the life of the loan.
Restricted Escrows required under the Nob Hill Villa refinancing are as
follows:
Capital Improvement Reserves - At the time of the refinancing of the
mortgage note payable, $219,000 of the proceeds were designated for "Capital
Improvement Escrows" for certain capital improvements. At December 31, 1995,
the escrow balance is approximately $291,000.
In December of 1995, the Partnership refinanced approximately $31.5 million of
mortgage indebtedness which encumbers the Arbour East, Briar Bay, Chimney
Hills, Citadel Village, Foothill Place, Knollwood and Village East Apartments.
As a result of the refinancings, the Partnership paid $179,000 in prepayment
penalties and wrote-off $28,000 in unamortized loan costs. As a result, the
Partnership recorded a $207,000 extraordinary loss from the refinancing. The
new mortgage indebtedness of $36,030,000 carries a stated interest rate of
6.95%, with interest only payments and balloon payments due December 1, 2005.
Total capitalized loan costs incurred in December 1995, for the seven
refinancings totaled $1,002,000 and are being amortized over the life of the
respective loans.
Restricted Escrows required under the December, 1995 refinancings are as
follows:
Capital Improvement Reserves - At the time of the refinancings of the
mortgage notes payable, $1,047,000 of the proceeds were designated for
"Capital Improvement Escrows" for certain capital improvements. At December
31, 1995, none of the reserves had been expended. In 1996, an additional
$97,500 was designated for "Capital Improvement Escrows" for Knollwood.
Replacement Reserve Account - In addition to the Capital Improvement
Reserves, Replacement Reserve Accounts of $507,000, which ranged from $191 to
$325 per unit, were established with the refinancing proceeds for the
refinanced properties. These funds were established to cover necessary
repairs and replacements of existing improvements.
Note H - Abandoned Limited Partnership Units
For the years ended December 31, 1994 and 1993, the number of Limited
Partnership Units decreased by 56 and 195 units, respectively due to limited
partners abandoning their units. In abandoning Limited Partnership Units, a
limited partner relinquishes all right, title and interest in the Partnership
as of the date of abandonment. The net loss per weighted average Limited
Partnership Unit in the accompanying Statements of Operations is calculated
based on weighted average Units outstanding during the period.
Note I - Sale of Real Estate
In August 1994, the Partnership sold the Denbigh Woods Apartments. In
connection with the sale, the Partnership accepted a $1.2 million wrap note
receivable and received net sales proceeds of $881,000. The new wrap note
receivable bears interest at an annual rate of 9%, requires monthly payments
of principal and interest totalling $11,814, and matures in March 1996. Since
the wrap around promissory note is subordinate and inferior to the first-lien
mortgages, the Partnership remains obligated under two underlying first-lien
mortgages totalling approximately $1.3 million which are secured by the
Denbigh Woods Apartments. Pursuant to the sale contract, the Partnership
received, from the purchaser, a capital improvement escrow totalling $150,000.
Upon completion of certain repairs and capital improvements at the property, the
Partnership will reimburse the purchaser from the escrow account. The
Partnership recognized a gain of $884,000 on the sale during the third quarter
of 1994. The sales transaction is summarized in the following table:
For The Year
Ended December 31, 1994
(in thousands)
Sales Value:
Cash proceeds received $ 881
Wrap note receivable 1,200
Total sales value 2,081
Cost of sales:
Net real estate (a) (1,188)
Other liabilities, net of other (9)
Total costs of sales (1,197)
Gain on sale of real estate $ 884
(a) Real estate at cost, net of accumulated depreciation of approximately $1.7
million.
The holder of the underlying first lien mortgages did not pre-approve the
sale and, as a result, as of December 31, 1995 and 1994, Partnership is in
default of the two first lien mortgages. Although the holder of the mortgages
has the right to accelerate the notes at any time, no such intentions have been
indicated by the holder of the mortgages.
Note J - Disposition of Real Estate
In January 1991, the Partnership suspended the scheduled debt service on the
HUD-financed loan secured by the Westwood Apartments because cash flow from
the property's operations did not support the scheduled payments and because
the property was leveraged in excess of its economic value. The Partnership
submitted two workout proposals to HUD, however, HUD rejected both proposals.
In 1993, HUD notified the Partnership that it intended to foreclose on the
Westwood Apartments and in September 1994, the property was foreclosed upon,
with the Partnership recognizing a gain of approximately $5.4 million on the
disposition of the real estate and an extraordinary gain of $426,000 on
extinguishment of the related debt.
As more fully described in "Note D," the General Partner, on behalf of
Greenbriar Associates, executed a deed-in-lieu of foreclosure on Greenbriar
Apartments and in July 1994, the property was transferred to the lienholder.
The Partnership recognized a gain of approximately $3.3 million on the
disposition of the real estate and an extraordinary gain of approximately $6.2
million on extinguishment of the related debt.
The transactions are summarized as follows:
For The Year
Ended December 31, 1994
(in thousands)
Net real estate (a) $(5,866)
Other assets, net of other liabilities 455
(5,411)
Debt discharged (b) 20,664
Net gain on foreclosure $15,253
Gain on disposition of real estate (c) $ 8,639
Extraordinary gain on extinguishment of
debt (d) 6,614
Net gain on foreclosure $15,253
(a) Real estate, at cost, net of accumulated depreciation of approximately
$14.9 million.
(b) Amount includes accrued interest.
(c) The gain on disposition of real estate represents the difference between
the carrying value of the real estate and the estimated fair value of the
property at disposition. The gain is included in "Gain on disposition of
real estate" in the accompanying statements of operations.
(d) The gain on extinguishment of debt represents the difference between the
estimated fair value of the property at foreclosure and the amount of
debt, including accrued interest, extinguished. The gain is reflected as
an extraordinary item in the accompanying statements of operations.
Note K - Distributions
In September 1995, the General Partner declared and paid distributions
attributable to cash flow from operations totalling approximately $921,000 to
the partners.
