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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
- --- ACT OF 1934 (FEE REQUIRED)
For the year ended December 31, 1996
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from to .
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Commission File Number 0-7798
FIRST WILKOW VENTURE, A LIMITED PARTNERSHIP
(Exact Name of Registrant as Specified in Its Charter)
Illinois 36-6169280
----------------------- ------------------------------------
(State of Organization) (I.R.S. Employer Identification No.)
180 North Michigan Avenue, Chicago, Illinois 60601
(Address of Principal Executive Offices)
Registrant's Telephone Number, including area code: (312) 726-9622
Securities Registered Pursuant to Section 12(h) of the Act: None
Securities Registered Pursuant to Section 12(g) of the Act:
Units of Partnership Interest, Exchange Value $86
(Title of Class)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
The Registrant's units of limited partnership interest are not traded in a
regulated market. The restrictions on the sale, transfer, assignment or pledge
of partnership units are described in the Agreement of Limited Partnership of
the Registrant.
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PART I
ITEM 1 - BUSINESS
ORGANIZATION
First Wilkow Venture (the "Registrant") is a limited partnership composed
of 482 limited partners and two general partners who are Marc R. Wilkow and
Clifton J. Wilkow.
Marc R. Wilkow and Clifton J. Wilkow have been engaged in real estate
activities for over 20 years as officers of M&J Wilkow, Ltd., a closely held
corporation, and certain affiliated companies which have been involved (through
their predecessors in interest) in the acquisition, sale, development, leasing,
operation, brokerage and management of real estate since 1939.
Marc R. Wilkow is also president and sole director and stockholder of the
law firm of Wilkow & Wilkow, P.C., which is the general counsel for the
Registrant.
All of the above entities, including the Registrant, have their principal
offices at 180 North Michigan Avenue in Chicago, Illinois 60601. M & J Wilkow,
Ltd. and its affiliated companies have a combined administrative staff of 35
and ancillary clerical, office and maintenance staff of approximately 105.
The Registrant employs approximately three people who are management and
maintenance personnel in connection with the operation of certain wholly owned
properties.
DESCRIPTION OF BUSINESS
The Registrant owns outright or otherwise has participatory ownership
interests in real property for investment purposes. At December 31, 1996,
there are 29 properties in which the Registrant has interests, divided among
residential, commercial and industrial buildings, shopping centers, and
undeveloped land. Twenty-four of the properties are neither owned nor leased
by the Registrant directly, but are owned by the Registrant in participation
with other partnerships, some of which the Registrant has contracted for a
priority position with respect to the receipt of cash distributions. These
properties break down into the following categories: three are residential
projects; thirteen are shopping centers; six are office buildings; one is a
real estate investment trust; and one is undeveloped land.
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The remaining five properties are owned and operated by the Registrant.
Two are office buildings, and three are shopping centers.
CHANGES IN PROPERTIES
During the calendar year ended December 31, 1996, certain of the property
investments held by the Registrant underwent the changes described below:
(a) Purchases:
None
(b) Sales:
On January 18, 1996, the Registrant sold the 8505 Freeport Office Building
for $8,503,150.
On December 24, 1996, the Registrant sold 6.1 acres of unimproved
land in Fort Myers, Florida, for $1,329,830, resulting in a net gain of
$150,200.
(c) Proposed Purchases and Sales:
There were no proposed purchases and sales during the year ended
December 31, 1996.
(d) Declined Purchases:
There were no declined purchases during the year ended December 31,
1996.
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COMPETITIVE POSITION
In general, none of the Registrant's properties are immune from the
pressures of competition. There are competing properties serving the
geographical areas in which each of the Registrant's properties are located.
The amount of revenue generated annually from these properties is very much
dependent upon national economic conditions generally and upon local economic
conditions specifically, among the latter of which are the availability and
demand for office space, commercial space and apartment units, as the case may
be. In general, the Registrant may incur substantial costs, from time to time,
at its commercial properties, in connection with either the renewal of existing
leases or the marketing of vacant space to new tenants. These costs may
include the costs of improving and upgrading space to be competitive, as well
as the payment of brokerage commissions.
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ITEM 2 - PROPERTIES
The Registrant has an ownership interest in the following properties as of
December 31, 1996:
PROPERTIES INVOLVING NET LEASES
23 EAST FLAGLER, MIAMI, FLORIDA
The property is a three-story commercial building located in downtown
Miami, Florida, which was net leased to McCrory Corporation for a term of 25
years, with four five-year options. The property is unencumbered by any
mortgage debt. The scheduled net rent through January 31, 2000, is $61,425 per
year. Prior to May 2, 1996, McCrory Corporation filed a petition for relief
under Chapter 11 of the United States Bankruptcy Code. In response to a motion
filed on behalf of the Registrant to either (i) compel McCrory Corporation to
comply with its obligations under the lease or (ii) reject the lease, a
settlement was reached which, as subsequently amended, would allow McCrory
Corporation to reject the lease and yet retain possession through April 30,
1997, to complete an inventory liquidation process. The Registrant has
retained CB Commercial to assist the Registrant in connection with its efforts
to either lease or sell the property.
47TH & HALSTED, CHICAGO, ILLINOIS
This property is a 148,469 square foot commercial complex acquired in 1968
at a cost of $1,994,842. The property was leased on a 25-year net lease,
expiring on April 30, 1993, to Community Discount Centers, Inc. In addition,
the tenant has three five-year options at a rental during each option of
$205,264 per annum. The first and second five-year options have been
exercised. On January 16, 1981, the lease was assigned to the Zayre Corp., to
be operated as a Zayre Department Store. As a result of the acquisition of
Zayre Corp. by Ames Department Stores, Inc., the latter succeeded to the
tenant's position under the lease. On April 25, 1990, Ames filed a petition
for relief under the United States Bankruptcy Code and on December 21, 1990,
elected to accept the lease. Subsequently, on January 15, 1991, the Zayre
Corp. assigned its interest in the lease to Fairplay, Inc. The tenant is
directly responsible for all taxes and common area maintenance expenses.
The property is encumbered by a mortgage securing two promissory notes in
the original principal amounts of $1,800,000 and $600,000, maturing December
31, 2003, and bearing interest at the respective rates of 7% and 4.96% per
annum.
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PROPERTIES INVOLVING PARTICIPATIONS
FIRST RON VENTURE (APOLLO APARTMENTS)
The Apollo Apartments consist of 256 units (128 one-bedroom and 128
two-bedroom) built on 10 acres of land on Britton Road in Oklahoma City,
Oklahoma. The project is owned by Apollo Associates, a limited partnership of
which First Ron Venture, a joint venture, owns 38%. The Registrant has a
one-third interest in First Ron Venture. The Registrant paid $260,000 for its
interest in May 1978. The limited partners are entitled to a cash flow
priority of 9% per annum. The Registrant also acquired 10 limited partnership
units (3.831% interest) in First Apollo Associates, which has a one-third
interest in First Ron Venture.
The property was acquired with a $2,150,000 first mortgage bearing
interest at 8-3/4% per annum. In December 1987, the mortgage was purchased by
McKinley Associates, an affiliate of the general partner of Apollo Associates.
The old mortgage was replaced with a $2,135,000 first mortgage bearing interest
at 9.9% per annum, but payable on a current basis only to the extent of cash
flow. Any unpaid interest accrues and compounds at 13% per annum. In addition
to minimum interest, the lender is entitled to additional interest based upon
generation of cash flow and net sale and/or refinancing proceeds in excess of
certain specified levels.
HAWDEL LIMITED PARTNERSHIP I AND III (2221 CAMDEN COURT OFFICE BUILDING)
The Registrant has invested a total of $1,320,000 representing an 18.03%
interest in Hawdel I and III Limited Partnerships, which own the 2221 Camden
Court Office Building located in Oak Brook, Illinois. The property contains
100,796 net rentable square feet of prime office space.
At August 1, 1994, the project was refinanced with a restructured first
mortgage in the reduced principal amount of $6,740,000 bearing interest at
8.875% per annum. Terms included the monthly payment of principal and interest
totaling $55,986 and a balloon payment of $6,040,052 on July 1, 2001. In
conjunction with the refinancing, the Registrant made an unsecured loan for
$314,516 representing the Registrant's share of the $1,625,000 in partner loans
needed to pay down the mortgage principal balance in order to obtain the
benefits of the restructured loan. The note terms included interest at 7.52%
and a maturity date of July 18, 2004. The outstanding balance at December 31,
1996, was $295,161.
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On January 16, 1997, the property was sold for $11,750,000, resulting in
full payment of the first mortgage and the partner loans. In addition, the
Registrant received an equity distribution of $690,360, resulting in an
estimated loss on disposition of $154,000. A provision for loss in book value
equal to the estimate is recognized in 1996.
M&J/LARGO LIMITED PARTNERSHIP (SUN POINTE PLACE APARTMENTS)
The Registrant invested a total of $694,227 to acquire 756 limited
partnership units (a 25.1% interest) in M&J/Largo Limited Partnership.
M&J/Largo Limited Partnership owned a 91.12% of Sun Pointe Place Limited
Partnership, which developed and owned a 140 furnished one-bedroom unit
apartment complex.
The project, located on Bay Drive in Largo, Florida, was sold on February
12, 1997, for $2,600,000. A portion of the sale proceeds were used to pay the
balance of a $200,000 mortgage obtained on October 13, 1994. The remainder of
the net sale proceeds were paid to M&J/Largo Limited Partnership when it
exercised its option to withdraw as a limited partner of Sun Pointe Place
Limited Partnership, simultaneous with the sale of the property. The
Registrant anticipates receiving a final equity distribution from M&J/Largo
Limited Partnership of approximately $575,000, resulting in an estimated loss
on disposition of $119,000. A provision for loss in book value equal to the
estimate is recognized in 1996.
DUKE REALTY LIMITED PARTNERSHIP
On December 2, 1994, the Registrant's interests in three partnerships were
redeemed for 50,251 partnership units in Duke Realty Limited Partnership, the
operating partnership ("UPREIT") of more than 100 properties. The UPREIT's
sole general partner is Duke Realty Investments, Inc., a real estate investment
trust ("REIT") listed on the New York Stock Exchange. The partnership units in
the UPREIT will, eventually, be convertible, on a one-for-one basis, to shares
of common stock to the REIT. As part of the issuance of partnership units in
the UPREIT, the REIT also completed an offering to the public of 13,167,500
additional shares of common stock, which generated proceeds of approximately
$312.7 million.
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ROSEMONT 28 LIMITED PARTNERSHIP (UNIMPROVED LAND IN ORLANDO, FLORIDA)
In June 1985, the Registrant invested $275,000 to obtain a 22.92% interest
in Rosemont 28 Limited Partnership, which owns 11.25 acres of unimproved land
held for development in Orlando, Florida. Additional investments of $460,910
have been funded to cover the Registrant's pro rata share of the costs of
carrying the property and paying off the mortgage loan in full. Net cash flow
and residual proceeds are required to be distributed in accordance with the
partners' respective interests.
XXI OFFICE PLAZA ASSOCIATES (CENTURY XXI OFFICE BUILDING)
Century XXI Office Plaza is an office complex built in 1971-1973, which is
located in Germantown, Maryland, a suburb of Washington, D.C. The property
consists of three separate office buildings and a connecting five-level parking
deck, on a site in excess of six acres. The office buildings have a total
leasable area of 179,385 square feet. The property has two 30-year mortgages
from Teachers Insurance and Annuity Association of America in the combined
original principal amount of $5,500,000. The mortgagee, in addition to the
regular monthly payments due under the mortgage, participates in 25% of the
gross income over $1,160,000. The Registrant owns a 13.907% limited
partnership interest in XXI Office Plaza Associates, the partnership that was
formed to acquire the subject property. In addition, the Registrant owns 50
units (an 8.28% interest) in 21st M&J Venture, which has a 16% interest in XXI
Office Plaza Associates and 35 units (a 7.59% interest) in Orhow Associates,
which has a 12.2% interest in XXI Office Plaza Associates.
During September 1994, the Registrant made an unsecured loan for $27,814
representing the Registrant's share of the $200,000 in partner loans needed for
capital improvements. The notes bear interest at prime and will be due
December 31, 1999.
On February 1, 1996, a tenant occupying approximately 40% of the leasable
area vacated the office building. As of December 31, 1996, XXI Office Plaza
Associates had leased 45% of the space vacated by the tenant.
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M&J/GROVE LIMITED PARTNERSHIP (THE GROVE OFFICE PARK)
The Grove Office Park consists of three two-story office buildings lying
on six acres of land located in Wheaton, Illinois. The complex contains
105,454 square feet of prime office space with parking available for 343 cars.
Through December 31, 1995, the Registrant had invested a total of $931,000
to acquire 981 limited partnership units (a 23.08% interest) in M&J/Grove
Limited Partnership ("M&J/Grove"). In addition, the Registrant owns seven units
(a 3.02% interest) in Wilkow/Grove Partners L.P., which has a 5.87% interest in
M&J/Grove. As a Class A Limited Partner, the Registrant is entitled to an 8%
cumulative priority claim.
On July 1, 1996, the Registrant invested an additional $98,100 in
M&J/Grove in connection with the purchase of 981 Call Units, increasing its
interest in the investment to 28.03%. The Call Unit holders are entitled to a
cumulative cash flow priority of 12% per annum. Upon sale or refinancing, the
Call Unit holders will receive the first $367,500 of available proceeds pro
rata. 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. The
proceeds of the M&J/Grove 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 made by third parties on behalf of
M&J/Grove. The Registrant guaranteed $520,833, an amount which approximates
28.41% of its ownership interest in M&J/Grove, exclusive of subordinated equity
interests which have no value. The property is also encumbered by unsecured
debentures of $1,000,000, which mature on May 1, 2001, and bear interest at 9%
per annum, payable quarterly.
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L-C OFFICE PARTNERSHIP IV (LAKE COOK OFFICE CENTRE - BUILDING IV)
The Registrant holds an investment of 2,434 limited partnership units (a
74.69% interest) in L-C Office Partnership IV, which has a 94.0% interest in
Lake Cook Office Development - Building Four Limited Partnership ("Lake Cook
Development"), the owner of a 58.50% undivided interest in Dover Farms
Apartments, a 300 unfurnished one- and two-bedroom apartment complex located on
a hilly, landscaped setting in North Royalton, Ohio. Each apartment has a
washer and dryer, as well as either a patio or terrace. Many apartments also
include fireplaces, dens and lofts. In terms of common areas, the complex
includes a clubhouse, pool and deck area, Jacuzzi and racquetball court.
In addition, the Registrant owns limited partnership interests in the
partnerships scheduled below whose sole asset is represented by an interest in
Lake Cook Development. The following is a recap of these interests:
<TABLE>
<CAPTION>
Owned by Ownership in
Registrant Lake Cook Development
-------------------- ------------------------
Partnership # of Units% Interest % Interest
- ------------------------------------- ----------------------- -----------
<S> <C> <C> <C>
544 Arizona Associates 61 13.034% .383%
Fifth Arizona Associates 3 .667 .154
Fifth Orlando Associates 83 11.690 .242
First Orlando Associates 50 10.000 .156
Monterey Village Associates 45 5.625 .596
Seventh M&J Associates 35 8.274 .225
TOP Investors Limited Partnership 95 95.000 .686
</TABLE>
222 FEE ASSOCIATES
The Registrant owns a 3.18% interest (58 units) in 222 Fee Associates,
which holds multiple partnership and debenture investments.
5601 N. SHERIDAN ASSOCIATES
The Registrant owns a 13.04% interest (36 units) in 5601 N. Sheridan
Associates, which holds partnership interests in XXI Office Plaza Associates
and M&J/Crossroads Limited Partnership and an investment in Tango Bay Suites
debentures.
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FIRST CANDLEWICK ASSOCIATES
The Registrant owns an 11.96% interest (55 units) in First Candlewick
Associates, which holds multiple partnership and debenture investments.
SECOND WILKOW VENTURE
The Registrant owns a 4.89% interest (197 units) in Second Wilkow Venture,
which holds multiple partnership and debenture investments.
209 WEST JACKSON
On August 24, 1995, the Registrant acquired a 59.44% undivided interest in
209 West Jackson, a 144,608 square foot office building located in downtown
Chicago, in exchange for its 57.67% undivided interest in Tango Bay Suites. As
part of this transaction, Tango Bay Suites remains liable to the Registrant for
loans advanced to fund operating deficits. The 209 West Jackson building is
subject to a first mortgage of $10,000,000 and an additional $5,661,000 note
secured by the first mortgage, both bearing interest only at General Electric
Capital Corporation's commercial paper rate plus 3.25% per annum. The
Registrant posted a letter of credit for $150,000 as a part of this
transaction. Due to the character of the investment, the Registrant is using
the equity method to account for its interest in the 209 West Jackson building.
PROPERTIES INVOLVING PROMISSORY NOTES
TANGO BAY SUITES, ORLANDO, FLORIDA
On August 24, 1995, the Registrant exchanged its 57.67% undivided interest
in Tango Bay Suites, a 158-unit all-suites hotel located on Westwood Drive in
Orlando, Florida, for a 59.44% undivided interest in the 209 West Jackson
office building located in Chicago, Illinois.
At December 31, 1996, the Registrant has a loan receivable in the
principal amount of $731,124 from Tango Bay Suites.
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PROPERTIES OWNED AND OPERATED BY REGISTRANT OR CONSOLIDATED SUBSIDIARIES
180 NORTH MICHIGAN, CHICAGO, ILLINOIS
The leasehold estate to this commercial office building on Chicago's
prestigious Michigan Avenue was acquired in 1968 at a price of $6,550,000, of
which $5,250,000 comprised mortgage financing. The property was completely
renovated in 1967 at a cost in excess of $3,000,000 which included changeover
to fully automatic passenger elevators, redesigned interiors and a marble
exterior facade. In 1973, the Registrant acquired the fee simple estate of
18,649 square feet of land for $1,600,000. In November 1986, the leasehold and
fee simple estates were merged and the property was refinanced with an
$8,700,000 first mortgage loan. This loan, which was scheduled to mature on
November 1, 1996, was restructured during September 1994. In conjunction with
the restructuring, the mortgage holder agreed to a $500,000 forgiveness of debt
in return for a principal payment of $500,000 for a total principal reduction
of $1,000,000. The debt forgiveness income of $500,000 is being amortized over
the remaining term of the loan using the effective interest method. The new
mortgage loan with a principal balance of $6,733,888 bears interest at 8.50%
per annum and is due on September 1, 2001.
M&J/FREEPORT LIMITED PARTNERSHIP (8505 FREEPORT OFFICE BUILDING)
The Registrant invested a total of $5,139,000 to obtain a 68.85% limited
partnership interest (5,164 units) in M&J/Freeport Limited Partnership, which
acquired a 94.05% interest in Freeport Office Partners Limited, a limited
partnership, which acquired an office building located at 8505 Freeport in
Dallas, Texas.
