UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period ended September 30, 1996
------------------------------------------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to_____________
Commission file number 0-7162
--------
MCNEIL PACIFIC INVESTORS FUND 1972
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 94-6279375
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (972) 448-5800
-----------------------------
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 and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
<PAGE>
MCNEIL PACIFIC INVESTORS FUND 1972
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
- ------- --------------------
BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
--------------- ----------------
ASSETS
- ------
Real estate investment:
<S> <C> <C>
Land..................................................... $ - $ 2,336,000
Buildings and improvements............................... - 5,010,483
-------------- --------------
- 7,346,483
Less: Accumulated depreciation.......................... - (1,010,990)
-------------- --------------
- 6,335,493
Asset held for sale 6,178,826 -
Cash and cash equivalents................................... 573,303 523,389
Cash segregated for security deposits....................... 56,896 43,885
Accounts receivable......................................... 1,832 3,849
Prepaid expenses and other assets........................... 24,267 23,220
Escrow deposits............................................. 124,255 49,353
Deferred borrowing costs, net of accumulated amorti-
zation of $45,010 and $37,220 at September 30,
1996 and December 31, 1995, respectively................. 6,924 14,714
-------------- --------------
$ 6,966,303 $ 6,993,903
============== ==============
LIABILITIES AND PARTNERS' EQUITY
- --------------------------------
Mortgage note payable....................................... $ 2,059,117 $ 2,161,204
Accounts payable............................................ 460 20,363
Accrued interest............................................ 15,014 10,076
Accrued property taxes...................................... 86,922 -
Other accrued expenses...................................... 12,229 24,853
Payable to affiliates - General Partner..................... 14,034 15,227
Security deposits and deferred rental revenue............... 63,093 47,198
-------------- --------------
2,250,869 2,278,921
-------------- --------------
Partners' equity:
Limited partners - 15,000 limited partnership units
authorized; 13,752.5 limited partnership units
issued and outstanding................................. 4,405,490 4,405,038
General Partner.......................................... 309,944 309,944
-------------- --------------
4,715,434 4,714,982
-------------- --------------
$ 6,966,303 $ 6,993,903
============== ==============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL PACIFIC INVESTORS FUND 1972
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------------- ---------------------------------
1996 1995 1996 1995
-------------- --------------- -------------- --------------
Revenue:
<S> <C> <C> <C> <C>
Rental revenue................ $ 437,221 $ 328,653 $ 1,253,566 $ 1,041,687
Interest...................... 8,560 10,026 19,721 32,840
------------- ------------- ------------- -------------
Total revenue............... 445,781 338,679 1,273,287 1,074,527
------------- ------------- ------------- -------------
Expenses:
Interest...................... 47,895 50,819 151,616 148,836
Depreciation.................. 100,119 89,268 294,116 251,888
Property taxes................ 28,974 29,475 86,922 88,425
Personnel expenses............ 68,873 63,403 205,457 183,848
Utilities..................... 16,036 20,032 48,938 61,306
Repair and maintenance........ 84,174 86,828 244,720 244,839
Property management
fees - affiliates........... 25,965 18,739 74,446 59,202
Other property operating
expenses.................... 34,340 48,354 102,567 136,450
General and administrative.... 14,769 41,219 31,146 56,054
General and administrative -
affiliates.................. 13,577 19,469 32,907 60,023
------------- ------------- ------------- -------------
Total expenses.............. 434,722 467,606 1,272,835 1,290,871
------------- ------------- ------------- -------------
Net income (loss)................ $ 11,059 $ (128,927) $ 452 $ (216,344)
============= ============= ============= =============
Net income (loss) allocated
to limited partners........... $ 11,059 $ (128,927) $ 452 $ (216,344)
Net income (loss) allocated
to General Partner............ - - - -
------------- ------------- ------------- -------------
Net income (loss)................ $ 11,059 $ (128,927) $ 452 $ (216,344)
============= ============= ============= =============
Net income (loss) per limited
partnership unit.............. $ .80 $ (9.37) $ .03 $ (15.73)
============= ============= ============= =============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL PACIFIC INVESTORS FUND 1972
STATEMENTS OF PARTNERS' EQUITY
(Unaudited)
For the Nine Months Ended September 30, 1996 and 1995
<TABLE>
<CAPTION>
Total
General Limited Partners'
Partner Partners Equity
-------------- -------------- ---------------
<S> <C> <C> <C>
Balance at December 31, 1994.............. $ 309,944 $ 4,690,924 $ 5,000,868
Net loss.................................. - (216,344) (216,344)