Note L - Investment Properties and Accumulated Depreciation
<TABLE>
<CAPTION>
Initial Cost
To Partnership
Cost
Buildings Capitalized
and Related (Written Down)
Personal Subsequent to
Description Encumbrances Land Property Acquisition
(Amounts in thousands)
<S> <C> <C> <C> <C>
Knollwood Apartments $6,780 $ 345 $ 7,065 $2,214
Chimney Hills Apartments 5,400 659 7,188 2,333
Briar Bay Racquet Club Apartments 3,500 1,084 5,271 1,196
Citadel Village Apartments 2,450 337 3,334 14
Village East Apartments 2,150 184 2,236 750
Rivers Edge Apartments 2,068 512 2,160 451
Nob Hill Villa Apartments 7,447 490 8,922 2,129
Citadel Apartments 4,904 695 5,619 1,016
Post Ridge Apartments 4,242 143 2,498 1,334
Arbour East Apartments 5,650 547 8,574 2,264
Southport Apartments 3,509 1,175 6,496 97
The Apartment Apartments 3,543 438 6,218 1,090
Lake Forest Apartments 4,212 692 5,811 1,290
Metro Centre 2,497 899 2,229 (1,523)
Foothill Place Apartments 10,100 3,492 9,435 1,701
Stratford Place Apartments 2,697 1,186 4,628 1,353
Overlook Apartments 1,904 397 3,573 130
Point West Apartments 496 285 2,919 (357)
Totals $73,549 $13,560 $94,176 $17,482
</TABLE>
Note L - Investment Properties and Accumulated Depreciation (continued)
<TABLE>
<CAPTION>
Gross Amount At Which Carried
At December 31, 1995
Buildings
And Related
Personal Accumulated Date of Date Depreciable
Description Land Property Total Depreciation Construction Acquired Life-Years
(Amounts in thousands)
<S> <C> <C> <C> <C> <C> <C> <C>
Knollwood Apartments $ 345 $ 9,279 $ 9,624 $7,957 1972 7/82 5-18
Chimney Hills Apartments 659 9,522 10,181 8,119 1973 8/82 5-18
Briar Bay Racquet Club 1,084 6,468 7,552 5,399 1975 9/82 5-18
Citadel Village Apts.. 337 3,347 3,684 3,042 1974 12/82 5-18
Village East Apartments 184 2,986 3,170 2,523 1973 12/82 5-18
Rivers Edge Apartments 512 2,611 3,123 2,177 1976 4/83 5-18
Nob Hill Villa Apartments 490 11,051 11,541 9,028 1971 4/83 5-18
Citadel Apartments 695 6,635 7,330 5,488 1973 5/83 5-18
Post Ridge Apartments 143 3,832 3,975 3,208 1972 7/82 5-18
Arbour East Apartments 547 10,838 11,385 8,436 1973 9/83 5-18
Southport Apartments 1,175 6,593 7,768 5,135 -- 11/83 5-18
The Apartment Apartments 438 7,308 7,746 5,007 1973 4/84 5-18
Lake Forest Apartments 692 7,101 7,793 4,696 1971 4/84 5-18
Metro Centre 377 1,228 1,605 1,076 1983 6/85 4-28
Foothill Place Apartments 3,402 11,226 14,628 7,089 1973 8/85 5-18
Stratford Place Apartments 1,186 5,981 7,167 3,226 1975 8/85 5-20
Overlook Apartments 397 3,703 4,100 2,744 1970 11/85 5-15
Point West Apartments 205 2,641 2,846 1,944 1973 11/85 5-40
Totals $12,868 $112,350 $125,218 $86,294
</TABLE>
Note L - Investment Properties and Accumulated Depreciation (continued)
Reconciliation of "Investment Properties and Accumulated Depreciation:
<TABLE>
<CAPTION>
For the Years Ended December 31,
1995 1994 1993
(in thousands)
<S> <C> <C> <C>
Investment Properties
Balance at beginning of year $122,218 $ 144,854 $143,217
Acquisitions and additions 3,325 1,708 1,637
Dispositions through sale -- (3,533) --
Dispositions through foreclosures -- (20,811) --
Property disposals (325) -- --
Balance at End of Year $125,218 $ 122,218 $144,854
Accumulated Depreciation
Balance at beginning of year $ 79,720 $ 89,681 $81,919
Depreciation of real estate 6,667 7,328 7,762
Accumulated depreciation on real
estate sold -- (2,345) --
Accumulated depreciation on real
estate foreclosed -- (14,944) --
Accumulated depreciation on
property disposals (93) -- --
Balance at end of year $ 86,294 $ 79,720 $89,681
</TABLE>
The aggregate cost of the real estate for Federal income tax purposes at
December 31, 1995 and 1994 is approximately $145,189,000 and $140,683,000.
The accumulated depreciation taken for Federal income tax purposes at December
31, 1995 and 1994, is approximately $101,945,000 and $96,261,000,
respectively.
Note M - Subsequent Events
Subsequent to December 31, 1995, the $484,000 balance of the first-lien note
secured by the Point West Apartments, with an original maturity of May 2001,
was paid off to retire debt with interest rates higher than the current market
rate. The Partnership realized a loss of $5,000 on the transaction resulting
from prepayment penalties paid on the early extinguishment of the debt.
Note M - Subsequent Events
Subsequent to December 31, 1995, the Partnership declared distributions to the
partners of approximately $3.6 million attributable to cash flow from
operations and approximately $71,000 attributable from surplus funds.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
As reported in the Partnership's Form 8-K filed May 10, 1995, as of May 3,
1995, Arthur Andersen L.L.P., the independent accountant previously engaged as
the principal accountant to audit the financial statements of the partnership
was dismissed. As of the same date, the firm of Ernst & Young L.L.P. was
engaged to provide that service for the Partnership.
PART III
Item 10. Directors and Executive Officers of the General Partner of the
Registrant
The Registrant has no officers or directors. The General Partner manages and
controls the Registrant and has general responsibility and authority in all
matters affecting its business.
The names of the directors and executive officers of ConCap Equities, Inc.
("CEI"), the Partnership's General Partner as of December 31, 1995, their ages
and the nature of all positions with CEI presently held by them are set forth
below.
NAME POSITION AGE
Carroll D. Vinson President, Director 55
William H. Jarrard, Jr. Vice President 49
John K. Lines Secretary 36
Kelley M. Buechler Assistant Secretary 38
Robert D. Long, Jr. Chief Accounting
Officer/Controller 28
Carroll D. Vinson has been President of CEI since December of 1994 and
President of the Metropolitan Asset Enhancement, L.P. ("MAE") subsidiaries
since August 1994. Prior to that, during 1993 to August 1994, Mr. Vinson was
affiliated with Crisp, Hughes & Co. (a regional CPA firm) and engaged in
various other investment and consulting activities, which included portfolio
acquisitions, asset dispositions, debt restructurings and financial reporting.
Briefly, in early 1993, Mr. Vinson served as President and Chief Executive
Officer of Angeles Corporation, a real estate investment firm. From 1991 to
1993, Mr. Vinson was employed by Insignia in various capacities including
Managing Director-President during 1991. From 1986 to 1990, Mr. Vinson was
President and a Director of U.S. Shelter Corporation, a real estate services
company, which sold substantially all of its assets to Insignia in December
1990.
William H. Jarrard, Jr. has been Vice President of CEI since December of 1994,
Vice President of the MAE subsidiaries since January 1992 and Managing
Director - Partnership Administration of Insignia since January 1991. During
the five years prior to joining Insignia in 1991, he served in a similar
capacity for U.S. Shelter. Mr. Jarrard is a graduate of the University of
South Carolina and a certified public accountant.
John K. Lines has been Secretary of CEI since December of 1994, Secretary of
the MAE subsidiaries since August 1994, General Counsel and Secretary of
Insignia since June 1994, and General Counsel and Secretary of Insignia since
July 1994. From May 1993 until June 1994, Mr. Lines was the Assistant General
Counsel and Vice President of Ocwen Financial Corporation in West Palm Beach,
Florida. From October 1991 until April 1993, Mr. Lines was a Senior Attorney
with Banc One Corporation in Columbus, Ohio. From May 1984 until October
1991, Mr. Lines was employed as an associate with Squire Sanders & Dempsey in
Columbus, Ohio.
Robert D. Long, Jr. has been Controller and Chief Accounting Officer of CEI
since December 1994 and Chief Accounting Officer and Controller of the MAE
subsidiaries since February 1994. Prior to joining MAE in September 1993, Mr.
Long served as a senior regional accountant with Insignia Management Group,
Inc. since December 1991. From January 1991 until December 1991, Mr. Long was
associated with the accounting firm of Harshman, Lewis and Associates. From
July 1989 until January 1991, Mr. Long was an auditor for the State of
Tennessee. He is a graduate of the University of Memphis.
Kelley M. Buechler has been Assistant Secretary of CEI since December 1994,
Assistant Secretary of the MAE subsidiaries since January 1992, and Assistant
Secretary of Insignia since January 1991. During the five years prior to
joining Insignia in 1991, she served in a similar capacity for U.S. Shelter.
Ms. Buechler is a graduate of the University of North Carolina.
CEI is the general partner of the Partnership and 15 other Affiliated Partner-
ships as of December 31, 1993.
No family relationship exists between any of the directors and officers of
CEI.
Item 11. Executive Compensation
No direct compensation was paid or payable by the Partnership to directors or
officers for the years ended December 31, 1995 or 1994, nor was any direct
compensation paid or payable by the Partnership to directors or officers of
the General Partner for the years ended December 31, 1995 or 1994. The
Partnership has no plans to pay any such remuneration to any directors or
officers of the General Partner in the future.
See "Item 8 - Financial Statements and Supplementary Data," Note B - Related
Party Transactions, for amounts of compensation and reimbursement of salaries
paid by the Partnership to the General Partner and its affiliates and the
former general partner and former affiliates.
Item 12. Security Ownership of Certain Beneficial Owners and Management
(a) Security Ownership of Certain Beneficial Owners
Except as provided below, as of February, 1996, no person was known to
CEI to own of record or beneficially own more than five percent of the
Units of the Partnership:
Number of Percent
Name and Address Units Of Total
Insignia CCP IV Acquisition, L.L.C. 64,343 18.77%
One Insignia Financial Plaza
Greenville, SC 29602
The Units reflected above were acquired by Insignia CCP IV Acquisition,
L.L.C., an affiliate of the Partnership and CEI, pursuant to the Tender
Offer dated January 20, 1995, to purchase Units for a purchase price of
$60.00 per Unit.