On January 18, 1996, the property was sold for $8,503,150, resulting in
full repayment of the first mortgage and the subordinated debentures and return
of approximately $600,000 in operating deficit loans previously received from
the Registrant. 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 $12,800 is included in 1996.
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M&J/RETAIL LIMITED PARTNERSHIP (TEN STRIP SHOPPING CENTERS)
The Registrant originally invested a total of $3,995,000 to obtain a
56.97% interest in M&J/Retail Limited Partnership ("M&J/Retail"). The
Registrant also owns three limited partnership units (.75% interest) in
Wilkow/Retail Partners L.P., which has a 5.63% interest in M&J/Retail. On July
1, 1995, the Registrant sold 300 Class A units of M&J/Retail for a total of
$314,800, resulting in a gain of $137,245 and reducing its ownership in this
partnership from 56.97% to 52.75%.
On July 28, 1995, M&J/Retail acquired a majority interest in Northlake
Tower Limited Partnership ("Tower") by contributing $1,112,677 of initial
capital with, potentially, an additional funding requirement of $179,162 to
cover unanticipated contingencies. Additional contributions of $74,951 have
increased the total capital investment to $1,187,628. Tower owns a 17.08%
share of BSRT/M&J Northlake Limited Partnership ("BSRT/M&J"), which purchased a
leasehold interest in the Northlake Tower Festival Shopping Center for
$16,989,000 on July 28, 1995. The purchase of this property was made subject
to a $10,350,000 first mortgage loan bearing interest only at the fixed rate of
8.5% per annum for ten years. The shopping center, consisting of 303,956
square feet of improvements and five outlots, is located in Atlanta, Georgia.
In a related transaction, M&J/Retail loaned $83,212 to Northlake Tower
Corporation ("Tower Corporation"), a General Partner of both Tower and
BSRT/M&J. The loan is secured by Tower Corporation's partnership interests in
Tower and BSRT/M&J, and interest thereon will be paid from Tower Corporation's
share of net cash flow. Tower Corporation was organized to act as general
partner, as aforesaid, in order to insulate M&J/Retail from personal liability.
On October 27, 1995, M&J/Retail invested a total of $297,000 to acquire a
46.41% interest in M&J/Crossroads Limited Partnership ("M&J/Crossroads").
M&J/Crossroads purchased a 330,505 square foot shopping center known as
Crossroads of Roseville for $19,250,000 on October 27, 1995, subject to a
$19,550,000 first mortgage loan (which included a reserve for anticipated
capital improvements). Until the completion of the expansion of several
tenants and certain other economic parameters are met, the Crossroads of
Roseville property will also serve as collateral for another mortgage loan,
which is partially secured by a first mortgage lien against the 209 West
Jackson building. The center is located on 19.9 acres of land in Roseville,
Minnesota.
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A summary of the properties in which M&J/Retail owns a majority interest is as
follows:
<TABLE>
<CAPTION>
Net Area
Rentable Land First Interest Mortgage
Property (Square Feet) (Acres) Mortgage Rate Maturity
- -------------------- ------------------ ------------------ ------------------ ------------------ --------
<S> <C> <C> <C> <C> <C>
Harlem & North 22,775 1.00 $2,362,500 7.85% 01/01/99
Diversey & Sheffield 16,500 .75 2,000,000 7.875% 04/01/99
Oak Lawn Promenade 32,576 1.95 3,175,000 8.25% 04/01/98
Oak Lawn Square 9,746 .67 890,000 8.25% 04/01/98
Broadway-Berwyn 33,385 1.44 2,750,000 8.20% 07/31/00
Irving-Kimball 14,062 .55 1,450,000 8.875% 05/01/98
Melrose-Kimball 9,653 .36 1,250,000 8.875% 05/01/98
Archer-Central 29,426 1.49 2,200,000 8.875% 05/01/98
Evergreen Commons 8,981 .41 530,000 8.25% 05/01/99
111th & Western 9,620 .36 618,000 8.25% 05/01/99
------------------ ------------------ ------------------
186,724 8.98 $17,225,500
================== ================== ==================
</TABLE>
The Registrant is entitled to a cumulative cash flow priority in the
amount of 9% per annum on its investment.
M&J/SHERIDAN LIMITED PARTNERSHIP (HIGHLAND PARK PROFESSIONAL BUILDING)
In April 1988, the Registrant invested $2,500,000 to obtain an 89.286%
interest in M&J/Sheridan Limited Partnership, which owns a 22,523 square
foot office building located at 1893 Sheridan Road in Highland Park,
Illinois. The property is a three-story building situated on a quarter acre
of land. On October 10, 1990, the property was encumbered with a $1,600,000
first mortgage loan bearing interest at the rate of 10.25% per annum which
matured on October 1, 1996. On September 30, 1996, M&J/Sheridan Limited
Partnership paid off the existing mortgage loan and refinanced the property.
The term of the new loan, with a principal amount of $1,425,000, is five
years. Debt service reflects an interest rate of 8.88% per annum and
amortization based on 20 years.
NAPERVILLE OFFICE COURT, NAPERVILLE, ILLINOIS
In August 1986, pursuant to the terms of an exchange agreement, the
Registrant acquired the Naperville Office Court for $4,830,000.
On April 6, 1988, the Registrant procured a $3,000,000 first mortgage
loan on the property which bears interest at the rate of 9.75% per annum and
is due in May 1998. During 1993, the Registrant exercised an option to
adjust the interest rate to 8.875%.
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Naperville Office Court is located at 1801 - 1813 Mill Street in
Naperville, Illinois. Consisting of four single-story office buildings, the
property rests on 5.5 acres, contains 66,405 net rentable square feet and
provides parking space for 300 automobiles.
UNDEVELOPED LAND (FORT MYERS, FLORIDA)
On December 24, 1996, the Registrant sold the 6.11 acres of unimproved
land it owned in Fort Myers, Florida, for $1,329,830, resulting in a net
gain of $150,200.
WATERFALL PLAZA, ORLAND PARK, ILLINOIS
In March 1993, the Registrant acquired 100% ownership in the Waterfall
Plaza in exchange for its interest in the 2101 Commercial Office Building.
The project is subject to a $2,100,000 first mortgage loan with
interest at the General Electric Capital Corporation commercial paper rate
plus 4.50%.
Waterfall Plaza is a retail center located in Orland Park, Illinois.
Consisting of one single-story building, the property rests on 1.5 acres and
contains 21,893 net rentable square feet.
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ITEM 3 - LEGAL PROCEEDINGS
Legal proceedings pending involve either suits which have been
instituted by the Registrant or its agents against tenants who are in
default of their lease obligations or the defense of alleged personal injury
claims incidental to the operation of properties accessible to the general
public. All of the personal injury claims are covered by insurance. It is
not anticipated that the outcome of any of these proceedings, if unfavorable
to the Registrant, will have a materially adverse impact on the Registrant.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the calendar year ended December 31, 1996, there were no matters
submitted to the partners of the Registrant.
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PART II
ITEM 5 - MARKET FOR REGISTRANT'S CAPITAL UNITS AND RELATED SECURITY HOLDER
MATTERS
The number of holders of record of equity securities of the Registrant
as of December 31, 1996, was approximately:
Title of Class Number of Record Holders
--------------------------------------- ------------------------
Unit of Limited Partnership Interest 482
The Registrant's units of limited partnership interest are not actively
traded in a regulated market. The restrictions on the sale, transfer,
assignment or pledge of partnership units are described in the Agreement of
Limited Partnership of the Registrant as amended.
17
<PAGE> 18
ITEM 6 - SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
December 31,
1996 1995 1994 1993
------ ------- ------- --------
<S> <C> <C> <C> <C>
OPERATING RESULTS
(IN THOUSANDS)
Total Revenue $9,874 $12,135 $14,445 $14,891
Net Loss* $( 99) $(2,327) $(3,119) $(3,116)
PARTNERSHIP UNIT DATA
(PER PARTNERSHIP UNIT)
Net Loss:
General Partner* $( .55) $( 13.00) $(17.43) $(15.10)
Limited Partner* ( .55) ( 13.00) (17.43) (15.10)
Cash Distributions Paid:
General Partner $ - $ - $ - $ 2.00
Limited Partner - - - 2.00
</TABLE>
* Includes gain (loss) on sale of real estate properties
<TABLE>
<CAPTION>
December 31,
1996 1995 1994 1993
------- ------- ------- -------
<S> <C> <C> <C> <C>
FINANCIAL POSITION DATA
Total Assets (In thousands) $45,595 $55,075 $64,373 $76,983
Net Book Value Per Unit $49.12 $49.67 $62.67 $80.10
</TABLE>
18
<PAGE> 19
ITEM 7 - MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS - 1996 COMPARED TO 1995
For the year ended December 31, 1996, income from partnerships was $136,843
compared to $382,248 for the comparative period of 1995. The decrease in 1996
is primarily due to estimated losses on the disposition of Hawdel Limited
Partnership and M&J/Largo Limited Partnership.
For the year ended December 31, 1996, the Registrant loaned to investment
partnerships in which it has substantial equity interests the following
amounts:
<TABLE>
<CAPTION>
Advances Collections Write-offs Total Loan
Year Ended Year Ended Year Ended Balance at
December 31, December 31, December 31, December 31,
1996 1996 1996 1996
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Second Wilkow Venture $- $200,000 $- $-
First Candlewick Associates - 45,000 - -
222 Fee Associates - 30,000 - -
5601 N. Sheridan Associates - 22,000 - -
L-C Office Partnership IV 502 - - 15,091
Lake Cook Office Development 71,872 - - 71,872
Crossroads of Roseville
Corporation - 6,000 - -
Northlake Tower Corporation 2,261 - - 83,212
</TABLE>
The Northlake Tower Corporation unsecured promissory note bears interest at
prime and is due on demand. The Lake Cook notes bear interest at prime plus 2%
and are due on demand.
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 approximately $600,000 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 $12,800 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,
increasing its interest in the investment to 28.03%. The Call Unit holders are
entitled to a cumulative cash flow priority of 12% per annum. Upon sale or
refinancing, the Call Unit holders will receive the first $367,500 of available
proceeds. 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. 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 made 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.
19
<PAGE> 20
On September 30, 1996, M&J/Sheridan Limited Partnership refinanced the Highland
Park Professional Center located at 1893 Sheridan Road in Highland Park,
Illinois. The term of the new loan, with a principal amount of $1,425,000, is
five years. Debt service reflects an interest rate of 8.88% per annum and
amortization based on 20 years.
On December 24, 1996, the Registrant sold 6.1 acres of land at Metro
Parkway/Colonial Boulevard in Fort Myers, Florida, for gross proceeds of
$1,329,830 and a gain of $150,200.
20
<PAGE> 21
RESULTS OF OPERATIONS - 1995 COMPARED TO 1994
For the year ended December 31, 1995, income from partnerships was $382,248
compared to loss of $1,099,073 for the comparative period of 1994. The
increase is primarily due to gains on the partial disposition of M&J/Retail
Limited Partnership interest and the entire disposition of the First MW
Associates, S & S Venture and Second Chase Venture interests. The prior year
loss was due primarily to the loss on disposition of the North LaSalle Street
Limited Partnership interest.
For the year ended December 31, 1995, the Registrant loaned to investment
partnerships in which it has substantial equity interests and to a property in
which it held a co-tenancy ownership interest through June 30, 1995, the
following amounts:
<TABLE>
<CAPTION>
Advances Collections Write-offs Total Loan
Year Ended Year Ended Year Ended Balance at
December 31, December 31, December 31, December 31,
1995 1995 1995 1995
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Hawdel Limited Partnership
and Hawdel Limited
Partnership III $ - $19,355 $ - $295,161
Tango Bay Suites 300,000 - 257,453 731,124
Second Wilkow Venture 200,000 - - 200,000
First Candlewick Associates 45,000 - - 45,000
222 Fee Associates 30,000 - - 30,000
5601 N. Sheridan Associates 22,000 - - 22,000
Crossroads of Roseville
Corporation 6,000 - - 6,000
Northlake Tower Corporation 80,951 - - 80,951
</TABLE>
The Second Wilkow Venture, First Candlewick Associates, 222 Fee Associates,
5601 N. Sheridan Associates and Crossroads of Roseville Corporation unsecured
promissory notes bear interest at prime and are due on demand. These loans
were repaid during March 1996.
On January 20, 1995, the Registrant entered into a revolving credit facility
with the LaSalle National Bank. The facility, due September 1, 1996, pays
interest at the prime rate per annum. Maximum borrowing under the facility
agreement is the lesser of $800,000 or 80% of the fair market value of the
Registrant's investment in Duke Realty Limited Partnership. As of December 31,
1995, the amount outstanding under this facility was $580,000, consisting of
cash draws of $350,000 and letters of credit of $230,000. Borrowings under the
facility are secured by the partnership units of Duke Realty Limited
Partnership owned by the Registrant.
S & S Venture acquired a property in Des Plaines, Illinois, on July 26, 1975,
which was sold on March 15, 1995. The Registrant received proceeds of $100,008
related to the sale of the property and has included a $34,290 gain on the
disposition of its 6.667% partnership in S & S Venture.
On July 1, 1995, the Registrant sold 300 Class A units of M&J/Retail Limited
Partnership ("M&J/Retail") for a total of $314,800, resulting in a gain of
$137,245 and reducing its ownership in this partnership from 56.97% to 52.75%.
21
<PAGE> 22
On July 28, 1995, Freeport Office Partners Limited extended the $5,200,000 loan
held by Confederation Life for five years effective August 1, 1995. The
Registrant sold the Freeport Office building in January of 1996. 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 is recognized in 1995.
On July 28, 1995, M&J/Retail, owned 52.75% by the Registrant, acquired a
majority interest in Northlake Tower Limited Partnership ("Tower"),
contributing $1,124,109 of a total initial capital requirement of $1,251,000,
with, potentially, an additional capital requirement of $124,000 to cover
unanticipated contingencies. Additional contributions of $25,532 made through
December 31, 1995, increased the total capital investment to $1,149,641. Tower
owns a 17.08% share of BSRT/M&J Northlake Limited Partnership ("BSRT/M&J"),
which purchased a leasehold interest in the Northlake Tower Festival Shopping
Center for $16,989,000 on July 28, 1995. The purchase of this property was
made subject to a $10,350,000 first mortgage loan bearing interest only at the
fixed rate of 8.5% per annum for ten years. The shopping center, consisting of
303,956 square feet of improvements and five outlots, is located in Atlanta,
Georgia. In a related transaction, M&J/Retail loaned $80,951 to Northlake
Tower Corporation ("Tower Corporation"), a General Partner of both Tower and
BSRT/M&J. The loan is secured by Tower Corporation's partnership interests in
Tower and BSRT/M&J, and interest thereon will be paid from Tower Corporation's
share of net cash flow.
On July 28, 1995, M&J/Retail refinanced a retail center located at Broadway and
Berwyn in Chicago, Illinois. The term of the new loan, with a principal amount
of $2,750,000, is five years. Debt service reflects an interest rate of 8.20%
per annum and amortization based on 25 years.
On August 24, 1995, the Registrant acquired a 59.44% undivided interest in the
209 W. Jackson building, a 144,608 square foot office building located in
downtown Chicago, in exchange for its 57.66% undivided interest in Tango Bay
Suites, a 260-unit all-suites hotel in Orlando, Florida. As part of this
transaction, Tango Bay Suites remains liable to the Registrant for loans
advanced to fund operating deficits. The 209 W. Jackson building is subject to
a first mortgage of $10,000,000 and an additional $4,213,875 note secured by
the first mortgage, both bearing interest only at General Electric Capital
Corporation's commercial paper rate plus 3.25% per annum. The Registrant
posted a letter of credit of $150,000 as a part of this transaction. Due to
the character of the investment, the Registrant is using the equity method to
account for its investment in 209 W. Jackson.
On October 27, 1995, M&J/Retail invested a total of $297,000 to acquire a
46.41% Class A interest in M&J/Crossroads Limited Partnership. The balance of
$303,000 of the total $600,000 required capital for Class A investors was also
financed by M&J/Retail, resulting in a receivable from the other investors for
their respective share of capital contributions. These loans were repaid to
M&J/Retail during March 1996.
22
<PAGE> 23
RESULTS OF OPERATIONS - 1994 COMPARED TO 1993
For the year ended December 31, 1994, loss from partnerships was $1,099,073
compared to loss of $96,204 for the comparative period of 1993. The increase
is due primarily to loss on disposition of the North LaSalle Street Limited
Partnership interest.
For the year ended December 31, 1994, the Registrant loaned to investment
partnerships in which it has substantial equity interests and to a property in
which it holds a co-tenancy ownership interest the following amounts:
<TABLE>
<CAPTION>
Advances Collections Total Loan
Year Ended Year Ended Balance at
December 31, December 31, December 31,
1994 1994 1994
------------ -------------- ------------
<S> <C> <C> <C>
Lake Cook Office Development -
Building Four Limited Partnership $14,589 $ - $14,589
Hawdel Limited Partnership and
Hawdel Limited Partnership III 314,516 - 314,516
XXI Office Plaza Associates 27,814 - 27,814
Tango Bay Suites 116,144 - 688,574
</TABLE>
The Lake Cook Office Development - Building Four Limited Partnership unsecured
promissory note bears interest at 2% over prime and is due on demand or, if
demand is not sooner made, on March 31, 1998. Hawdel Limited Partnership and
Hawdel Limited Partnership III's unsecured promissory note bears interest at
7.52% and is due July 18, 2004. XXI Office Plaza Associates' unsecured
promissory note bears interest at prime and is due on October 1, 1995. The
Tango Bay Suites - Co-Tenants unsecured promissory notes bear interest at 1%
over prime and are due upon demand.
On January 1, 1994, the Registrant's $327,827 loan receivable from Lake Cook,
Inc. was exchanged for a .4906% limited partnership interest in Lake Cook
Office Development - Building Four Limited Partnership.
During January 1994, the $2,000,000 of unsecured loans from the general
partners and other related individuals was repaid from proceeds of the
$2,362,500 mortgage on the Harlem North Shopping Center.
In September 1994, the Registrant restructured the mortgage loan secured by the
180 North Michigan Avenue Building. The mortgage holder agreed to a $500,000
forgiveness of debt in return for a $500,000 paydown of principal for a total
reduction in the principal balance of $1,000,000. The debt forgiveness income
of $500,000 is being amortized over the remaining term of the loan using the
effective interest method. The new mortgage loan with a principal balance of
$6,733,888 bears interest at 8.50% per annum and is due on September 1, 2001.
Buschwood Office Building, which was placed in receivership on July 25, 1994,
was foreclosed on December 12, 1994. As a result of the foreclosure, the total
assets of $7,447,498 and total liabilities of $7,635,069 were removed from the
accounts, resulting in a gain of $187,571.
