FORM 10-QSB.--QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarterly or Transitional Report
(As last amended by 34-32231, eff. 6/3/93.)
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period.........to.........
Commission file number 2-76434
DREXEL BURNHAM LAMBERT REAL ESTATE ASSOCIATES
(Exact name of small business issuer as specified in its charter)
New York 13-3153572
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
230 Park Avenue, Suite 2400
New York, New York 10169
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (212) 697-2330
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
a) DREXEL BURNHAM LAMBERT REAL ESTATE ASSOCIATES
(A Limited Partnership)
BALANCE SHEET
(Unaudited)
March 31, 1996
Assets
Cash and cash equivalents:
Unrestricted $ 276,169
Restricted--tenant security deposits 9,920
Accounts receivable 14,016
Deposits with mortgagee 10,694
Deferred charges 71,201
Deferred rent receivable 7,273
Investment property:
Land $ 227,104
Buildings and improvements 2,712,884
2,939,988
Less accumulated depreciation (1,251,883) 1,688,105
$ 2,077,378
Liabilities and Partners' Equity (Deficit)
Liabilities
Accounts payable $ 3,544
Accrued liabilities:
Interest $ 8,639
Real estate taxes 9,649
Professional fees 10,587 28,875
Deposits payable 11,674
Mortgage payable 1,287,875
Total liabilities 1,331,968
Partners' equity (deficit)
General partner (46,744)
Limited partners 792,154 745,410
$ 2,077,378
See Notes to Financial Statements
b) DREXEL BURNHAM LAMBERT REAL ESTATE ASSOCIATES
(A Limited Partnership)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Revenues:
Rental operations $ 83,127 $ 91,648
Interest income 3,325 3,432
Total revenue 86,452 95,080
Expenses:
Rental operations 23,797 18,151
General and administrative 12,001 12,522
Management fees to related party (Note 3) 1,536 1,700
Mortgage interest 25,864 26,429
Depreciation and amortization 26,961 26,808
Total expenses 90,159 85,610
Net income (loss) $ (3,707) $ 9,470
Net income (loss) per limited partner
interest(based on 11,455 units issued
and outstanding) $ (.32) $ .82
<FN>
See Notes to Financial Statements
</TABLE>
c) DREXEL BURNHAM LAMBERT REAL ESTATE ASSOCIATES
(A Limited Partnership)
STATEMENT OF CHANGES IN PARTNERS' EQUITY (DEFICIT)
(Unaudited)
For the Three Months Ended March 31, 1996
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
<S> <C> <C> <C>
Partners' equity (deficit) at
December 31, 1995 $ (46,707) $ 795,824 $ 749,117
Net loss for the three months
ended March 31, 1996 (37) (3,670) (3,707)
Partners' equity (deficit) at
March 31, 1996 $ (46,744) $ 792,154 $ 745,410
<FN>
See Notes to Financial Statements
</TABLE>
d) DREXEL BURNHAM LAMBERT REAL ESTATE ASSOCIATES
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (3,707) $ 9,470
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation and amortization 26,961 26,808
Change in accounts:
Restricted cash 1,754 --
Accounts and other receivable 1,315 (6,497)
Deferred charges (5,152) (6,001)
Deposits with mortgagee 90,907 (4,638)
Accounts payable (1,814) (1,181)
Accrued liabilities (3,264) (2,683)
Deposits payable -- (15,120)
Net cash provided by
operating activities 107,000 158
Cash flows from investing activities:
Additions to real and personal property (10,506) --
Net cash used in investing activities (10,506) --
Cash flows from financing activities:
Principal payments on mortgage (8,011) --
Repayment of mortgage payable -- (7,398)
Distributions to partners (114,550) (114,550)
Net cash used in financing activities (122,561) (121,948)
Net decrease in cash and cash equivalents (26,067) (121,790)
Cash and cash equivalents at beginning of period 302,236 399,762
Cash and cash equivalents at end of period $ 276,169 $ 277,972
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 25,864 $ 26,479
<FN>
See Notes to Financial Statements
</TABLE>
e) DREXEL BURNHAM LAMBERT REAL ESTATE ASSOCIATES
(A Limited Partnership)
Notes to Financial Statements
(Unaudited)
March 31, 1996
Note 1 - Basis of Presentation
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-QSB and Item 310(b) of
Regulation S-B. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of the General Partner, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three month period
ended March 31, 1996, are not necessarily indicative of the results that may be
expected for the fiscal year ending December 31, 1996. For further information,
refer to the financial statements and footnotes thereto included in the
Partnership's annual report on Form 10-KSB for the fiscal year ended December
31, 1995.
