FORM 10-QSB--QUARTERLY OR TRANSITIONAL REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________to _________
Commission file number 0-11137
CENTURY PROPERTIES FUND XVII
(Exact name of small business issuer as specified in its charter)
California 94-2782037
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
55 Beattie Place, P.O. Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone number)
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 No___
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a)
CENTURY PROPERTIES FUND XVII
CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands, except unit data)
March 31, 2000
<TABLE>
<CAPTION>
Assets
<S> <C>
Cash and cash equivalents $ 2,757
Receivables and deposits 1,223
Restricted escrows 168
Other assets 735
Investment properties:
Land $ 7,078
Buildings and related personal property 63,758
70,836
Less accumulated depreciation (36,012) 34,824
$ 39,707
Liabilities and Partners' Deficit
Liabilities
Accounts payable $ 186
Tenant security deposit liabilities 329
Accrued property taxes 442
Other liabilities 471
Mortgage notes payable 48,613
Partners' Deficit
General partner $ (8,215)
Limited partners (75,000 units issued and
outstanding) (2,119) (10,334)
$ 39,707
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
b)
CENTURY PROPERTIES FUND XVII
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
2000 1999
Revenues:
<S> <C> <C>
Rental income $3,473 $3,356
Other income 197 163
Total revenues 3,670 3,519
Expenses:
Operating 1,184 1,153
General and administrative 72 69
Depreciation 692 611
Interest 974 894
Property taxes 269 198
Total expenses 3,191 2,925
Income before extraordinary loss 479 594
Extraordinary loss on extinguishment of debt (102) --
Net income $ 377 $ 594
Net income allocated to general partner $ 45 $ 70
Net income allocated to limited partners 332 524
$ 377 $ 594
Per limited partnership unit:
Income before extraordinary loss $ 5.63 $ 6.99
Extraordinary loss (1.20) --
Net income $ 4.43 $ 6.99
Distributions per limited partnership unit $76.84 $30.31
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
c)
CENTURY PROPERTIES FUND XVII
CONSOLIDATED STATEMENT OF CHANGES IN PARTNERS' (DEFICIT) CAPITAL
(Unaudited)
(in thousands, except unit data)
<TABLE>
<CAPTION>
Limited
Partnership General Limited
Units Partner Partners Total
<S> <C> <C> <C> <C>
Original capital contributions 75,000 $ -- $75,000 $ 75,000
Partners' (deficit) capital
at December 31, 1999 75,000 $(8,023) $ 3,312 $ (4,711)
Distributions to partners -- (237) (5,763) (6,000)
Net income for the three months
ended March 31, 2000 -- 45 332 377
Partners' deficit at
March 31, 2000 75,000 $(8,215) $(2,119) $(10,334)
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
d)
CENTURY PROPERTIES FUND XVII
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
2000 1999
Cash flows from operating activities:
<S> <C> <C>
Net income $ 377 $ 594
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 692 611
Amortization of loan costs and debt discounts 109 355
Extraordinary loss on debt refinancing 102 --
Change in accounts:
Receivables and deposits 88 102
Other assets (41) (42)
Accounts payable (66) (45)
Tenant security deposit liabilities 21 17
Accrued property taxes (170) (209)
Other liabilities 148 (10)
Net cash provided by operating activities 1,260 1,373
Cash flows from investing activities:
Net withdrawals from restricted escrows 295 291
Property improvements and replacements (303) (305)
Net cash used in investing activities (8) (14)
Cash flows from financing activities:
Payments on mortgage notes payable (114) (99)
Payoff of mortgage notes payable (21,943) --
Proceeds from mortgage notes payable 22,800 --
Loan costs paid (256) --
Prepayment penalty (79) --
Distributions to partners (6,000) (2,500)
Net cash used in financing activities (5,592) (2,599)
Net decrease in cash and cash equivalents (4,340) (1,240)
Cash and cash equivalents at beginning of period 7,097 4,031
Cash and cash equivalents at end of period $ 2,757 $ 2,791
Supplemental disclosure of cash flow information:
Cash paid for interest $ 674 $ 539
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
<PAGE>
e)
CENTURY PROPERTIES FUND XVII
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note A - Basis of Presentation
The accompanying unaudited consolidated financial statements of Century
Properties Fund XVII (the "Partnership" or the "Registrant") have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Item 310(b)
of Regulation S-B. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of Fox Capital Management Corporation
("FCMC" or the "Managing General Partner") the general partner of the
Partnership's general partner, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three month period ended March 31, 2000 are not
necessarily indicative of the results that may be expected for the fiscal year
ending December 31, 2000. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Partnership's Annual
Report on Form 10-KSB for the fiscal year ended December 31, 1999.