On December 2, 1994, the Registrant redeemed its interest in three partnerships
for 50,251 limited partnership units in Duke Realty Limited Partnership which
will be convertible on a one-for-one basis to shares of common stock of Duke
Realty Investments, Inc., a real estate investment trust.
On December 31, 1994, the Registrant elected to transfer its partnership
interest in North LaSalle Street Limited Partnership for nominal consideration
to an unrelated third party resulting in a loss on disposition of $962,991.
On December 31, 1994, the Registrant sold its partnership interest in M&J/Fort
Myers Limited Partnership for nominal consideration.
23
<PAGE> 24
LIQUIDITY AND CAPITAL RESOURCES
On January 20, 1995, the Registrant entered into a revolving credit
facility with the LaSalle National Bank. The facility, due September 10, 1997,
pays interest at the prime rate. Maximum borrowings under the facility
agreement are the lesser of $800,000 or 80% of the fair market value of the
Registrant's investment in Duke Realty Limited Partnership (see Item 2).
Borrowings under the facility agreement are secured by the partnership units of
Duke Realty Limited Partnership owned by the Registrant.
As of December 31, 1996, the amounts outstanding under this facility are as
follows:
<TABLE>
<S> <C>
Cash borrowings $ -
Letters of credit:
Waterfall Plaza (expires 8/31/97) 80,000
209 W. Jackson (expires 8/31/97) 150,000
---------
Total Outstanding Amounts $230,000
=========
</TABLE>
The liquid assets of the Registrant increased as of December 31, 1996,
when compared to December 31, 1995, due to proceeds from sale of real estate.
The General Partners currently believe that the amount of working capital
reserves, when considered with the Registrant's projected cash flows from
operations in 1997 and borrowings under the revolving credit facility, will be
sufficient to cover any normal cash or liquidity requirements which may be
reasonably foreseen.
24
<PAGE> 25
ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Page
Independent Auditor's Report 26
First Wilkow Venture:
Consolidated Balance Sheet, December 31, 1996 and 1995 27
Consolidated Statement of Operations,
Years Ended December 31, 1996, 1995 and 1994 28
Consolidated Statement of Partners' Capital,
Years Ended December 31, 1996, 1995 and 1994 29
Consolidated Statement of Cash Flows,
Years Ended December 31, 1996, 1995 and 1994 30
Notes to Consolidated Financial Statements,
Years Ended December 31, 1996, 1995 and 1994 32
25
<PAGE> 26
[Philip Rootbert & Company, LLP Letterhead]
INDEPENDENT AUDITOR'S REPORT
To the Partners
First Wilkow Venture
We have audited the consolidated financial statements of First Wilkow Venture
listed in the index to the consolidated financial statements set forth on Page
25. Our audits also included the financial statement schedules listed in the
index at Item 14 on Page 69. These financial statements and financial
statement schedules 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 audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of First Wilkow
Venture and its subsidiaries as of December 31, 1996 and 1995, and the
consolidated results of their operations and their consolidated cash flows for
the years ended December 31, 1996, 1995 and 1994, in conformity with generally
accepted accounting principles.
Also, in our opinion, such financial statement schedules, when considered in
relation to the basic financial statements taken as a whole, present fairly, in
all material respects, the information set forth therein.
PHILIP ROOTBERG & COMPANY, LLP
March 3, 1997
Chicago, Illinois
26
<PAGE> 27
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
DECEMBER 31, 1996 1995
<S> <C> <C>
ASSETS
REAL ESTATE AND INVESTMENTS IN
REAL ESTATE PARTNERSHIPS
Real estate:
Land $6,230,711 $8,698,675
Buildings and improvements 45,672,807 56,540,021
Fixtures and equipment 116,955 138,384
----------- -----------
Total 52,020,473 65,377,080
Less accumulated depreciation 16,543,394 19,726,068
----------- -----------
Net Real Estate 35,477,079 45,651,012
Investments in real estate partnerships 5,180,049 5,130,522
----------- -----------
Total 40,657,128 50,781,534
----------- -----------
LOANS RECEIVABLE 1,224,274 1,452,639
----------- -----------
OTHER ASSETS
Cash 466,870 328,852
Certificates of deposit 840,000 162,998
Receivables 702,376 551,307
Prepaid expenses - 1,062
Deposits 715,053 598,870
Deferred charges 988,991 1,197,568
----------- -----------
Total 3,713,290 2,840,657
----------- -----------
TOTAL ASSETS $45,594,692 $55,074,830
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
MORTGAGES AND LOANS PAYABLE
Mortgages payable $31,339,400 $37,124,893
Loans payable 829,488 3,649,822
----------- -----------
Total 32,168,888 40,774,715
----------- -----------
OTHER LIABILITIES
Accounts payable and accrued expenses 182,975 240,092
Accrued property taxes 2,328,926 2,470,265
Deferred state income taxes 200,000 200,000
Security deposits and prepaid rent 404,507 555,767
Accrued interest 69,110 365,078
----------- -----------
Total 3,185,518 3,831,202
----------- -----------
MINORITY INTEREST 1,449,774 1,579,357
----------- -----------
PARTNERS' CAPITAL (178,972 units
authorized and issued) 8,790,512 8,889,556
----------- -----------
TOTAL LIABILITIES AND PARTNERS' CAPITAL $45,594,692 $55,074,830
=========== ===========
</TABLE>
See accompanying notes to consolidated financial statements
27
<PAGE> 28
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, 1996 1995 1994
<S> <C> <C> <C>
REVENUE
Rental $9,388,112 $ 10,612,769 $11,143,657
Hotel - 1,327,682 2,891,170
Interest 169,168 152,793 134,657
Other 316,876 42,137 275,099
---------- ----------- -----------
Total 9,874,156 12,135,381 14,444,583
---------- ----------- -----------
PARTNERSHIP INVESTMENTS' INCOME (LOSS)
Share of net income (loss) 409,843 382,248 (1,099,073)
Provision for loss in book value (273,000) - ( 213,227)
---------- ---------- ----------
Total 136,843 382,248 (1,312,300)
---------- ---------- ----------
EXPENSES
Operating 3,121,511 4,637,916 6,184,028
Real estate taxes 2,460,946 2,608,758 2,716,552
Depreciation and amortization 1,719,377 2,334,430 2,705,676
Provision for loss in book value of real estate - 1,400,000 -
Interest 2,740,843 3,852,992 4,700,490
General and administrative 86,750 95,178 155,572
---------- ---------- ---------
Total 10,129,427 14,929,274 16,462,318
---------- ---------- ----------
LOSS FROM OPERATIONS (118,428) (2,411,645) (3,330,035)
MINORITY INTEREST IN SUBSIDIARIES' NET LOSS 19,384 84,485 210,575
---------- ---------- ----------
NET LOSS $( 99,044) $(2,327,160) $(3,119,460)
========== ========== ==========
UNITS - AUTHORIZED AND ISSUED
General Partner 7,174 6,803 6,778
Limited Partner 171,798 172,169 172,194
NET LOSS PER UNIT
General Partner $( .55) $( 13.00) $( 17.43)
Limited Partner ( .55) ( 13.00) ( 17.43)
BOOK VALUE OF A UNIT
General Partner $ 49.12 $ 49.67 $ 62.67
Limited Partner 49.121 49.67 62.67
CASH DISTRIBUTIONS
General Partner $ - $ - $ -
Limited Partner - - -
</TABLE>
See accompanying notes to consolidated financial statements
28
<PAGE> 29
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
GENERAL LIMITED
PARTNERS PARTNERS TOTAL
--------- ----------- -----------
<S> <C> <C> <C>
BALANCE - DECEMBER 31, 1993 $532,241 $13,803,935 $14,336,176
Deduct:
Loss for the year ended
December 31, 1994 (118,140) (3,001,320) (3,119,460)
--------- ----------- -----------
BALANCE - DECEMBER 31, 1994 414,101 10,802,615 11,216,716
Add (deduct):
Loss for the year ended
December 31, 1995 (88,459) (2,238,701) (2,327,160)
To reflect changes in partnership
capital between general and limited
partners - net 2,050 (2,050) -
--------- ----------- -----------
BALANCE - DECEMBER 31, 1995 327,692 8,561,864 8,889,556
Add (deduct):
Loss for the year ended
December 31, 1996 (3,970) (95,074) (99,044)
To reflect changes in partnership
capital between general and limited
partners - net 31,906 (31,906) -
--------- ----------- -----------
BALANCE - DECEMBER 31, 1996 $355,628 $8,434,884 $8,790,512
========= =========== ===========
</TABLE>
See accompanying notes to consolidated financial statements
29
<PAGE> 30
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
CONSOLIDATED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, 1996 1995 1994
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (99,044) $(2,327,160) $(3,119,460)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 1,719,377 2,334,430 2,705,676
Amortization of debt forgiveness income (72,642) (73,389) (24,630)
Net (gain) loss on disposal of land,
building and improvements (108,194) 160,840 (187,571)
Provision for loss in book value 273,000 1,400,000 -
Reserve for loans and interest receivable - - 213,227
(Income) loss from partnerships (409,843) (382,248) 1,099,073
Changes in assets and liabilities:
Ending cash balance of entity
eliminated from consolidation - (42,455) -
(Increase) decrease in accounts receivable
and prepaid expenses - net (21,370) 61,493 345,653
(Increase) decrease in deposits (116,181) 320,928 (10,457)
Increase (decrease) in accounts payable
and accrued expenses (57,115) (133,898) 143,024
Increase in accrued property taxes 26,838 90,096 112,228
Increase (decrease) in accrued interest (20,611) 234,984 342,863
Increase (decrease) in security deposits
and prepaid rent (77,232) 3,231 46,332
--------- --------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES 1,036,983 1,646,852 1,665,958
--------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in land, building and
furniture and equipment (629,987) (879,261) (1,703,052)
Investment in partnerships (139,983) (1,455,871) (14,896)
Investments in loans receivable (74,635) (683,950) (798,062)
Investment in deferred charges (primarily
unamortized broker commissions) (308,956) (364,067) (628,783)
Proceeds from sale of real estate,
net of selling expenses 3,836,988 - -
Proceeds from sale of investment
in partnership - 314,800 -
Partnership investment draws 227,299 311,187 122,229
Decrease in minority interest (88,085) (185,685) (309,275)
Collection of notes receivable 303,000 19,355 305,500
--------- --------- ---------
NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES 3,125,641 (2,923,492) (3,026,339)
--------- --------- ---------
</TABLE>
See accompanying notes to consolidated financial statements
30
<PAGE> 31
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
CONSOLIDATED STATEMENT OF CASH FLOWS - Continued
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31, 1996 1995 1994
<S> <C> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of mortgages and notes payable $(3,857,920) $ (778,357) $(3,242,922)
Proceeds from mortgage financing 10,316 898,223 273,513
Proceeds from loans payable 500,000 1,119,488 802,425
---------- --------- ----------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (3,347,604) 1,239,354 (2,166,984)
---------- --------- ----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 815,020 (37,286) (3,527,365)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF YEAR 491,850 529,136 4,056,501
---------- --------- ----------
CASH AND CASH EQUIVALENTS AT
END OF YEAR $ 1,306,870 $ 491,850 $ 529,136
========== ========= ==========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest paid during the year $ 3,109,453 $3,967,495 $ 4,604,942
========== ========= ==========
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING
AND FINANCING ACTIVITIES
During 1995, the Partnership exchanged its
undivided interest in a property with total
assets of $8,480,741 and total liabilities
of $8,257,513 for an undivided interest in a
replacement property.
</TABLE>
See accompanying notes to consolidated financial statements
31
<PAGE> 32
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A summary of the principal accounting policies followed by First Wilkow
Venture (the "Partnership") is set forth as follows:
The financial statements include the accounts of all entities in which the
Partnership owns fifty percent or more and maintains effective control.
The Partnership had a 57.67% undivided interest in a hotel which was
accounted for using the proportionate consolidation method. The interest in
the hotel was exchanged in 1995 for an interest in a commercial property
which is being reported under the equity method of accounting. Investments
in entities in which ownership interests are less than fifty percent and
the Partnership exercises significant influence over operating and
financial policies are accounted for on the equity method. Other
investments are accounted for on the cost method. Intercompany accounts and
transactions between consolidated entities have been eliminated in
consolidation.
For purposes of the consolidated statement of cash flows, the Partnership
considers certificates of deposit with a maturity of three months or less
to be cash equivalents. Certain Partnership deposits at LaSalle National
Bank are in excess of the amount insured by the Federal Deposit Insurance
Corporation and are, therefore, considered a concentration of credit risk.
Rental income is derived from leasing to lessees (under operating leases)
various types of real estate owned by the Partnership.
Investments in real estate partnerships are reported using either the cost
or equity methods of accounting. Under the equity method, the cost
of these investments is reduced by a pro rata share of net losses and
drawings and increased by a pro rata share of net income of the investee.
Under the cost method, income is reported as draws are received.
Land, buildings and improvements are carried at cost. Major additions and
betterments are charged to the property accounts; maintenance and
repairs which do not improve or extend the life of the respective assets
are charged to expense as incurred. When assets are sold or retired, the
cost and accumulated depreciation are removed from the accounts, and any
gain or loss is recognized.
Depreciation on buildings, improvements, furniture and equipment is
computed using the straight-line and accelerated methods based on the
estimated useful lives of the assets.
Deferred charges represent real estate acquisition costs, deferred broker
commissions and mortgage financing costs. These costs are being
amortized using the straight-line method over lives ranging from 1 to 40
years.
There is no provision for federal income taxes as the partners report their
share of the Partnership's net income or loss in their individual income
tax returns.
32
<PAGE> 33
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
Deferred state income taxes are provided on certain real estate sales that
are taxable to the Partnership which are being reported on an
installment or tax free exchange basis for income tax purposes.
Debt forgiveness income is being amortized as a reduction of interest
expense over the remaining term of the related loan using the effective
interest method.
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 reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
Financial Instruments - The Partnership has a number of financial
instruments, none of which are held for trading purposes. The Partnership
estimates that the fair value of all financial instruments at December
31, 1996, does not differ materially from the aggregate carrying values of
its financial instruments recorded in the accompanying consolidated balance
sheet. The estimated fair value amounts have been determined by the
Partnership using available market information and appropriate valuation
methodologies. Considerable judgment is necessarily required in
interpreting market data to develop the estimates of fair value, and,
accordingly, the estimates are not necessarily indicative of the amounts
that the Partnership could realize in a current market exchange.
2 - DEPRECIATION
Depreciation is based on the method and estimated useful life of the
respective assets as follows:
Property Method Life
--------- ------ ------
180 North Michigan Avenue
a. Building Straight Line 35 years
b. Improvements Straight Line Various
c. Furniture and equipment 150% Declining Balance 12 years
Naperville Office
a. Building Straight Line 25 years
b. Improvements Straight Line Various
c. Furniture and equipment 150% Declining Balance Various
33
<PAGE> 34
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
Property Method Life
-------- ------- ------
Waterfall Plaza
a. Building Straight Line 40 years
b. Improvements Straight Line 40 years
Freeport Office*
a. Building Straight Line 40 years
b. Improvements Straight Line Various
c. Furniture and equipment Straight Line Various
Highland Park
a. Building Straight Line 30 years
b. Improvements Straight Line 40 years
150% Declining Balance 40 years
150% Declining Balance 12 years
M&J/Retail (10 retail centers)
a. Buildings Straight Line 40 years
b. Improvements Straight Line 40 years
c. Furniture and equipment Straight Line 12 years
* The Freeport Office Building was sold in 1996.
34
<PAGE> 35
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
3 - INVESTMENTS IN PARTNERSHIPS
A summary of the income or loss from partnership investments included in
the accompanying consolidated statement of operations on the equity method
of accounting, unless otherwise indicated, is as follows:
<TABLE>
<CAPTION>
1996 1995 1994
<S> <C> <C> <C>
21st M&J Venture $ - $ - $ 1,000 (a)
222 Fee Associates 319 (A) 406 (a) 305 (a)
5601 N. Sheridan Associates 576 (A) 544 (a) 408 (a)
Duke Realty Limited Partnership 100,502 (A) 134,754 (a) -
First Candlewick Associates 22,055 (A) 3,000 (a) 2,250 (a)
First MW Associates - 1,750 -
Hawdel Limited Partnership (163,664)(B) (34,351) (71,434)
M&J/Grove Limited Partnership 208,519 (31,206) (168,179)
M&J/Largo Limited Partnership (119,000)(B) - -
M&J/Retail Limited Partnership - 137,245 (c) -
M&J/Two Market Associates - - 800 (a)
North LaSalle Street Limited Partnership - - (962,991)(b)
Orhow Associates - - 700 (a)
Rosemont 28 Limited Partnership (3,559) 49 (11,508)
S & S Venture - 35,206 (a) 2,754 (a)
Second Chase Venture - 4,325 (a) 675 (a)
Second Wilkow Venture 2,364 (A) 2,364 (a) 2,068 (a)
Wilkow/Retail Partners L.P. 120 (A) 120 (a) 90 (a)
XXI Office Plaza Associates 27,291 128,042 103,989
Northlake Tower Limited Partnership 84,669 - -
M&J/Crossroads Limited Partnership (23,349) - -
---------- -------- ---------- ----------
$136,843 $382,248 $(1,099,073)
========== ======== ==========
</TABLE>
(a) Income recognized under the cost method.
(b) Loss on disposition of investment.
(c) Gain on disposition of investment.
35
<PAGE> 36
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
The following is a summary of financial position and results of
operations of the properties in which the Partnership has a partnership
interest. The following schedule has been prepared from financial
information provided by these partnerships as of their calendar year
ends.
