<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
[ ] For the quarterly period ended June 30, 1996
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File No. 0-7798
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FIRST WILKOW VENTURE
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(Exact name of registrant as specified in its charter)
ILLINOIS 36-6169280
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State or other jurisdiction of (IRS Employer
incorporation or organization Identification No.)
180 NORTH MICHIGAN AVENUE, CHICAGO, ILLINOIS 60601
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 726-9622
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NOT APPLICABLE
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Former name, former address and former fiscal year,
if changed since last report.
Indicate by check mark whether the registrant (1) has filed all reports to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months and (2) has been subject to such filing requirements for
the past 90 days. YES X NO
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<PAGE> 2
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
JUNE 30,
1996 DECEMBER 31,
(UNAUDITED) 1995
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ASSETS
<S> <C> <C>
REAL ESTATE AND INVESTMENTS IN REAL ESTATE PARTNERSHIPS
Real Estate
Land $ 7,311,455 $ 8,698,675
Buildings and Improvements 45,259,096 56,540,021
Fixtures and Equipment 114,830 138,384
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Total 52,685,381 65,377,080
Less-Accumulated Depreciation 15,848,213 19,726,068
------------ -----------
Net Real Estate 36,837,168 45,651,012
Investments in Real Estate Partnerships 5,273,327 5,130,522
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Total 42,110,495 50,781,534
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LOANS RECEIVABLE 1,223,508 1,452,639
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OTHER ASSETS
Cash 368,933 328,852
Certificates of Deposit 277,998 162,998
Receivable 466,867 551,307
Prepaid Expenses 15,555 1,062
Deposits 661,931 598,870
Deferred Charges 975,544 1,197,568
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Total 2,766,828 2,840,657
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TOTAL ASSETS $ 46,100,831 $55,074,830
============ ===========
LIABILITIES AND PARTNERS' CAPITAL
MORTGAGES AND LOANS PAYABLE
Mortgages Payable $ 31,702,664 $37,124,893
Notes Payable 904,488 3,649,822
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Total 32,607,152 40,774,715
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OTHER LIABILITIES
Accounts Payable and Accrued Expenses 235,135 240,092
Accrued Property Taxes 2,341,111 2,470,265
Deferred State Income Taxes 200,000 200,000
Security Deposits and Prepaid Rent 389,858 555,767
Accrued Interest 53,569 365,078
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Total 3,219,673 3,831,202
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MINORITY INTEREST 1,479,717 1,579,357
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PARTNERS' CAPITAL (178,972 units authorized and issued) 8,794,289 8,889,556
------------ -----------
TOTAL LIABILITIES AND PARTNERS' CAPITAL $ 46,100,831 $55,074,830
============ ===========
</TABLE>
Note: Balance Sheet at 12/31/95 has been taken from the audited financial
statements at that date.