Principles of Consolidation
The financial statements include all the accounts of the Partnership and
Apartment CCG 17, L.P., which owns Cherry Creek Gardens Apartments, Apartment
Creek 17, LLC, which owns Creekside Apartments and Apartment Lodge 17, LLC,
which owns The Lodge Apartments. The Partnership ultimately holds a 100%
interest in Apartment CCG 17, L.P., Apartment Creek 17, LLC, and Apartment Lodge
17, LLC. All intra-entity balances have been eliminated.
Note B - Transfer of Control
Pursuant to a series of transactions which closed on October 1, 1998 and
February 26, 1999, Insignia Financial Group, Inc. and Insignia Properties Trust
merged into Apartment Investment and Management company ("AIMCO"), a publicly
traded real estate investment trust, with AIMCO being the surviving corporation
(the "Insignia Merger"). As a result, AIMCO acquired a 100% ownership interest
in the Managing General Partner. The Managing General Partner does not believe
that this transaction has had or will have a material effect on the affairs and
operations of the Partnership.
Note C - 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.
<PAGE>
The following payments were made to the Managing General Partner and affiliates
during the three months ended March 31, 2000 and 1999:
2000 1999
(in thousands)
Property management fees (included in operating expenses) $184 $176
Reimbursement for services of affiliates (included in
investment properties, general and administrative
expense and operating expense) 62 37
Partnership management fee (included in general partner
distributions) 119 181
During the three months ended March 31, 2000 and 1999, affiliates of the
Managing General Partner were entitled to receive 5% of gross receipts from all
of the Registrant's properties for providing property management services. The
Registrant paid to such affiliates approximately $184,000 and $176,000 for the
three months ended March 31, 2000 and 1999, respectively.
An affiliate of the Managing General Partner received reimbursement of
accountable administrative expenses amounting to approximately $62,000 and
$37,000 for the three months ended March 31, 2000 and 1999, respectively.
Pursuant to the Partnership Agreement, for managing the affairs of the
Partnership, the general partner is entitled to receive a Partnership management
fee equal to 10% of the Partnership's adjusted cash from operations as
distributed. Approximately $119,000 and $181,000 in Partnership management fees
were paid along with the distributions from operations made during the three
months ended March 31, 2000 and 1999, respectively.
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.
AIMCO and its affiliates currently own 41,620 limited partnership units in the
Partnership representing 55.493% of the outstanding units. A number of these
units were acquired pursuant to tender offers made by AIMCO or its affiliates.
It is possible that AIMCO or its affiliates will make one or more additional
offers to acquire additional limited partnership interests in the Partnership
for cash or in exchange for units in the operating partnership of AIMCO. Under
the Partnership Agreement, unitholders holding a majority of the Units are
entitled to take action with respect to a variety of matters. As a result of its
ownership of 55.493% of the outstanding units, AIMCO is in a position to
influence all voting decisions with respect to the Registrant. When voting on
matters, AIMCO would in all likelihood vote the Units it acquired in a manner
favorable to the interest of the Managing General Partner because of their
affiliation with the Managing General Partner. However, DeForest Ventures I
L.P., from whom AIMCO, through its merger with Insignia, acquired its units, had
agreed for the benefit of non-tendering unitholders, that it 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 unit holders.
Except for the foregoing, no other limitations are imposed on Insiginia
Properties, L.P.'s right to vote each Unit acquired.
Note D - Distributions to Partners
During the three months ended March 31, 2000, the Partnership declared and paid
a distribution of approximately $6,000,000 (approximately $5,763,000 to the
limited partners or $76.84 per limited partnership unit) to its partners. The
distribution consisted of approximately $1,190,000 (approximately $1,049,000 to
the limited partners or $13.99 per limited partnership unit) from operations and
approximately $4,810,000 (approximately $4,714,000 to the limited partners or
$62.85 per limited partnership unit) from the proceeds of the refinancing of
Cherry Creek Gardens Apartments in December 1999. During the three months ended
March 31, 1999, the Partnership paid a distribution of approximately $2,500,000
(approximately $2,273,000 to the limited partners or $30.31 per limited
partnership unit) to its partners. The distribution consisted of approximately
$1,811,000 (approximately $1,598,000 to the limited partners or approximately
$21.31 per limited partnership unit) from operations and approximately $689,000
(approximately $675,000 to the limited partners or $9.00 per limited partnership
unit) from the proceeds of the refinancing of Creekside Apartments and The Lodge
Apartments in August 1998.
