U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X]ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT
OF 1934 [NO FEE REQUIRED]
For the fiscal year ended December 31, 1996
[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 [NO FEE REQUIRED]
For the transition period from to
Commission file number 0-11137
CENTURY PROPERTIES FUND XVII
California 94-2782037
(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 Exchange Act:
None
Securities registered under Section 12(g) of the Exchange Act:
Limited Partnership Units
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [X]
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will 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-KSB or any amendment to
this Form 10-KSB.[X]
State issuer's revenues for its most recent fiscal year. $12,587,000
State the aggregate market value of the voting stock held by nonaffiliates of
the Registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock, as of a specified date within the past 60 days. Market value information
for 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 million.
DOCUMENTS INCORPORATED BY REFERENCE
SEE EXHIBIT INDEX
PART I
ITEM 1. DESCRIPTION OF BUSINESS
Century Properties Fund XVII (the "Partnership" or "Registrant") was organized
in November 1981 as a California limited partnership under the Uniform Limited
Partnership Act of the California Corporations Code. Fox Partners, a
California general partnership, is the general partner of the Registrant. The
general partners of Fox Partners are Fox Capital Management Corporation (the
"Managing General Partner"), a California corporation, Fox Realty Investors
("FRI"), a California general partnership, and Fox Partners 82, a California
general partnership.
The principal business of the Registrant is and has been to acquire, hold for
investment and ultimately sell income-producing multi-family residential
properties. The Registrant is a "closed" limited partnership real estate
syndicate formed to acquire multi-family residential properties. Beginning in
March 1982 through October 1982, the Registrant offered and sold $75,000,000 in
Limited Partnership Units. The net proceeds of this offering were used to
acquire twelve income-producing real properties. The Registrant's original
property portfolio was geographically diversified with properties acquired in
four states. Since 1982, the principal activity of the Registrant has been
managing its portfolio.
Three apartment properties were sold in 1988. One apartment was acquired by the
lender through a deed in-lieu of foreclosure in 1992. During 1993, two
apartment properties were sold and one was acquired by the lender through
foreclosure.
On August 10, 1994, an affiliate of Apollo Real Estate Advisors, L.P. ("Apollo")
obtained general and limited partnership interests in NPI-AP Management, L.P.
("NPI-AP"), an affiliate of the Managing General Partner.
On October 12, 1994, Apollo acquired one-third of the stock of National Property
Investors, Inc. ("NPI"), the parent corporation of NPI Equity Investments II,
Inc. Pursuant to the terms of the stock acquisition, Apollo was entitled to
designate three of the seven directors of the Managing General Partner and NPI
Equity Investments II, Inc. In addition, the approval of certain major actions
on behalf of the Registrant required the affirmative vote of at least five
directors of the Managing General Partner.
On August 17, 1995, the stockholders of NPI entered into an agreement to sell to
IFGP Corporation, a Delaware corporation, an affiliate of Insignia Financial
Group, Inc. ("Insignia"), a Delaware corporation, all of the issued and
outstanding common stock of NPI, for an aggregate purchase price of $1,000,000.
NPI is the sole shareholder of NPI Equity Investments II, Inc., the general
partner of FRI, and the entity which controls the Managing General Partner. The
closing of the transactions contemplated by the above mentioned agreement (the
"Closing") occurred on January 19, 1996.
Upon the Closing, the officers and directors of NPI, NPI Equity II and the
Managing General Partner resigned and an affiliate of Insignia caused new
officers and directors of each of those entities to be elected (See "Item 9.").
On October 12, 1994, affiliates of Apollo acquired (i) one-third of the stock of
the respective general partners of DeForest Ventures I L.P. ("DeForest I") and
DeForest Ventures II L.P. and (ii) an additional equity interest in NPI-AP
(bringing its total equity interest in such entity to one-third). NPI-AP is a
limited partner of DeForest I which was formed for the purpose of making tender
offers for limited partnership units in the Registrant as well as eleven
affiliated limited partnerships.
On January 19, 1996, DeForest I and certain of its affiliates sold all of its
interest in the Registrant to Insignia NPI L.L.C. ("Insignia LLC"), an affiliate
of Insignia. Pursuant to a Schedule 13-D filed by Insignia LLC with the
Securities and Exchange Commission, Insignia LLC acquired 25,710.50 limited
partnership units or approximately 34% of the total limited partnership units of
the Registrant (See "Item 11.").
The Partnership has no full-time employees. The Managing General Partner is
vested with full authority as to the general management and supervision of the
business and affairs of the Partnership. The Non-Managing General Partners and
the Limited Partners have no right to participate in the management or conduct
of such business and affairs. Insignia Residential Group, L.P. provides day-to-
day management services to the Partnership's investment properties.