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<PAGE> 3
FIRST WILKOW VENTURE
CONSOLIDATED STATEMENT OF OPERATIONS
THREE AND SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Six Months
Ended June 30, Ended June 30,
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1996 1995 1996 1995
---------- ---------- ------------ -----------
<S> <C> <C> <C> <C>
REVENUES
Rental Income $2,346,416 $2,643,737 $4,578,017 $5,517,386
Hotel Income 0 672,416 0 1,446,067
Interest Income 37,893 42,769 70,777 79,317
Other Income 23,949 30,360 27,564 38,262
---------- ---------- ------------ -----------
2,408,258 3,389,282 4,676,358 7,081,032
---------- ---------- ------------ -----------
PARTNERSHIP INVESTMENTS' INCOME (L0SS)
Share of Net Income (Loss) 80,940 21,499 136,518 32,286
---------- ---------- ------------ -----------
80,940 21,499 136,518 32,286
---------- ---------- ------------ -----------
EXPENSES
Operating Expenses 567,842 1,121,687 1,235,388 2,296,172
Real Estate Taxes 581,276 699,318 1,187,348 1,425,580
Depreciation and Amortization 395,115 617,018 851,515 1,234,118
Interest Expense 670,030 1,101,920 1,402,743 2,179,338
General and Administrative 112,871 309,756 275,689 594,925
---------- ---------- ------------ -----------
2,327,134 3,849,699 4,952,683 7,730,133
---------- ---------- ------------ -----------
INCOME (LOSS) BEFORE
MINORITY INTEREST
AND TAXES 162,064 (438,918) (139,807) (616,815)
MINORITY INTEREST IN
SUBSIDIARIES NET LOSS (42,875) 43,128 44,540 44,450
PROVISION FOR STATE
INCOME TAXES 0 0 0 0
---------- ---------- ------------ -----------
NET INCOME (LOSS) $ 119,189 $ (395,790) $ (95,267) $ (572,365)
========== =========== ============ ===========
EARNINGS PER UNIT
BASED ON 178,972
UNITS OUTSTANDING $ .67 $ (2.21) $ (.53) $(3.20)
====== ======= ======== =======
DISTRIBUTION PER UNIT $ 0.00 $ 0.00 $ 0.00 $ 0.00
====== ======= ======== =======
</TABLE>
NOTE 1: No provision for Federal Income Taxes has been made since First Wilkow
Venture is a partnership and the partners report their pro-rata share
of income or loss individually.
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<PAGE> 4
FIRST WILKOW VENTURE
CONSOLIDATED STATEMENT OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30,
--------------------------------------
1996 1995
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CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net Income (Loss) $ (95,267) $ (572,365)
Non Cash Items Included in Net Income
Loss On Sale of Real Estate 271,076 0
Minority Interest in Subsidiaries
Net Income/Loss (44,540) (44,450)
Depreciation and Amortization 851,515 1,234,118
Amortization of Debt Forgiveness Income (294,690) (36,788)
(Decrease) Increase in Net Payables and
Accrued Expense (346,369) 140,997
Share of Partnership's Net (Income) Loss (136,518) (32,286)
Total Cash Provided (Used) from Operating Activities 205,207 689,226
CASH FLOWS FROM INVESTING ACTIVITIES
Cash Provided from the Sale of Real Estate 8,197,646 0
Partnership Investment Draws 120,817 189,391
(Increase) in Land and Buildings (160,644) (377,566)
Investment in Partnerships (127,105) (2,751)
(Decrease) Increase in Minority Interest (55,100) (49,100)
(Decrease) Increase in Mortgage and Notes Payable (2,745,333) 459,707
(Increase) Decrease in Mortgage and Notes Receivable 229,131 (58,862)
Investment in Deferred Charges (123,724) (106,161)
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Total Cash Provided (Used) from Investing Activities 5,335,688 54,658
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CASH FLOWS FROM FINANCING ACTIVITIES
Mortgage Principal Payments Upon Sale of Real Estate (5,185,580) 0
Mortgage Principal Payments (200,234) (200,154)
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Total Cash Provided (Used) from Financing Activities (5,385,814) (200,154)
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INCREASE (DECREASE) IN CASH AND EQUIVALENTS 155,081 543,730
CASH AND EQUIVALENTS - BEGINNING OF PERIOD 491,850 529,136
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CASH AND EQUIVALENTS - END OF PERIOD $ 646,931 $1,072,866
============ ==========
</TABLE>
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<PAGE> 5
FIRST WILKOW VENTURE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996
Accounting Policies
The financial statements have been prepared in accordance with
generally accepted accounting principles. Under this method of accounting,
revenues are recorded when earned and expenses are recorded when incurred.
Reference is made to the Partnership's annual report for the year
ended December 31, 1995, for a description of other accounting policies and
additional details for the Partnership's financial condition, results of
operations, changes in partners' capital and statement of cash flows for the
year then ended. The details provided in the notes thereto have not changed as
a result of normal transactions in the interim.