Note E - Refinancing and Extraordinary Loss
On December 10, 1999, the Partnership refinanced the mortgage encumbering Cherry
Creek Gardens Apartments. The refinancing replaced indebtedness of approximately
$7,320,000 with a new mortgage in the amount of $12,415,000. The new mortgage
carries a stated interest rate of 7.99%. Interest on the old mortgage was 8.63%.
Payments on the mortgage loan are due monthly until the loan matures on January
1, 2020. In addition, the Partnership was required to establish a repair escrow
of $110,000 with the lender for certain capital replacements. Total capitalized
loan costs were approximately $92,000 at December 31, 1999. Additional loan
costs of approximately $6,000 were capitalized during the three months ended
March 31, 2000.
On January 28, 2000, the Partnership refinanced the mortgage encumbering Village
in the Woods Apartments. The refinancing replaced indebtedness of approximately
$14,421,000 with a new mortgage in the amount of $14,500,000. The new mortgage
carries a stated interest rate of 8.56%. The refinanced mortgage was a zero
coupon note which was discounted at an effective interest rate of 10.247%.
Payments on the mortgage loan are due monthly until the loan matures on February
1, 2020. Total capitalized loan costs were approximately $148,000 at March 31,
2000. The Partnership recognized an extraordinary loss on the extinguishment of
debt of approximately $93,000 due to the write off of an unamortized mortgage
discount.
On February 15, 2000, the Partnership refinanced the first and second mortgages
encumbering Cooper's Pond Apartments. The refinancing replaced indebtedness of
approximately $7,522,000 with a new mortgage in the amount of $8,300,000. The
new mortgage carries a stated interest rate of 8.47%. Interest rates on the
refinanced mortgages were 8.00% and 8.5%. Payments on the mortgage loan are due
monthly until the loan matures on March 1, 2020. Total capitalized loan costs
were approximately $116,000 at March 31, 2000. The Partnership recognized an
extraordinary loss on the early extinguishment of debt of approximately $102,000
due to the write-off of unamortized loan costs and a prepayment penalty.
Note F - Casualty Event
In November 1999, a fire occurred at The Village in the Woods Apartments which
caused damage to sixteen units of the complex. The restoration will be completed
during the second quarter of 2000. The financial statement impact of this loss
is currently being evaluated by the Managing General Partner.
Note G - Segment Reporting
The Partnership has one reportable segment: residential properties. The
Partnership's residential property segment consists of five apartment complexes,
three of which are located in Colorado and one each in Texas and Florida. The
Partnership rents apartment units to tenants for terms that are typically twelve
months or less.
The Partnership evaluates performance based on segment profit (loss) before
depreciation. The accounting policies of the reportable segment are the same as
those described in the Partnership's Annual Report on Form 10-KSB for the year
ended December 31, 1999.
The Partnership's reportable segment consists of investment properties that
offer similar products and services. Although each of the investment properties
is managed separately, they have been aggregated into one segment as they
provide services with similar types of products and customers.
Segment information for the three month periods ended March 31, 2000 and 1999 is
shown in the tables below (in thousands). The "Other" column includes
Partnership administration related items and income and expense not allocated to
the reportable segment.
2000 Residential Other Totals
Rental income $ 3,473 $ -- $ 3,473
Other income 162 35 197
Interest expense 974 -- 974
Depreciation 692 -- 692
General and administrative expense -- 72 72
Extraordinary loss on extinguishment
of debt (102) -- (102)
Segment profit (loss) 414 (37) 377
Total assets 38,719 988 39,707
Capital expenditures for investment
properties 303 -- 303
1999 Residential Other Totals
Rental income $ 3,356 $ -- $ 3,356
Other income 153 10 163
Interest expense 894 -- 894
Depreciation 611 -- 611
General and administrative expense -- 69 69
Segment profit (loss) 653 (59) 594
Total assets 39,489 715 40,204
Capital expenditures for investment
properties 305 -- 305
Note H - Legal Proceedings
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia
Financial Group, Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs named as defendants, among others,
the Partnership, the Managing General Partner and several of their affiliated
partnerships and corporate entities. The action purports to assert claims on
behalf of a class of limited partners and derivatively on behalf of a number of
limited partnerships (including the Partnership) which are named as nominal
defendants, challenging the acquisition by Insignia Financial Group, Inc.