The business in which the Partnership is engaged is highly competitive, and the
Partnership is not a significant factor in its industry. Such competition is
primarily on the basis of location, rents, services, and amenities. In
addition, the Partnership competes with significant numbers of individuals and
organizations (including similar partnerships, real estate investment trusts and
financial institutions) with respect to the sale of improved real properties,
primarily on the basis of the prices and terms of such transactions.
At this time, it appears that the original investment objective of capital
growth from the inception of the Registrant will not be attained and that
investors will not receive a return of all their invested capital. The extent
to which invested capital is returned to investors is dependent upon the success
of the Registrant's strategy as set forth in "Item 6." as well as upon
significant improvement in the performance of the Registrant's remaining
properties and the markets in which such properties are located and on the sales
price of the remaining properties. In this regard, it is anticipated at this
time that some of the remaining properties will be held longer than originally
expected. The ability to hold and operate these properties is dependent on the
Registrant's ability to obtain additional financing, refinancing or debt
restructuring as required.
ITEM 2. DESCRIPTION OF PROPERTIES:
The following table sets forth the Partnership's investments in properties:
Date of
Property Purchase Type of Ownership Use
Cherry Creek Gardens Apartments 09/82 Fee ownership subject to Apartment
Englewood, Colorado first mortgage 296 units
Creekside Apartments 10/82 Fee ownership subject to Apartment
Denver, Colorado first mortgage 328 units
The Lodge Apartments 10/82 Fee ownership subject to Apartment
Denver, Colorado first mortgage 376 units
The Village in the Woods Apartments 10/82 Fee ownership subject to Apartment
Cypress, Texas first mortgage 530 units
Cooper's Pond Apartments 03/83 Fee ownership subject to Apartment
Tampa, Florida first and second 463 units
mortgage
SCHEDULE OF PROPERTIES:
(dollar amounts in thousands)
<TABLE>
<CAPTION>
Carrying Accumulated Federal
Property Value Depreciation Rate Method Tax Basis
<S> <C> <C> <C> <C> <C>
Cherry Creek Gardens Apartments $ 14,647 $ 6,419 5-30yrs S\L $ 2,900
Creekside Apartments 10,148 4,159 5-30yrs S\L 2,929
The Lodge Apartments 11,963 4,886 5-30yrs S\L 3,442
Cooper's Pond Apartments 14,197 6,593 5-30yrs S\L 2,828
$ 65,225 $ 28,140 $ 15,899
</TABLE>
See "Note A" of the financial statements included in "Item 7." for a description
of the Partnership's depreciation policy.
SCHEDULE OF MORTGAGES:
(dollar amounts in thousands)
<TABLE>
<CAPTION>
Principal Principal
Balance At Balance
December 31, Interest Period Maturity Due At
Property 1996 Rate Amortized Date Maturity
<S> <C> <C> <C> <C> <C>
Cherry Creek Gardens Apartments $ 7,766 8.630% 25 years 12/01/99 $ 7,335
Creekside Apartments 5,249 7.875% 25 years 07/01/00 4,882
The Lodge Apartments 5,775 7.875% 25 years 07/01/00 5,363
The Village in the Woods Apts. 14,421 (1) (1) 01/24/00 14,421
Cooper's Pond - 1st mortgage 3,637 8.000% 23 years 07/01/99 3,439
- 2nd mortgage 4,134 8.500% (2) 07/01/05 4,134
40,982 $ 39,574
Mortgage discount (4,608)
$ 36,374
<FN>
(1) Zero coupon note; discounted at an effective interest rate of 10.247%
(2) Interest only
</TABLE>
SCHEDULE OF RENTAL RATES AND OCCUPANCY:
Average Annual Average
Rental Rates Occupancy
Property 1996 1995 1996 1995
Cherry Creek Gardens Apartments $ 8,378/unit $ 8,255/unit 96% 95%
Creekside Apartments 6,210/unit 5,979/unit 97% 97%
The Lodge Apartments 5,840/unit 5,541/unit 96% 97%
The Village in the Woods Apartments 6,458/unit 6,434/unit 93% 94%
Cooper's Pond Apartments 5,239/unit 5,069/unit 94% 94%
The Village in the Woods Apartments is in a highly competitive market and
construction of single family housing continues to increase. Although the Tampa
market is a soft market, the average occupancy at Cooper's Pond's Apartments is
slightly above the market for that area.
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 apartment complexes in the area. The Managing General
Partner believes that all of the properties are adequately insured. The multi-
family residential properties' lease terms are for one year or less. No
residential tenant leases 10% or more of the available rental space.