Note 2 - General
The financial statements of Drexel Burnham Lambert Real Estate Associates
include the operations of Wendover Business Park Phase I ("Wendover"), which is
the only property the Partnership owns and operates.
Note 3 - Related Party Transactions
For the three months ended March 31, 1996 and 1995, the Partnership paid
management fees of $1,536 and $1,700, respectively, to The Wynnewood Company,
the parent of the Partnership's general partner.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Results of Operations
For the three months ended March 31, 1996, the Partnership realized a net
loss of $3,707, compared to net income of $9,470 for the three months ended
March 31, 1995. Rental income decreased due to a decrease in average occupancy
from 100% for the three months ended March 31, 1995, compared to 90% for the
three months ended March 31, 1996. One tenant occupying approximately 6,960
square feet moved out in June 1995. This space has remained vacant since the
move-out in 1995. Total expenses increased due to increases in rental
operating expense for the three months ended March 31, 1996, compared to the
three months ended March 31, 1995. This increase was primarily due to increases
in roof repairs, increases in parking lot cleaning and maintenance expense, and
landscaping expense. Partnership operations were otherwise comparable in the
two periods.
Liquidity and Capital Resources
On March 31, 1996, the Partnership held cash of $276,169. The present cash
reserves of the Partnership are believed to be sufficient to meet the
foreseeable needs of the Partnership.
As of March 31, 1996, the Partnership's remaining property was approximately
90% leased. Effective May 1, 1996, the property's largest tenant, occupying
17,477 sq. ft. or approximately 26% of the leasable space, will reduce the space
it occupies to approximately 3,500 sq. ft. Management is negotiating with
another national tenant to lease approximately 8,000 sq. ft. of the space being
vacated (and 2,580 sq. ft. of space which will be vacated on April 30, 1996),
for a five-year term at a higher rental per sq. ft. than the present tenant is
paying. Tenant improvements and leasing commissions will offset part of this
higher rental rate if the new lease is consummated. If this proposed lease is
not consummated, the property will experience a decline in operating cash flow
until the space is re-leased. During 1996, one other tenant occupying
approximately 7,000 sq. ft. of space is expected to renew its lease which
expires during the year.
For the second quarter of 1996, the Partnership has approved capital
expenditures of approximately $20,000 for repairs to the foundation of one of
the buildings. In February 1996, the Partnership paid a distribution of $10 per
partnership interest, or approximately $115,000, from existing cash reserves.
Remaining cash balances are believed to be sufficient to meet planned capital
expenditures, tenant improvements and leasing commissions.
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit 27, Financial Data Schedule, is filed as an exhibit to this
report.
(b) Reports on Form 8-K:
None filed during the quarter ended March 31, 1996.
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934,
the Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
DREXEL BURNHAM LAMBERT REAL ESTATE ASSOCIATES
(Registrant)
By: DBL Properties Corporation
(General Partner)
By: /s/William D. Clements
William D. Clements
President
Date: May 7, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Drexel
Burnham Lambert Real Estate Associates 1996 First Quarter 10-QSB and is
qualified in its entirety by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000700951
<NAME> DREXEL BURNHAM LAMBER REAL ESTATE ASSOCIATES
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 276,169
<SECURITIES> 0
<RECEIVABLES> 14,016
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 2,939,988
<DEPRECIATION> (1,251,883)
<TOTAL-ASSETS> 2,077,378
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 1,287,875
0
0
<COMMON> 0
<OTHER-SE> 745,410
<TOTAL-LIABILITY-AND-EQUITY> 2,077,378
<SALES> 0
<TOTAL-REVENUES> 86,452
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 90,159
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 25,864
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,707)
<EPS-PRIMARY> (.32)
<EPS-DILUTED> 0
<FN>
<F1>The Registrant has an unclassified balance sheet.
</FN>
</TABLE>