Insignia CCP IV Acquisition, LLC is owned jointly by Insignia CCP IV
Holding, Inc. (60%) and Koll Tender Corporation I (40%).
As of February, 1996, no other person was known to CEI to own of
record or beneficially own more than 5 percent (5%) of the Units of
the Partnership.
(b) Beneficial Owners of Management
Except as provided below, neither CEI nor any of the directors or
officers or associates of CEI own any Units of the Partnership of
record or beneficially:
(c) Changes in Control
Beneficial Owners of CEI
As of February, 1996, the following persons were known to CEI to be
the beneficial owners of more than 5 percent (5%) of its common stock:
Number of Percent
Name and Address CEI Shares Of Total
GII Realty, Inc. 100,000 100%
One Insignia Financial Plaza
Greenville, SC 29602
GII Realty, Inc. is owned by MAE-ICC, Inc. (See Item 1)
Item 13. Certain Relationships and Related Transactions
Transactions with Current Management and Others
Except for the transactions described below, neither CEI nor any of its
directors, officers or associates, or any associates of any of them, has had
any interest in any other transaction to which the Partnership is a party.
Please refer to "Item 8 - Financial Statements and Supplementary Data", "Note
B - Related Party Transactions," for the amounts and items of permissible
compensation and fees paid to the General Partner and its affiliates and other
related parties for the last three years.
The Partnership has paid property management fees equal to 5% of collected
gross rental revenues ("Rental Revenues") for property management services for
each of the three years in the period ended December 31, 1995. A portion of
such property management fees equal to 4% of Rental Revenues has been paid to
the management companies performing day-to-day property management services
and the portion equal to 1% of Rental Revenues has been paid to PSI for
advisory services related to day-to-day property operations. Prior to July
1993, day-to-day property management services were provided to the Partnership
properties by unaffiliated management companies. In July 1993, Coventry
Properties, Inc. ("Coventry"), an affiliate of the General Partner, assumed
day-to-day property management responsibilities for two of the Partnership's
properties under the same management fee arrangement as the unaffiliated
management companies. Coventry assumed day-to-day property management
responsibilities for four additional Partnership properties in January 1994.
In late December 1994, an affiliate of Insignia assumed day-to-day property
management responsibilities for fifteen of the Partnerships' eighteen
properties. On February 15, 1995, an affiliate of Insignia assumed day to day
property management responsibilities for Lake Forest and Post Ridge
Apartments. South Port Apartments is currently managed by an unaffiliated
management company.
All of the above-referenced agreements with affiliates of CEI and related
parties of the Partnership are subject to the conditions and limitations
imposed by the Partnership Agreement.
Litigation with Former Related Parties
Please refer to "Item 8 - Financial Statements and Supplementary Data," "Note
B - Related Party Transactions," for the amounts and items of compensation and
fees paid to former affiliates.
In 1991, the Partnership (and simultaneously each of the Affiliated
Partnerships) entered claims in Southmark's Chapter 11 bankruptcy proceeding.
These claims related to Southmark's activities while it exercised control
(directly, or indirectly through its affiliates) over the Partnership. The
Bankruptcy Court set the Partnership's and the Affiliated Partnership's
allowed claim at $11 million, in aggregate. In March 1994, the Partnership
received 3,143 shares of Southmark Corporation Redeemable Series A Preferred
Stock and 22,985 shares of Southmark Corporation New Common Stock with an
aggregate market value on the date of receipt of $23,000 and $172,000 in cash,
representing the Partnership's share of the recovery, based on its pro rata
share of the claims filed.
Item 14. Exhibits, Financial Statements, Schedules and Reports on Form 8-K
(a) The following documents are filed as part of this report:
1. Financial Statements
Consolidated Balance Sheets - December 31, 1995 and 1994
Consolidated Statements of Operations - Years Ended
December 31, 1995, 1994 and 1993
Consolidated Statements of Partners' Deficit - Years Ended
December 31, 1995, 1994 and 1993
Consolidated Statements of Cash Flows - Years Ended
December 31, 1995, 1994 and 1993
Notes to Consolidated Financial Statements
2. Schedules
All schedules are omitted because either they are not required, are
not applicable or the financial information is included in the
financial statements or notes thereto.
3. Exhibits
S-K REFERENCE
NUMBER DOCUMENT DESCRIPTION
3 Certificate of Limited Partnership, as amended
to date.
10.1 Property Management Agreement No. 105
dated October 23, 1990, by and between the
Partnership and CCEC (Incorporated by refer-
ence to the Quarterly Report on Form 10-Q
for the quarter ended September 30, 1990).
10.2 Property Management Agreement No. 106
dated October 23, 1990, by and between
the LeTourneau Associates, Ltd. and CCEC
(Incorporated by reference to the Quarterly
Report on Form 10-Q for the quarter ended
September 30, 1990).
10.3 Property Management Agreement No. 107
dated October 23, 1990, by and between
Overlook Associates, Ltd. and CCEC (Incor-
porated by reference to the Quarterly Report
on Form 10-Q for the quarter ended
September 30, 1990).
10.4 Property Management Agreement No. 108
dated October 23, 1990, by and between
Park 77 Associates, Ltd. and CCEC
(Incorporated by reference to the Quarterly
Report on Form 10-Q for the quarter ended
September 30, 1990).
10.5 Property Management Agreement No. 205
dated October 23, 1990, by and between the
Partnership and CCEC (Incorporated by refer-
ence to the Quarterly Report on Form 10-Q for
the quarter ended September 30, 1990).
10.6 Property Management Agreement No. 306
dated October 23, 1990, by and between the
Partnership and CCEC (Incorporated by refer-
ence to the Quarterly Report on Form 10-Q for
the quarter ended September 30, 1990).
10.7 Property Management Agreement No. 307
dated October 23, 1990, by and between Point
West Associates, Ltd. and CCEC (Incorporated
by reference to the Quarterly Report on Form
10-Q for the quarter ended September 30, 1990).
10.8 Property Management Agreement No. 403 dated
October 23, 1990, by and between the Partnership
and CCEC (Incorporated by reference to the Quar-
terly Report on Form 10-Q for the quarter ended
September 30, 1990).
10.9 Property Management Agreement No. 404 dated
October 23, 1990, by and between Denbigh Village
Associates, Ltd. and CCEC (Incorporated by refer-
ence to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1990).
10.10 Property Management Agreement No. 405 dated
October 23, 1990, by and between Stratford Place
Associates, Ltd. and CCEC (Incorporated by refer-
ence to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1990).
10.11 Bill of Sale and Assignment dated October 23,
1990, by and between CCEC and ConCap Services
Company (Incorporated by reference to the Quar-
terly Report on Form 10-Q for the quarter ended
September 30, 1990).
10.12 Assignment and Assumption Agreement dated
October 23, 1990, by and between CCEC and
ConCap Management Limited Partnership
("CCMLP") (Incorporated by reference to the
Quarterly Report on Form 10-Q for the quarter
ended September 30, 1990).
10.13 Assignment and Assumption Agreement as to
Certain Property Management Services dated
October 23, 1990, by and between CCMLP and
ConCap Capital Company (Incorporated by
reference to the Quarterly Report on Form 10-Q
for the quarter ended September 30, 1990).
10.14 Assignment and Assumption Agreement dated
October 23, 1990, by and between CCMLP
and The Hayman Company (100 Series of
Property Management Contracts) (Incorporated
by reference to the Quarterly Report on Form
10-Q for the quarter ended September 30, 1990).
10.15 Assignment and Assumption Agreement dated
October 23, 1990, by and between CCMLP and
Horn-Barlow Companies (200 Series of Property
Management Contracts) (Incorporated by reference
to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1990).
10.16 Assignment and Assumption Agreement dated
October 23, 1990, by and between CCMLP and
Metro ConCap, Inc. (300 Series of Property
Management Contracts) (Incorporated by reference
to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1990).