Real estate taxes and rates in 1996 for each property were (dollar amounts in
thousands):
1996 1996
Billing Rate
Cherry Creek Gardens Apartments $ 126 10.46
Creekside Apartments 69 7.76
The Lodge Apartments 81 7.75
The Village in the Woods Apartments 295 2.75
Cooper's Pond Apartments 188 2.51
ITEM 3. LEGAL PROCEEDINGS
The Registrant is unaware of any pending or outstanding litigation that is not
of a routine nature. The Managing General Partner of the Registrant believes
that all such pending or outstanding litigation will be resolved without a
material adverse effect upon the business, financial condition, or operations of
the Partnership.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The unit holders of the Registrant did not vote on any matter during the fiscal
year covered by this report.
PART II
ITEM 5. MARKET FOR THE PARTNERSHIP'S COMMON EQUITY AND RELATED SECURITY HOLDER
MATTERS
The Partnership, a publicly-held limited partnership, sold 75,000 Limited
Partnership Units aggregating $75,000,000 during its offering period. The
Partnership currently has 75,000 units outstanding and 5,819 Limited Partners of
record. There is no intention to sell additional Limited Partnership Units nor
is there an established market for these Units.
In October 1996, Unit holders received distributions from operations of $15.04
per Limited Partnership Unit. No distributions from operations were made in
1995.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This item should be read in conjunction with the consolidated financial
statements and other items contained elsewhere in this report.
Results of Operations
The Partnership realized net income of $133,000 for the year ended December 31,
1996, versus a net loss of $345,000 for the year ended December 31, 1995. The
increase in net income can be attributed to increased revenue and decreased
expenses. Rental revenues increased due to increases in average rental rates at
all of the Partnership's investment properties. Other income increased due to an
increase in interest income as a result of the increase in cash reserves held by
the Partnership. Also contributing to the increase in other income was an
increase in the collection of lease cancellation fees. Operating expense
decreased due to fewer interior and exterior building repairs for the year ended
December 31, 1996. This decrease in operating expense was offset by increases
in depreciation and general and administrative expenses. Depreciation expense
increased due to an increase in capital improvements at the Partnership's
investment properties. The Partnership reimburses the Managing General Partner
and its affiliates for its costs involved in the management and administration
of all Partnership activities. While overall expense reimbursements have
increased during the year ending December 31, 1996, the recurring expenses
subsequent to the transition efforts to the new administration are expected to
more closely approximate historical levels. The increase in expense
reimbursements during the year ending December 31, 1996, is directly
attributable to the combined transition efforts of the Greenville and Atlanta
administrative offices during the year-end close, preparation of the 1995 10-K
and tax return (including the limited partner K-1's), filing of the first two
quarterly reports and transition of asset management responsibilities to the new
administration.
On August 3, 1995, the Partnership paid $910,000 to satisfy in full the
$1,039,000 second mortgage encumbering the Village in the Woods Apartments at a
discount. As a result, the Partnership recognized an extraordinary gain on
early extinguishment of debt of $129,000.
Included in operating expense for the year ended December 31, 1996 is $415,000
of major repairs and maintenance mainly comprised of interior building
maintenance, exterior painting, exterior building maintenance, and gutter
repair.
As part of the ongoing business plan of the Partnership, the Managing 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 the burden of
increases in expenses. However, due to changing market conditions, which can
result in the use of rental concessions and rental reductions to offset
softening market conditions, there is no guarantee that the Managing General
Partner will be able to sustain such a plan.
Capital Resources and Liquidity
The Partnership had unrestricted cash and cash equivalents of $4,441,000 at
December 31, 1996, versus $2,623,000 at December 31, 1995. The increase in net
cash provided by operating activities is attributable to an increase in net
income and an increase in accrued expenses and other liabilities. Cash flows
from investing activities decreased in 1996 as compared to 1995. This decrease
results from an increase in property improvements and replacements and an
increase in deposits to restricted escrows. The distribution to partners in
October 1996 resulted in an increase in net cash used in financing activities
for 1996 versus 1995.
An affiliate of the Managing General Partner has made available to the
Partnership a credit line of up to $150,000 per property owned by the
Partnership. The Partnership has no outstanding amounts due under this line of
credit. Based on present plans, the Managing General Partner does not
anticipate the need to borrow in the near future. Other than cash and cash
equivalents, the line of credit is the Partnership's only unused source of
liquidity.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Partnership. Such assets are currently
thought to be sufficient for any near-term needs of the Partnership. The
mortgage indebtedness of $36,374,000, net of discount, is amortized over varying
periods with maturity dates ranging from July 1999 to July 2005, at which time
the properties will either be sold or refinanced. Future cash distributions will
depend on the levels of net cash generated from operations, property sales and
the availability of cash reserves. In 1996, Unit holders received distributions
from operations of $1,128,000 ($15.04 per Limited Partnership Unit). There were
no cash distributions in 1995.
