SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Quarterly 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 0-7660
MULTIVEST REAL ESTATE FUND, LTD. SERIES VII
(Exact name of registrant as specified in its charter)
Michigan 38-6285884
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
6100 Glades Road, Suite 205
Boca Raton, Florida 33434
(Address of principal executive offices) (Zip Code)
(561) 487-6700
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports 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 report), and (2) has been subject to such filing
requirements for the past 90 days.
Yes x No
<PAGE>
MULTIVEST REAL ESTATE FUND, LTD., SERIES VII
COMMISSION FILE NUMBER 0-7660
FORM 10-Q
September 30, 1996
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Statements of Financial Condition, as of September 30, 1996
(Unaudited) and December 31, 1995 . . . . . . . . . . . . . 3
Statements of Operations, for the three month and nine month
periods ended September 30, 1996 and 1995 (Unaudited) . . . 4
Statements of Cash Flows, for the three months ended
September 30, 1996 and 1995 (Unaudited) . . . . . . . . . 5
Notes to Financial Statements (Unaudited) . . . . . . . . . . . 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . 7
PART II. OTHER INFORMATION:
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . 8
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
MULTIVEST REAL ESTATE FUND, LTD., SERIES VII
(a Michigan limited partnership)
STATEMENTS OF FINANCIAL CONDITION
September 30, December 31,
1996 1995
ASSETS (Unaudited)
Investments in real estate
Land $ - $ 1,900,000
Building and improvements - 2,986,895
- 4,886,895
Less: Accumulated depreciation - 125,992
Net investment in real estate - 4,760,903
Wrap-around mortgage notes receivable - 4,489,845
Deferred gain on sales of real estate - (2,402,387)
- 2,087,458
Other assets
Cash 4,659 5,270
Investments, at cost which
approximates market 6,440,347 1,850,930
Accounts receivable 26,214 6,447
Prepaid insurance 128 44,867
Escrow and deposits and other assets 20,010 20,010
Total other assets 6,491,358 1,927,524
Total assets $ 6,491,358 $ 8,775,885
LIABILITIES AND PARTNERS' CAPITAL
Mortgage notes payable $ - $ 1,143,793
Accounts payable 12,120 176,106
Accrued liabilities 488 188,591
Accrued liabilities to affiliates 613,988 36,176
Security deposits - 51,785
Total liabilities 626,596 1,596,451
Partners' capital
Limited Partners, 22,261 units 5,799,443 7,100,786
General Partners, 228 units 65,319 78,648
Total Partners' capital 5,864,762 7,179,434
Total liabilities and
Partners' capital $ 6,491,358 $ 8,775,885
<PAGE>
MULTIVEST REAL ESTATE FUND, LTD., SERIES VII
(a Michigan limited partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
Revenues
Rents and other tenant charges $ 375,621 $ 388,787 $ 1,163,951 $ 884,854
Other income 54,883 30,451 103,981 73,067
430,504 419,238 1,267,932 957,921
Expenses
Maintenance, custodial salaries
and related expenses 36,509 33,314 117,114 70,000
Real estate management fees 21,760 22,414 67,928 55,304
Investment management/real estate
commission 600,000 59,110 884,688 73,630
Mortgage servicing fee - - - 3,275
Property taxes 38,717 36,714 113,717 85,666
Depreciation and amortization 56,181 18,151 157,594 29,393
Insurance 21,523 13,980 47,023 32,620
Utilities 21,493 55,111 127,107 148,140
Repairs and maintenance 65,492 83,728 188,938 158,330
Legal and accounting 1,964 373 14,214 22,593
Administrative and other 30,672 38,398 96,798 94,607
894,311 361,293 1,815,121 773,558
Income (loss) from existing
assets (463,807) 57,945 (547,189) 184,363
Provision for loss on wrap-
around mortgage note
receivable - (150,000) - (150,000)
Operations of disposed properties - 100,354 164,957 295,328
Income (loss) from operations (463,807) 8,299 (382,232) 329,691
Discount on settlement of note - - (680,340) -
Deferred gain recognized on
sale of real estate - - 2,402,386 -
Gain on sale of real estate 679,508 - 679,508 -
Net income $ 215,701 $ 8,299 $ 2,019,322 $ 329,691
Allocated to
Limited partners, 22,261
units $ 213,514 $ 8,215 $ 1,998,850 $ 326,348
General partner, 228 units 2,187 84 20,472 3,343
$ 215,701 $ 8,299 $ 2,019,322 $ 329,691
Net income per partnership
unit based on 22,489
Partnership units
outstanding $ 9.60 $ .37 $ 89.79 $ 14.66
<PAGE>
MULTIVEST REAL ESTATE FUND, LTD., SERIES VII
(a Michigan limited partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
1996 1995
Operating Activities
Net income $ 2,019,322 $ 329,691
Adjustments to reconcile net income to
net cash provided by (used in) operating
activities:
Depreciation 157,594 29,393
Deferred gain recognized on sale
of real estate (2,402,386) -
Gain on sale of property (679,508) -
Discount on settlement of note 680,340 -
Amortization of discount on mortgage
note receivable - (17,215)
Provision for loss on wrap-around mortgage
note receivable - 150,000
(Increase) decrease in accounts receivable (19,767) 4,672
Decrease (increase) in prepaid insurance 44,739 (7,962)
Increase in escrow deposits and other assets - (20,010)
Decrease in accounts payable (163,986) (2,549)
(Decrease) increase in accrued liabilities (188,103) 127,900
Increase in accrued liabilities to affiliates 577,812 56,338
Decrease in unfunded distributions payable - (552,470)
(Decrease) increase in security deposits (51,785) 50,610