------------- ------------- -------------
Balance at September 30, 1995............. $ 309,944 $ 4,474,580 $ 4,784,524
============= ============= =============
Balance at December 31, 1995.............. $ 309,944 $ 4,405,038 $ 4,714,982
Net income................................ - 452 452
------------- ------------- -------------
Balance at September 30, 1996............. $ 309,944 $ 4,405,490 $ 4,715,434
============= ============= =============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL PACIFIC INVESTORS FUND 1972
STATEMENTS OF CASH FLOWS
(Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------------------------
1996 1995
--------------- ---------------
Cash flows from operating activities:
<S> <C> <C>
Cash received from tenants....................... $ 1,256,778 $ 1,011,917
Cash paid to suppliers........................... (664,713) (681,391)
Cash paid to affiliates.......................... (108,546) (199,961)
Interest received................................ 19,721 32,840
Interest paid.................................... (138,888) (147,411)
Property taxes paid and escrowed................. (74,902) 19,246
------------- -------------
Net cash provided by operating activities........... 289,450 35,240
------------- -------------
Cash flows from investing activities:
Additions to real estate investments............. (137,449) (326,258)
------------- -------------
Cash flows from financing activities:
Principal payments on mortgage notes
payable........................................ (102,087) (93,564)
------------- -------------
Net increase (decrease) in cash and
cash equivalents................................. 49,914 (384,582)
Cash and cash equivalents at beginning
of period........................................ 523,389 1,062,361
------------- -------------
Cash and cash equivalents at end of period.......... $ 573,303 $ 677,779
============= =============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL PACIFIC INVESTORS FUND 1972
STATEMENTS OF CASH FLOWS
(Unaudited)
Reconciliation of Net Income (Loss) to Net Cash Provided by
Operating Activities
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------------------------
1996 1995
-------------- ---------------
<S> <C> <C>
Net income (loss)................................... $ 452 $ (216,344)
------------- -------------
Adjustments to reconcile net loss to
net cash provided by (used in) operating
activities:
Depreciation..................................... 294,116 251,888
Amortization of deferred borrowing costs......... 7,790 7,790
Changes in assets and liabilities:
Cash segregated for security deposits.......... (13,011) (384)
Accounts receivable............................ 2,017 1,546
Prepaid expenses and other assets.............. (1,047) 663
Escrow deposits................................ (74,902) 19,252
Accounts payable............................... (19,903) (3,022)
Accrued interest............................... 4,938 (6,365)
Accrued property taxes......................... 86,922 88,419
Other accrued expenses......................... (12,624) (26,265)
Payable to affiliates - General Partner........ (1,193) (80,736)
Security deposits and deferred rental
revenue...................................... 15,895 (1,202)
------------- -------------
Total adjustments............................ 288,998 251,584
------------- -------------
Net cash provided by operating activities........... $ 289,450 $ 35,240
============= =============
</TABLE>
The financial information included herein has been prepared by management
without audit by independent public accountants.
See accompanying notes to financial statements.
<PAGE>
MCNEIL PACIFIC INVESTORS FUND 1972
Notes To Financial Statements
(Unaudited)
September 30, 1996
NOTE 1.
- -------
McNeil Pacific Investors Fund 1972 (the "Partnership") is a limited partnership
organized under the laws of the State of California to invest in real property.
The general partner of the Partnership is McNeil Partners, L.P. (the "General
Partner"), a Delaware limited partnership, an affiliate of Robert A. McNeil. The
principal place of business for the Partnership and the General Partner is 13760
Noel Road, Suite 700, LB70, Dallas, Texas 75240.
In the opinion of management, the financial statements reflect all adjustments
necessary for a fair presentation of the Partnership's financial position and
results of operations. All adjustments were of a normal recurring nature.
However, the results of operations for the nine months ended September 30, 1996,
are not necessarily indicative of the results to be expected for the year ending
December 31, 1996.
NOTE 2.
- -------
The financial statements should be read in conjunction with the financial
statements contained in the Partnership's Annual Report on Form 10-K for the
year ended December 31, 1995, and the notes thereto, as filed with the
Securities and Exchange Commission, which is available upon request by writing
to McNeil Pacific Investors Fund 1972, c/o McNeil Real Estate Management, Inc.,
Investor Services, 13760 Noel Road, Suite 700, LB70, Dallas, Texas 75240.
NOTE 3.
- -------
The Partnership pays property management fees equal to 6% of the gross rental
receipts of the Partnership's property to McNeil Real Estate Management, Inc.
("McREMI"), an affiliate of the General Partner, for providing property
management and leasing services for the Partnership's property.