YEAR ENDED DECEMBER 31, 1996:
<TABLE>
<CAPTION>
Rosemont 28 XXI Office
Apollo Limited Plaza
Associates Partnership Associates
----------- ------------- -----------
(a) (a) (b)
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $ 881,266 $ 1,909,955 $2,848,714
Current assets 212,886 1,846 1,489,951
Other assets 13,889 103 11,000
------------ ------------ ----------
TOTAL ASSETS $ 1,108,041 $ 1,911,904 $4,349,665
============ ============ ==========
Mortgages payable $ 1,844,394 $ - $2,661,470
Other liabilities 2,566,987 21,256 435,937
Partners' capital (deficit) ( 3,303,340) 1,890,648 1,252,258
------------ ------------ ----------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL (DEFICIT) $ 1,108,041 $ 1,911,904 $4,349,665
============ ============ ==========
STATEMENT OF OPERATIONS
Revenue $ 782,516 $ 307 $1,598,746
Less:Operating expenses 670,841 15,830 931,886
Other expenses 613,370 - 164,015
Depreciation 150,359 - 211,240
------------ ------------ ----------
NET INCOME (LOSS) $( 652,054) $( 15,523) $291,605
========== ========= ==========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
36
<PAGE> 37
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Sun Pointe 2221 Camden
Place Court M&J/Grove
Limited Office Limited
Partnership Building Partnership
----------- -------- -----------
(a) (a) (a)
<S> <C> < <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $2,310,382 $6,866,362 $10,852,818
Current assets 226,179 573,034 292,241
Other assets 6,504 272,705 15,000
----------- -------- -----------
TOTAL ASSETS $2,543,065 $7,712,101 $11,160,059
=========== ========== ===========
Mortgages payable $125,231 $8,082,869 $6,437,661
Other liabilities 18,364 195,562 316,956
Partners' capital (deficit) 2,399,470 (566,330) 4,405,442
----------- -------- -----------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL (DEFICIT) $2,543,065 $7,712,101 $11,160,059
=========== ========== ===========
STATEMENT OF OPERATIONS
Revenue $755,131 $1,784,216 $1,715,587
Less:Operating expenses 521,987 770,142 701,826
Other expenses 13,242 698,901 690,101
Depreciation 176,469 385,505 303,516
----------- -------- -----------
NET INCOME (LOSS) $43,433 $(70,332) $20,144
=========== ======== ===========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
37
<PAGE> 38
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Lake Cook
Office
Development
(a)
BALANCE SHEET
<S> <C>
Real estate - net of
accumulated depreciation $3,045,515
Current assets 25,244
Other assets 79,289
----------
TOTAL ASSETS $3,150,048
==========
Mortgages payable $8,678,941
Other liabilities 296,349
Partners' deficit (5,825,242)
----------
TOTAL LIABILITIES AND
PARTNERS' DEFICIT $3,150,048
==========
STATEMENT OF OPERATIONS
Revenue $1,488,804
Less:Operating expenses 766,642
Other expenses 770,648
Depreciation 187,045
----------
NET LOSS $ (235,531)
==========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
38
<PAGE> 39
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
YEAR ENDED DECEMBER 31, 1995:
Crow- Rosemont
Commerce 28
Apollo Park North Limited
Associates Retail, Ltd. Partnership
---------- ------------ -----------------
(a) (a)(c) (a)
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $ 1,000,834 $ 1,909,955
Current assets 3,467 472
Other assets 204,822 -
----------- -----------
TOTAL ASSETS $ 1,209,123 $ 1,910,427
=========== ===========
Mortgages payable $ 1,016,862 $ -
Other liabilities 2,843,506 21,256
Partners' capital (deficit) (2,651,245) 1,889,171
----------- -----------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL (DEFICIT) $ 1,209,123 $ 1,910,427
=========== ===========
STATEMENT OF OPERATIONS
Revenue $ 775,314 $ 480,977 $ 133
Less:Operating expenses 594,413 487,077 14,315
Other expenses 189,736 888,852 -
Depreciation 153,479 67,904 -
----------- ----------- -----------
NET LOSS $ 162,314) $( 962,856) $( 14,182)
========== ========= =========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
39
<PAGE> 40
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Sun Pointe 2221 Camden
XXI Office Place Court
Plaza Limited Office
Associates Partnership Building
---------- ------------ ---------
(b) (a) (a)
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $5,819,187 $ 2,462,283 $ 8,008,848
Current assets 1,712,961 80,547 352,327
Other assets 8,654 8,905 336,841
---------- ----------- -----------
TOTAL ASSETS $7,540,802 $ 2,551,735 $ 8,698,016
========== ========= =========
Mortgages payable $3,011,175 $ - $ 8,147,287
Other liabilities 837,810 199,053 203,650
Partners' capital 3,691,817 2,352,682 347,079
---------- ----------- -----------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL $7,540,802 $ 2,551,735 $ 8,698,016
========== =========== ===========
STATEMENT OF OPERATIONS
Revenue $3,387,093 $ 690,303 $ 1,704,227
Less: Operating expenses 1,148,533 580,804 736,955
Other expenses 854,159 16,341 710,164
Depreciation 442,647 172,395 467,894
---------- ----------- -----------
NET INCOME (LOSS) $941,754 $( 79,237) $( 210,786)
========== ========= =========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
40
<PAGE> 41
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
M&J/Fort
Myers M&J/Grove Lake Cook
Limited Limited Office
Partnership Partnership Development
(a)(c) (a) (a)
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $10,799,651 $ 3,003,057
Current assets 398,570 137,124
Other assets 150,018 92,120
--------- ---------
TOTAL ASSETS $11,348,239 $ 3,232,301
=========== =========
Mortgages payable $ 8,667,856 $ 8,555,515
Other liabilities 1,659,904 261,909
Partners' capital (deficit) 1,020,479 (5,585,123)
--------- ---------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL (DEFICIT) $11,348,239 $ 3,232,301
=========== =========
STATEMENT OF OPERATIONS
Revenue $ 36,900 $ 1,779,295 $ 1,403,197
Less: Operating expenses 41,696 771,139 722,660
Other expenses 178,068 831,512 753,229
Depreciation 42,898 292,792 181,712
--------- ---------- ---------
NET LOSS $(225,762) $ (116,148) $ (254,404)
======== =========== =========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
41
<PAGE> 42
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1994:
Crow-
Commerce 203 N.
Apollo Park North LaSalle St.
Associates Retail, Ltd. Partnership
----------------- ------------ -----------
(a) (a)(c) (a)(c)
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $ 1,125,727 $ 7,684,825 $ 35,252,805
Current assets 5,662 2,531,499 2,876,917
Other assets 210,719 104,662 5,554,588
----------- ------------ -------------
TOTAL ASSETS $ 1,342,108 $ 10,320,986 $ 43,684,310
=========== ============ =============
Mortgages payable $ 861,308 $ 9,710,770 $ 103,882,052
Other liabilities 2,969,451 1,520,198 12,777,232
Partners' deficit (2,488,651) ( 909,982) ( 72,974,974)
----------- ------------ -------------
TOTAL LIABILITIES AND
PARTNERS' DEFICIT $ 1,342,108 $ 10,320,986 $ 43,684,310
=========== ============ =============
STATEMENT OF OPERATIONS
Revenue $ 744,512 $ 1,203,346 $ 14,960,475
Less:Operating expenses 633,248 626,123 7,996,915
Other expenses 123,112 608,390 6,680,352
Depreciation 157,592 271,604 4,990,596
----------- ------------ -------------
NET LOSS $( 169,440) $ 302,771) $( 4,707,388)
========= ========== ===========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
42
<PAGE> 43
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Rosemont Sun Pointe
28 XXI Office Place
Limited Plaza Limited
Partnership Associates Partnership
----------------- ---------- -----------------
(a) (b) (a)
BALANCE SHEET
<S> <C> <C> <C>
Real estate - net of
accumulated depreciation $ 1,909,955 $6,327,158 $ 2,576,224
Current assets 690 807,169 68,951
Other assets - 8,813 15,137
----------------- ---------- -----------------
TOTAL ASSETS $ 1,910,645 $7,143,140 $ 2,660,312
================= ========== =================
Mortgages payable $ - $3,268,622 $ -
Other liabilities 19,292 1,124,455 228,393
Partners' capital 1,891,353 2,750,063 2,431,919
----------------- ---------- -----------------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL $ 1,910,645 $7,143,140 $ 2,660,312
================= ========== =================
STATEMENT OF OPERATIONS
Revenue $ 215 $2,740,956 $ 548,916
Less:Operating expenses 61,287 1,061,887 553,967
Other expenses - 708,165 3,898
Depreciation - 393,960 178,634
----------------- ---------- -----------------
NET INCOME (LOSS) $ (61,072) $576,944 $ (187,583)
================= ======== ================
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
43
<PAGE> 44
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
2221 Camden M&J/Fort
Court Myers M&J/Grove
Office Limited Limited
Building Partnership Partnership
--------- ----------- --------------
(a) (a)(c) (a)
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $ 7,444,964 $ 20,058,882 $ 10,967,814
Current assets 476,699 1,104,305 119,687
Other assets 392,562 80,919 204,113
----------- ------------- ------------
TOTAL ASSETS $ 8,314,225 $ 21,244,106 $ 11,291,614
=========== ============= ============
Mortgages payable $ 8,327,483 $ 16,545,551 $ 9,144,856
Other liabilities 248,551 6,981,624 1,022,837
Partners' capital (deficit) ( 261,809) ( 2,283,069) 1,123,921
----------- ------------- ------------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL (DEFICIT) $ 8,314,225 $ 21,244,106 $ 11,291,614
=========== ============= ============
STATEMENT OF OPERATIONS
Revenue $ 1,673,572 $ 515,040 $ 1,180,717
Less:Operating expenses 857,457 728,152 791,220
Other expenses 753,566 2,326,691 842,349
Depreciation 473,944 589,790 286,922
----------- ------------- ------------
NET LOSS $( 411,395) $( 3,129,593) $( 739,774)
========= =========== ==========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
44
<PAGE> 45
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
Lake Cook
Office
Development
(a)
BALANCE SHEET
<S> <C>
Real estate - net of
accumulated depreciation $ 3,151,460
Current assets 149,223
Other assets 62,129
------------
TOTAL ASSETS $ 3,362,812
============
Mortgages payable $ 8,427,988
Other liabilities 261,156
Partners' deficit ( 5,326,332)
------------
TOTAL LIABILITIES AND
PARTNERS' DEFICIT $ 3,362,812
============
STATEMENT OF OPERATIONS
Revenue $ 1,314,991
Less:Operating expenses 673,511
Other expenses 523,535
Depreciation 178,753
------------
NET LOSS $( 60,808)
==========
</TABLE>
(a) Based upon unaudited financial statements.
(b) Based upon audited financial statements.
(c) Investment is stated at zero.
(d) Information not available at time of report.
45
<PAGE> 46
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
First Ron Venture
In April 1978, the Partnership invested $260,000 to obtain a one-third
interest in First Ron Venture, which has a 38% interest in Apollo
Associates, which owns an apartment complex in Oklahoma City, Oklahoma.
Although First Ron Venture is entitled to a cumulative annual priority
distribution of cash flow of which the Partnership's share is $23,490,
the property has not generated sufficient cash flow for the past several
years to make distributions. The investment is being carried at zero.
On December 31, 1993, the Partnership acquired a 3.831% interest in First
Apollo Associates, which holds a one-third interest in First Ron Venture.
Hawdel Limited Partnership I and III
To date, the Partnership has invested $1,320,000 to obtain 18.03%
interests in Hawdel I and III Limited Partnerships, which own the 2221
Camden Court Office Building located in Oak Brook, Illinois. In addition
to the investment, the Partnership had a note receivable of $295,161 from
Hawdel Limited Partnership I and III as of December 31, 1996 (see Note
4).
On January 16, 1997, the property was sold, resulting in full payment of
Partnership loans, and an equity distribution of $690,360 was received by
the Partnership (see Note 4). A provision for loss in book value of
$154,000, equal to the estimated loss to the Partnership on the
disposition of the investment, is recognized in 1996.
M&J/Fort Myers Limited Partnership
In March 1987, the Partnership invested $1,000,000 to obtain a 12.16%
interest in M&J/Fort Myers Limited Partnership, which owns Metro Mall
located in Fort Myers, Florida. In the event of a sale or refinancing,
the Partnership is entitled to a cash distribution priority equal to the
original investment in the partnership. In addition to the partnership
investment, the Partnership had a $5,282,050 loan receivable from
M&J/Fort Myers Limited Partnership (see Note 4). On December 31, 1993,
the Partnership's loan receivable and related accrued interest were
exchanged for a 5% limited partnership interest in M&J/Fort Myers Limited
Partnership.
46
<PAGE> 47
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
During 1990, the Partnership transferred all of its partnership interest
in M&J/Fort Myers Limited Partnership to Metro Class A Investors Limited
Partnership, a limited partnership in which the Partnership owns a 95%
residual partnership interest. On December 31, 1993, the Partnership
acquired a 1.26% interest in M&J/Fort Myers Limited Partnership and a
3.52% interest in Wilkow/Metro Partners L.P., a partner of M&J/Fort Myers
Limited Partnership.
During 1994, the Partnership sold its partnership interest to an
unrelated third party for nominal consideration.
M&J/Largo Limited Partnership
The Partnership invested a total of $694,227 to acquire a 25.1% interest
in M&J/Largo Limited Partnership, which owns 91.12% of Sun Pointe Place
Limited Partnership, which developed and owned a 140 one-bedroom unit
apartment complex located in Largo, Florida. The property was sold on
February 12, 1997, for $2,600,000. Simultaneous with the sale, M&J/Largo
Limited Partnership exercised its put to Sun Pointe Place Limited
Partnership, resulting in all net sale proceeds being allocated to
M&J/Largo Limited Partnership. The Partnership anticipates receiving a
final equity distribution from M&J/Largo Limited Partnership of
approximately $575,000. A provision for loss in book value of $119,000,
equal to the estimated loss to the Partnership on the disposition of the
investment, is recognized in 1996.
M&J/Quorum Associates
The Partnership has invested a total of $2,295,000 to obtain a 64.35%
interest in M&J/Quorum Associates, which is a 66.29% limited partner in the
Quorum Limited Partnership, which is a 50% general partner in Crow-Commerce
Park North Retail, Ltd., which developed a shopping center in Houston, Texas.
The Partnership is entitled to a 9% cumulative cash flow priority on
invested capital. In addition to the partnership investment, the Partnership
has a loan receivable of $113,663 which was written off at December 31, 1995,
as a result of the mortgage lien being foreclosed during April 1995 (see
Notes 4 and 11). During 1996, the Partnership received $46,490 based on a
settlement with the unrelated General Partner. This investment is being
carried at zero.
M&J/Westwood Limited Partnership
In December 1986, the Partnership invested $517,000 to obtain an 18.52%
interest in M&J/Westwood Limited Partnership, which owns 48% of The Villas at
Monterey Limited Partnership, which owns a 260-unit all suites hotel and
corporate rental project in Orlando, Florida, known as Tango Bay Suites
Resort. On December 31, 1993, the Partnership acquired an additional 2.19%
interest in M&J/Westwood.
47
<PAGE> 48
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
In March 1993, the Partnership acquired a 63.64% undivided interest in Tango
Bay Suites pursuant to an exchange for an ownership interest in a similar
property. The Villas at Monterey Limited Partnership retained the remaining
36.36% interest. In November 1993, the Partnership sold a 5.98% undivided
interest in Tango Bay Suites to an unrelated party for a relative proportion
of the debt, recognizing a gain of $53,231 on the disposition. The
Partnership exchanged its interest in Tango Bay Suites for an undivided
interest in the 209 W. Jackson building effective June 30, 1995. The
Partnership also has a loan receivable of $731,124 at December 31, 1996, from
Tango Bay Suites (see Note 4).
North LaSalle Street Limited Partnership
Through 1987, the Partnership had invested a total of $962,991 to obtain a
6.42% interest in North LaSalle Street Limited Partnership, which owns a 63%
general partnership interest in 203 North LaSalle Street Partnership, which
owns a 547,641 square foot, 15-story office building built on the air rights
above the twelfth story of the 203 North LaSalle Street Building parking
garage at the same address in Chicago, Illinois. The Partnership's interest
was diluted to 3.21% on January 1, 1988, due to the exercise of an option by
an affiliate of an existing partner. The Partnership's interest was further
diluted to 2.824% as a result of issuance of additional units during 1991 and
1992 to which the Partnership did not participate.
On December 31, 1994, the Partnership transferred its partnership interest
for nominal consideration to an unrelated third party, resulting in a loss on
disposition of $962,991.
Duke Realty Limited Partnership
Prior to October 1993, the Partnership owned a 69.42% interest in Park 100
Equity Investors Limited Partnership and a 55.07% limited partnership
interest in Park 100 Mortgage Investors Limited Partnership. Both of these
limited partnerships held indirect ownership interests in Park 100, an
industrial park in Indianapolis, Indiana, which was developed by Duke
Associates. Duke Associates also maintained a significant ownership interest
in the property. On October 4, 1993, Park 100 was conveyed to an operating
partnership, Duke Realty Limited Partnership (the "UPREIT"), owned by Duke
Realty Investments, Inc., a real estate investment trust ("REIT") listed on
the New York Stock Exchange, together with more than 100 other properties, in
return for the issuance of units of partnership interest in the operating
partnership which, eventually, will be convertible, on a one-for-one basis,
to shares of common stock to the REIT. As part of this transaction, the REIT
also completed an offering to the public of 13,167,500 additional shares of
common stock, which generated proceeds of approximately $312.7 million.
On December 31, 1993, the Partnership acquired an additional 1.77% interest
in Park 100 Equity Investors Limited Partnership and an additional 6.78%
interest in Park 100 Mortgage Investors Limited Partnership. The Partnership
also acquired a 5.52% interest in M&J/Two Market Associates, which also holds
an indirect interest in the real estate investment trust.
48
<PAGE> 49
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
On December 2, 1994, the Partnership redeemed its interest in the above three
partnerships for a direct ownership in the UPREIT. The redemption resulted
in the Partnership owning 50,251 partnership units in the UPREIT which,
eventually, will be convertible on a one-for-one basis, to shares of common
stock of the REIT. The Partnership's limited partner units are currently
pledged as collateral for a revolving credit facility with LaSalle National
Bank (see Note 10).
Rosemont 28 Limited Partnership
The Partnership has invested a total of $732,014 to obtain a 22.92% interest
in Rosemont 28 Limited Partnership, which owns 11.25 acres of land held for
development in Orlando, Florida. Net cash flow and residual proceeds are
distributed in accordance with the partners' respective interests.
S & S Venture
On December 31, 1993, the Partnership acquired a 6.67% interest in S & S
Venture, which owned a 51,000 square foot industrial building in Lincoln,
Rhode Island. On March 15, 1995, S & S Venture closed a transaction which
coupled the sale of its property with a settlement of the obligations of the
tenant under its lease and resulted in a gain to the Partnership of $34,290.
XXI Office Plaza Associates
In February 1981, the Partnership invested $525,000 to obtain a 13.91%
interest in XXI Office Plaza Associates, which owns an office plaza in
Germantown, Maryland. As a "Class A" limited partner, the Partnership is
entitled, on a noncumulative basis, to a priority distribution from available
cash flow of $41,580. On December 31, 1993, the Partnership acquired an
8.28% interest in 21st M&J Venture, which has a 16% interest in XXI Office
Plaza Associates. The Partnership also acquired a 7.59% interest in Orhow
Associates, which has a 12.2% interest in XXI Office Plaza Associates. In
addition to the investment, the Partnership has a note receivable of $27,814
from XXI Office Plaza Associates (see Note 4).
On February 1, 1996, a tenant occupying approximately 40% of the leasable
area vacated the building. As of December 31, 1996, XXI Office Plaza
Associates had leased 45% of the space vacated.
M&J/Grove Limited Partnership
The Partnership had invested a total of $931,000 to obtain a 21.91% interest
in M&J/Grove Limited Partnership ("M&J/Grove"), which owns an office complex
in Wheaton, Illinois. As a "Class A" limited partner, the Partnership is
entitled to cumulative cash priority of 8%. On December 31, 1993, the
Partnership acquired an additional 1.17% interest in M&J/Grove.