10.17 Assignment and Assumption Agreement dated
October 23, 1990, by and between CCMLP and
R&B Realty Group (400 Series of Property Manage-
ment Contracts) (Incorporated by reference to the
Quarterly Report on Form 10-Q for the quarter
ended September 30, 1990).
10.18 Assignment and Assumption Agreement dated
February 21, 1991, by and between the Partnership
and Greenbriar Apartments Associates Limited
Partnership (Property Management Agreement No.
403). (Incorporated by reference to the Annual
Report on Form 10-K for the year ended December
31, 1991).
10.19 Assignment and Assumption Agreement dated
April 1, 1991, by and between the Partnership and
ConCap Village East Apartments Associates, L.P.
(Property Management Agreement No. 205).
(Incorporated by reference to the Annual Report
on Form 10-K for the year ended December 31,
1991).
10.20 Assignment and Assumption Agreement
dated April 1, 1991, by and between the
Partnership and Nob Hill Villa Apartments
Associates, L.P. (Property Management
Agreement No. 306). (Incorporated by
reference to the Annual Report on Form
10-K for the year ended December 31, 1991).
10.21 Assignment and Assumption Agreement
dated April 1, 1991, by and between the
Partnership and Barnett Regency Tower
Associates Limited Partnership (Property
Management Agreement No. 105).
(Incorporated by reference to the Annual
Report on Form 10-K for the year ended
December 31, 1991).
10.22 Assignment and Assumption of Property
Management Agreement dated August 1,
1991, by and between R & B Realty Group
and R & B Apartment Management Company,
Inc. (Property Management Agreement with
Denbigh Village Associates, Ltd.) (Incorporated
by reference to the Annual Report on Form
10-K for the year ended December 31, 1991).
10.23 Assignment and Assumption of Property
Management Agreement dated August 1, 1991,
by and between R & B Realty Group and R & B
Apartment Management Company, Inc. (Property
Management Agreement with Greenbriar Apart-
ments Associates Limited Partnership). (Incor-
porated by reference to the Annual Report on
Form 10-K for the year ended December 31,
1991).
10.24 Assignment and Assumption of Property Manage-
ment Agreement dated August 1, 1991, by and
between R & B Realty Group and R & B Apart-
ment Management Company, Inc. (Property
Management Agreement with the Partnership
concerning Briar Bay Racquet Club). (Incorpora-
ted by reference to the Annual Report on Form
10-K for the year ended December 31, 1991).
10.25 Assignment and Assumption of Property Manage-
ment Agreement dated August 1, 1991, by and
between R & B Realty Group and R & B Apartment
Management Company, Inc. (Property Management
Agreement with Stratford Place Associates, Ltd.).
(Incorporated by reference to the Annual Report on
Form 10-K for the year ended December 31, 1991).
10.26 Assignment and Assumption Agreement
dated September 1, 1991, by and between
the Partnership and CCP IV Associates, Ltd.
(Property Management Agreement No. 306).
(Incorporated by reference to the Annual
Report on Form 10-K for the year ended
December 31, 1991).
10.27 Assignment and Assumption Agreement
dated September 1, 1991, by and between
the Partnership and CCP IV Associates, Ltd.
(Property Management Agreement No. 205).
(Incorporated by reference to the Annual
Report on Form 10-K for the year ended
December 31, 1991).
10.28 Assignment and Assumption Agreement
dated September 1, 1991, by and between
ConCap Village East Apartments Associates,
L.P. and CCP IV Associates, Ltd. (Property
Management Agreement No. 205). (Incor-
porated by reference to the Annual Report
on Form 10-K for the year ended December
31, 1991).
10.29 Assignment and Assumption Agreement
dated September 15, 1991, by and between
the Partnership and Foothill Chimney Associates
Limited Partnership (Property Management
Agreement No. 105). (Incorporated by reference
to the Annual Report on Form 10-K for the year
ended December 31, 1991).
10.30 Assignment and Assumption Agreement dated
September 15, 1991, by and between the Partner-
ship and Foothill Chimney Associates Limited
Partnership (Property Management Agreement
No. 205). (Incorporated by reference to the
Annual Report on Form 10-K for the year ended
December 31, 1991).
10.31 Construction Management Cost Reimbursement
Agreement dated January 1, 1991, by and between
the Partnership and Horn-Barlow Companies (the
"Horn-Barlow Construction Management Agree-
ment"). (Incorporated by reference to the Annual
Report on Form 10-K for the year ended December
31, 1991).
10.33 Assignment and Assumption Agreement
dated September 15, 1991, by and between
the Partnership and Foothill Chimney Associates
Limited Partnership (Horn-Barlow Construction
Management Agreement Concerning Chimney
Hill Apartments). (Incorporated by reference
to the Annual Report on Form 10-K for the year
ended December 31, 1991).
10.34 Assignment and Assumption Agreement dated
September 1, 1991, by and between ConCap
Village East Apartments Associates, L.P. and
CCP IV Associates, Ltd. (Village East Construc-
tion Agreement). (Incorporated by reference to
the Annual Report on Form 10-K for the year
ended December 31, 1991).
10.35 Construction Management Cost Reimbursement
Agreement dated January 1, 1991, by and
between the Partnership and Metro ConCap,
Inc. (the "Metro Construction Management
Agreement"). (Incorporated by reference
to the Annual Report on Form 10-K for the
year ended December 31, 1991).
10.36 Assignment and Assumption Agreement dated
September 1, 1991, by and between the
Partnership and CCP IV Associates, Ltd.
(Metro Construction Management Agreement
concerning Arbour East and Knollwood
apartments). (Incorporated by reference
to the Annual Report on Form 10-K for the
year ended December 31, 1991).
10.37 Construction Management Cost Reimburse-
ment Agreement dated January 1, 1991, by and
between the Partnership and The Hayman
Company (the "Hayman Construction Manage-
ment Agreement"). (Incorporated by reference
to the Annual Report on Form 10-K for the
year ended December 31, 1991).
10.38 Assignment and Assumption Agreement dated
September 15, 1991, by and between the
Partnership and Foothill Chimney Associates
Limited Partnership (Hayman Construction
Management Agreement concerning Chimney
Hill Apartments). (Incorporated by reference
to the Annual Report on Form 10-K for the
year ended December 31, 1991).
10.39 Construction Management Cost Reimbursement
Agreement dated January 1, 1991, by and between
the Partnership and R & B Apartment Management
Company, Inc. (Incorporated by reference to the
Annual Report on Form 10-K for the year ended
December 31, 1991).
10.40 Construction Management Cost Reimbursement
Agreement dated January 1, 1991, by and between
ConCap Metro Centre Associates, L.P. and R & B
Commercial Management Company, Inc. (Incor-
porated by reference to the Annual Report on Form
10-K for the year ended December 31, 1991).
10.41 Investor Services Agreement dated October 23,
1990, by and between the Partnership and CCEC
(Incorporated by reference to the Quarterly Report
on Form 10-Q for the quarter ended September 30,
1990). (Incorporated by reference to the Annual
Report on Form 10-K for the year ended December
31, 1991).
10.42 Assignment and Assumption Agreement (Investor
Services Agreement) dated October 23, 1990, by and
between CCEC and ConCap Services Company
(Incorporated by reference to the Annual Report on
Form 10-K for the year ended December 31, 1990).
10.43 Letter of Notice dated December 20, 1991, from
Partnership Services, Inc. ("PSI") to the Partnership
regarding the change in ownership and dissolution
of ConCap Services Company whereby PSI assumed
the Investor Services Agreement. (Incorporated by
reference to the Annual Report on Form 10-K for the
year ended December 31, 1991).
10.44 Financial Services Agreement dated October 23,
1990, by and between the Partnership and CCEC
(Incorporated by reference to the Quarterly Report
on Form 10-Q for the quarter ended September 30,
1990).
10.45 Assignment and Assumption Agreement
(Financial Service Agreement) dated October
23, 1990, by and between CCEC and ConCap
Capital Company (Incorporated by reference
to the Quarterly Report on Form 10-Q for the
quarter ended September 30, 1990).
10.46 Letter of Notice dated December 20, 1991, from
PSI to the Partnership regarding the change in
ownership and dissolution of ConCap Capital
Company whereby PSI (Incorporated by reference
to the Annual Report on Form 10-K for the year
ended December 31, 1991).