The Partnership reimburses McREMI for its costs, including overhead, of
administering the Partnership's affairs.
The General Partner is entitled to receive a partnership management fee equal to
9.5% of distributions of cash from operations when distributable cash from
operations is distributed to the limited partners. No partnership management
fees were incurred during the nine month periods ended September 30, 1996 and
1995.
The General Partner is entitled to receive a sales commission as compensation
for selling Partnership property equal to the lesser of 4% of the sales price of
the property sold or the customary fee charged by independent real estate
brokers in the area where the property is located.
<PAGE>
The General Partner is also entitled to a distribution of cash from sales and
refinancings and cash from working capital reserves equal to 9.5% of such
distributions. No such distributions were paid to the partners during 1996 or
1995.
Compensation and reimbursements paid to or accrued for the benefit of the
General Partner and its affiliates are as follows:
Nine Months Ended
September 30,
-------------------------
1996 1995
--------- ----------
Property management fees - affiliates....... $ 74,446 $ 59,202
Charged to general and administrative -
affiliates:
Partnership administration............... 32,907 60,023
-------- ---------
$ 107,353 $ 119,225
======== =========
NOTE 4.
- -------
On October 1, 1996, the General Partner has placed the Partnership's only
remaining property, Palm Bay Apartments, on the market for sale. Consequently,
the Partnership reclassified its investment in Palm Bay Apartments as an Asset
Held for Sale on the accompanying Balance Sheet dated September 30, 1996.
NOTE 5.
- -------
In 1996, the Partnership adopted the Financial Accounting Standards Board's
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of."
This statement required the cessation of depreciation on assets held for sale.
Since Palm Bay is currently classified as an asset held for sale, no
depreciation has been taken effective October 1, 1996.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
- ------- ---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
On October 1, 1996, the General Partner placed the Partnership's remaining
property, Palm Bay Apartments, on the market for sale. The General Partner
decided to offer Palm Bay Apartments for sale because of recently improved
operations at the Orlando property following extensive capital improvements over
the past three years, and because of the impending maturity of the mortgage note
encumbering Palm Bay Apartments. The Palm Bay mortgage note matures on June 1,
1997.
<PAGE>
RESULTS OF OPERATIONS
- ---------------------
Revenues:
Rental revenues at Palm Bay Apartments increased $108,568 and $211,879 or 33%
and 20% for the three month and nine month periods ended September 30, 1996 as
compared to the similar periods of 1995. Although small rental rate increases
have been implemented, most of the increase in rental revenues is from improved
occupancy rates at the property. The occupancy rate at September 30 improved to
94.8%, up from 85.5% at December 31, 1995, and up from 78.3% at September 30,
1995.
Although occupancy rates have improved, the Partnership has not yet been able to
increase base rental rates as quickly as had been hoped. Several apartment
communities in the immediate area of Palm Bay Apartments have undergone major
rehabilitation, and several competing apartment communities are able to offer
their units at rates that are subsidized by various government programs. The
effect of this competition has restricted expected increases in rental rates at
Palm Bay Apartments. After occupancy rates stabilize in the mid-90% range,
management hopes to resume rental rate increases to improve the revenue growth
of the property.
Expenses:
Partnership expenses decreased $32,884 or 7.0% in the third quarter of 1996 as
compared to the third quarter of 1995. For the nine month period ended September
30, 1996, expenses decreased $18,036 or 1.4% as compared to the same period of
1995. Decreased expenses in partnership administration and utilities were offset
by increased expenses concentrated in depreciation, personnel expenses, and
property management fees.
Depreciation increased $42,228 or 16.8% for the first nine months of 1996 as
compared to the same period of 1995. The Partnership continues to invest funds
into capital improvements at Palm Bay Apartments. The increased capital basis of
the property leads to increased depreciation charges. In the twelve months ended
September 30, 1996, the Partnership placed in service an additional $252,097 of
capital improvements. The improvements are generally being depreciated over
lives ranging from five to ten years.
Personnel expenses increased $21,609 or 11.7% for the first nine months of 1996
as compared to the same period of 1995. The Partnership has increased the level
of staffing at Palm Bay Apartments in an effort to provide a higher level of
service to the tenants of Palm Bay Apartments. One of the strategies the
Partnership is using to differentiate itself in the local market is to provide a
greater level of services to its tenants.
Property management fees increased $15,244 or 26% for the first nine months of
1996 as compared to the same period of 1995. Increased rental revenue caused a
corresponding increase in property management fees which are based on a
percentage of the revenue of Palm Bay Apartments.