("Insignia") and entities which were, at one time, affiliates of Insignia
("Insignia Affiliates") of interests in certain general partner entities, past
tender offers by Insignia Affiliates to acquire limited partnership units, the
management of partnerships by Insignia Affiliates and the Insignia Merger (see
"Note B - Transfer of Control"). The plaintiffs seek monetary damages and
equitable relief, including judicial dissolution of the Partnership. On June 25,
1998, the Managing General Partner filed a motion seeking dismissal of the
action. In lieu of responding to the motion, the plaintiffs have filed an
amended complaint. The Managing General Partner filed demurrers to the amended
complaint which were heard February 1999. Pending the ruling on such demurrers,
settlement negotiations commenced. On November 2, 1999, the parties executed and
filed a Stipulation of Settlement, settling claims, subject to final court
approval, on behalf of the Partnership and all limited partners who own units as
of November 3, 1999. Preliminary approval of the settlement was obtained on
November 3, 1999 from the Superior Court of the State of California, County of
San Mateo, at which time the Court set a final approval hearing for December 10,
1999. Prior to the December 10, 1999 hearing the Court received various
objections to the settlement, including a challenge to the Court's preliminary
approval based upon the alleged lack of authority of class plaintiffs' counsel
to enter the settlement. On December 14, 1999, the Managing General Partner and
its affiliates terminated the proposed settlement. Certain plaintiffs have filed
a motion to disqualify some of the plaintiffs' counsel in the action. The
Managing General Partner does not anticipate that costs associated with this
case will be material to the Partnership's overall operations.
The Partnership is unaware of any other pending or outstanding litigation that
is not of a routine nature arising in the ordinary course of business.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The matters discussed in this Form 10-QSB contain certain forward-looking
statements and involve risks and uncertainties (including changing market
conditions, competitive and regulatory matters, etc.) detailed in the
disclosures contained in this Form 10-QSB and the other filings with the
Securities and Exchange Commission made by the Registrant from time to time. The
discussion of the Registrant's business and results of operations, including
forward-looking statements pertaining to such matters, does not take into
account the effects of any changes to the Registrant's business and results of
operations. Accordingly, actual results could differ materially from those
projected in the forward-looking statements as a result of a number of factors,
including those identified herein.
The Partnership's investment properties consist of five apartment complexes. The
following table sets forth the average occupancy of the properties for the three
months ended March 31, 2000 and 1999:
Average Occupancy
Property 2000 1999
Cherry Creek Gardens Apartments 96% 98%
Englewood, Colorado
Creekside Apartments 98% 99%
Denver, Colorado
The Lodge Apartments 98% 98%
Denver, Colorado
The Village in the Woods Apartments 92% 93%
Cypress, Texas
Cooper's Pond Apartments 94% 95%
Tampa, Florida
Results of Operations
The Partnership realized net income for the three months ended March 31, 2000 of
approximately $377,000 as compared to net income of approximately $594,000 for
the corresponding period of 1999. The decrease in net income was due to the
recognition of an extraordinary loss on the extinguishment of debt recognized
during the three months ended March 31, 2000. The extraordinary loss on the
extinguishment of debt relates to the refinancing of the mortgage at Cooper's
Pond Apartments (see discussion below).
Excluding the extraordinary loss on the extinguishment of debt, the Partnership
realized income for the three months ended March 31, 2000 of approximately
$479,000 as compared to income of approximately $594,000 for the corresponding
period of 1999. The decrease in income before extraordinary loss was primarily
due to an increase in total expenses partially offset by an increase in total
revenues. Total revenues increased primarily due to an increase in rental income
and, to a lesser extent, other income. The increase in rental income was due to
an increase in average rental rates at all of the Partnership's investment
properties. These increases were partially offset by slight decreases in
occupancy at Cherry Creek Gardens Apartments, Creekside Apartments, Village in
the Woods Apartments, and Cooper's Pond Apartments, as well as increased
concession costs and bad debt expense at Village in the Woods Apartments. The
increase in other income is due primarily to an increase in interest income due
to higher average cash balances in interest bearing accounts and an increase in
income from utility charges at Cherry Creek Gardens Apartments and Creekside
Apartments.