10.47 Property Management Agreement No. 419 dated
May 13, 1993, by and between the Partnership
and Coventry Properties, Inc. (Incorporated
by reference to the Quarterly Report on Form
10-Q for the quarter ended September 30, 1993).
10.48 Assignment and Assumption Agreement
(Property Management Agreement No. 419)
dated May 13, 1993, by and between Coventry
Properties, Inc., R&B Apartment Management
Company, Inc. and Partnership Services, Inc.
(Incorporated by reference to the Quarterly
Report on Form 10-Q for the quarter ended
September 30, 1993).
10.49 Assignment and Agreement as to Certain
Property Management Services dated May 13,
1993, by and between Coventry Properties, Inc.
and Partnership Services, Inc. (Incorporated by
reference to the Quarterly Report on Form 10-Q
for the quarter ended September 30, 1993).
10.50 Property Management Agreement No. 419A
dated October 11, 1993, by and between ConCap
Stratford Associates, Ltd. and Coventry Properties,
Inc. (Incorporated by reference to the Quarterly
Report on Form 10-Q for the quarter ended
September 30, 1993).
10.51 Assignment and Assumption Agreement
(Property Management Agreement No. 491A)
dated October 11, 1993, by and between
Coventry Properties, Inc., R&B Apartment
Management Company, Inc. and Partnership
Services, Inc. (Incorporated by reference to the
Quarterly Report on Form 10-Q for the quarter
ended September 30, 1993).
10.52 Assignment and Agreement as to Certain
Property Management Services dated October 11,
1993, by and between Coventry Properties, Inc.
and Partnership Services, Inc. (Incorporated by
reference to the Quarterly Report on Form 10-Q
for the quarter ended September 30, 1993).
10.53 Property Management Agreement No. 427A
dated October 11, 1993, by and between ConCap
River's Edge Associates, Ltd. and Coventry
Properties, Inc. (Incorporated by reference to the
Quarterly Report on Form 10-Q for the quarter
ended September 30, 1993).
10.54 Assignment and Assumption Agreement
(Property Management Agreement No. 427A)
dated October 11, 1993, by and between
Coventry Properties, Inc., R&B Apartment
Management Company, Inc. and Partnership
Services, Inc. (Incorporated by reference to the
Quarterly Report on Form 10-Q for the quarter
ended September 30, 1993).
10.55 Assignment and Agreement as to Certain
Property Management Services dated October
11, 1993, by and between Coventry Properties,
Inc. and Partnership Services, Inc. (Incorporated
by reference to the Quarterly Report on Form
10-Q for the quarter ended September 30, 1993).
10.56 Property Management Agreement No. 513A
dated August 18, 1993, by and between ConCap
Citadel Associates, Ltd. and Coventry Properties,
Inc.
10.57 Assignment and Agreement as to Certain Property
Management Services dated November 17, 1993,
by and between Coventry Properties, Inc. and
Partnership Services, Inc.
10.58 Property Management Agreement No. 514 dated
June 1, 1993, by and between the Partnership and
Coventry Properties, Inc.
10.59 Assignment and Agreement as to Certain Property
Management Services dated November 17, 1993,
by and between Coventry Properties, Inc. and
Partnership Services, Inc.
10.60 Stock and Asset Purchase Agreement, dated December 8,
1994 (the "Gordon Agreement"), among MAE-ICC, Inc. ("MAE-
ICC"), Gordon Realty Inc. ("Gordon"), GII Realty, Inc.
("GII Realty"), and certain other parties. (Incorporated
by reference to form 8-K dated December 8, 1994)
10.61 Exercise of the Option (as defined in the Gordon
Agreement), dated December 8, 1994, between MAE-ICC and
Gordon. (Incorporated by reference to Form 8-K dated
December 8, 1994)
10.62 Contracts related to refinancing of debt
(a) Deed of Trust and Security Agreement dated
March 27, 1995 between Nob Hill Villa Apartment
Associates, L.P., a Tennessee limited partnership,
and First Union National Bank of North Carolina, a
North Carolina Corporation.
(b) Promissory Note dated March 27, 1995 between Nob Hill
Villa Apartments Associates, L.P., a Tennessee
limited partnership, and First Union National Bank of
North Carolina, a North Carolina corporation.
(c) Assignment of leases and Rents dated March 27, 1995
between Nob Hill Villa Apartments Associates, L.P., a
Tennessee limited partnership, and First Union
National Bank of North Carolina, a North Carolina
Corporation.
10.63 Multifamily Note dated November 30, 1995 between Briar Bay
Apartments Associates, LTD., a Texas limited partnership,
and Lehman Brothers Holdings Inc. d/b/a Lehman Capital, A
Division of Lehman Brothers Holdings Inc..
10.64 Multifamily Note dated November 30, 1995 between CCP IV
Associates, LTD., a Texas limited partnership, and Lehman
Brothers Holdings Inc. d/b/a Lehman Capital, A Division of
Lehman Brothers Holdings Inc..
10.65 Multifamily Note dated November 30, 1995 between CCP IV
Associates, LTD., a Texas limited partnership, and Lehman
Brothers Holdings Inc. d/b/a Lehman Capital, A Division of
Lehman Brothers Holdings Inc..
10.66 Multifamily Note dated November 30, 1995 between CCP IV
Associates, LTD., a Texas limited partnership, and Lehman
Brothers Holdings Inc. d/b/a Lehman Capital, A Division of
Lehman Brothers Holdings Inc..
10.67 Multifamily Note dated November 30, 1995 between CCP IV
Associates, LTD., a Texas limited partnership, and Lehman
Brothers Holdings Inc. d/b/a Lehman Capital, A Division of
Lehman Brothers Holdings Inc..
10.68 Multifamily Note dated November 30, 1995 between Foothill
Chimney Associates Limited Partnership, a Georgia limited
partnership, and Lehman Brothers Holdings Inc. d/b/a
Lehman Capital, A Division of Lehman Brothers Holdings
Inc..
10.69 Multifamily Note dated November 30, 1995 between Foothill
Chimney Associates Limited Partnership, a Georgia limited
partnership, and Lehman Brothers Holdings Inc. d/b/a
Lehman Capital, A Division of Lehman Brothers Holdings
Inc..
11 Statement regarding computation of Net Income
per Limited Partnership Unit (Incorporated by
reference to Note 1 of Item 8 - Financial Statements
of this Form 10-K).
16.1 Letter, dated August 12, 1992, from Ernst & Young
to the Securities and Exchange Commission regard-
ing change in certifying accountant. (Incorporated
by reference to Form 8-K dated August 6, 1992).
16.2 Letter dated May 9, 1995 from the Registrant's former
independent accountant regarding its concurrence with
the statements made by the Registrant regarding a change
in the certifying accountant. (Incorporated by reference
to Form 8-K dated May 3, 1995)
19.1 Chapter 11 Plan of CCP/IV Associates, Ltd.
(Restated to incorporate first amended Chapter
11 Plan filed October 27, 1992 and second amend-
ments to Chapter 11 Plan of CCP/IV Associates,
Ltd. filed December 14, 1992) dated December 14,
1992, and filed December 14, 1992, in the United
States Bankruptcy Court for the Middle District of
Tennessee. (Incorporated by reference to the Annual
Report on Form 10-K for the year ended December
31, 1992).
19.2 First amended disclosure statement to
accompany Chapter 11 Plan, dated February
21, 1992, and amended October 27, 1992
filed by CCP/IV Associates, Ltd. filed
October 27, 1992, in the United States
Bankruptcy Court for the Middle District
of Tennessee. (Incorporated by reference
to the Annual Report on Form 10-K for the
year ended December 31, 1992).
27 Financial Data Schedule
(b) Reports on Form 8-K filed during the fourth quarter of 1995
A Form 8-K dated October 24, 1995, was filed reporting a change in the
ownership of GII Realty, Inc., the sole stockholder of the general
partner of the Registrant.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
CONSOLIDATED CAPITAL PROPERTIES IV
By: CONCAP EQUITIES, INC.
General Partner
By: /s/Carroll D. Vinson
Carroll D. Vinson
President
By: /s/Robert D. Long, Jr.