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<PAGE> 6
FIRST WILKOW VENTURE
FORM 10-Q
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
JUNE 30, 1996
Overview
Reference is made to partnership's annual report for the year ended
December 31, 1995 for a discussion of the partnership's business.
On January 18, 1996, Freeport Office Partners Limited sold the 8505
Freeport Office Building for $8,503,150, resulting in full repayment of the
$5,185,580 first mortgage and the $2,000,000 subordinated debenture. The
Registrant received $615,983 as repayment of previous operating deficit loans.
A provision for loss in book value of $1,400,000, equal to the estimated loss
to the Registrant on the disposition of the property, was recognized in 1995.
An additional loss of $271,076 is included in 1996.
On July 1, 1996, the Registrant invested an additional $98,100 in M &
J/Grove Limited Partnership in connection with the purchase of 981 Call Units.
The Call Unit holders are entitled to a cumulative cash flow priority of 12%
per annum and will receive their proportionate share of the first $367,500 of
available cash flows upon sale or refinancing. Any proceeds remaining
thereafter, will be split 25% to the holders of the Call Units and 75% to the
General and Class A Limited Partners, until their original investment has been
recovered in full. The proceeds of the M & J/Grove Limited Partnership capital
call were primarily used for a mortgage debt restructuring of the Grove Office
Park. The original $8,000,000 mortgage was paid off at a discounted amount of
$5,600,000 and replaced with a new first mortgage loan in the amount of
$5,500,000, bearing interest at the fixed rate of 8.55% per annum for five
years. A Limited Guaranty covering 28.41%, or $1,562,500 of the mortgage loan
was guaranteed by third parties on behalf of M & J/Grove Limited Partnership.
The Registrant guaranteed $520,833, an amount which approximates 28.41% of its
ownership interest in M & J/Grove Limited Partnership, exclusive of
subordinated equity interests which have no value.
For the six months ended June 30, 1996, revenues and expenses were
$4,676,358 and $4,952,683, respectively, compared to $7,081,032 and $7,730,133
for the six months ended June 30, 1995. The variances are primarily due to the
disposition of the 8505 Freeport Office Building and Tango Bay Suites. The
decreases in revenues and expenses from the comparative period of 1995, which
are related to the 8505 Freeport Office Building, were approximately $825,000
and $949,680, respectively. The decreases in revenues and expenses from the
comparative period of 1995, which are related to Tango Bay Suites, were
approximately $1,446,067 and $1,714,911, respectively.
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<PAGE> 7
REMARKS
In the opinion of the General Partners, the financial information of
this report includes all adjustments, including estimated provisions for items
normally settled at year end, and is a fair statement of the results for the
interim ended June 30, 1996 and 1995.
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.
FIRST WILKOW VENTURE
By: Marc R. Wilkow
--------------------------------------
Marc R. Wilkow, General Partner and
President of M & J Wilkow, Ltd., its
Managing Agent
DATED: August 9, 1996
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, in the capacities indicated, on August 9, 1996.
Clifton J. Wilkow
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Clifton J. Wilkow, General Partner and
Executive Vice President of
M & J Wilkow, Ltd.
Thomas Harrigan
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Thomas Harrigan, Vice President of
M & J Wilkow, Ltd.
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<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 646,931
<SECURITIES> 0
<RECEIVABLES> 1,223,508
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,791,284
<PP&E> 52,685,381
<DEPRECIATION> 15,848,213
<TOTAL-ASSETS> 46,100,831
<CURRENT-LIABILITIES> 2,576,246
<BONDS> 32,607,152
<COMMON> 0
0
0
<OTHER-SE> 8,794,289
<TOTAL-LIABILITY-AND-EQUITY> 46,100,831
<SALES> 4,578,017
<TOTAL-REVENUES> 4,676,358
<CGS> 0
<TOTAL-COSTS> 1,235,388
<OTHER-EXPENSES> 1,463,037
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,402,743
<INCOME-PRETAX> (95,267)
<INCOME-TAX> 0
<INCOME-CONTINUING> (95,267)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (95,267)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