Net cash (used in) provided by
operating activities (25,728) 148,398
Investing Activities
Capital improvements to real estate (717,184) (380,515)
Net cash used in investing activities (717,184) (380,515)
Financing Activities
Payoff received on Ross Ridge Apartments
mortgage note receivable 3,788,960 -
Principal payoff on Ross Ridge mortgage
note payable (1,103,937) -
Distributions to Partners (3,333,994) -
Net proceeds from sale of property 6,000,000 -
Payments received on wrap-around mortgage
notes receivable 20,545 28,372
Principal payments on mortgage notes payable (39,856) (95,650)
Net cash provided by (used in)
financing activities 5,331,718 (67,278)
Increase (decrease) in cash and cash
equivalents 4,588,806 (299,395)
Cash and cash equivalents - January 1 1,856,200 1,668,060
Cash and cash equivalents - September 30 $ 6,445,006 $ 1,368,665
Non-Cash Activities
Foreclosure on Las Cortes Apartments:
Decrease in wrap-around mortgage
note receivable $ - $(7,600,000)
Decrease in deferred gain on sale - 5,442,927
Decrease in deferred interest receivable - (1,886,866)
Decrease in interest receivable - (25,333)
Foreclosed property - 4,069,272
MULTIVEST REAL ESTATE FUND, LTD., SERIES VII
(a Michigan limited partnership)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
The financial statements reflect all adjustments which are, in the opinion of
management, necessary to a fair statement of the results of the interim periods
presented. It is suggested that these financial statements be read in
conjunction with the financial statements and the notes included in the
Partnership's latest annual report on Form 10-K. The results of operations for
interim periods should not be considered as indicative of the results to be
expected for a full year.
Reclassifications
Certain reclassifications have been made in the 1995 financial statements to
conform to the presentation of 1996 results of operations.
<PAGE>
MULTIVEST REAL ESTATE FUND, LTD., SERIES VII
(a Michigan limited partnership)
September 30, 1996
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Partnership has completed the sale of its remaining property and collection
on the mortgage note receivable and is in the process of now completing its
liquidation and dissolution program.
On June 28, 1996, the Partnership received $2,681,681 in repayment of the Ross
Ridge Apartments mortgage note receivable. The amount represents the difference
between (a) the remaining principal on the note less a discount of $680,340
($3,788,960) and (b) the principal and accrued interest on the underlying
mortgage note payable with respect to this property ($1,107,279). The
Partnership previously recorded the sale under the installment method of
accounting and, as a result of the payoff, recognized a gain of $2,402,387.
On September 24, 1996, the Partnership sold Las Cortes Apartments for $6,000,000
less closing costs and proration of income and expenses resulting in a gain on
sale of $679,507. Las Cortes and five additional properties owned by other
MultiVest partnerships were sold on separate sales contracts to a purchaser not
affiliated with the Partnership or its General Partner. Your General Partner
believes that the terms and conditions of the sale were favorable to the
Partnership.
The Partnership's total revenues increased $11,266 or 3% for the three months
ended September 30, 1996, and $310,011 or 32% for the nine month period as
compared to the same periods of the prior year. Rents and other tenant charges
increased $279,097 or 32% for the nine month period due primarily to rental
activity for 1996 being for a period of nine months, and 1995 being for seven
months. The Partnership foreclosed and took possession of the property on
March 7, 1995.
Expenses of the Partnership increased $533,018 or 148% for the quarter ending
September 30, 1996 as compared to the same period of the prior year. There was
a $1,041,563 or 135% increase in total expenses for the nine months ended
September 30, 1996. The increase for both periods is due primarily to the
increase in the investment management/real estate commission due the General
Partner pursuant to the Partnership Agreement.
Funds generated from collections on the wrap-around mortgage note, and from
operations have primarily been utilized to meet debt service obligations and,
when possible, distribute funds to the Partners. Funds in excess of
Partnership reserves resulted in distributions totaling $3,333,994.25 or
$148.25 per unit being paid during the nine months ending September 30, 1996.
<PAGE>
MULTIVEST REAL ESTATE FUND, LTD., SERIES VII
(a Michigan limited partnership)
September 30, 1996
PART II - OTHER INFORMATION
Item 6. Exhibits and Report on Form 8-K
(b) No report on Form 8-K has been filed during the quarter ended
September 30, 1996.
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.
MULTIVEST REAL ESTATE FUND, LTD.,
Series VII, a Michigan Limited
Partnership,
(Registrant)
By: MULTIVEST REAL ESTATE, INC.
a Delaware corporation
Its: Corporate General Partner
Date: NOVEMBER 14, 1996 RICHARD L. DAVIS
Richard L. Davis
President -
Chief Executive Officer
Date: NOVEMBER 14, 1996 JOHN J. KAMMERER
John J. Kammerer
Principal Accounting Officer
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<TOTAL-LIABILITY-AND-EQUITY> 6491358
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