Robert D. Long, Jr.
Controller and Principal
Accounting Officer
Date: March 28, 1996
In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the Registrant and in the capacities and on
the date indicated.
/s/Carroll D. Vinson President March 28, 1996
Carroll D. Vinson
/s/Robert D. Long, Jr. Controller and Principal March 28, 1996
Robert D. Long, Jr. Accounting Officer
Loan No. 734079494
MULTIFAMILY NOTE
US $3,500,000.00 New York, New York
As of November 30, 1995
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings
Inc., or order, the principal sum of Three Million Five Hundred Thousand and
00/100 Dollars, with interest on the unpaid principal balance from the date of
this Note, until paid, at the rate of 6.95 percent per annum. Interest only
shall be payable at 3 World Financial Center, New York, New York 10285, or
such other place as the holder hereof may designate in writing, in consecutive
monthly installments of Twenty Thousand Two Hundred Seventy Dollars and 83/100
(US $20,270.83) on the first day of each month beginning January, 1996, until
the entire indebtedness evidenced hereby is fully paid, except that any
remaining indebtedness, if not sooner paid, shall be due and payable on
December 1, 2005.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default
in the payment of this Note, and if the same is referred to an attorney at law
for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all expenses and costs,
including, but not limited to, attorney's fees.
From time to time, without affecting the obligation of the undersigned
or the successors or assigns of the undersigned to pay the outstanding
principal balance of this Note and observe the covenants of the undersigned
contained herein, without affecting the guaranty of any person, corporation,
partnership or other entity for payment of the outstanding principal balance
of this Note, without giving notice to or obtaining the consent of the
undersigned, the successors or assigns of the undersigned or guarantors, and
without liability on the part of the holder hereof, the holder hereof may, at
the option of the holder hereof, extend the time for payment of said
outstanding principal balance or any part thereof, reduce the payments
thereon, release anyone liable on any of said outstanding principal balance,
accept a renewal of this Note, modify the terms and time of payment of said
outstanding principal balance, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, and agree in writing with the undersigned to modify the
rate of interest or period of amortization of this Note or change the amount
of the monthly installments payable hereunder.
Prepayments shall be applied against the outstanding principal balance
of this Note and shall not extend or postpone the due date of any subsequent
monthly installments, unless the holder hereof shall agree otherwise in
writing. The holder hereof may require that any partial prepayments be made on
the date monthly installments are due and be in the amount of that part of one
or more monthly installments which would be applicable to principal.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the
joint and several obligation of all makers, sureties, guarantors and
endorsers, and shall be binding upon them and their successors and assigns.
The indebtedness evidenced by this Note is secured by a Mortgage or Deed
of Trust dated as of November 30, 1995, and reference is made thereto for
rights as to acceleration of the indebtedness evidenced by this Note. This
Note shall be governed by the law of the jurisdiction in which the Property
subject to the Mortgage or Deed of Trust is located.
The undersigned shall pay any installment of interest due hereunder
within ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The monthly installment payable on January 1, 1996 shall include
interest on the outstanding principal balance of this Note for a full month at
the above-specified interest rate, notwithstanding the fact that as of the due
date of that installment principal may not have been outstanding for a full
month.
BRIAR BAY APARTMENTS ASSOCIATES, LTD., a Texas
limited partnership
By: ConCap CCP/IV Properties, Inc., a Texas
corporation, its general partner
Witness
By:
Robert Long
Witness Vice President and Chief
Accounting Officer
DOCUMENTARY STAMP TAX IN THE AMOUNT OF
$_____________ HAS BEEN PAID IN CONNECTION WITH
THIS NOTE, AND PROPER DOCUMENTARY STAMPS HAVE
BEEN AFFIXED TO OR NOTED ON THE MORTGAGE
SECURING THIS NOTE.
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 30th day of November, 1995.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman Brothers
Holdings Inc.
By:
Name:
Title:
Loan No. 734133499
MULTIFAMILY NOTE
US $2,150,000.00 New York, New York
As of November 30, 1995
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings
Inc., or order, the principal sum of Two Million One Hundred Fifty Thousand
and 00/100 Dollars, with interest on the unpaid principal balance from the
date of this Note, until paid, at the rate of 6.95 percent per annum. Interest
only shall be payable at 3 World Financial Center, New York, New York 10285,
or such other place as the holder hereof may designate in writing, in
consecutive monthly installments of Twelve Thousand Four Hundred Fifty Two
Dollars and 08/100 (US $12,452.08) on the first day of each month beginning
January, 1996, until the entire indebtedness evidenced hereby is fully paid,
except that any remaining indebtedness, if not sooner paid, shall be due and
payable on December 1, 2005.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default
in the payment of this Note, and if the same is referred to an attorney at law
for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all expenses and costs,
including, but not limited to, attorney's fees.
Prepayments shall be applied against the outstanding principal balance
of this Note and shall not extend or postpone the due date of any subsequent
monthly installments, unless the holder hereof shall agree otherwise in
writing. The holder hereof may require that any partial prepayments be made on
the date monthly installments are due and be in the amount of that part of one
or more monthly installments which would be applicable to principal.
From time to time, without affecting the obligation of the undersigned
or the successors or assigns of the undersigned to pay the outstanding
principal balance of this Note and observe the covenants of the undersigned
contained herein, without affecting the guaranty of any person, corporation,
partnership or other entity for payment of the outstanding principal balance
of this Note, without giving notice to or obtaining the consent of the
undersigned, the successors or assigns of the undersigned or guarantors, and
without liability on the part of the holder hereof, the holder hereof may, at
the option of the holder hereof, extend the time for payment of said
outstanding principal balance or any part thereof, reduce the payments
thereon, release anyone liable on any of said outstanding principal balance,
accept a renewal of this Note, modify the terms and time of payment of said
outstanding principal balance, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, and agree in writing with the undersigned to modify the
rate of interest or period of amortization of this Note or change the amount
of the monthly installments payable hereunder.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the
joint and several obligation of all makers, sureties, guarantors and
endorsers, and shall be binding upon them and their successors and assigns.
The indebtedness evidenced by this Note is secured by a Mortgage or Deed
of Trust dated as of November 30, 1995, and reference is made thereto for
rights as to acceleration of the indebtedness evidenced by this Note. This
Note shall be governed by the law of the jurisdiction in which the Property
subject to the Mortgage or Deed of Trust is located.
The undersigned shall pay any installment of interest due hereunder
within ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The monthly installment payable on January 1, 1996 shall include
interest on the outstanding principal balance of this Note for a full month at
the above-specified interest rate, notwithstanding the fact that as of the due
date of that installment principal may not have been outstanding for a full
month.
CCP IV ASSOCIATES, LTD., a Texas limited
partnership
By: CONCAP CCP/IV RESIDENTIAL, INC., a Texas
corporation, its general partner
By:
Robert Long
Vice President and Chief Accounting
Officer
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 30th day of November, 1995.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman Brothers
Holdings Inc.
By:
Name:
Title:
Loan No.: 734079524
MULTIFAMILY NOTE
US $6,780,000.00 New York, New York
As of November 30, 1995
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings
Inc., or order, the principal sum of Six Million Seven Hundred Eighty Thousand
and 00/100 Dollars, with interest on the unpaid principal balance from the
date of this Note, until paid, at the rate of 6.95 percent per annum. Interest
only shall be payable at 3 World Financial Center, New York, New York 10285,
or such other place as the holder hereof may designate in writing, in
consecutive monthly installments of Thirty Nine Thousand Two Hundred Sixty
Seven Dollars and 50/100 (US $39,267.50) on the first day of each month
beginning January, 1996, until the entire indebtedness evidenced hereby is
fully paid, except that any remaining indebtedness, if not sooner paid, shall
be due and payable on December 1, 2005.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default
in the payment of this Note, and if the same is referred to an attorney at law
for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all expenses and costs,
including, but not limited to, attorney's fees.
Prepayments shall be applied against the outstanding principal balance
of this Note and shall not extend or postpone the due date of any subsequent
monthly installments, unless the holder hereof shall agree otherwise in
writing. The holder hereof may require that any partial prepayments be made on
the date monthly installments are due and be in the amount of that part of one
or more monthly installments which would be applicable to principal.