ITEM 7. FINANCIAL STATEMENTS
CENTURY PROPERTIES FUND XVII
LIST OF FINANCIAL STATEMENTS
Independent Auditors' Report
Consolidated Balance Sheet - December 31, 1996
Consolidated Statements of Operations - Years ended December 31, 1996 and
1995
Consolidated Statement of Changes in Partners' Capital (Deficit) - Years
ended December 31, 1996 and 1995
Consolidated Statements of Cash Flows - Years ended December 31, 1996 and
1995
Notes to Consolidated Financial Statements
Independent Auditors' Report
To the Partners
Century Properties Fund XVII
Greenville, South Carolina
We have audited the accompanying consolidated balance sheet of Century
Properties Fund XVII, (a limited partnership) (the "Partnership") and its
subsidiaries as of December 31, 1996, and the related consolidated statements of
operations, changes in partners' capital (deficit) and cash flows for each of
the two years in the period ended December 31, 1996. These consolidated
financial statements are the responsibility of the Partnership's management.
Our responsibility is to express an opinion on these consolidated 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 audits to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
consolidated financial statement presentation. We believe that our audits
provide 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 Century
Properties Fund XVII and its subsidiaries, as of December 31, 1996, and the
results of its operations and its cash flows for each of the two years in the
period ended December 31, 1996, in conformity with generally accepted accounting
principles.
/S/ IMOWITZ KOENIG & CO., LLP
New York, N.Y.
January 30, 1997
CENTURY PROPERTIES FUND XVII
CONSOLIDATED BALANCE SHEET
(in thousands, except unit data)
December 31, 1996
Assets
Cash and cash equivalents:
Unrestricted $ 4,441
Restricted--tenant security deposits 269
Escrow for taxes 422
Restricted escrows 881
Other assets 433
Investment properties (Notes B and E)
Land $ 7,078
Buildings and related
personal property 58,147
65,225
Less accumulated depreciation (28,140) 37,085
$ 43,531
Liabilities and Partners' Capital
Liabilities
Accrued expenses and other liabilities $ 588
Accrued taxes 586
Security deposit liabilities 269
Mortgage notes payable (Notes B and E) 36,374
Partners' (Deficit) Capital
General partners $ (7,057)
Limited partners (75,000 units issued
and outstanding) 12,771 5,714
$ 43,531
See Accompanying Notes to Consolidated Financial Statements
CENTURY PROPERTIES FUND XVII
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)
Years Ended December 31,
1996 1995
Revenues:
Rental income $ 11,784 $ 11,589
Other income 803 604
Total revenues 12,587 12,193
Expenses:
Operating 6,481 6,853
Interest 3,539 3,527
Depreciation 2,127 2,043
General and administrative 307 244
Total expenses 12,454 12,667
Income (loss) before extraordinary item 133 (474)
Extraordinary item - gain on early
extinguishment of debt -- 129
Net income (loss) (Note C) $ 133 $ (345)
Net income (loss) allocated to
general partners $ 16 $ (41)
Net income (loss) allocated to
limited partners 117 (304)
Net income (loss) $ 133 $ (345)
Per limited partnership unit:
Income (loss) before extraordinary item $ 1.56 $ (5.57)
Extraordinary item -- 1.52
Net income (loss) $ 1.56 $ (4.05)
Cash distributions per limited
partnership unit $ 15.04 $ --
See Accompanying Notes to Consolidated Financial Statements
CENTURY PROPERTIES FUND XVII
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
(in thousands, except unit data)
Limited
Partnership General Limited
Units Partners Partners Total
Original capital contributions 75,000 $ -- $75,000 $75,000
Partners' (deficit) capital at
December 31, 1994 75,000 $ (6,881) $14,086 $ 7,205
Net loss for the year ended
December 31, 1995 -- (41) (304) (345)
Partners' (deficit) capital at
December 31, 1995 75,000 (6,922) 13,782 6,860
Distribution to the partners -- (151) (1,128) (1,279)
Net income for the year ended
ended December 31, 1996 -- 16 117 133
Partners' (deficit) capital at
December 31, 1996 75,000 $ (7,057) $12,771 $ 5,714
See Accompanying Notes to Consolidated Financial Statements
CENTURY PROPERTIES FUND XVII
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
Years Ended December 31,
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 133 $ (345)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization 3,475 3,299
Extraordinary gain on early extinguishment of debt -- (129)
Change in accounts:
Other assets 178 236
Accrued expenses and other liabilities 726 (358)
Net cash provided by operating activities: 4,512 2,703
Cash flows from investing activities:
Property improvements and replacements (1,007) (692)
(Deposits to) withdrawals from restricted escrows, net (45) 760
Net cash (used in) provided by
investing activities (1,052) 68
Cash flows from financing activities:
Payments on mortgage notes payable (363) (387)
Repayments of mortgage notes payable -- (910)
Distribution to partners (1,279) --
Net cash used in financing activities: (1,642) (1,297)
Net increase in cash and cash equivalents 1,818 1,474
Cash and cash equivalents at beginning of year 2,623 1,149
Cash and cash equivalents at end of year $ 4,441 $ 2,623
Supplemental disclosure of cash flow
Cash paid for interest $ 2,043 $ 2,268
Property improvements and replacements in notes payable $ -- $ 39
<FN>
See Accompanying Notes to Consolidated Financial Statements
</TABLE>
CENTURY PROPERTIES FUND XVII
Notes to Consolidated Financial Statements
December 31, 1996
NOTE A - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Organization:
Century Properties Fund XVII (the "Partnership" or "Registrant") is a California
limited partnership organized in November 1981 to acquire and operate
residential apartment complexes. The partnership currently owns five
residential apartment complexes of which three are located in Colorado, and one
each in Florida and Texas. The Partnership's General Partner is Fox Partners,
an affiliate of Insignia Financial Group, Inc.