Total expenses increased primarily due to increased depreciation expense,
property tax expense and interest expense. Depreciation expense increased due to
property improvements and replacements put into service during the last twelve
months. Property tax expense increased due to an increase in the assessed value
at Village in the Woods Apartments. Interest expense increased due to the
refinancings of Cherry Creek Gardens Apartments in December 1999, Village in the
Woods Apartments in January 2000, and Cooper's Pond Apartments in February 2000,
as discussed below. General and administrative expenses were relatively constant
for the comparable three month periods. Included in general and administrative
expenses at both March 31, 2000 and 1999 are reimbursements to the Managing
General Partner allowed under the Partnership Agreement associated with its
management of the Partnership. In addition, costs associated with the quarterly
communications with investors and regulatory agencies required by the
Partnership Agreement are included.
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 increases in
expenses. As part of this plan, the Managing 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 Managing General Partner will be able to sustain such a plan.
Liquidity and Capital Resources
At March 31, 2000, the Partnership had cash and cash equivalents of
approximately $2,757,000 compared to approximately $2,791,000 at March 31, 1999.
The decrease in cash and cash equivalents of approximately $4,340,000 from the
Partnership's year ended December 31, 1999 is due to approximately $5,592,000 of
cash used in financing activities and approximately $8,000 of cash used in
investing activities, which was partially offset by approximately $1,260,000 of
cash provided by operating activities. Cash used in financing activities
consisted of payments of principal made on the mortgages encumbering the
Partnership's properties, the payoff of the previous mortgages encumbering
Village in the Woods Apartments and Cooper's Pond Apartments, loan costs paid,
the payment of a prepayment penalty on the refinancing of Cooper's Pond
Apartments, and distributions to partners which was partially offset by the
proceeds from the debt refinancing of Village in the Woods Apartments and
Cooper's Pond Apartments. Cash used in investing activities consisted of
property improvements and replacements largely offset by net withdrawals from
escrow accounts maintained by the mortgage lenders. The Partnership invests its
working capital reserves in money market accounts.
On December 10, 1999, the Partnership refinanced the mortgage encumbering Cherry
Creek Gardens Apartments. The refinancing replaced indebtedness of approximately
$7,320,000 with a new mortgage in the amount of $12,415,000. The new mortgage
carries a stated interest rate of 7.99%. Interest on the old mortgage was 8.63%.
Payments on the mortgage loan are due monthly until the loan matures on January
1, 2020. In addition, the Partnership was required to establish a repair escrow
of $110,000 with the lender for certain capital replacements. Total capitalized
loan costs were approximately $92,000 at December 31, 1999. Additional loan
costs of approximately $6,000 were capitalized during the three months ended
March 31, 2000.
On January 28, 2000, the Partnership refinanced the mortgage encumbering The
Village in the Woods Apartments. The refinancing replaced indebtedness of
approximately $14,421,000 with a new mortgage in the amount of $14,500,000. The
new mortgage carries a stated interest rate of 8.56%. The refinanced mortgage
was a zero coupon note which was discounted at an effective interest rate of
10.247%. Payments on the mortgage loan are due monthly until the loan matures on
February 1, 2020. Total capitalized loan costs were approximately $148,000 at
March 31, 2000.
On February 15, 2000, the Partnership refinanced the first and second mortgages
encumbering Cooper's Pond Apartments. The refinancing replaced indebtedness of
approximately $7,522,000 with a new mortgage in the amount of $8,300,000. The
new mortgage carries a stated interest rate of 8.47%. Interest rates on the
refinanced mortgages were 8.00% and 8.5%. Payments on the mortgage loan are due
monthly until the loan matures on March 1, 2020. Total capitalized loan costs
were approximately $116,000 at March 31, 2000. The Partnership recognized an
extraordinary loss on the early extinguishment of debt of approximately $102,000
due to the write-off of unamortized loan costs and a prepayment penalty.
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 and to comply with Federal,
state, and local legal and regulatory requirements. Capital improvements planned
for each of the Partnership's properties are detailed below.