From time to time, without affecting the obligation of the undersigned
or the successors or assigns of the undersigned to pay the outstanding
principal balance of this Note and observe the covenants of the undersigned
contained herein, without affecting the guaranty of any person, corporation,
partnership or other entity for payment of the outstanding principal balance
of this Note, without giving notice to or obtaining the consent of the
undersigned, the successors or assigns of the undersigned or guarantors, and
without liability on the part of the holder hereof, the holder hereof may, at
the option of the holder hereof, extend the time for payment of said
outstanding principal balance or any part thereof, reduce the payments
thereon, release anyone liable on any of said outstanding principal balance,
accept a renewal of this Note, modify the terms and time of payment of said
outstanding principal balance, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, and agree in writing with the undersigned to modify the
rate of interest or period of amortization of this Note or change the amount
of the monthly installments payable hereunder.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the
joint and several obligation of all makers, sureties, guarantors and
endorsers, and shall be binding upon them and their successors and assigns.
The undersigned shall pay any installment of interest due hereunder
within ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The monthly installment payable on January 1, 1996 shall include
interest on the outstanding principal balance of this Note for a full month at
the above-specified interest rate, notwithstanding the fact that as of the due
date of that installment principal may not have been outstanding for a full
month.
Witness the hand(s) and seal(s) of the undersigned.
CCP IV ASSOCIATES, LTD., a Texas limited
partnership
By: CONCAP CCP/IV RESIDENTIAL, INC., a Texas
corporation, its general partner
By:
Robert Long
Vice President and Chief Accounting
Officer
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 30th day of November, 1995.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman Brothers
Holdings Inc.
By:
Name:
Title:
Loan No. 734133480
MULTIFAMILY NOTE
US $2,450,000.00 New York, New York
As of November 30, 1995
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings
Inc., or order, the principal sum of Two Million Four Hundred Fifty Thousand
and 00/100 Dollars, with interest on the unpaid principal balance from the
date of this Note, until paid, at the rate of 6.95 percent per annum. Interest
only shall be payable at 3 World Financial Center, New York, New York 10285,
or such other place as the holder hereof may designate in writing, in
consecutive monthly installments of Fourteen Thousand One Hundred Eighty Nine
Dollars and 58/100 (US $14,189.58) on the first day of each month beginning
January, 1996, until the entire indebtedness evidenced hereby is fully paid,
except that any remaining indebtedness, if not sooner paid, shall be due and
payable on December 1, 2005.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default
in the payment of this Note, and if the same is referred to an attorney at law
for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all expenses and costs,
including, but not limited to, attorney's fees.
Prepayments shall be applied against the outstanding principal balance
of this Note and shall not extend or postpone the due date of any subsequent
monthly installments, unless the holder hereof shall agree otherwise in
writing. The holder hereof may require that any partial prepayments be made on
the date monthly installments are due and be in the amount of that part of one
or more monthly installments which would be applicable to principal.
From time to time, without affecting the obligation of the undersigned
or the successors or assigns of the undersigned to pay the outstanding
principal balance of this Note and observe the covenants of the undersigned
contained herein, without affecting the guaranty of any person, corporation,
partnership or other entity for payment of the outstanding principal balance
of this Note, without giving notice to or obtaining the consent of the
undersigned, the successors or assigns of the undersigned or guarantors, and
without liability on the part of the holder hereof, the holder hereof may, at
the option of the holder hereof, extend the time for payment of said
outstanding principal balance or any part thereof, reduce the payments
thereon, release anyone liable on any of said outstanding principal balance,
accept a renewal of this Note, modify the terms and time of payment of said
outstanding principal balance, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, and agree in writing with the undersigned to modify the
rate of interest or period of amortization of this Note or change the amount
of the monthly installments payable hereunder.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the
joint and several obligation of all makers, sureties, guarantors and
endorsers, and shall be binding upon them and their successors and assigns.
The indebtedness evidenced by this Note is secured by a Mortgage or Deed
of Trust dated as of November 30, 1995, and reference is made thereto for
rights as to acceleration of the indebtedness evidenced by this Note. This
Note shall be governed by the law of the jurisdiction in which the Property
subject to the Mortgage or Deed of Trust is located.
The undersigned shall pay any installment of interest due hereunder
within ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The monthly installment payable on January 1, 1996 shall include
interest on the outstanding principal balance of this Note for a full month at
the above-specified interest rate, notwithstanding the fact that as of the due
date of that installment principal may not have been outstanding for a full
month.
CCP IV ASSOCIATES, LTD., a Texas limited
partnership
By: CONCAP CCP/IV RESIDENTIAL, INC., a Texas
corporation, its general partner
By:
Robert Long
Vice President and Chief Accounting
Officer
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 30th day of November, 1995.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman Brothers
Holdings Inc.
By:
Name:
Title:
Loan No. 734079516
MULTIFAMILY NOTE
US $5,650,000.00 New York, New York
As of November 30, 1995
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings
Inc., or order, the principal sum of Five Million Six Hundred Fifty Thousand
and 00/100 Dollars, with interest on the unpaid principal balance from the
date of this Note, until paid, at the rate of 6.95 percent per annum. Interest
only shall be payable at 3 World Financial Center, New York, New York 10285,
or such other place as the holder hereof may designate in writing, in
consecutive monthly installments of Thirty Two Thousand Seven Hundred Twenty
Two Dollars and 92/100 (US $32,722.92) on the first day of each month
beginning January, 1996, until the entire indebtedness evidenced hereby is
fully paid, except that any remaining indebtedness, if not sooner paid, shall
be due and payable on December 1, 2005.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default
in the payment of this Note, and if the same is referred to an attorney at law
for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all expenses and costs,
including, but not limited to, attorney's fees.
Prepayments shall be applied against the outstanding principal balance
of this Note and shall not extend or postpone the due date of any subsequent
monthly installments, unless the holder hereof shall agree otherwise in
writing. The holder hereof may require that any partial prepayments be made on
the date monthly installments are due and be in the amount of that part of one
or more monthly installments which would be applicable to principal.
From time to time, without affecting the obligation of the undersigned
or the successors or assigns of the undersigned to pay the outstanding
principal balance of this Note and observe the covenants of the undersigned
contained herein, without affecting the guaranty of any person, corporation,
partnership or other entity for payment of the outstanding principal balance
of this Note, without giving notice to or obtaining the consent of the
undersigned, the successors or assigns of the undersigned or guarantors, and
without liability on the part of the holder hereof, the holder hereof may, at
the option of the holder hereof, extend the time for payment of said
outstanding principal balance or any part thereof, reduce the payments
thereon, release anyone liable on any of said outstanding principal balance,
accept a renewal of this Note, modify the terms and time of payment of said
outstanding principal balance, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, and agree in writing with the undersigned to modify the
rate of interest or period of amortization of this Note or change the amount
of the monthly installments payable hereunder.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the
joint and several obligation of all makers, sureties, guarantors and
endorsers, and shall be binding upon them and their successors and assigns.
The indebtedness evidenced by this Note is secured by a Mortgage or Deed
of Trust dated as of November 30, 1995, and reference is made thereto for
rights as to acceleration of the indebtedness evidenced by this Note. This
Note shall be governed by the law of the jurisdiction in which the Property
subject to the Mortgage or Deed of Trust is located.
The undersigned shall pay any installment of interest due hereunder
within ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The monthly installment payable on January 1, 1996 shall include
interest on the outstanding principal balance of this Note for a full month at
the above-specified interest rate, notwithstanding the fact that as of the due
date of that installment principal may not have been outstanding for a full
month.
CCP IV ASSOCIATES, LTD., a Texas limited
partnership
By: CONCAP CCP/IV RESIDENTIAL, INC., a Texas
corporation, its general partner
By:
Robert Long
Vice President and Chief Accounting
Officer
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 30th day of November, 1995.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman Brothers
Holdings Inc.