Principles of Consolidation:
The financial statements include all the accounts of the Partnership and its
subsidiaries. All significant interpartnership balances have been eliminated.
Minority interest is immaterial and not shown separately in the financial
statements.
Depreciation:
Depreciation is calculated by the straight-line method over the estimated lives
of the rental properties and related personal property.
Cash and Cash Equivalents:
The Partnership considers all highly liquid investments with a maturity, when
purchased, of three months or less to be cash equivalents. At certain times,
the amount of cash deposited at a bank may exceed the limit on insured deposits.
Leases:
The Partnership generally leases apartment units for twelve-month terms or less.
Restricted Cash - Tenant Security Deposits:
The Partnership requires security deposits from all apartment leases for the
duration of the lease and are considered restricted cash. Deposits are refunded
when the tenant vacates the apartment if there has been no damage to the unit.
Loan Costs:
Loan costs of $1,104,000 are included in "Other assets" in the accompanying
balance sheet and are being amortized on a straight-line basis over the life of
the loans. At December 31, 1996, accumulated amortization is $729,000.
Amortization of loan costs is included in "Interest" expense in the accompanying
statement of operations.
Investment Properties:
During the fourth quarter of 1995 the Partnership adopted "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 effect of
adoption was not material.
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 short-
term maturities. The Partnership estimates the fair value of its fixed rate
mortgage by discounted cash flow analysis, based on estimated borrowing rates
currently available to the Partnership (see "Note B").
Advertising Costs:
Advertising costs of $311,000, and $334,000 are charged to expense as incurred
and are included in "Operating" expenses in the accompanying statement of
operations.
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.
Reclassifications:
Certain reclassifications have been made to the 1995 balances to conform to the
1996 presentation.
Net Income (Loss) Per Limited Partnership Unit:
Net income (loss) per limited partnership unit is calculated by dividing the net
income (loss) allocated to the limited partners by the number of its units
outstanding.
NOTE B - MORTGAGE NOTES PAYABLE
The principle terms of mortgage notes payable are as follows (dollar amounts in
thousands):
<TABLE>
<CAPTION>
Monthly Principal Principal
Payment Stated Balance Balance At
Including Interest Maturity Due At December 31,
Property Interest Rate Date Maturity 1996
<S> <C> <C> <C> <C> <C>
Cherry Creek Gardens Apartments $ 67 8.630% 12/01/99 $ 7,335 $ 7,766
Creekside Apartments 42 7.875% 07/01/00 4,882 5,249
The Lodge Apartments 46 7.875% 07/01/00 5,363 5,775
The Village in the Woods Apts. -- (1) 01/24/00 14,421 14,421
Cooper's Pond Apartments
- 1st mortgage 30 8.000% 07/01/99 3,439 3,637
- 2nd mortgage 29 8.500% 07/01/05 4,134 4,134
$ 39,574 40,982
Mortgage discount (4,608)
$ 36,374
</TABLE>
(1) Zero coupon note; discounted at an effective interest rate of 10.247%
The estimated fair values of the Partnership's aggregate debt is approximately
$39,000,000. This value represents a general approximation of possible
valuation and is not necessarily indicative of the amounts the Partnership may
pay in an actual market transaction.
On August 3, 1995, the Partnership paid $910,000 to satisfy in full the
$1,039,000 second mortgage encumbering The Village in the Woods Apartments at a
discount. The debt forgiveness of $129,000 was recognized as an extraordinary
item in 1995.
Scheduled principal payments on the mortgage notes payable subsequent to
December 31, 1996, are as follows (dollar amounts in thousands):
1997 $ 414
1998 449
1999 11,202
2000 24,783
2001 --
Thereafter 4,134
$ 40,982
NOTE C - INCOME TAXES
Taxable income or loss of the Partnership is reported in the income tax returns
of its partners. Accordingly, no provision for income taxes is made in the
financial statements of the Partnership.