Cherry Creek Gardens Apartments
During the three months ended March 31, 2000, the Partnership completed
approximately $26,000 of capital improvements at the property, consisting
primarily of appliances, carpet and vinyl replacement, golf carts, water heater
replacements, and other building improvements. These improvements were funded
from operating cash flow. The Partnership has evaluated the capital improvement
needs of the property for the year. The amount budgeted for 2000 is
approximately $626,000, consisting primarily of swimming pool upgrades,
clubhouse renovations, carpet replacement, appliances, and other building
improvements. Additional improvements may be considered and will depend on the
physical condition of the property as well as replacement reserves and
anticipated cash flow generated by the property.
Creekside Apartments
During the three months ended March 31, 2000, the Partnership completed
approximately $45,000 of capital improvements at the property, consisting
primarily of roof replacement, appliances, carpet and vinyl replacement, and
water heater replacements. These improvements were funded from operating cash
flow. The Partnership has evaluated the capital improvement needs of the
property for the year. The amount budgeted for 2000 is approximately $443,000,
consisting primarily of appliances, carpet replacement, and submetering
improvements. Additional improvements may be considered and will depend on the
physical condition of the property as well as replacement reserves and
anticipated cash flow generated by the property.
The Lodge Apartments
During the three months ended March 31, 2000, the Partnership completed
approximately $11,000 of capital improvements at the property, consisting
primarily of carpet and vinyl replacements. These improvements were funded from
operating cash flow. The Partnership has evaluated the capital improvement needs
of the property for the year. The amount budgeted for 2000 is approximately
$450,000, consisting primarily of carpet replacements and submetering
improvements. Additional improvements may be considered and will depend on the
physical condition of the property as well as replacement reserves and
anticipated cash flow generated by the property.
The Village in the Woods Apartments
During the three months ended March 31, 2000, the Partnership completed
approximately $63,000 of capital improvements at the property, consisting
primarily of parking area improvements, office equipment, carpet replacements,
and golf carts. These improvements were funded from operating cash flow. The
Partnership has evaluated the capital improvement needs of the property for the
year. The amount budgeted for 2000 is approximately $173,000, consisting
primarily of appliances, air conditioning unit replacement, and carpet and vinyl
replacements. Additional improvements may be considered and will depend on the
physical condition of the property as well as replacement reserves and
anticipated cash flow generated by the property.
Cooper's Pond Apartments
During the three months ended March 31, 2000, the Partnerhsip completed
approximately $158,000 of capital improvements at the property, consisting
primarily of carpet and vinyl replacements, appliances, and plumbing upgrades.
These improvements were funded from Partnership reserves. The Partnership has
evaluated the capital improvement needs of the property for the year. The amount
budgeted for 2000 is approximately $558,000, consisting primarily of air
conditioning unit replacement, carpet and vinyl replacement, major landscaping,
swimming pool improvements, plumbing upgrades, and structural improvements.
Additional improvements may be considered and will depend on the physical
condition of the property as well as replacement reserves and anticipated cash
flow generated by the property.
The additional capital expenditures will be incurred only if cash is available
from operations or from Partnership reserves. To the extent that such budgeted
capital improvements are completed, the Partnership's distributable cash flow,
if any, may be adversely affected at least in the short term.
The Partnership's current assets are thought to be sufficient for any near-term
needs (exclusive of capital improvements) of the Partnership. The mortgage
indebtedness of approximately $48,613,000 is amortized over varying periods with
maturity dates ranging from September 2008 at Creekside Apartments and The Lodge
Apartments to March 2020 at Cooper's Pond Apartments. The Managing General
Partner will attempt to refinance such indebtedness and/or sell the properties
prior to such maturity dates. If the properties cannot be refinanced or sold for
a sufficient amount, the Partnership will risk losing such properties through
foreclosure.