49
<PAGE> 50
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
On July 1, 1996, the Partnership invested an additional $98,100 in M&J/Grove
in connection with the purchase of 981 Call Units, increasing its interest in
this investment to 28.03%. The Call Unit holders are entitled to a
cumulative cash flow priority of 12% per annum. Upon sale or refinancing,
the Call Unit holders will receive the first $367,500 of available proceeds.
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. The proceeds
of the M&J/Grove 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 made by third parties on behalf of
M&J/Grove. The Partnership guaranteed $520,833, an amount which approximates
28.41% of its ownership interest in M&J/Grove, exclusive of subordinated
equity interests which have no value. The property is also encumbered by
unsecured debentures of $1,000,000, which mature on May 1, 2001, and bear
interest at 9% per annum, payable quarterly.
L-C Office Partnership IV
Prior to December 31, 1993, the Partnership had a 73.34% ownership interest
in L-C Office Partnership IV Limited Partnership, which holds a 92.565%
interest in Lake Cook Office Development - Building Four Limited Partnership
("Lake-Cook IV"), which owned an office building/conference center in
Deerfield, Illinois.
In January 1993, L-C Office Partnership IV's subsidiary entered into an
agreement to exchange its ownership of Lake Cook Office Centre - Building IV
for the right to receive similar property prior to July 1993. The ownership
interest in Building IV was transferred pursuant to the agreement to the
exchange agent in January 1993.
In July 1993, Lake-Cook IV exercised its right to receive property under the
exchange agreement and acquired a 58.50% undivided interest in Dover Farms
Apartments, a 300-unit apartment complex located in a suburb of Cleveland,
Ohio. In 1996, under the terms of the co-tenancy agreement, Lake-Cook IV
made advances to the property totaling $102,375. As of December 31, 1995,
the Partnership had a loan payable of $50,000 to Dover Farms Apartments
bearing interest at prime and payable on demand. The loan and related
interest were paid in full during 1996.
On December 31, 1993, the Partnership acquired an additional 1.35% interest
in L-C Office Partnership IV. On January 1, 1994, the Partnership acquired a
0.4906% interest in Lake Cook Office Development - Building Four Limited
Partnership. In addition to the investment, the Partnership has notes
receivable of $15,091 and $71,872 from Lake Cook Office Development -Building
Four Limited Partnership and L-C Office Partnership IV, respectively.
50
<PAGE> 51
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
CONSOLIDATED PARTNERSHIPS
M&J/Sheridan Limited Partnership
During 1988, the Partnership invested $2,500,000 to obtain an 89.29% interest
in the M&J/Sheridan Limited Partnership, which owns a 22,523 square foot
office building in Highland Park, Illinois. The financial position and
results of operations at December 31, 1996, are included in the accompanying
consolidated financial statements. In addition to the investment, the
Partnership has a note receivable of $462,000 at December 31, 1996, from
M&J/Sheridan Limited Partnership. On September 30, 1996, M&J/Sheridan
Limited Partnership refinanced the Highland Park Professional Center. The
term of the new loan, with a principal amount of $1,425,000, is five years.
Debt service reflects an interest rate of 8.88% per annum and amortization
based on 20 years.
M&J/Freeport Limited Partnership
The Partnership had invested a total of $5,139,000 to obtain a 68.85% limited
partnership interest in M&J/Freeport Limited Partnership, which is a 94.05%
limited partner in Freeport Office Partners Limited, which owns an office
building in Dallas, Texas. The financial position and results of operations
at December 31, 1996, are included in the accompanying consolidated financial
statements. The property was sold on January 18, 1996. A provision for loss
in book value of $1,400,000 equal to the estimated loss to the Partnership on
the disposition of the property was recognized in 1995 (see Note 11). An
additional loss of $12,800 is included in 1996.
M&J/Retail Limited Partnership
The Partnership has invested a total of $3,995,000 to obtain a 56.27% limited
partnership interest in M&J/Retail Limited Partnership ("M&J/Retail"), which
owns a majority interest in ten strip shopping centers in the metropolitan
Chicago area and two partnership interests. The Partnership is entitled to a
9% cumulative cash flow priority on invested capital. On December 31, 1993,
the Partnership acquired an additional 0.70% interest in M&J/Retail. On July
1, 1995, the Partnership sold 4.22% of its limited partnership interest in
M&J/Retail to an unrelated party for $314,800 and recognized a gain of
$137,245.
During 1988, the Partnership invested $3,110,000 to obtain a 99% interest in
M&J/Harlem Mortgage Limited Partnership, which funded a $3,100,000 first
mortgage on a shopping center located in Oak Park, Illinois. The first
mortgage was partially funded by $2,000,000 of loans payable to certain
limited partners and the general partners bearing interest at 8.5% per annum.
The loans were repaid in January 1994. On August 18, 1993, M&J/Harlem
Mortgage Limited Partnership became Mortgagee in Possession of the Harlem
North Shopping Plaza. On October 13, 1993, a Judgement of Foreclosure was
entered in the Circuit Court of Cook County, Illinois for M&J/Harlem Mortgage
Limited Partnership. On December 30, 1993, M&J/Harlem Mortgage Limited
Partnership financed the property with a first mortgage of $2,362,500,
bearing
51
<PAGE> 52
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
interest at 7.85% per annum. The mortgage matures January 1, 1999. On
December 31, 1993, the Partnership sold its 99% interest in M&J/Harlem
Mortgage Limited Partnership to M&J/Retail for $3,150,000. No gain or loss
was recognized on the sale.
On July 28, 1995, M&J/Retail acquired a majority interest in Northlake Tower
Limited Partnership ("Tower"), contributing $1,112,667 of initial capital
with, potentially, an additional capital requirement of $179,162 to cover
unanticipated contingencies. Additional contributions of $74,951 made
through December 31, 1996, increased the total capital investment to
$1,187,628. Tower owns a 17.08% share of BSRT/M&J Northlake Limited
Partnership ("BSRT/M&J"), which purchased a leasehold interest in the
Northlake Tower Festival Shopping Center for $16,989,000 on July 28, 1995.
The purchase of this property was made subject to a $10,350,000 first
mortgage loan bearing interest only at the fixed rate of 8.5% per annum for
ten years. The shopping center, consisting of 303,956 square feet of
improvements and five outlots, is located in Atlanta, Georgia. In a related
transaction, M&J/Retail loaned $83,212 to Northlake Tower Corporation ("Tower
Corporation"), a General Partner of both Tower and BSRT/M&J (see Note 4).
The loan is secured by Tower Corporation's partnership interests in Tower and
BSRT/M&J, and interest thereon will be paid from Tower Corporation's share of
net cash flow.
On October 27, 1995, M&J/Retail invested a total of $297,000 to acquire a
46.41% Class A interest in M&J/Crossroads Limited Partnership. The balance
of $303,000 of the total $600,000 required capital for Class A investors was
also financed by M&J/Retail, resulting in a receivable from the other
investors for their respective share of capital contributions as of December
31, 1995 (see Note 4). These receivables were repaid in full during 1996.
The financial position and results of operations at December 31, 1996, are
included in the accompanying consolidated financial statements.
52
<PAGE> 53
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
The following is a summary of the financial position and results of
operations of the entities included in consolidation at December 31, 1996:
<TABLE>
<CAPTION>
Freeport M&J/ M&J/
Office Sheridan Retail
Partners Limited Limited
Limited Partnership Partnership
---------- ----------- -----------
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $ - $2,834,233 $18,882,289
Current assets - 20,436 123,452
Other assets - 93,680 500,770
---------- ---------- -----------
TOTAL ASSETS $ - $2,948,349 $19,506,511
========== ========== ===========
Mortgages payable $ - $1,422,834 $16,024,959
Other long-term payables - 462,000 575,000
Current liabilities - 106,853 1,265,268
Minority interest - (93,977) 1,543,751
Partners' capital - 1,050,639 97,533
---------- ---------- -----------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL $ - $2,948,349 $19,506,511
========== ========== ===========
STATEMENT OF OPERATIONS
Revenue $1,773,673 $ 396,499 $ 3,945,064
Less:Operating expenses 201,162 227,551 1,944,470
Other expenses 32,335 177,486 1,400,382
Depreciation - 122,035 522,310
Minority interest (41,499) (13,984) 36,100
---------- ---------- -----------
NET INCOME (LOSS) $1,581,675 $ (116,589) $ 41,802
========== ========== ===========
</TABLE>
53
<PAGE> 54
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
The following is a summary of the financial position and results of
operations of the entities included in consolidation at December 31, 1995:
<TABLE>
<CAPTION>
Freeport M&J/ M&J/
Office Sheridan Retail
Partners Limited Limited
Limited Partnership Partnership
---------- ----------- -----------
<S> <C> <C> <C>
BALANCE SHEET
Real estate - net of
accumulated depreciation $ 8,328,075 $2,906,108 $19,221,742
Current assets 66,480 14,775 894,027
Other assets 182,295 37,130 442,304
----------- ---------- -----------
TOTAL ASSETS $ 8,576,850 $2,958,013 $20,558,073
=========== ========== ===========
Mortgages payable $ 5,185,580 $1,545,802 $16,337,894
Other long-term payables 3,730,000 265,000 608,333
Current liabilities 1,201,446 59,975 1,245,725
Minority interest 41,499 (79,993) 1,617,851
Partners' capital (deficit) (1,581,675) 1,167,229 748,270
----------- ---------- -----------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL (DEFICIT) $ 8,576,850 $2,958,013 $20,558,073
=========== ========== ===========
STATEMENT OF OPERATIONS
Revenue $ 1,417,320 $ 381,346 $ 4,042,911
Less:Operating expenses 929,202 202,057 2,216,168
Other expenses 2,345,203 182,398 1,400,034
Depreciation 437,245 121,217 518,583
Minority interest (219,384) (13,315) (148,215)
----------- ---------- -----------
NET INCOME (LOSS) $(2,074,946) $(111,011) $ 56,341
=========== ========= ===========
</TABLE>
54
<PAGE> 55
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
The following is a summary of the financial position and results of
operations of the entities included in consolidation at December 31, 1994:
<TABLE>
<CAPTION>
Freeport M&J/ M&J/
Office Sheridan Retail
Partners Limited Limited
Limited Partnership Partnership
--------------- ----------------- ----------------
BALANCE SHEET
<S> <C> <C> <C>
Real estate - net of
accumulated depreciation $ 10,063,225 $ 3,001,201 $ 19,580,503
Current assets 207,137 5,647 839,797
Other assets 231,665 54,360 417,513
--------------- ---------------- ----------------
TOTAL ASSETS $ 10,502,027 $ 3,061,208 $ 20,837,813
=============== ================= ================
Mortgages payable $ 5,200,000 $ 1,558,634 $ 15,700,654
Other long-term payables 3,560,000 180,000 106,592
Current liabilities 987,874 111,011 1,162,362
Minority interest 260,883 (66,677) 1,393,281
Partners' capital 493,270 1,278,240 2,474,924
--------------- ---------------- ----------------
TOTAL LIABILITIES AND
PARTNERS' CAPITAL $ 10,502,027 $ 3,061,208 $ 20,837,813
=============== ================= ================
STATEMENT OF OPERATIONS
Revenue $ 1,486,882 $ 327,414 $ 3,769,062
Less:Operating expenses 952,854 184,223 1,818,455
Other expenses 915,318 162,101 1,287,773
Depreciation 437,824 111,920 524,083
Minority interest (249,797) (14,012) 53,234
--------------- ---------------- ----------------
NET INCOME (LOSS) $ (569,317) $ (116,818) $ 85,517
=============== ================= ================
</TABLE>
55
<PAGE> 56
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
4 - LOANS RECEIVABLE - OTHER
<TABLE> 1996 1995
<CAPTION>
---- ----
<S> <C> <C>
Tango Bay Suites
Unsecured promissory note
bearing interest at 3%
over prime issued in
connection with Tango Bay
Suites located in Orlando,
Florida. The note is due
on demand or, if demand is
not sooner made, on
December 31, 2002. (see
Note 3). $731,124 $731,124
L-C Office Partnership IV
Unsecured promissory note
bearing interest at 2%
over prime issued in
connection with the Dover
Farms Apartments located
in North Royalton, Ohio.
The note is due on demand
or, if demand is not
sooner made, on March 31,
1998. 71,872 -
Lake Cook Office
Development - Building
Four Limited Partnership
Unsecured promissory note
bearing interest at 2%
over prime issued in
connection with the Dover
Farms Apartments located
in North Royalton, Ohio.
The note is due on demand
or, if demand is not
sooner made, on March 31,
1998. 15,091 14,589
Hawdel Limited Partnership
and Hawdel Limited
Partnership III
Unsecured promissory note
bearing interest at 7.52%
issued in connection with
the Camden Place Office
Building located in Oak
Brook, Illinois. The note
is due on July 18, 2004.
On February 21, 1997, the
loan was repaid in full
along with accrued
interest. 295,161 295,161
XXI Office Plaza Associates
Unsecured promissory note
bearing interest at prime
issued in connection with
Century XXI Office Plaza
located in Germantown,
Maryland. The note is due
on December 31, 1999. 27,814 27,814
Northlake Tower Corporation
Promissory note bearing
interest at prime plus
participating interest,
secured by Northlake Tower
Corporation's partnership
interests in Northlake
Tower Limited Partnership
and BSRT/M&J Northlake
Limited Partnership. The
note is due on demand or,
if demand is not sooner
made, on December 31,
1999. 83,212 80,951
</TABLE>
56
<PAGE> 57
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Second Wilkow Venture
Unsecured promissory note bearing
interest at prime and payable on
demand, issued in connection with
the acquisition of a partnership
interest in M&J/Crossroads Limited
Partnership. On March 31, 1996,
the loan was repaid in full along
with accrued interest. $ - $200,000
First Candlewick Associates
Unsecured promissory note bearing
interest at prime and payable on
demand, issued in connection with
the acquisition of a partnership
interest in M&J/Crossroads Limited
Partnership. On March 31, 1996,
the loan was repaid in full along
with accrued interest. - 45,000
222 Fee Associates
Unsecured promissory note bearing
interest at prime and payable on
demand, issued in connection with
the acquisition of a partnership
interest in M&J/Crossroads Limited
Partnership. On March 31, 1996,
the loan was repaid in full along
with accrued interest. - 30,000
5601 N. Sheridan Associates
Unsecured promissory note bearing
interest at prime and payable on
demand, issued in connection with
the acquisition of a partnership
interest in M&J/Crossroads Limited
Partnership. On March 31, 1996,
the loan was repaid in full along
with accrued interest. - 22,000
Crossroads of Roseville Corporation
Unsecured promissory note bearing
interest at prime and payable on
demand, issued in connection with
the acquisition of a partnership
interest in M&J/Crossroads Limited
Partnership. On March 31, 1996,
the loan was repaid in full along
with accrued interest. - 6,000
---------- ----------
Total $1,224,274 $1,452,639
========== ==========
</TABLE>
57
<PAGE> 58
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
5 - CERTIFICATES OF DEPOSIT
Certificates of deposit include maturities through January 6, 1997, with
an interest rate of 5.50%, and represent temporary investments.
58
<PAGE> 59
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
6 - MORTGAGES PAYABLE
The mortgages payable at December 31, 1996, consist of:
<TABLE>
<CAPTION>
PRINCIPAL PAYMENTS
OUTSTANDING ------------------------------------------------------------
ORIGINAL BALANCE DURING YEAR ENDED DECEMBER 31,
PRINCIPAL MONTHLY DECEMBER 31, --------------------------------------------
AMOUNT PAYMENTS 1996 1997 1998 1999 2000 2001 THEREAFTER
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
180 North Michigan, 8.50%
due monthly to September 1,
2001 (a) $6,733,888 $47,698 $6,733,888 $- $26,377 $83,752 $91,154 $6,532,605 $ -
Naperville Office Court,
8.875% due monthly to
May 1, 1998 (b) 3,000,000 24,025 2,755,914 45,535 2,710,379 - - - -
Highland Park Medical Building,
8.88% due monthly to
October 1, 2001 (c) 1,425,000 12,711 1,422,835 29,667 30,025 32,802 35,837 1,294,504 -
Oak Lawn Promenade,
8.25% due monthly to
April 1, 1998 (d) 3,175,000 24,143 2,824,108 53,825 2,770,283 - - - -
Oak Lawn Square,
8.25% due monthly to
April 1, 1998 (e) 890,000 6,995 818,269 15,595 802,674 - - - -
Broadway - Berwyn, 8.20% due
monthly to July 31, 2000 (f) 2,750,000 23,346 2,673,282 63,281 68,670 74,517 2,466,814 - -
Irving - Kimball, 8.875% due
monthly to May 1, 1998 (g) 1,450,000 11,725 1,344,834 22,235 1,322,599 - - - -
Melrose - Kimball, 8.875% due
monthly to May 1, 1998 (h) 1,250,000 10,108 1,159,335 19,172 1,140,163 - - - -
</TABLE>
59
<PAGE> 60
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
OUTSTANDING
ORIGINAL BALANCE
PRINCIPAL MONTHLY DECEMBER 31,
AMOUNT PAYMENTS 1996
<S> <C> <C> <C>
Archer - Central, 8.875% due
monthly to May 1, 1998 (i) $2,200,000 $17,789 $2,040,501
Diversey and Sheffield, 7.875%
due monthly to April 1, 1999 (j) 2,000,000 14,938 1,879,281
111th and Western,
8.25% due May 1, 1999 (k) 618,000 5,266 582,996
Evergreen Commons, 8.25% due
May 1, 1999 (l) 530,000 4,516 499,980
Harlem North Shopping Center,
7.85% due monthly to January 1,
1999 (m) 2,362,500 19,541 2,202,370
Waterfall Plaza, 7.96% due monthly
to September 30, 1999 (n)(o) 2,100,000 12,232 2,248,954
47th and Halsted, 7% due monthly
to December 31, 2003 (p) 1,800,000 (p) 1,620,000
47th and Halsted, 4.96% due
at maturity on December 31,
2002 (q) 600,000 2,480 600,000
-----------
TOTAL 31,406,547
===========
Unamortized debt forgiveness
income and fair market value
acquisition adjustment (a)(n) (67,147)
-----------
TOTAL OUTSTANDING MORTGAGE BALANCE $31,339,400
===========
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL PAYMENTS
-----------------------------------------------------------------------
DURING YEAR ENDED DECEMBER 31,
--------------------------------------------------------
1997 1998 1999 2000 2001 THEREAFTER
<S> <C> <C> <C> <C> <C> <C>
Archer - Central, 8.875% due
monthly to May 1, 1998 (i) $33,723 $2,006,778 $- $- $- $-
Diversey and Sheffield, 7.875%
due monthly to April 1, 1999 (j) 32,417 35,062 1,811,802 - - -
111th and Western,
8.25% due May 1, 1999 (k) 15,676 17,020 550,300 - - -
Evergreen Commons, 8.25% due
May 1, 1999 (l) 13,444 14,596 471,940 - - -
Harlem North Shopping Center,
7.85% due monthly to January 1,
1999 (m) 63,870 69,069 2,069,431 - - -
Waterfall Plaza, 7.96% due monthly
to September 30, 1999 (n)(o) - - 2,248,954 - - -
47th and Halsted, 7% due monthly
to December 31, 2003 (p) 60,000 60,000 93,000 96,000 96,000 1,215,000
47th and Halsted, 4.96% due
at maturity on December 31,
2002 (q) - - - - - 600,000
-------- ----------- ----------- ---------- ---------- ---------
TOTAL $468,440 $11,073,695 $7,436,498 $2,689,805 $7,923,109 $1,815,000
======== =========== ========== ========== ========== ==========
</TABLE>
60
<PAGE> 61
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
(a) A balloon payment of $6,475,755 will be due September 1, 2001.