Differences between the net income (loss) as reported and Federal taxable loss
result primarily from depreciation over different methods and lives and on
differing cost bases. The following is a reconciliation of reported net income
(loss) and Federal taxable income (loss):
1996 1995
(in thousands, except unit data)
Net income (loss) as reported $ 133 $ (345)
Add (deduct):
Depreciation differences (1,014) (994)
Amortization of discount 1,239 1,124
Miscellaneous 26 14
Federal taxable income (loss) $ 384 $ (201)
Federal taxable loss
per limited partnership unit $ 4.51 $ (2.36)
The following is a reconciliation between the Partnership's reported amounts and
Federal tax basis of net liabilities (in thousands):
Net assets as reported $ 5,714
Sales commissions and organization expense 9,324
Depreciation (28,932)
Provision for impairment of value 1,430
Leaseback termination (1,365)
Lease payments credited to rental properties 2,068
Amortization of discount on notes payable 11,725
Construction period interest and taxes (483)
Debt forgiven (276)
Interest capitalized for income tax reporting 195
Other (92)
Net liabilities - Federal tax basis $ (692)
NOTE D - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The Partnership Agreement provides for payments to
affiliates for services and as reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership. The following payments were made to the
Managing General Partner and affiliates in 1996 and 1995:
1996 1995
(in thousands)
Property management fees $ 617 $ 592
Reimbursement for services of
affiliates 166 162
Included in "Reimbursement for services of affiliates" for 1996 is $13,000 in
construction oversight costs.
The Partnership insures its properties under a master policy through an agency
and insurer unaffiliated with the Managing General Partner. An affiliate of the
Managing General Partner acquired, in the acquisition of a business, certain
financial obligations from an insurance agency which was later acquired by the
agent who placed the current year's master policy. The current agent assumed
the financial obligations to the affiliate of the Managing General Partner who
receives payments on these obligations from the agent. The amount of the
Partnership's insurance premiums accruing to the benefit of the affiliate of the
Managing General Partner by virtue of the agent's obligations is not
significant.
Included in operating expenses for the fiscal year ended December 31, 1995, are
insurance premiums of approximately $399,000 which were paid to the Managing
General Partner under a master insurance policy arranged for by the Managing
General Partner.
Property management fees and real estate tax reduction fees are included in
operating expenses. Reimbursed expenses are primarily included in general and
administrative expenses.
In accordance with the partnership agreement, the Managing General Partner is
entitled to receive cash distributions as follows: (1) a partnership management
incentive not to exceed ten percent, determined on a cumulative, noncompounded
basis, of cash from operations available for distribution (as defined in the
partnership agreement) distributed to partners, and (2) a continuing interest
representing a two percent share of cash distributions, after allocation of the
partnership management incentive. Cash distributions to the Managing General
Partner for the years ended December 31, 1996 and 1995 are as follows (in
thousands):
1996 1995
Partnership management incentive $ 128 $ --
Continuing interest 23 --
Total $ 151 $ --
In accordance with the partnership agreement, the Managing General Partner
received a partnership management incentive allocation equal to ten percent of
net and taxable income (loss) before gains on property dispositions. The
Managing General Partner is also allocated its two percent continuing interest
in the Partnership's net and taxable income (loss) after preceding allocation.
The Managing General Partner is also allocated gain on property dispositions to
the extent it is entitled to receive distributions and then twelve percent of
any remaining gain.
Upon sale of all properties and termination of the Partnership, the Managing
General Partner may be required to contribute certain funds to the Partnership
in accordance with the partnership agreement.
On March 29, 1996, an affiliate of Insignia acquired the corporate limited
partners owning 1% of the subsidiary partnerships which own the Lodge
Apartments, Creekside Apartments and Cherry Creek Apartments.