During the three months ended March 31, 2000, the Partnership declared and paid
a distribution of approximately $6,000,000 (approximately $5,763,000 to the
limited partners or $76.84 per limited partnership unit) to its partners. The
distribution consisted of approximately $1,190,000 (approximately $1,049,000 to
the limited partners or $13.99 per limited partnership unit) from operations and
approximately $4,810,000 (approximately $4,714,000 to the limited partners or
$62.85 per limited partnership unit) from the proceeds of the refinancing of
Cherry Creek Gardens Apartments in December 1999. During the three months ended
March 31, 1999, the Partnership paid a distribution of approximately $2,500,000
(approximately $2,273,000 to the limited partners or $30.31 per limited
partnership unit) to its partners. The distribution consisted of approximately
$1,811,000 (approximately $1,598,000 to the limited partners or approximately
$21.31 per limited partnership unit) from operations and approximately $689,000
(approximately $675,000 to the limited partners or $9.00 per limited partnership
unit) from the proceeds of the refinancing of Creekside Apartments and The Lodge
Apartments in August 1998. Future cash distributions will depend on the levels
of net cash generated from operations, the availability of cash reserves, and
the timing of debt maturities, refinancings and/or property sales. The
Partnership's distribution policy is reviewed on a quarterly basis. There can be
no assurance, however, that the Partnership will generate sufficient funds from
operations after required capital improvements to permit further distributions
to its partners during the remainder of 2000 or subsequent periods.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In March 1998, several putative unit holders of limited partnership units of the
Partnership commenced an action entitled Rosalie Nuanes, et al. v. Insignia
Financial Group, Inc., et al. in the Superior Court of the State of California
for the County of San Mateo. The plaintiffs named as defendants, among others,
the Partnership, the Managing General Partner and several of their affiliated
partnerships and corporate entities. The action purports to assert claims on
behalf of a class of limited partners and derivatively on behalf of a number of
limited partnerships (including the Partnership) which are named as nominal
defendants, challenging the acquisition by Insignia Financial Group, Inc.
("Insignia") and entities which were, at one time, affiliates of Insignia
("Insignia Affiliates") of interests in certain general partner entities, past
tender offers by Insignia Affiliates to acquire limited partnership units, the
management of partnerships by Insignia Affiliates and the Insignia Merger (see
"Part 1 - Financial Information, Item 1. Financial Statements, Note B - Transfer
of Control"). The plaintiffs seek monetary damages and equitable relief,
including judicial dissolution of the Partnership. On June 25, 1998, the
Managing General Partner filed a motion seeking dismissal of the action. In lieu
of responding to the motion, the plaintiffs have filed an amended complaint. The
Managing General Partner filed demurrers to the amended complaint which were
heard February 1999. Pending the ruling on such demurrers, settlement
negotiations commenced. On November 2, 1999, the parties executed and filed a
Stipulation of Settlement, settling claims, subject to final court approval, on
behalf of the Partnership and all limited partners who own units as of November
3, 1999. Preliminary approval of the settlement was obtained on November 3, 1999
from the Superior Court of the State of California, County of San Mateo, at
which time the Court set a final approval hearing for December 10, 1999. Prior
to the December 10, 1999 hearing the Court received various objections to the
settlement, including a challenge to the Court's preliminary approval based upon
the alleged lack of authority of class plaintiffs' counsel to enter the
settlement. On December 14, 1999, the Managing General Partner and its
affiliates terminated the proposed settlement. Certain plaintiffs have filed a
motion to disqualify some of the plaintiffs' counsel in the action. The Managing
General Partner does not anticipate that costs associated with this case will be
material to the Partnership's overall operations.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit to
this report.
b) Reports on Form 8-K filed during the first quarter of 2000:
None.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the Partnership 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/Patrick J. Foye
Patrick J. Foye
Executive Vice President
By: /s/Martha L. Long
Martha L. Long
Senior Vice President
and Controller
Date:
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from CENTURY
PROPERTIES FUND XVII 2000 First Quarter 10-QSB and is qualified in its entirety
by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000356472
<NAME> CENTURY PROPERTIES FUND XVII
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 2,757
<SECURITIES> 0
<RECEIVABLES> 1,223
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0 <F1>
<PP&E> 70,836
<DEPRECIATION> (36,012)
<TOTAL-ASSETS> 39,707
<CURRENT-LIABILITIES> 0 <F1>
<BONDS> 48,613
0
0
<COMMON> 0
<OTHER-SE> (10,334)
<TOTAL-LIABILITY-AND-EQUITY> 39,707
<SALES> 0
<TOTAL-REVENUES> 3,670
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,191
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 974
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> (102)
<CHANGES> 0
<NET-INCOME> 377
<EPS-BASIC> 4.43 <F2>
<EPS-DILUTED> 0
<FN>
<F1> Registrant has an unclassified balance sheet. <F2> Multiplier is 1.
</FN>
</TABLE>