Loan is interest only through September 30, 1998, at which time a
principal amortization schedule based on 25 years will commence. Debt
forgiveness income of $500,000 is being amortized over the remaining
term of the loan using the effective interest method.
(b) A balloon payment of $2,698,352 will be due May 1, 1998.
(c) A balloon payment of $1,265,467 will be due October 1, 2001.
(d) A balloon payment of $2,754,886 will be due April 1, 1998.
(e) A balloon payment of $798,214 will be due April 1, 1998.
(f) A balloon payment of $2,420,449 will be due July 31, 2000.
(g) A balloon payment of $1,316,725 will be due May 1, 1998.
(h) A balloon payment of $1,135,099 will be due May 1, 1998.
(i) A balloon payment of $1,997,870 will be due May 1, 1998.
(j) A balloon payment of $1,805,684 will be due April 1, 1999.
(k) A balloon payment of $542,784 will be due May 1, 1999.
(l) A balloon payment of $465,494 will be due May 1, 1999.
(m) A balloon payment of $2,063,428 will be due January 1, 1999.
(n) A balloon payment of $2,248,954 will be due September 30, 1999.
The loan was adjusted to the fair market value of the property at time
of acquisition.
(o) Current interest is GECC commercial paper plus 2.00% for years 1
through 3, plus 3.25% for year 4 (commencing October 1, 1995) and plus
4.5% (commencing October 1, 1996) for years 5 through 7.
(p) Monthly interest payments and fixed principal payments of $5,000
from February 1, 1994, to January 1, 1999, and $8,000 from February 1,
1999, to December 1, 2003, are to be made with the balance of
$1,028,000 due on December 31, 2003.
(q) A balloon payment will be due on December 31, 2002.
61
<PAGE> 62
7 - RELATED PARTY TRANSACTIONS
Management and Other Fees
Management, leasing and consulting fees paid to M&J Wilkow, Ltd., M&J
Wilkow Management Corp., and M&J Wilkow Brokerage Corp. (companies
whose principal shareholders are general partners of the Partnership) for
the years ended December 31, 1996, 1995 and 1994, were $907,244, $994,776
and $1,179,527, respectively.
At December 31, 1996 and 1995, $98,371 and $179,082 respectively, are owed
to M&J Wilkow, Ltd. and M&J Wilkow Management Corp. for management,
leasing and consulting fees.
Professional Fees
Professional fees paid during the years ended December 31, 1996, 1995 and
1994, to Wilkow & Wilkow, P.C. (a company owned by a general partner
of the Partnership) for services in the ordinary course of business were
$37,901, $37,170 and $54,487, respectively. For the years ended December
31, 1996, 1995 and 1994, $62,792, $59,388 and $97,738, respectively, were
paid to M&J Wilkow, Ltd. and M&J Wilkow Management Corp. for services
rendered in connection with legal, tax and accounting matters.
Investments in Partnerships
The general partners and/or entities controlled or managed by one or more
of such partners have ownership interests in a majority of the real
estate projects in which the Partnership also has ownership interests.
Loans Payable
As of December 31, 1993, loans payable to certain limited partners and the
general partners in the amount of $1,694,500 had a variable rate
of interest and were due on demand. The proceeds were used by M&J/Harlem
Mortgage Limited Partnership to partially fund a $3,100,000 first mortgage
loan (see Note 3 - M&J/Retail Limited Partnership). The loans were repaid
in January of 1994. Loans payable to a general partner and certain
limited partners in the amount of $410,000 bear interest at the prime rate
and are due December 31, 1997.
The Partnership has received loans from a company partially owned by the
general partners. The loan in the amount of $425,000 bears interest
at the prime rate and matures on December 31, 1996. The loan was repaid
on January 25, 1996, with interest accruing through the date of repayment.
The Partnership also has a loan payable in the amount of $44,488 to a real
estate project held in a cotenancy arrangement by various entities in
which the general partners of the Partnership are also partners. The note
bears interest at the prime rate and is due on demand.
62
<PAGE> 63
Debentures
Freeport Office Partners had issued $1,674,000 of a total available issue
of $2,000,000 of subordinated debentures to the general partners,
certain limited partners and other related parties. The debentures earned
interest of 11% (per annum) and an additional 3% (per annum) to be accrued
over five years. The debentures were due September 1, 1995. Nine percent
interest was accrued and paid on the outstanding debentures until the date
of repayment along with the principal amount on January 18, 1996, from the
proceeds of the sale of the building.
At December 31, 1994, the Partnership had a nonrecourse liability of
$1,747,833 in connection with the issuance of $3,260,000 of
unsecured, subordinated debentures by The Villas at Monterey Limited
Partnership, one of the co-tenants of the Tango Bay Suites property (see
Note 3 - M&J/Westwood Limited Partnership). The debentures are payable to
the general partners, certain limited partners, and other related parties.
The debentures bear interest at 10% and are due November 24, 1999. In
addition, the debenture holders are entitled to contingent interest equal
to 50% of "net cash flow" as defined in the agreement. The Partnership
was relieved of its liability in connection with the debentures upon
disposal of its interest in Tango Bay Suites effective June 30, 1995.
Deferred Charges
Loan origination fees paid to M&J Wilkow, Ltd. and M&J Wilkow Management
Corp. were $51,420 for the year ended December 31, 1994.
Rental Income
Rental income received from M&J Wilkow, Ltd. (a company whose principal
shareholders are partners of the Partnership) was $172,279, $162,528 and
$180,399 for the years ended December 31, 1996, 1995 and 1994,
respectively, under a lease for office space.
63
<PAGE> 64
8 - RENTALS RECEIVABLE UNDER OPERATING LEASES
Minimum future rentals receivable by First Wilkow Venture on
noncancelable operating leases as of December 31, 1996, are as follows:
<TABLE>
<CAPTION>
Year Ending
December 31, Total
<S> <C>
1997 $6,777,000
1998 5,457,000
1999 3,999,000
2000 3,193,000
Thereafter 7,810,000
----------
Total $27,236,000
============
</TABLE>
9 - PARTNERS' CAPITAL
At December 31, 1996, general partner units totaled 7,174 units and the
general partners also beneficially owned 2,923 limited partner units.
At December 31, 1995, general partner units totaled 6,803 units and the
general partners also beneficially owned 2,773 limited partner units.
10 - COMMITMENTS AND CONTINGENCIES
As of December 31, 1996, the Partnership has a revolving credit facility
with LaSalle National Bank which is secured by the Partnership's limited
partnership units in Duke Realty Limited Partnership (see Note 3). The
facility, due September 10, 1997, pays interest at the prime rate.
Maximum borrowings under the agreement are the lesser of $800,000 or 80%
of the fair market value of the Partnership's 50,251 units in Duke Realty
Limited Partnership (see Note 3). As of December 31, 1996, the amount
outstanding under this facility is $230,000, consisting of two unsecured
letters of credit for $80,000 and $150,000 with General Electric Capital
Corporation as beneficiary.
As of December 31, 1996, the Partnership, through its investment in
M&J/Retail Limited Partnership, has an installment note due to LaSalle
National Bank. The note, due October 1, 2000, pays interest at the prime
rate plus 1% per annum. As of December 31, 1996, the amount outstanding
under this note is $375,000.
64
<PAGE> 65
11 - PROVISION FOR LOSS IN BOOK VALUE OF REAL ESTATE
During the fourth quarter of 1996, the Partnership recognized write-downs
of $154,000 and $119,000 on its investments in Hawdel Limited
Partnership I and III and M&J/Largo Limited Partnership, respectively.
The amounts of the write-downs were based on estimated final cash
distributions from the proceeds of the sale of the underlying real
properties in 1997.
During the fourth quarter of 1995, the Partnership recognized a
$1,400,000 write-down on the Freeport Office building.
On December 31, 1994, the Partnership wrote off a loan receivable of
$113,663 as well as related accrued interest of $99,565 due from
M&J/Quorum Associates due to the fact that Crow-Commerce Park North
Retail, Ltd. was unable to finalize the terms of a loan extension
agreement with the mortgagee and was consequently foreclosed on in April
1995.
These provisions were based upon market conditions and estimated future
cash flows.
12 - SUBSEQUENT EVENT
In January 1997, the Partnership made a distribution in the amount of
$357,944, or $2 per unit.
In January 1997, the property known as 2221 Camden Court Office Building
was sold for $11,750,000, resulting in repayment of Partnership loans
and an equity distribution of $690,360 to the Partnership. A provision
for loss in book value of $154,000, equal to the estimated loss to the
Partnership on the disposition of the investment, is recognized in 1996.
On February 12, 1997, Sun Pointe Place Limited Partnership sold a
140-unit apartment complex it developed and owned in Largo, Florida, for
$2,600,000. M&J/Largo Limited Partnership, in which the Partnership owns
a 91.12% interest, exercised its option to withdraw as a limited partner
of Sun Pointe Place Limited Partnership simultaneously with the sale of
the property, entitling it to all the available sale proceeds. The
Partnership anticipates receiving a final equity distribution from
M&J/Largo Limited Partnership of approximately $575,000. A provision for
loss in book value of $119,000, equal to the estimated loss to the
Partnership on the disposition of the investment, is recognized in 1996.
65
<PAGE> 66
ITEM 9 - DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
None
PART III
ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The following sets forth certain information with respect to each general
partner of the
Registrant:
Name Position
----------------- -----------------------------------
Marc R. Wilkow General Partner and General Counsel
Clifton J. Wilkow General Partner
Marc R. Wilkow has been in the real estate management and investment
business since 1977. He is also a lawyer and the sole shareholder of the law
firm of Wilkow & Wilkow, P.C. Clifton J. Wilkow has been involved in the
business of the Registrant since 1976. Also see "ITEM 1: Business
Organization" for further information.
There have been no proceedings of any kind involving bankruptcy,
criminality or restraint in the area of financial dealings against or otherwise
affecting any general partner during the last ten years.
The executive officers of the Registrant are its general partners. Their
names, ages, positions and relationships are listed below:
Name Position Age Other Positions Relation to Other Officer
----------------- -------- --- --------------- -------------------------
Marc R. Wilkow General 47 General Counsel Brother of Clifton Wilkow
Partner
Clifton J. Wilkow General 44 None Brother of Marc Wilkow
Partner
66
<PAGE> 67
ITEM 11 - EXECUTIVE COMPENSATION
The general partners do not receive any remuneration or other special
benefit directly from the Registrant; however, Marc R. and Clifton J. Wilkow
are owners and shareholders of M&J Wilkow, Ltd., which receives management,
leasing, consulting and brokerage fees from each of the operating properties
and/or partnerships. In addition, the Registrant pays M&J Wilkow, Ltd. an
asset management fee. M&J Wilkow, Ltd. receives accounting and tax return
preparation fees based upon hourly service. Wilkow & Wilkow, P.C. also
receives a retainer for services rendered as general counsel to the Registrant
and legal fees on an hourly rate basis for professional services rendered
beyond the scope of the services contemplated by the retainer fee. Also see
"ITEM 1: Business Organization" for further information.
Options Granted to Management to Purchase Securities
There have been no options granted to management to purchase securities
from the Registrant.
Interest of Management and Others in Certain Transactions
For transactions to date, and those anticipated, reference is made to
"ITEM 1: Business."
ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) No general partner holds 5% or more of any of the securities.
The following limited partner holds 5% or more of the Registrant's total units:
Units Owned % of Total Units
--------------------------- ----------------
William W. Wilkow Marital Trust 12,815 7.16%
(b) The following table sets forth the equity securities of the
Registrant beneficially owned directly or indirectly by the general
partners and their spouses as a group (three persons) at December 31,
1996:
67
<PAGE> 68
Amount
Beneficially Owned % of Owned
------------------ ----------
General Partnership Units 7,174 4.00%
Units of Limited
Partnership Interest 2,923 1.63%
(c) There are no contractual arrangements known to the Registrant
including any pledge of securities of the Registrant, the operation of
the terms of which may at a subsequent date result in a change of
control of the Registrant.
Wilkow & Wilkow, P.C., a professional corporation owned by one of the
general partners, acting in its capacity as attorney and general
counsel for the Registrant, was involved with the Registrant in certain
transactions.
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Management, leasing and consulting fees paid to M&J Wilkow, Ltd., M&J
Wilkow Management Corp. and M&J Wilkow Brokerage Corp. (companies whose
principal shareholders are general partners of the Registrant) for the years
ended December 31, 1996, 1995 and 1994, were $907,244, $994,776 and $1,179,527,
respectively (see Note 7 to Consolidated Financial Statements).
Professional fees paid during the years ended December 31, 1996, 1995 and
1994, to Wilkow & Wilkow, P.C. for services in the ordinary course of business
were $37,901, $37,170 and $54,487, respectively.
Legal, tax and accounting services rendered in the years ended December
31, 1996, 1995 and 1994, by M&J Wilkow Management Corp. and M&J Wilkow, Ltd.
were $62,792, $59,388 and $97,738, respectively.
The general partners and/or entities controlled or managed by one or more
of such partners have ownership interests in a majority of the real estate
projects in which the Registrant also has ownership interests.
68
<PAGE> 69
PART IV
ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) The following documents are filed as a part of this report:
1. The Index to Consolidated Financial Statements is set forth on Page 25
2. Financial Statement Schedules: Page No.
Independent Auditor's Report 26
Schedule VIII - Valuation and Qualifying Accounts and Reserves,
Years Ended December 31, 1996, 1995 and 1994 70
Schedule X - Supplementary Profit and Loss Information,
Years Ended December 31, 1996, 1995 and 1994 71
Schedule XI - Real Estate and Accumulated Depreciation,
Year Ended December 31, 1996 72
Notes to Schedule XI 76
Schedule XIII - Investments in, Equity in Earnings of,
and Drawings Received From Affiliates and Other Persons,
Years Ended December 31, 1996, 1995 and 1994 89
Schedules other than those listed above have been omitted since they are
either not applicable or not required or the information is included elsewhere
herein.
3. Exhibits: See Index to Exhibits on Page 99
(b) Reports on Form 8-K:
No reports on Form 8-K were filed by the Registrant during the year
ended December 31, 1996.
69
<PAGE> 70
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
COLUMN B COLUMN C COLUMN D COLUMN E
(1) ADDITIONS
BALANCE AT CHARGED TO BALANCE AT
BEGINNING PROFIT OR CLOSE OF
OF YEAR INCOME OTHER DEDUCTIONS YEAR
---------- ---------- ----- ---------- ----------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1994
Reserve for bad debts $- $- $- $- $-
========== ========== ===== ========== ==========
Reserve for losses on loans $327,787 $113,863 $- $327,787 $113,863
========== ========== ===== ========== ==========
Reserve for valuation of investments $2,560,000 $- $- $- $2,560,000
========== ========== ===== ========== ==========
YEAR ENDED DECEMBER 31, 1995
Reserve for bad debts $ - $ - $ - $ - $ -
========== ========== ===== ========== ==========
Reserve for losses on loans $ 113,863 $ - $ - $ 113,863 $ -
========== ========== ===== ========== ==========
Reserve for valuation of investments $2,560,000 $ - $ - $ - $2,560,000
========== ========== ===== ========== ==========
YEAR ENDED DECEMBER 31, 1996
Reserve for bad debts $ - $ - $ - $ - $ -
========== ========== ===== ========== ==========
Reserve for losses on loans $ - $ - $ - $ - $ -
========== ========== ===== ========== ==========
Reserve for valuation of investments $2,560,000 $273,000 $ - $2,560,000 $273,000
========== ========== ===== ========== ==========
</TABLE>
70
<PAGE> 71
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE X - SUPPLEMENTARY PROFIT AND LOSS INFORMATION
YEARS ENDED DECEMBER 31, 1996 1995 1994
1. REPAIRS AND MAINTENANCE
<TABLE>
<S> <C> <C> <C>
Name of property:
180 North Michigan Avenue $427,928 $391,454 $481,796
Buschwood - - 43,267
Naperville 45,433 64,734 51,582
Freeport Office 22,555 111,033 137,596
Highland Park 64,468 59,343 35,101
Waterfall Plaza 7,313 12,120 12,280
Tango Bay Suites - 62,127 94,307
Ten Retail Centers 114,989 135,570 150,697
-------- -------- ----------
TOTAL $682,686 $836,381 $1,006,626
======== ======== ==========
</TABLE>
2. DEPRECIATION, DEPLETION AND AMORTIZATION
<TABLE>
<S> <C> <C> <C>
OF FIXED AND INTANGIBLE ASSETS
Depreciation expense $1,384,141 $1,905,764 $2,176,820
Amortization expense 335,236 428,666 528,856
---------- ---------- ----------
TOTAL $1,719,377 $2,334,430 $2,705,676
========== ========== ==========
</TABLE>
3. TAXES, OTHER THAN INCOME TAXES
<TABLE>
<S> <C> <C> <C> <C>
Real estate taxes:
23 East Flagler - Department Store $63,937 $54,988 $65,333
Fairplay Foods 218,820 206,009 233,930
Freeport Office 9,451 185,084 163,542
180 North Michigan Avenue 682,999 614,938 754,534
Naperville Office Court 103,278 119,193 118,345
Buschwood - - 62,384
Highland Park 44,219 36,670 44,007
Ten Retail Centers 1,163,665 1,127,412 1,029,432
Tango Bay Suites - 58,920 132,854
Waterfall Plaza 142,401 172,885 17,845
Land - Fort Myers 32,176 32,659 37,572
---------- ---------- ----------
Total 2,460,946 2,608,758 2,659,778
Payroll taxes 14,453 6,877 11,927
Florida sales taxes 4,371 12,657 4,325
---------- ---------- ----------
TOTAL $2,479,770 $2,628,292 $2,676,030
========== ========== ==========
4. MANAGEMENT FEES $734,716 $877,342 $963,261
========== ========== ==========
5. RENTS
Ground rent - 180 North Michigan Avenue $ 13,549 $ 13,549 $ 27,098
========== ========== ==========
</TABLE>
71
<PAGE> 72
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION
YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
INITIAL COST TO COST CAPITALIZED
COMPANY SUBSEQUENT TO ACQUISITION
----------------------- -------------------------
BUILDINGS
AND CARRYING
DESCRIPTION ENCUMBRANCES LAND IMPROVEMENTS IMPROVEMENTS COST
------------ ------------ --------- ------------ ------------ ---- ----
<S> <C> <C> <C> <C> <C> <C>
23 East Flagler Street -
Department Store, Shopping
Miami, Florida Center $ - $231,920 $695,759 $ - $ -
Fairplay Foods, Shopping
Chicago, Illinois Center 2,220,000 429,877 1,562,842 - -
Naperville Office Court, Office
Naperville, Illinois Building 2,755,914 1,796,459 3,321,535 1,958,876 -
180 North Michigan Avenue, Office
Chicago, Illinois Building 7,063,227 1,061,120 6,550,000 5,445,525 -
Highland Park, Office
Highland Park, Illinois Building (A) 1,422,835 158,000 2,028,750 1,539,137 -
Waterfall Plaza, Shopping
Orland Park, Illinois Center 1,852,468 317,400 1,165,643 506,677 -
</TABLE>
72
<PAGE> 73
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEAR ENDED DECEMBER 31, 1996
INITIAL COST TO COST CAPITALIZED
COMPANY SUBSEQUENT TO ACQUISITION
<TABLE>
<CAPTION>
BUILDINGS
AND CARRYING
DESCRIPTION ENCUMBRANCES LAND IMPROVEMENTS IMPROVEMENTS COST
----------- ------------ ---- ------------ ------------ --------
<S> <C> <C> <C> <C> <C> <C>
Ten Strip Shopping Centers:
Oak Lawn Promenade, Shopping
Oak Lawn, Illinois Center (B) $2,824,108 $429,456 $3,865,100 $29,592 $-
Oak Lawn Square, Shopping
Oak Lawn, Illinois Center (B) 818,269 136,325 1,226,921 86,383 -
Broadway Festival, Shopping
Chicago, Illinois Center (B) 2,673,282 355,696 3,201,267 157,232 -
Irving Kimball, Shopping
Chicago, Illinois Center (B) 1,344,834 180,521 1,624,686 103,138 -
Melrose Kimball, Shopping
Chicago, Illinois Center (B) 1,159,335 155,195 1,396,752 - -
Archer Central, Shopping
Chicago, Illinois Center (B) 2,040,501 267,483 2,407,344 210,202 -
Evergreen Commons, Shopping
Evergreen Park, Illinois Center (B) 499,980 70,307 632,760 20,000 -
111 and Western, Shopping
Chicago, Illinois Center (B) 582,996 76,295 686,652 - -
Diversey and Sheffield, Shopping
Chicago, Illinois Center (B) 1,879,281 254,657 2,291,911 15,968 -
Harlem North Shopping Center, Shopping
Oak Park, Illinois Center (B) 2,202,370 310,000 2,790,000 152,155 -
------------ ---------- ------------ ------------ --------
Total $31,339,400 $6,230,711 $35,447,922 $10,224,885 $-
============ ========== ============ ============ ========
</TABLE>
See Notes 1, 2 and 3 accompanying Schedule XI.