NOTE E - INVESTMENT PROPERTIES AND ACCUMULATED DEPRECIATION
Initial Cost
To Partnership
(in thousands)
Cost
Buildings Capitalized
and Related (Removed)
Personal Subsequent to
Description Encumbrances Land Property Acquisition
Cherry Creek Gardens Apts. $ 7,766 $ 1,320 $ 11,879 $ 1,448
Creekside Apartments 5,249 1,366 7,307 1,475
The Lodge Apartments 5,775 1,575 8,580 1,808
The Village in the Woods Apts. 9,813 2,852 20,915 (9,497)
Cooper's Pond Apartments 7,771 1,476 12,505 216
Total $ 36,374 $ 8,589 $ 61,186 $ (4,550)
<TABLE>
<CAPTION>
Gross Amount at Which Carried
At December 31, 1996
(in thousands)
Buildings
And Related Year
Personal Accumulated of Date Depreciable
Description Land Property Total Depreciation Construction Acquired Life-Years
<S> <C> <C> <C> <C> <C> <C>
Cherry Creek Gardens
Apartments $ 1,320 $ 13,327 $ 14,647 $ 6,419 1979 9/82 5-30 yrs
Creekside Apartments 1,366 8,782 10,148 4,159 1974 10/82 5-30yrs
The Lodge Apartments 1,577 10,386 11,963 4,886 1974 10/82 5-30 yrs
Village in the Woods
Apartments 1,500 12,770 14,270 6,083 1983 10/82 5-30 yrs
Cooper's Pond Apts. 1,315 12,882 14,197 6,593 1979-1981 3/83 5-30 yrs
Total $ 7,078 $ 58,147 $ 65,225 $ 28,140
</TABLE>
The depreciable lives included above are for the buildings and components. The
depreciable lives for related personal property are for 5 to 7 years.
Reconciliation of "Investment Properties and Accumulated Depreciation":
Years Ended December 31,
1996 1995
(in thousands)
Investment Properties
Balance at beginning of year $ 64,218 $ 63,526
Property improvements 1,007 692
Balance at end of year $ 65,225 $ 64,218
Years Ended December 31,
1996 1995
(in thousands)
Accumulated Depreciation
Balance at beginning of year $ 26,013 $ 23,970
Additions charged to expense 2,127 2,043
Balance at end of year $ 28,140 $ 26,013
The aggregate cost of the real estate for Federal income tax purposes at
December 31, 1996 and 1995 is $72,966,000 and $71,953,000, respectively. The
accumulated depreciation taken for Federal income tax purposes at December 31,
1996 and 1995 is $57,071,000 and $53,929,000, respectively.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANT ON ACCOUNTING AND
FINANCIAL DISCLOSURES
There were no disagreements with Imowitz Koenig & Co., LLP regarding the 1996 or
1995 audits of the Partnership's financial statements.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
The Registrant has no officers or directors. The Managing General Partner of
the partnership is Fox Capital Management Corporation. The names and ages of,
as well as the positions and offices held by, the executive officers and
directors of the Managing General Partner are set forth below. There are no
family relationships between or among any officers or directors.
Name Age Position
William H. Jarrard, Jr. 50 President and
Director
Ronald Uretta 41 Vice President and
Treasurer
John K. Lines, Esq. 37 Vice President and
Secretary
Kelley M. Buechler 39 Assistant Secretary
William H. Jarrard, Jr. has been Managing Director - Partnership Administration
of Insignia since January 1991. Mr. Jarrard served as Managing Director -
Partnership Administration and Asset Management from July 1994 until January
1996.
Ronald Uretta served as Insignia's Chief Financial Officer and Treasurer from
January 1992 until August 1996. Since August 1996, he has served as Chief
Operating Officer of Insignia. He also served as Secretary from January 1992 to
June 1994. Since September 1990, Mr. Uretta has served as the Chief Financial
Officer and Controller of Metropolitan Asset Group.
John K. Lines, Esq., has been Insignia's General Counsel from June 1994 and
General Counsel and Secretary since July 1994. From May 1993 until June 1994,
Mr. Lines was the Assistant General Counsel and Vice President of Ocwen
Financial Corporation, West Palm Beach, Florida. From October 1991 until May
1993, Mr. Lines was a Senior Attorney with BANC ONE CORPORATION, Columbus, Ohio.
From May 1984 until October 1991, Mr. Lines was an attorney with Squire Sanders
& Dempsey, Columbus, Ohio.
Kelley M. Buechler has served as Assistant Secretary of Insignia since 1991.
ITEM 10. EXECUTIVE COMPENSATION
No direct form of compensation or remuneration was paid by the Partnership to
any officer or director of the General Partners. The Partnership has no plan,
nor does the Partnership presently propose a plan, which will result in any
remuneration being paid to any officer or director upon termination of
employment. However, fees and other payments have been made to the
Partnership's Managing General Partner and its affiliates, as described in "Item
12. Certain Relationships and Related Transactions".
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding limited partnership
units of the Registrant owned by each person who is known by the Registrant to
own beneficially or exercise voting or dispositive control over more than 5% of
the Registrant's limited partnership units, by each of the directors and by all
directors and executive officers of the Managing General Partner as a group as
of December 31, 1996.
Name and address of Amount and nature of
Beneficial Owner Beneficial Owner % of Class
Insignia LLC 25,710.50 34.0
There are no arrangements known to the Registrant which may result in a change
in control of the Registrant.