<PAGE>
Besides the increases noted above, the Partnership recorded decreases in utility
expense, other property operating expenses, general and administrative expense,
and general and administrative expenses paid to affiliates. The increase in Palm
Bay Apartments' occupancy rate resulted in a 20% reduction in utility
expenditures. The Partnership's tenants pay for their own utilities. As the
occupancy rate increases, there are fewer units incurring utility charges at the
Partnership's expense. Other property operating expenses decreased 25% due to
decreases in bad debt expense and decreases in legal and other professional
fees. Finally, general and administrative expenses paid to affiliates decreased
45% due to decreased levels of overhead expenses charged to the Partnership by
affiliates of the General Partner.
General and administrative expenses decreased $24,908 or 44% and $26,450 or 64%
for the nine and three months ended September 30, 1996, respectively, as
compared to the same periods in 1995. In the nine months ended September 30,
1995, the Partnership incurred $36,194 of costs to evaluate and disseminate
information regarding an unsolicited tender offer. Only $11,824 of such costs
have been incurred in 1996. However, the Partnership anticipates incurring such
costs in the fourth quarter of 1996 in response to an additional unsolicited
tender offer, as discussed in Item 5 - Other Information.
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Cash generated by Partnership operating activities increased to $289,450 for the
first nine months of 1996, an improvement over the $35,240 generated by
operating activities during the first nine months of 1995. The capital
renovation projects undertaken at Palm Bay Apartments during the past three
years are allowing the Partnership to increase occupancy at Palm Bay Apartments
and to reduce certain repair and maintenance expenditures that would otherwise
have been incurred. The Partnership anticipates further improvements to cash
flow from operations as the restored and refurbished units are leased to new
tenants. The General Partner anticipates that cash flow from operations for the
balance of 1996 will be sufficient to fund Partnership operating expenses, debt
service requirements, and budgeted capital improvements. If cash flows from
operations are not sufficient to meet Partnership obligations, the Partnership
will use its cash reserves to fund such deficits.
For the nine months ended September 30, 1996, cash flows used in investing
activities decreased to $137,449 from $326,258 in 1995. Although the Partnership
will continue to make capital improvements to Palm Bay Apartments, the level of
capital improvements will decrease compared to the past three years.
The financing activities of the Partnership consist of the repayment of the Palm
Bay mortgage note through monthly debt service payments. These payments are
scheduled to gradually increase until June 1, 1997, when the Palm Bay mortgage
note matures.
Short Term Liquidity:
At September 30, 1996, the Partnership held $573,303 of cash and cash
equivalents, up $49,914 from the balance at the end of 1995. The General Partner
considers the Partnership's cash reserves adequate for anticipated Partnership
operations for the balance of 1996 and 1997.
<PAGE>
The General Partner believes that operations at Palm Bay Apartments will
generate sufficient cash flow to pay the operating expenses of the property, pay
the required monthly debt service payments on the Palm Bay mortgage note, and
provide funds to make necessary capital improvements to the property. Cash flow
from operations is anticipated to provide for these cash requirements until the
property is sold.
The General Partner has established a revolving credit facility not to exceed
$5,000,000 in the aggregate which is available on a "first-come, first-served"
basis to the Partnership and other affiliated partnerships if certain conditions
are met. However, there is no assurance that the Partnership will receive
additional funds under the facility because no amounts will be reserved for any
particular partnership. As of September 30, 1996, $4,082,159 remained available
for borrowing under the facility; however, additional funds could become
available as other partnerships repay borrowings. This commitment will terminate
on March 30, 1997.
Long Term Liquidity:
While the present outlook for the Partnership's liquidity is favorable, market
conditions may change and property operations can deteriorate. In that event,
the Partnership would require other sources of working capital. No such other
sources have been identified, and the Partnership has no established lines of
credit. Other possible actions to resolve working capital deficiencies include
refinancing or renegotiating terms of the Partnership's existing mortgage loan,
deferring major capital expenditures on Partnership property except where
improvements are expected to enhance the competitiveness or marketability of the
property, or arranging working capital support from affiliates. There is no
assurance that support from affiliates would be provided in the future, since
neither the General Partner nor any affiliates have any obligation in this
regard.
The Partnership has determined to begin an orderly liquidation of the
Partnership's remaining assets. Although there can be no assurance as to the
timing of any liquidation, it is anticipated that such liquidation would result
in distributions to the limited partners of the cash proceeds from the sale of
the Partnership's remaining property, subject to cash reserve requirements. The
Partnership anticipates selling its remaining property before December 1997,
which would be followed by the dissolution of the Partnership. In this regard,
the Partnership has placed its remaining property, Palm Bay Apartments, on the
market for sale.