By:
Name:
Title:
Loan No. 734079508
MULTIFAMILY NOTE
US $5,400,000.00
New York, New York
As of November 30, 1995
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings
Inc., or order, the principal sum of Five Million Four Hundred Thousand and
00/100 Dollars, with interest on the unpaid principal balance from the date of
this Note, until paid, at the rate of 6.95 percent per annum. Interest only
shall be payable at 3 World Financial Center, New York, New York 10285, or
such other place as the holder hereof may designate in writing, in consecutive
monthly installments of Thirty One Thousand Two Hundred Seventy Five Dollars
and 00/100 Dollars (US $31,275.00) on the first day of each month beginning
January, 1996, until the entire indebtedness evidenced hereby is fully paid,
except that any remaining indebtedness, if not sooner paid, shall be due and
payable on December 1, 2005.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default
in the payment of this Note, and if the same is referred to an attorney at law
for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all expenses and costs,
including, but not limited to, reasonable attorney's fees.
Prepayments shall be applied against the outstanding principal balance
of this Note and shall not extend or postpone the due date of any subsequent
monthly installments, unless the holder hereof shall agree otherwise in
writing. The holder hereof may require that any partial prepayments be made on
the date monthly installments are due and be in the amount of that part of one
or more monthly installments which would be applicable to principal.
From time to time, without affecting the obligation of the undersigned
or the successors or assigns of the undersigned to pay the outstanding
principal balance of this Note and observe the covenants of the undersigned
contained herein, without affecting the guaranty of any person, corporation,
partnership or other entity for payment of the outstanding principal balance
of this Note, without giving notice to or obtaining the consent of the
undersigned, the successors or assigns of the undersigned or guarantors, and
without liability on the part of the holder hereof, the holder hereof may, at
the option of the holder hereof, extend the time for payment of said
outstanding principal balance or any part thereof, reduce the payments
thereon, release anyone liable on any of said outstanding principal balance,
accept a renewal of this Note, modify the terms and time of payment of said
outstanding principal balance, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, and agree in writing with the undersigned to modify the
rate of interest or period of amortization of this Note or change the amount
of the monthly installments payable hereunder. No one or more of such actions
shall constitute a novation.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the
joint and several obligation of all makers, sureties, guarantors and
endorsers, and shall be binding upon them and their successors and assigns.
The indebtedness evidenced by this Note is secured by a Mortgage or Deed
of Trust dated as of November 30, 1995, and reference is made thereto for
rights as to acceleration of the indebtedness evidenced by this Note. This
Note shall be governed by the law of the jurisdiction in which the Property
subject to the Mortgage or Deed of Trust is located.
The undersigned shall pay any installment of interest due hereunder
within ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The monthly installment payable on January 1, 1996 shall include
interest on the outstanding principal balance of this Note for a full month at
the above-specified interest rate, notwithstanding the fact that as of the due
date of that installment principal may not have been outstanding for a full
month.
Witness the hand(s) and seal(s) of the undersigned.
FOOTHILL CHIMNEY ASSOCIATES LIMITED PARTNERSHIP,
a Georgia limited partnership
By: ConCap Equities, Inc., a Delaware
corporation, its general partner
By:
Robert Long
Vice President and Chief Accounting
Officer
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 30th day of November, 1995.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman Brothers
Holdings Inc.
By:
Name:
Title:
Loan No. 734133502
MULTIFAMILY NOTE
US $10,100,000.00 New York, New York
As of November 30, 1995
FOR VALUE RECEIVED, the undersigned promise to pay LEHMAN BROTHERS
HOLDINGS INC. d/b/a Lehman Capital, A Division of Lehman Brothers Holdings
Inc., or order, the principal sum of Ten Million One Hundred Thousand and
00/100 Dollars, with interest on the unpaid principal balance from the date of
this Note, until paid, at the rate of 6.95 percent per annum. Interest only
shall be payable at 3 World Financial Center, New York, New York 10285, or
such other place as the holder hereof may designate in writing, in consecutive
monthly installments of Fifty Eight Thousand Four Hundred Ninety Five Dollars
and 83/100 (US $58,495.83) on the first day of each month beginning January,
1996, until the entire indebtedness evidenced hereby is fully paid, except
that any remaining indebtedness, if not sooner paid, shall be due and payable
on December 1, 2005.
If any installment under this Note is not paid when due, the entire
principal amount outstanding hereunder and accrued interest thereon shall at
once become due and payable, at the option of the holder hereof. The holder
hereof may exercise this option to accelerate during any default by the
undersigned regardless of any prior forbearance. In the event of any default
in the payment of this Note, and if the same is referred to an attorney at law
for collection or any action at law or in equity is brought with respect
hereto, the undersigned shall pay the holder hereof all expenses and costs,
including, but not limited to, attorney's fees.
Prepayments shall be applied against the outstanding principal balance
of this Note and shall not extend or postpone the due date of any subsequent
monthly installments, unless the holder hereof shall agree otherwise in
writing. The holder hereof may require that any partial prepayments be made on
the date monthly installments are due and be in the amount of that part of one
or more monthly installments which would be applicable to principal.
From time to time, without affecting the obligation of the undersigned
or the successors or assigns of the undersigned to pay the outstanding
principal balance of this Note and observe the covenants of the undersigned
contained herein, without affecting the guaranty of any person, corporation,
partnership or other entity for payment of the outstanding principal balance
of this Note, without giving notice to or obtaining the consent of the
undersigned, the successors or assigns of the undersigned or guarantors, and
without liability on the part of the holder hereof, the holder hereof may, at
the option of the holder hereof, extend the time for payment of said
outstanding principal balance or any part thereof, reduce the payments
thereon, release anyone liable on any of said outstanding principal balance,
accept a renewal of this Note, modify the terms and time of payment of said
outstanding principal balance, join in any extension or subordination
agreement, release any security given herefor, take or release other or
additional security, and agree in writing with the undersigned to modify the
rate of interest or period of amortization of this Note or change the amount
of the monthly installments payable hereunder.
Presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be the
joint and several obligation of all makers, sureties, guarantors and
endorsers, and shall be binding upon them and their successors and assigns.
The indebtedness evidenced by this Note is secured by a Mortgage or Deed
of Trust dated as of November 30, 1995, and reference is made thereto for
rights as to acceleration of the indebtedness evidenced by this Note. This
Note shall be governed by the law of the jurisdiction in which the Property
subject to the Mortgage or Deed of Trust is located.
The undersigned shall pay any installment of interest due hereunder
within ten (10) calendar days after such installment of interest is due. The
undersigned shall pay any other installment due hereunder or due in accordance
with the terms of the Mortgage or Deed of Trust securing this Note, within
thirty (30) calendar days of the date such installment is due.
The monthly installment payable on January 1, 1996 shall include
interest on the outstanding principal balance of this Note for a full month at
the above-specified interest rate, notwithstanding the fact that as of the due
date of that installment principal may not have been outstanding for a full
month.
FOOTHILL CHIMNEY ASSOCIATES LIMITED PARTNERSHIP,
a Georgia limited partnership
By: ConCap Equities, Inc., a Delaware
corporation, its general partner
By:
Robert Long
Vice President and Chief Accounting
Officer
PAY TO THE ORDER OF FEDERAL HOME LOAN
MORTGAGE CORPORATION WITHOUT RECOURSE.
This 30th day of November, 1995.
LEHMAN BROTHERS HOLDINGS INC. d/b/a
Lehman Capital, A Division of Lehman Brothers
Holdings Inc.
By:
Name:
Title:
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Consolidated
Captial Properties IV Year-End 1995 10-K and is qualified in its entirety by
reference to such 10-K filing.
</LEGEND>
<CIK> 0000355804
<NAME> CONSOLIDATED CAPITAL PROPERTIS IV
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 10,865
<SECURITIES> 2,637
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 125,218
<DEPRECIATION> 86,294
<TOTAL-ASSETS> 64,146
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 76,336
0
0
<COMMON> 0
<OTHER-SE> (18,633)
<TOTAL-LIABILITY-AND-EQUITY> 61,146
<SALES> 0
<TOTAL-REVENUES> 27,380
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 28,620
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,544
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 43
<CHANGES> 0
<NET-INCOME> (1,197)
<EPS-PRIMARY> (3.35)
<EPS-DILUTED> 0
<FN>
<F1>The Partnership has an unclassified balance sheet.
</FN>
</TABLE>