(A) Owned by M&J/Sheridan Limited Partnership; 89% owned subsidiary of
First Wilkow Venture.
(B) Owned by M&J/Retail Limited Partnership; 53% owned subsidiary of
73
<PAGE> 74
First Wilkow Venture.
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEAR ENDED DECEMBER 31, 1996
<TABLE>
GROSS AMOUNT AT WHICH CARRIED AT
DECEMBER 31, 1996
--------- ------------ -------------------------------
BUILDINGS LIFE ON WHICH
AND ACCUMULATED DATE OF DATE DEPRECIATION IS
LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED COMPUTED
--------- ------------ ---------- ---------------- ------------ -------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
23 East Flagler Street -
Department Store
Miami, Florida $231,920 $695,759 $927,679 $ 695,759 1928 1966 25 Years
Fairplay Foods,
Chicago, Illinois 429,877 1,562,842 1,992,719 1,562,842 1963 1968 25 Years
Naperville Office Court,
Naperville, Illinois 1,796,459 5,280,411 7,076,870 1,724,097 1980 1986 25 Years
180 North Michigan Avenue,
Chicago, Illinois 1,061,120 11,995,525 13,056,645 7,189,911 1926 1968 building 35 Years
Highland Park,
Highland Park, Illinois 158,000 3,567,887 3,725,887 891,655 1931 1988 30 Years
Renovated in 1972
Waterfall Plaza,
Orland Park, Illinois 317,400 1,672,320 1,989,720 142,896 1980 1993 40 Years
</TABLE>
74
<PAGE> 75
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEAR ENDED DECEMBER 31, 1996
<TABLE>
<CAPTION>
GROSS AMOUNT AT WHICH CARRIED AT
DECEMBER 31, 1996
-----------------------------------------
BUILDINGS LIFE ON WHICH
AND ACCUMULATED DATE OF DATE DEPRECIATION IS
LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED COMPUTED
-------- ----------------- ------- ------------ ------------ -------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ten Strip Shopping Centers:
Oak Lawn Promenade,
Oak Lawn, Illinois $429,456 $ 3,894,692 $ 4,324,148 $ 959,918 1986 1987 40 Years
Oak Lawn Square,
Oak Lawn, Illinois 136,325 1,313,304 1,449,629 308,461 1982 1987 40 Years
Broadway Festival,
Chicago, Illinois 355,696 3,358,499 3,714,195 780,794 1984 1987 40 Years
Irving Kimball,
Chicago, Illinois 180,521 1,727,824 1,908,345 359,073 1987 1988 40 Years
Melrose Kimball,
Chicago, Illinois 155,195 1,396,752 1,551,947 305,542 1987 1988 40 Years
Archer Central,
Chicago, Illinois 267,483 2,617,546 2,885,029 551,450 1985 1988 40 Years
Evergreen Commons,
Evergreen Park, Illinois 70,307 652,760 723,067 140,168 1987 1988 40 Years
111 and Western,
Chicago, Illinois 76,295 686,652 762,947 150,205 1987 1988 40 Years
Diversey and Sheffield,
Chicago, Illinois 254,657 2,307,879 2,562,536 459,705 1984 1989 40 Years
Harlem North Shopping Center,
Oak Park, Illinois 310,000 2,942,155 3,252,155 247,666 1980 1993 40 Years
------- ---------- --------- -------
TOTAL $ 6,230,711 $ 45,672,807 $ 51,903,518 $ 16,470,142
=========== ============ ============ ============
</TABLE>
75
<PAGE> 76
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
1 - RECONCILIATION OF COSTS OF REAL ESTATE DURING EACH
OF THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
-------------------------- -------- ----------- ------------- ----------
BUILDING AND BUILDING IMPROVEMENTS -
YEAR ENDED DECEMBER 31, 1996
<S> <C> <C> <C> <C> <C>
23 East Flagler - Department Store,
Miami, Florida $695,759 $- $- $- $695,759
Fairplay Foods,
Chicago, Illinois 1,562,842 - - - 1,562,842
Naperville Office Court,
Naperville, Illinois 5,065,453 254,987 40,029 - 5,280,411
180 North Michigan Avenue,
Chicago, Illinois 11,870,761 124,764 - - 11,995,525
Freeport Office,
Dallas, Texas 11,472,870 - - (11,472,870) -
Highland Park,
Highland Park, Illinois 3,517,726 50,161 - - 3,567,887
Waterfall Plaza,
Orland Park, Illinois 1,639,404 32,916 - - 1,672,320
</TABLE>
76
<PAGE> 77
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ -------- ----------- ------------- -------
Ten Strip Shopping Centers:
<S> <C> <C> <C> <C> <C>
Oak Lawn Promenade,
Oak Lawn, Illinois $3,880,389 $14,303 $ - $ - $3,894,692
Oak Lawn Square,
Oak Lawn, Illinois 1,311,990 1,314 - - 1,313,304
Broadway Festival,
Chicago, Illinois 3,347,234 11,265 - - 3,358,499
Irving Kimball,
Chicago, Illinois 1,642,428 85,396 - - 1,727,824
Melrose Kimball,
Chicago, Illinois 1,396,752 - - - 1,396,752
Archer Central,
Chicago, Illinois 2,617,546 - - - 2,617,546
Evergreen Commons,
Evergreen Park, Illinois 652,760 - - - 652,760
111 and Western,
Chicago, Illinois 686,652 - - - 686,652
Diversey and Sheffield,
Chicago, Illinois 2,302,638 5,241 - - 2,307,879
Harlem North Shopping Center,
Oak Park, Illinois 2,876,817 65,338 - - 2,942,155
------------ -------- ----------- ------------- -----------
TOTAL $56,540,021 $645,685 $40,029 $(11,472,870) $45,672,807
============ ======== =========== ============= ===========
</TABLE>
77
<PAGE> 78
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
1 - RECONCILIATION OF COSTS OF REAL ESTATE DURING EACH
OF THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994 - Continued
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
---------- -------- ----------- -------------- ----------
BUILDING AND BUILDING IMPROVEMENTS -
YEAR ENDED DECEMBER 31, 1995
<S> <C> <C> <C> <C> <C>
23 East Flagler - Department Store,
Miami, Florida $695,759 $- $- $- $695,759
Fairplay Foods,
Chicago, Illinois 1,562,842 - - - 1,562,842
Naperville Office Court,
Naperville, Illinois 4,704,984 360,469 - - 5,065,453
180 North Michigan Avenue,
Chicago, Illinois 11,739,472 131,289 - - 11,870,761
Buschwood,
Carrollwood, Florida - - - - -
Freeport Office,
Dallas, Texas 12,770,775 102,095 - (1,400,000)(A) 11,472,870
Highland Park,
Highland Park, Illinois 3,491,603 26,123 - - 3,517,726
Tango Bay Suites,
Orlando, Florida 6,099,144 - 6,099,144 - -
Waterfall Plaza,
Orland Park, Illinois 1,570,086 69,318 - - 1,639,404
</TABLE>
78
<PAGE> 79
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ -------- ----------- ------------------- -----------
Ten Strip Shopping Centers:
<S> <C> <C> <C> <C> <C> <C>
Oak Lawn Promenade,
Oak Lawn, Illinois $3,871,900 $8,489 $- - $3,880,389
Oak Lawn Square,
Oak Lawn, Illinois 1,286,757 25,233 - - 1,311,990
Broadway Festival,
Chicago, Illinois 3,307,949 39,285 - - 3,347,234
Irving Kimball,
Chicago, Illinois 1,642,428 - - - 1,642,428
Melrose Kimball,
Chicago, Illinois 1,396,752 - - - 1,396,752
Archer Central,
Chicago, Illinois 2,617,546 - - - 2,617,546
Evergreen Commons,
Evergreen Park, Illinois 652,760 - - - 652,760
111 and Western,
Chicago, Illinois 686,652 - - - 686,652
Diversey and Sheffield,
Chicago, Illinois 2,302,638 - - - 2,302,638
Harlem North Shopping Center,
Oak Park, Illinois 2,790,000 86,817 - - 2,876,817
------------ -------- ----------- ---------- -----------
TOTAL $63,190,047 $849,118 $6,099,144 $(1,400,000) $56,540,021
============ ======== =========== ========== ===========
</TABLE>
(A) Reflects the write-down of the building based on
estimated loss on 1996 disposition (see Note 11 of
the financial statements).
79
<PAGE> 80
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
1 - RECONCILIATION OF COSTS OF REAL ESTATE DURING EACH
OF THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994 - Continued
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
-------------------------------- -------- ----------- ---------------- ----------
BUILDING AND BUILDING IMPROVEMENTS -
YEAR ENDED DECEMBER 31, 1994
<S> <C> <C> <C> <C> <C>
23 East Flagler - Department Store,
Miami, Florida $695,759 $- $- $ - $695,759
Fairplay Foods,
Chicago, Illinois 1,562,842 - - - 1,562,842
Naperville Office Court,
Naperville, Illinois 4,641,946 63,038 - - 4,704,984
180 North Michigan Avenue,
Chicago, Illinois 11,240,558 498,914 - - 11,739,472
Buschwood,
Carrollwood, Florida 7,558,414 - 7,558,414 - -
Freeport Office,
Dallas, Texas 12,536,909 233,866 - - 12,770,775
Highland Park,
Highland Park, Illinois 3,235,382 256,221 - - 3,491,603
Tango Bay Suites,
Orlando, Florida 6,063,222 35,922 - - 6,099,144
Waterfall Plaza,
Orland Park, Illinois 1,358,256 211,830 - - 1,570,086
</TABLE>
80
<PAGE> 81
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ ---------- ----------- ---------------- -----------
Ten Strip Shopping Centers:
<S> <C> <C> <C> <C> <C>
Oak Lawn Promenade,
Oak Lawn, Illinois $3,871,900 $- $- $ - $3,871,900
Oak Lawn Square,
Oak Lawn, Illinois 1,226,921 59,836 - - 1,286,757
Broadway Festival,
Chicago, Illinois 3,313,467 10,935 16,453 - 3,307,949
Irving Kimball,
Chicago, Illinois 1,642,428 - - - 1,642,428
Melrose Kimball,
Chicago, Illinois 1,396,752 - - - 1,396,752
Archer Central,
Chicago, Illinois 2,617,546 - - - 2,617,546
Evergreen Commons,
Evergreen Park, Illinois 652,760 - - - 652,760
111 and Western,
Chicago, Illinois 686,652 - - - 686,652
Diversey and Sheffield,
Chicago, Illinois 2,302,638 - - - 2,302,638
Harlem North Shopping Center,
Oak Park, Illinois 2,790,000 - - - 2,790,000
------------ ---------- ----------- ---------------- -----------
TOTAL $69,394,352 $1,370,562 $7,574,867 $ - $63,190,047
============ ========== =========== ================ ===========
</TABLE>
81
<PAGE> 82
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
2 -RECONCILIATIONS OF ACCUMULATED DEPRECIATION OF REAL ESTATE
DURING EACH OF THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
-------------------------------- -------- ----------- ------------- ---------
YEAR ENDED DECEMBER 31, 1996
<S> <C> <C> <C> <C> <C>
23 East Flagler - Department Store,
Miami, Florida $695,759 $- $- $- $695,759
Fairplay Foods,
Chicago, Illinois 1,562,842 - - - 1,562,842
Naperville Office Court,
Naperville, Illinois 1,528,906 206,013 10,822 - 1,724,097
180 North Michigan Avenue,
Chicago, Illinois 6,704,663 485,248 - - 7,189,911
Freeport Office,
Dallas, Texas 4,370,870 - - (4,370,870) -
Highland Park,
Highland Park, Illinois 769,619 122,036 - - 891,655
Waterfall Plaza,
Orland Park, Illinois 101,714 41,182 - - 142,896
</TABLE>
82
<PAGE> 83
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ ---------- ----------- ------------- -----------
Ten Strip Shopping Centers:
<S> <C> <C> <C> <C> <C>
Oak Lawn Promenade,
Oak Lawn, Illinois $862,691 $97,227 $- $ - $959,918
Oak Lawn Square,
Oak Lawn, Illinois 275,639 32,822 - - 308,461
Broadway Festival,
Chicago, Illinois 696,988 83,806 - - 780,794
Irving Kimball,
Chicago, Illinois 317,592 41,481 - - 359,073
Melrose Kimball,
Chicago, Illinois 270,623 34,919 - - 305,542
Archer Central,
Chicago, Illinois 486,010 65,440 - - 551,450
Evergreen Commons,
Evergreen Park, Illinois 123,848 16,320 - - 140,168
111 and Western,
Chicago, Illinois 133,039 17,166 - - 150,205
Diversey and Sheffield,
Chicago, Illinois 402,086 57,619 - - 459,705
Harlem North Shopping Center,
Oak Park, Illinois 174,621 73,045 - - 247,666
------------ ---------- ----------- ---------- ----------
TOTAL $19,477,510 $1,374,324 $10,822 $(4,370,870) $16,470,142
============ ========== =========== ========== ===========
</TABLE>
83
<PAGE> 84
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
2 - RECONCILIATIONS OF ACCUMULATED DEPRECIATION OF REAL ESTATE
DURING EACH OF THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994 -
Continued
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ -------- ----------- ---------------- ---------
YEAR ENDED DECEMBER 31, 1995
<S> <C> <C> <C> <C> <C>
23 East Flagler - Department Store,
Miami, Florida $695,759 $- $- $ - $695,759
Fairplay Foods,
Chicago, Illinois 1,562,842 - - - 1,562,842
Naperville Office Court,
Naperville, Illinois 1,335,365 193,541 - - 1,528,906
180 North Michigan Avenue,
Chicago, Illinois 6,244,563 460,100 - - 6,704,663
Buschwood,
Carrollwood, Florida - - - - -
Freeport Office,
Dallas, Texas 3,970,515 400,355 - - 4,370,870
Highland Park,
Highland Park, Illinois 648,402 121,217 - - 769,619
Tango Bay Suites,
Orlando, Florida 276,423 - 276,423 - -
Waterfall Plaza,
Orland Park, Illinois 61,840 39,874 - - 101,714
</TABLE>
84
<PAGE> 85
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ ---------- ----------- ---------------- -----------
Ten Strip Shopping Centers:
<S> <C> <C> <C> <C> <C>
Oak Lawn Promenade,
Oak Lawn, Illinois $765,819 $96,872 $- $ - $862,691
Oak Lawn Square,
Oak Lawn, Illinois 243,307 32,332 - - 275,639
Broadway Festival,
Chicago, Illinois 613,687 83,301 - - 696,988
Irving Kimball,
Chicago, Illinois 276,532 41,060 - - 317,592
Melrose Kimball,
Chicago, Illinois 235,704 34,919 - - 270,623
Archer Central,
Chicago, Illinois 419,629 66,381 - - 486,010
Evergreen Commons,
Evergreen Park, Illinois 107,529 16,319 - - 123,848
111 and Western,
Chicago, Illinois 115,873 17,166 - - 133,039
Diversey and Sheffield,
Chicago, Illinois 344,313 57,773 - - 402,086
Harlem North Shopping Center,
Oak Park, Illinois 104,625 69,996 - - 174,621
------------ ---------- ----------- ----------------- -----------
TOTAL $18,022,727 $1,731,206 $276,423 $ - $19,477,510
============ ========== =========== ================= ===========
</TABLE>
85
<PAGE> 86
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
2 - RECONCILIATIONS OF ACCUMULATED DEPRECIATION OF REAL ESTATE
DURING EACH OF THE YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994 -
Continued
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ -------- ----------- ---------------- ---------
YEAR ENDED DECEMBER 31, 1994
<S> <C> <C> <C> <C> <C>
23 East Flagler - Department Store,
Miami, Florida $695,759 $- $- $ - $695,759
Fairplay Foods,
Chicago, Illinois 1,562,842 - - - 1,562,842
Naperville Office Court,
Naperville, Illinois 1,153,281 182,084 - - 1,335,365
180 North Michigan Avenue,
Chicago, Illinois 5,778,352 466,211 - - 6,244,563
Buschwood,
Carrollwood, Florida 1,596,728 112,719 1,709,447 - -
Freeport Office,
Dallas, Texas 3,673,175 297,340 - - 3,970,515
Highland Park,
Highland Park, Illinois 536,482 111,920 - - 648,402
Tango Bay Suites,
Orlando, Florida 125,647 150,776 - - 276,423
Waterfall Plaza,
Orland Park, Illinois 24,743 37,097 - - 61,840
</TABLE>
86
<PAGE> 87
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
<TABLE>
<CAPTION>
BALANCE AT BALANCE
BEGINNING OF ADDITION OTHER CHARGES AT END
YEAR AT COST RETIREMENTS ADD (DEDUCT) OF YEAR
------------ -------- ----------- ---------------- --------
Ten Strip Shopping Centers:
<S> <C> <C> <C> <C> <C>
Oak Lawn Promenade,
Oak Lawn, Illinois $669,023 $ 96,796 $- $ - $765,819
Oak Lawn Square,
Oak Lawn, Illinois 212,155 31,152 - - 243,307
Broadway Festival,
Chicago, Illinois 531,641 92,493 10,447 - 613,687
Irving Kimball,
Chicago, Illinois 235,472 41,060 - - 276,532
Melrose Kimball,
Chicago, Illinois 200,785 34,919 - - 235,704
Archer Central,
Chicago, Illinois 355,130 64,499 - - 419,629
Evergreen Commons,
Evergreen Park, Illinois 91,210 16,319 - - 107,529
111 and Western,
Chicago, Illinois 98,707 17,166 - - 115,873
Diversey and Sheffield,
Chicago, Illinois 286,849 57,464 - - 344,313
Harlem North Shopping Center,
Oak Park, Illinois 34,875 69,750 - - 104,625
------------ ----------- ----------- ---------- ------------
TOTAL $ 17,862,856 $ 1,879,765 $ 1,719,894 $ - $ 18,022,727
============ =========== =========== ========== ============
</TABLE>
87
<PAGE> 88
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
3 - BASIS OF REAL ESTATE FOR FEDERAL INCOME TAX PURPOSES
<TABLE>
<CAPTION>
BUILDING
AND
LAND IMPROVEMENTS
---------- ------------
<S> <C> <C>
First Wilkow Venture:
23 East Flagler - Department Store $266,738 $800,211
Fairplay Foods 502,093 1,825,386
180 North Michigan Avenue 1,079,535 10,725,495
Naperville Office Court 299,723 2,942,964
Waterfall Plaza 243,321 726,362
---------- ------------
Subtotal 2,391,410 17,020,418
---------- ------------
Subsidiaries:
Highland Park 158,000 2,821,755
Ten Strip Centers:
Harlem North 321,384 2,694,488
Oak Lawn Promenade 429,456 2,934,773
Oak Lawn Square 136,325 1,004,843
Broadway Festival 355,696 2,577,703
Irving Kimball 180,521 1,368,750
Melrose Kimball 155,195 1,091,210
Archer Central 267,483 2,066,097
Evergreen Commons 70,307 512,592
111 and Western 76,295 536,447
Diversey and Sheffield 254,657 1,848,170
---------- ------------
Subtotal 2,405,319 19,456,828
---------- ------------
Total Consolidated $4,796,729 $36,477,246
========== ============
</TABLE>
88
<PAGE> 89
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1996:
<TABLE>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS DEDUCTIONS BALANCE
BEGINNING OF ------------------ ------------------------------ AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
---------- -------- -------- -------- ------------ ----- ----------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE EQUITY METHOD
<S> <C> <C> <C> <C> <C> <C> <C>
Registrant:
L-C Office Partnership IV $- $- $- $- $- $ - $-
Realdal Venture - - - - - - -
M&J/Westwood Limited Partnership - - - - - - -
XXI Office Plaza Associates 406,644 27,291 - - - - 433,935
DB/F Office Ltd. Partnership - - - - - - -
M&J/Quorum Associates - - - - - - -
Hawdel Limited Partnership 854,014 - - 163,664 (C) - - 690,350
M&J/Grove Limited Partnership 296,324 208,519 98,100 (A) - 2,943 - 600,000
Rosemont 28 Limited Partnership 557,182 - 3,896 (A) 3,559 - - 557,519
First Ron Venture - - - - - - -
TOP Investors Limited Partnership - - - - - - -
---------- -------- -------- -------- ------- ----- --- ----------
Total Registrant 2,114,164 235,810 101,996 167,223 2,943 - 2,281,804
M&J/Crossroads Limited Partnership (B) 297,000 - - 23,349 13,751 - 259,900
---------- -------- -------- -------- ------- ----- --- ----------
TOTAL INVESTMENTS - EQUITY METHOD $2,411,164 $235,810 $101,996 $190,572 $16,694 $ - $2,541,704
========== ======== ======== ======== ======= ===== === ==========
</TABLE>
(A) Additional investment.