Distributions:
Distributions to partners have been suspended as part of the General Partner's
policy of maintaining adequate cash reserves. Distributions to Unit holders will
remain suspended until Palm Bay Apartments is sold and all liabilities of the
Partnership are provided for. The General Partner will continue to monitor the
cash reserves and working capital needs of the Partnership to determine when
cash flows will support distributions to the Unit holders.
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
- ------- -----------------
McNeil Pacific Investors Fund 1972, Ltd., McNeil Real Estate Fund V, Ltd.,
McNeil Real Estate Fund IX, Ltd., McNeil Real Estate Fund X, Ltd., McNeil Real
Estate Fund XI, Ltd., McNeil Real Estate Fund XIV, Ltd., McNeil Real Estate Fund
XV, Ltd., McNeil Real Estate Fund XX, L.P., McNeil Real Estate Fund XXIV, L.P.,
and McNeil Real Estate Fund XXV, L.P. vs. High River Limited Partnership,
Riverdale Investors Corp., Carl C. Icahn, and Unicorn Associates Corporation -
United States District Court for the Central District of California, Case No.
96-5680SVW.
On August 12, 1996, High River Limited Partnership ("High River"), a partnership
controlled by Carl C. Icahn, sent a letter to the partnerships referenced above
demanding lists of the names, current residences or business addresses and
certain other information concerning the unitholders of such partnerships. On
August 19, 1996, these partnership commenced the above action seeking, among
other things, to declare that such partnerships are not required to provide High
River with a current list of unitholders on the grounds that the defendants
commenced a tender offer in violation of the federal securities laws by filing
certain Schedule 13D Amendments on August 5, 1996.
On October 17, 1996, the presiding judge denied the partnerships' requests for a
permanent and preliminary injunction to enjoin High River's tender offers and
granted the defendants request for an order directing the partnerships to turn
over current lists of unitholders to High River forthwith. On October 24, 1996,
the partnerships delivered the unitholder lists to High River.
ITEM 5. OTHER INFORMATION
- ------- -----------------
On September 20, 1996, High River announced that it had commenced a tender offer
for any and all units of the Partnership at $224.50 per unit. The tender was
originally due to expire October 18, 1996, however, this offer has been extended
until November 22, 1996.
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits.
Exhibit
Number Description
-------- -----------
3. Restated Certificate and Agreement of
Limited Partnership dated of March 8,
1972. (1)
4. Amendment to Restated Certificate and Agree-
ment of Limited Partnership dated March 30,
1992. (2)
11. Statement regarding computation of net
income per limited partnership unit: Net
income per limited partnership unit is
computed by dividing net income allocated to
the limited partners by the number of
limited partnership units outstanding. Per
unit information has been computed based on
13,752.5 limited partnership units
outstanding in 1996 and 1995.
27. Financial Data Schedule for the quarter
ended September 30, 1996.
(1) Incorporated by reference to the Annual Report of Registrant on Form
10-K for the period ended December 31, 1990, as filed on March 29,
1991.
(2) Incorporated by reference to the Current Report on Form 8-K filed by
the Registrant with the Securities and Exchange Commission on April
10, 1992.
(b) Reports on Form 8-K. There were no reports on Form 8-K filed during the
quarter ended September 30, 1996.
<PAGE>
McNEIL PACIFIC INVESTORS FUND 1972
SIGNATURES
Pursuant to the requirements 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:
McNEIL PACIFIC INVESTORS FUND 1972
By: McNeil Partners, L.P., General Partner
By: McNeil Investors, Inc., General Partner
November 14, 1996 By: /s/ Donald K. Reed
- ----------------- -----------------------------------------
Date Donald K. Reed
President and Chief Executive Officer
November 14, 1996 By: /s/ Ron K. Taylor
- ----------------- -----------------------------------------
Date Ron K. Taylor
Acting Chief Financial Officer of McNeil
Investors, Inc.
November 14, 1996 By: /s/ Brandon K. Flaming
- ----------------- -----------------------------------------
Date Brandon K. Flaming
Chief Accounting Officer of McNeil
Real Estate Management, Inc.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 573,303
<SECURITIES> 0
<RECEIVABLES> 1,832
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 6,966,303
<CURRENT-LIABILITIES> 0
<BONDS> 2,059,117
<COMMON> 0
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 6,966,303
<SALES> 1,253,566
<TOTAL-REVENUES> 1,273,287
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,121,219
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 151,616
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 452
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 452
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