As a result of its ownership of 25,710.50 of limited partnership units, Insignia
LLC could be in a position to significantly influence all voting decisions with
respect to the Registrant. Under the Partnership Agreement, unitholders holding
a majority of the Units are entitled to take action with respect to a variety of
matters. When voting on matters, Insignia LLC would in all likelihood vote the
Units it acquired in a manner favorable to the interest of the Managing General
Partner because of its affiliation with the Managing General Partner. However,
DeForest II, from whom Insignia LLC acquired its units, had agreed for the
benefit of non-tendering unitholders, that would vote its Units: (i) against
any increase in compensation payable to the Managing General Partner or to
affiliates; and (ii) on all other matters submitted by it or its affiliates, in
proportion to the votes cast by non tendering units holders. Except for the
foregoing, no other limitations are imposed on Insignia LLC's right to vote each
Unit acquired.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The Partnership Agreement provides for payments to
affiliates for services and as reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership. The following payments were made to the
Managing General Partner and affiliates in 1996 and 1995:
1996 1995
(in thousands)
Property management fees $ 617 $ 592
Reimbursement for services of
affiliates 166 162
Included in "Reimbursement for services of affiliates" for 1996 is $13,000 in
construction oversight costs.
The Partnership insures its properties under a master policy through an agency
and insurer unaffiliated with the Managing General Partner. An affiliate of the
Managing General Partner acquired, in the acquisition of a business, certain
financial obligations from an insurance agency which was later acquired by the
agent who placed the current year's master policy. The current agent assumed
the financial obligations to the affiliate of the Managing General Partner who
receives payments on these obligations from the agent. The amount of the
Partnership's insurance premiums accruing to the benefit of the affiliate of the
Managing General Partner by virtue of the agent's obligations is not
significant.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a) The Exhibits listed on the accompanying Index to Exhibits are filed as part
of this Annual Report and incorporated in this Annual Report as set forth
in said Index.
(b) No reports on Form 8-K were filed during the fourth quarter of 1996.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.
CENTURY PROPERTIES FUND XVII
By: Fox Partners
Its General Partner
By: Fox Capital Management Corporation
Its Managing General Partner
By: /s/William H. Jarrard, Jr.
William H. Jarrard, Jr.
President and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, this Report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the date indicated.
Signature/Name Title Date
/s/ William H. Jarrard, Jr. President and Director March 21, 1997
William H. Jarrard, Jr.
/s/ Ronald Uretta Principal Financial March 21, 1997
Ronald Uretta Officer and Principal
Accounting Officer
EXHIBIT INDEX
Exhibit Number Description of Exhibit
2.1 NPI, Inc. Stock Purchase Agreement, incorporated by
reference to the Registrant's Current Report on Form
8-K dated August 17, 1995.
2.2 Partnership Units Purchase Agreement incorporated by
reference to Exhibit 2.1 to Form 8-K filed by
Insignia Financial Group, Inc. ("Insignia") with the
Securities and Exchange Commission on September 1,
1995.
2.3 Management Purchase Agreement incorporated by
reference to Exhibit 2.2 to Form 8-K filed by
Insignia with the Securities and Exchange Commission
on September 1, 1995.
2.4 Limited Liability Company Agreement of Riverside
Drive L.L.C., incorporated by reference to Exhibit
2.4 to Form 8-K filed by Insignia with the Securities
and Exchange Commission on September 1, 1995.
2.5 Master Indemnity Agreement incorporated by reference
to Exhibit 2.5 to Form 8-K filed by Insignia with the
Securities and Exchange Commission on September 1,
1995.
3.4 Agreement of Limited Partnership, incorporated by
reference to Exhibit A to the Prospectus of the
Registrant dated March 29, 1982, and as thereafter
supplemented contained in the Registrant's
Registration Statement on Form S-11 (Reg. No. 2-
75411).
16 Letter from the Registrant's former Independent
Auditor dated April 27, 1994, incorporated by
reference to exhibit 10 to the Registrant's Current
Report on Form 8-K dated April 22, 1994.
27 Financial Data Schedule.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XVII 1996 Year-End 10-KSB and is qualified in its entirety by
reference to such 10-KSB filing.
</LEGEND>
<CIK> 0000356472
<NAME> CENTURY PROPERTIES FUND XVII
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 4,441
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 65,225
<DEPRECIATION> 28,140
<TOTAL-ASSETS> 43,531
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 36,374
0
0
<COMMON> 0
<OTHER-SE> 5,714
<TOTAL-LIABILITY-AND-EQUITY> 43,531
<SALES> 0
<TOTAL-REVENUES> 12,587
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 12,454
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,539
<INCOME-PRETAX> 133
<INCOME-TAX> 0
<INCOME-CONTINUING> 133
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 133
<EPS-PRIMARY> 1.56
<EPS-DILUTED> 0
<FN>
<F1>Registrant has an unclassified balance sheet.
</FN>
</TABLE>