(B) Investment is owned by M&J/Retail Limited Partnership, which is
consolidated with the Registrant.
(C) Represents estimated loss on the 1997 disposition of the investment.
89
<PAGE> 90
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1996:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS DEDUCTIONS BALANCE
BEGINNING OF -------------- ---------------------------- AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
-------- -------- ----- ------------ -------- ----- --------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE COST METHOD
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Duke Realty Limited Partnership $468,904 $100,502 $- $- $100,502 $- $468,904
Metro Class A Investors Limited
Partnership - - - - - - -
Park 100 Equity Investors Limited
Partnership - - - - - - -
Park 100 Mortgage Investors Limited
Partnership - - - - - - -
M&J/Largo Limited Partnership 694,227 - - 119,000 (C) - - 575,227
North LaSalle Street Limited Partnership - - - - - - -
Second Daltex Venture - - - - - - -
21st M&J Associates 99,900 - - - - - 99,900
222 Fee Associates 6,728 319 - - 319 - 6,728
5601 N. Sheridan Associates 29,916 576 - - 576 - 29,916
First Candlewick Associates 125,950 22,055 - - 22,055 - 125,950
M&J/Two Market Limited Partnership - - - - - - -
Orhow Associates 70,000 - - - - - 70,000
Second Wilkow Venture 64,813 2,364 - - 2,364 - 64,813
Wilkow/Retail Partners L.P. 2,799 120 - - 120 - 2,799
544 Arizona Associates - - - - - - -
</TABLE>
90
<PAGE> 91
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1996:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE ADDITIONS DEDUCTIONS AT BALANCE
BEGINNING OF --------------------- ------------------------- AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
---------- -------- --- ------ -------- -------- ----- ----------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE COST METHOD - Continued
<S> <C> <C> <C> <C> <C> <C> <C>
Registrant:
Fifth Arizona Associates $- $- $ - $- $- $- $-
Fifth Orlando Associates - - - - - - -
Monterey Village Associates - - - - - - -
Pre-Vest Associates - - - - - - -
Seventh M&J Associates - - - - - - -
First Apollo Associates - - - - - - -
M&J/LaSalle L.P. 6,480 - - - - - 6,480
Wilkow/Grove L.P. - - - - - - -
Wilkow/Metro Partners L.P. - - - - - - -
---------- -------- --- ------ -------- -------- ----- ----------
Total Registrant 1,569,717 125,936 - 119,000 125,936 - 1,450,717
Northlake Tower Limited Partnership (A) 1,149,641 84,669 (B) 37,987 - 84,669 - 1,187,628
---------- -------- --- ------ -------- -------- ----- ----------
TOTAL INVESTMENTS - COST METHOD $2,719,358 $210,605 $ 37,987 $119,000 $210,605 $- $2,638,345
========== ======== ====== ======== ======== ===== ==========
</TABLE>
(A) Investment is owned by M&J/Retail Limited Partnership, which is
consolidated with the Registrant.
(B) Additional investment.
(C) Represents estimated loss on the 1997 disposition of the investment.
91
<PAGE> 92
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1995:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE ADDITIONS DEDUCTIONS AT BALANCE
BEGINNING OF ---------------------- ------------------------ AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
---------- -------- ----------- ------- ------ ------- ---------------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE EQUITY METHOD
<S> <C> <C> <C> <C> <C> <C> <C>
Registrant:
L-C Office Partnership IV $- $- $- $- $- $- $ -
Realdal Venture - - - - - - -
M&J/Westwood Limited Partnership - - - - - - -
XXI Office Plaza Associates 278,602 128,042 - - - - 406,644
DB/F Office Ltd. Partnership - - - - - - -
M&J/Quorum Associates - - - - - - -
Hawdel Limited Partnership 888,365 - - 34,351 - - 854,014
M&J/Grove Limited Partnership 327,530 - - 31,206 - - 296,324
Rosemont 28 Limited Partnership 554,383 49 2,750 (A) - - - 557,182
First Ron Venture - - - - - - -
TOP Investors Limited Partnership - - - - - - -
First MW Associates 18,462 900 - - 8,650 10,712 (B) -
---------- -------- -------- ------- ------ ------- ---------
Total Registrant 2,067,342 128,991 2,750 65,557 8,650 10,712 2,114,164
M&J/Crossroads Limited Partnership - - 297,000 (C) - - - 297,000
---------- -------- -------- ------- ------ ------- ---- ---------
TOTAL INVESTMENTS - EQUITY METHOD $2,067,342 $128,991 $299,750 $65,557 $8,650 $10,712 $ 2,411,164
========== ======== ======== ======= ====== ======= ==== =========
</TABLE>
(A) Additional investment.
(B) Investment was disposed of in 1995.
(C) Investment is owned by M&J/Retail Limited Partnership, which is
consolidated with the Registrant.
92
<PAGE> 93
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1995:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS DEDUCTIONS BALANCE
BEGINNING OF ---------------- ---------------------- AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
-------- -------- ------ ---- -------- ----- --------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE COST METHOD
<S> <C> <C> <C> <C> <C> <C> <C>
Duke Realty Limited Partnership $468,904 $134,752 $- $- $134,752 $- $468,904
Metro Class A Investors Limited
Partnership - - - - - - -
Park 100 Equity Investors Limited
Partnership - - - - - - -
Park 100 Mortgage Investors Limited
Partnership - - - - - - -
M&J/Largo Limited Partnership 694,227 - - - - - 694,227
North LaSalle Street Limited Partnership - - - - - - -
Second Daltex Venture - - - - - - -
21st M&J Associates 99,900 - - - - - 99,900
222 Fee Associates 6,728 406 - - 406 - 6,728
5601 N. Sheridan Associates 28,254 544 1,662 (D) - 544 - 29,916
First Candlewick Associates 116,050 3,000 9,900 (D) - 3,000 - 125,950
M&J/Two Market Limited Partnership - - - - - - -
Orhow Associates 70,000 - - - - - 70,000
S & S Venture 65,718 918 34,290 (C) - 100,926 - -
Second Chase Venture 56,100 450 3,875 (C) - 60,425 - -
Second Wilkow Venture 64,813 2,364 - - 2,364 - 64,813
Wilkow/Retail Partners L.P. 2,799 120 - - 120 - 2,799
544 Arizona Associates - - - - - - -
</TABLE>
93
<PAGE> 94
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1995:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS DEDUCTIONS BALANCE
BEGINNING OF --------------------- --------------------- AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
---------- -------- ---------- ---- -------- ----- ----------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE COST METHOD - Continued
<S> <C> <C> <C> <C> <C> <C> <C>
Registrant:
Fifth Arizona Associates $- $- $- $- $- $- $-
Fifth Orlando Associates - - - - - - -
Monterey Village Associates - - - - - - -
Pre-Vest Associates - - - - - - -
Seventh M&J Associates - - - - - - -
First Apollo Associates - - - - - - -
M&J/LaSalle L.P. - - 6,480 (B) - - - 6,480
Wilkow/Grove L.P. - - - - - - -
Wilkow/Metro Partners L.P. - - - - - - -
---------- -------- ---------- ---- -------- ----- ----------
Total Registrant 1,673,493 142,554 56,207 - 302,537 - 1,569,717
Northlake Tower Limited Partnership - - 1,149,641 (A) - - - 1,149,641
---------- -------- ---------- ---- -------- ----- ----------
TOTAL INVESTMENTS - COST METHOD $1,673,493 $142,554 $1,205,848 $- $302,537 $- $2,719,358
========== ======== ========== ==== ======== ===== ==========
</TABLE>
(A) Investment is owned by M&J/Retail Limited Partnership, which is
consolidated with the Registrant.
(B) Additional investment.
(C) Investment was disposed of in 1995.
(D) Distribution of assets from the liquidation of First MW Associates.
94
<PAGE> 95
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1994:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE ADDITIONS DEDUCTIONS AT BALANCE
BEGINNING OF ----------------- ----------------------- AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
---------- -------- ------- -------- ------- ----- ----------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE EQUITY METHOD
<S> <C> <C> <C> <C> <C> <C> <C>
L-C Office Partnership IV $- $- $- $- $- $- $-
Realdal Venture - - - - - - -
M&J/Westwood Limited Partnership - - - - - - -
XXI Office Plaza Associates 221,863 103,989 - - 47,250 - 278,602
DB/F Office Ltd. Partnership - - - - - - -
M&J/Quorum Associates - - - - - - -
Hawdel Limited Partnership 959,799 - - 71,434 - 888,365
M&J/Grove Limited Partnership 495,709 - - 168,179 - - 327,530
Rosemont 28 Limited Partnership 550,995 - 14,896 (A) 11,508 - - 554,383
First Ron Venture - - - - - - -
TOP Investors Limited Partnership - - - - - - -
First MW Associates 18,462 - - - - - 18,462
---------- -------- ------- -------- ------- ----- ----------
TOTAL $2,246,828 $103,989 $14,896 $251,121 $47,250 $- $2,067,342
========== ======== ======= ======== ======= ===== ==========
</TABLE>
(A) Additional investment.
95
<PAGE> 96
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1994:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS DEDUCTIONS BALANCE
BEGINNING OF ---------------- ------------------------------ AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
------- ------ -------- ------------ ------ ------- --------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE COST METHOD
<S> <C> <C> <C> <C> <C> <C> <C>
Duke Realty Limited Partnership $- $- $468,904 (A) $- $- $- $468,904
Metro Class A Investors Limited
Partnership - - - - - - -
Park 100 Equity Investors Limited
Partnership 506,944 - - - 60,600 446,344 (A) -
Park 100 Mortgage Investors Limited
Partnership 5,313 - - - 2,633 2,680 (A) -
M&J/Largo Limited Partnership 694,227 - - - - - 694,227
North LaSalle Street Limited Partnership 962,991 - - 962,991 (C) - - -
Second Daltex Venture - - - - - - -
21st M&J Associates 99,900 1,000 - - 1,000 - 99,900
222 Fee Associates 7,424 305 - - 305 696 (B) 6,728
5601 N. Sheridan Associates 28,254 408 - - 408 - 28,254
First Candlewick Associates 116,050 2,250 - - 2,250 - 116,050
M&J/Two Market Limited Partnership 19,880 800 - - 800 19,880 (A) -
Orhow Associates 70,000 700 - - 700 - 70,000
S & S Venture 65,718 2,754 - - 2,754 - 65,718
Second Chase Venture 56,100 675 - - 675 - 56,100
Second Wilkow Venture 64,813 2,068 - - 2,068 - 64,813
Wilkow/Retail Partners L.P. 2,799 90 - - 90 - 2,799
544 Arizona Associates - - - - - - -
</TABLE>
96
<PAGE> 97
FIRST WILKOW VENTURE
(A LIMITED PARTNERSHIP)
SCHEDULE XIII - INVESTMENTS IN, EQUITY IN EARNINGS OF, AND
DRAWINGS RECEIVED FROM AFFILIATES AND OTHER PERSONS - Continued
YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994
YEAR ENDED DECEMBER 31, 1994:
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS DEDUCTIONS BALANCE
BEGINNING OF ------------------ --------------------------- AT END
YEAR INCOME OTHER LOSS DRAWS OTHER OF YEAR
---------- ------- -------- -------- ------- -------- ----------
INVESTMENTS IN PARTNERSHIPS ACCOUNTED
FOR BY THE COST METHOD - Continued
<S> <C> <C> <C> <C> <C> <C> <C>
Fifth Arizona Associates $- $- $- $- $- $- $-
Fifth Orlando Associates - - - - - - -
Monterey Village Associates - - - - - - -
Pre-Vest Associates - - - - - - -
Seventh M&J Associates - - - - - - -
First Apollo Associates - - - - - - -
M&J/LaSalle L.P. - - - - - - -
Wilkow/Grove L.P. - - - - - - -
Wilkow/Metro Partners L.P. - - - - - - -
---------- ------- -------- -------- ------- -------- ----------
TOTAL $2,700,413 $11,050 $468,904 $962,991 $74,283 $469,600 $1,673,493
========== ======= ======== ======== ======= ======== ==========
</TABLE>
(A) Investments were exchanged for interest in Duke Realty Limited
Partnership.
(B) A portion of the investment was sold in 1994.
(C) Investment was disposed of in 1994.
97
<PAGE> 98
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: March 25, 1997
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 March 25, 1997.
Clifton J. Wilkow
----------------------------------
Clifton J. Wilkow, General Partner and
Executive Vice President of
M&J Wilkow, Ltd.
Thomas Harrigan
----------------------------------
Thomas Harrigan, Vice President of
M&J Wilkow, Ltd.
98
<PAGE> 99
INDEX TO EXHIBITS
Exhibit No. Description
- ----------- -----------
(A) Agreement of Limited Partnership of First Wilkow Venture (filed as
Exhibit A or Prospectus for Exchange Offer of First Wilkow
Venture dated July 2, 1973).
(B) Amendments to Certificate of Limited Partnership filed as an
Exhibit to Annual Report on Form 10-K for 1983 which is hereby
incorporated by reference.
(C) Proxy Statement issued October 20, 1986, filed as Exhibit D to the
Annual Report on 10-K for 1986 which is hereby incorporated by
reference.
99
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> DEC-31-1996
<CASH> 1,306,870
<SECURITIES> 0
<RECEIVABLES> 702,376
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,009,246
<PP&E> 52,020,473
<DEPRECIATION> 16,543,394
<TOTAL-ASSETS> 45,594,692
<CURRENT-LIABILITIES> 2,511,901
<BONDS> 32,168,888
0
0
<COMMON> 0
<OTHER-SE> 8,790,512
<TOTAL-LIABILITY-AND-EQUITY> 45,594,692
<SALES> 9,388,112
<TOTAL-REVENUES> 9,874,156
<CGS> 0
<TOTAL-COSTS> 3,121,511
<OTHER-EXPENSES> 2,547,696
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,740,843
<INCOME-PRETAX> 99,044
<INCOME-TAX> 0
<INCOME-CONTINUING> 99,044
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 99,044
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
