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 MARCH 31, 1998
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from TO
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Commission file number 2-77330
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PROPERTY RESOURCES FUND VI
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(Exact name of registrant as specified in its charter)
CALIFORNIA 94-2838890
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State or other jurisdiction of incorporation or organization) (I.R.S. Employer
Identification No.)
P. O. BOX 7777, SAN MATEO, CALIFORNIA 94403-7777
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (650) 312-2000
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N/A
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Former name, former address and former fiscal year, if changed since last
report
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or 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
Limited Partnership Units Outstanding as of March 31, 1998: 21,585
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PROPERTY RESOURCES FUND VI
(A CALIFORNIA LIMITED PARTNERSHIP)
BALANCE SHEETS
MARCH 31, 1998 AND DECEMBER 31, 1997
(Unaudited)
(Dollars in thousands) 1998 1997
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ASSETS:
Real estate:
Land $2,239 $2,239
Land improvements 781 781
Buildings and improvements 7,347 7,347
Furnishings and equipment 1060 1,050
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11427 11,417
Less: accumulated depreciation 4,780 4,708
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Total real estate, net 6647 6,709
Cash and cash equivalents 505 407
Note receivable 214 237
Other assets, net 261 308
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Total assets $7,627 $7,661
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LIABILITIES AND STOCKHOLDERS' EQUITY:
Notes payable $6,452 $6,559
Advances from General Partner - -
Accrued interest due to General Partner 527 527
Deposits and other liabilities 216 249
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Total liabilities 7,195 7,335
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Partners' capital (deficit):
Limited partners, 21,585 units issued and 897 766
outstanding
General Partner (435) (440)
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Total partners' capital (deficit) 432 326
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Total liabilities and partners' capital $7,627 $7,661
(deficit)
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The accompanying notes are an integral part of these financial statements.
PROPERTY RESOURCES FUND VI
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
(Unaudited)
(Dollars in thousands, except per 1998 1997
unit amounts)
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REVENUE:
Rent $512 $507
Interest and dividends 9 10
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Total revenue 521 517
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EXPENSES:
Interest, other than related party 51 48
Depreciation 72 75
Operating 244 241
Related party 30 33
General and administrative 18 8
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Total expenses 415 405
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NET INCOME $106 $112
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Net income allocable to limited $101 $106
partners
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Net income allocable to General $5 $6
Partner
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Net income per $500 limited
partnership unit- $4.68 $4.91
based on 21,585 units outstanding
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The accompanying notes are an integral part of these financial statements.
PROPERTY RESOURCES FUND VI
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTH PERIODS ENDED MARCH 31, 1998 AND 1997
(Unaudited)
(Dollars in thousands) 1998 1997
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Cash flows from operating activities:
Net income $106 $112
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Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 75 75
(Increase) decrease in other assets 44 92
Increase in accrued interest - 2
Decrease in deposits and other liabilities (33) (80)
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86 89
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Net cash provided by operating activities 192 201
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Cash flow from investing activities:
Improvements to rental property (10) (20)
Principal received on note receivable 23 14
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Net cash (used in) provided by investing 13 (6)
activities
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Origination of note payable -
Principal payments on notes payable (107) (107)
Principal payments to General Partner - (69)
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Net cash used in financing activities (107) (176)
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Net increase in cash and cash equivalents 98 19
Cash and cash equivalents, beginning of period 407 279
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Cash and cash equivalents, end of period $505 $298
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The accompanying notes are an integral part of these financial statements.
PROPERTY RESOURCES FUND VI
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1998
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited interim financial statements of Property Resources
Fund VI (the "Partnership") have been prepared in accordance with the
instructions to Form 10-Q pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. In the opinion of management, all
appropriate adjustments necessary to a fair presentation of the results of
operations have been made for the periods shown. All adjustments are of a
normal recurring nature. Certain prior year amounts have been reclassified
to conform to current year presentations. These financial statements should
be read in conjunction with the Partnership's audited financial statements
for the year ended December 31, 1997.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
INTRODUCTION
Management's discussion and analysis of financial condition and results of
operations should be read in conjunction with the Financial Statements and
Notes thereto.
RESULTS OF OPERATIONS
COMPARISON OF THE THREE-MONTH PERIODS ENDED MARCH 31, 1998 AND 1997
Net income for the three-month periods ended March 31, 1998 decreased $6,000,
or 5%, when compared to 1997 primarily as a result of increased general and
administrative expenses.
Total revenue for the three-month periods ended March 31, 1998 increased
$4,000, or 1% when compared to 1997. Both Grouse Run and Clearlake Village
experienced slight increases in rental revenues during the period.
Total expenses for the three-month periods ended March 31, 1998 increased
$10,000, or 2%, when compared to 1997 as a result of increases in general and
administrative expenses primarily accounting services. A small increase in
property operating expenses, which was due to increased repair and
maintenance costs, was offset by a decrease in interest expense, as the note
payable to the General Partner was repaid in 1997.
LIQUIDITY AND CAPITAL RESOURCES
In July, 1983, the Partnership completed a public offering of its limited
partnership units with total proceeds of $10,795,500 from the sale of 21,585
limited partnership units. The Partnership acquired five properties with an
aggregate cost of $23,526,000.
As of March 31, 1998 the Partnership had two operating properties: Clearlake
Village Apartments and Grouse Run Apartments. The buildings and the land
upon which the buildings are located are owned directly by the Partnership or
the Subsidiary, as herein after defined, in fee. Both Partnership properties
are subject to mortgages. Management is currently marketing the properties
for sale, and a sale of one or both of the properties may occur in 1998.
Management estimates that the net realizable value of the property
approximates its carrying value; however, there can be no assurance that the
eventual sales price of the property will not result in a loss or that a sale
will be consummated.
As of March 31, 1998, cash and cash equivalents totaled $505,000. As of
March 31, 1998, accrued interest due to General Partner amounted to
$527,000. The General Partner presently intends to continue to make such
advances to the Partnership as necessary. Consequently, management believes
that the Partnership's current sources of funds will be adequate to meet both
its short-term and long-term capital commitments and operating requirements.
PROPERTY RESOURCES FUND VI
(A CALIFORNIA LIMITED PARTNERSHIP)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (CONTINUED)
LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)
The Partnership presently believes that funds available from operations and
from its note receivable due in 1999 will permit it to repay interest owed to
the General Partner. The Partnership also believes that the present trend
toward improved operations at its properties will permit it to repay the
Grouse Run note payable due in 1999 either from the sale of a property or
from a loan refinancing.
Net cash provided by operating activities for the three month period ended
March 31, 1998 was $192,000, or $9,000 less than the same period in 1997.
The decrease was primarily due to a decrease in net income as described under
"Results of Operations".
Net cash provided by investing activities for the three month period ended
March 31, 1998, increased $19,000 when compared to the same period in 1997.
In 1998, the Partnership received $9,000 more principle repayments on the
note secured on Dell and spent $10,000 less on capital improvements than in
the corresponding period in 1997.
IMPACT OF INFLATION
The Partnership's management believes that inflation may have a positive
effect on the Partnership's property portfolio, but this effect generally
will not be fully realized until such properties are sold or exchanged.
PROPERTY RESOURCES FUND VI
(A CALIFORNIA LIMITED PARTNERSHIP)
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Not applicable
(b) Reports on Form 8-K
No reports on Form 8-K were filed by the Registrant during the quarter
ended March 31, 1998.
SIGNATURE
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.
PROPERTY RESOURCES FUND VI
By: /s/ David P. Goss
Chief Executive Officer
Date: May 15, 1998
