SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________________
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter 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 from _____ to _____
Commission File No. 0-12166
MERIDIAN POINT REALTY TRUST '83
-------------------------------------------------------------------------
(Exact name of Registrant as specified in its Charter)
Missouri 94-6542723
------------------------------- -------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
655 Montgomery Street, Suite 800, San Francisco, California 94111
-------------------------------------------------------------------
(Address and zip code of principal executive offices)
Registrant's telephone number, including area code: (415) 393-8000
50 California Street, Suite 1600, San Francisco, CA 94111
- - --------------------------------------------------------------------------
(Former name, 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 and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
----- -----
Indicate the number of shares outstanding of the common stock as of the
latest practicable date:
Shares of beneficial interest outstanding as of April 30, 1996: 3,031,618
<PAGE>
___________________________________________________________________________
PART I: FINANCIAL INFORMATION
___________________________________________________________________________
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS.
The accompanying unaudited consolidated financial statements should be
read in conjunction with the 1995 Form 10-K of the registrant (the
"Company"). These statements have been prepared in accordance with the
instructions of the Securities and Exchange Commission Form 10-Q and do not
include all of the information and footnotes required by generally accepted
accounting principles for complete consolidated financial statements.
In the opinion of the Company's management, all material adjustments
considered necessary for a fair presentation of results of operations for
the interim periods have been included. The results of consolidated
operations for the three months ended March 31, 1996 are not necessarily
indicative of the results that may be expected for the year ending December
31, 1996.
<PAGE>
<TABLE>
MERIDIAN POINT REALTY TRUST '83
CONSOLIDATED BALANCE SHEETS
March 31, 1996 and December 31, 1995
- - ------------------------------------------------------------------------------------------------------------
1996 1995
- - ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Assets
Investment in Real Estate Held for Sale:
Rental Properties, Net $8,701,564 $40,276,221
Less: Accumulated Deprecation (2,455,196) (11,495,736)
- - ------------------------------------------------------------------------------------------------------------
6,246,368 28,780,485
Other Assets:
Cash and Cash Equivalents 4,475,695 2,525,918
Cash Held in Escrow 0 98,363
Restricted Cash 1,231,482 1,119,831
Accounts Receivable, Net of Reserves of $216,185 and $178,146
as of March 31, 1996 and December 31, 1995, respectively 264,911 193,796
Notes Receivable From Affiliates 77,750 84,000
Investment in Real Estate Investment Trust 0 79,500
Capitalized Loan Costs, Net of Accumulated Amortization of $89,266
and $324,324 as of March 31, 1996 and December 31, 1995, respectively 24,208 65,445
Capitalized Lease Commissions, Net of Accumulated Amortization of $28,359
and $522.059 as of March 31, 1996 and December 31, 1995, respectively 54,775 548,856
Other Assets, Net of Accumulated Amortization of $50,663
as of and December 31, 1995 149,439 557,142
- - ------------------------------------------------------------------------------------------------------------
Total Assets $12,524,628 $34,053,336
============================================================================================================
Liabilities and Shareholders' Equity
Liabilities:
Mortgage Notes Payable $4,711,607 $21,177,787
Less: Unamortized Discount 0 (304,776)
- - -----------------------------------------------------------------------------------------------------------
4,711,607 20,873,011
Due To Affiliates 40,379 67,046
Accounts Payable 93,185 368,861
Prepaid Rent, Tenant Deposits and Other Liabilities 335,336 518,265
- - -----------------------------------------------------------------------------------------------------------
Total Liabilities 5,180,507 21,827,183
- - -----------------------------------------------------------------------------------------------------------
Shareholders' Equity:
Shares of Beneficial Interest -- $1.00 stated value:
authorized - unlimited, 3,031,618 shares issued and
outstanding as of March 31, 1996 and December 31, 1995 3,031,618 3,031,618
Paid-in Capital 22,755,694 22,755,694
Distributions in Excess of Income (18,443,191) (13,561,159)
- - -----------------------------------------------------------------------------------------------------------
Total Shareholders' Equity 7,344,121 12,226,153
- - -----------------------------------------------------------------------------------------------------------
Total Liabilities and Shareholders' Equity $12,524,628 $34,053,336
===========================================================================================================
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
MERIDIAN POINT REALTY TRUST '83
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 1996 and 1995
(Unaudited)
1996 1995
- - -------------------------------------------------------------------------------------------------------
<S> <C> <C>
Revenues:
Rentals from Real Estate Investments $1,081,447 $1,448,447
Interest and Other 58,436 78,821
- - -------------------------------------------------------------------------------------------------------
Total Revenues 1,139,883 1,527,268
- - -------------------------------------------------------------------------------------------------------
Expenses:
Interest and Amortization of Debt Discount 338,121 559,195
Property Taxes 104,118 154,759
Property Operating Costs, Including Amounts Paid to Related Parties of
$99,453 and $42,948, respectively 357,748 208,340
General and Administrative,7
Including Amounts Paid to Related Parties of
$68,034 and $89,916, respectively 137,353 230,666
Depreciation and Amortization 274,602 358,484
- - -------------------------------------------------------------------------------------------------------
Total Expenses 1,211,942 1,511,444
- - -------------------------------------------------------------------------------------------------------
Net Income (Loss) before Gain on Disposition of Assets (72,059) 15,824
Gain on Disposition of Assets 2,582,606 0
- - -------------------------------------------------------------------------------------------------------
Net Income $2,510,547 $15,824
=======================================================================================================
Net Income per Common Share $0.83 $0.01
=======================================================================================================
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
MERIDIAN POINT REALTY TRUST '83
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 1996 and 1995
(Unaudited)
1996 1995
- - ---------------------------------------------------------------------------------------------
<S> <C> <C>
Cash Flows From Operating Activities:
Net Income $2,510,547 $15,824
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Gain on Disposition of Assets (2,582,006) 0
Depreciation 240,178 322,685
Amortization - Debt Discount 5,438 12,650
Amortization - Other 39,785 42,803
Rent Adjustment 0 12,153
Decrease (Increase) in Cash Held in Escrow 98,363 (1,397)
Increase in Restricted Cash (111,652) (111,926)
Increase in Capitalized Lease Commissions (39,941) (81,859)
Decrease (Increase) in Accounts Receivable (71,115) 31,053
Increase in Other Assets (233,395) 0
Decrease in Accounts Payable (180,308) (158,621)
Decrease (Increase) in Payable to Affiliates (20,417) 76,955
Decrease in Other Liabilities (182,929) (124,830)
- - ---------------------------------------------------------------------------------------------
Net Cash Provided By (Used In) Operating Activities (527,452) 35,490
- - ---------------------------------------------------------------------------------------------
Cash Flows From Investing Activities:
Improvements to Existing Real Estate (48,322) (199,265)
- - ---------------------------------------------------------------------------------------------
Net Cash Used in Investing Activities (48,322) (199,265)
- - ---------------------------------------------------------------------------------------------
Cash Flows from Financing Activities:
Proceeds from Disposition of Assets 3,693,309 0
Closing Costs on Disposition of Assets (89,460) 0
Cash Dividends Paid (1,000,434) 0
Principal Payments on Mortgage Notes (77,864) (121,775)
- - ---------------------------------------------------------------------------------------------
Net Cash Provided by (Used in) Financing Activities 2,525,551 (121,775)
- - ---------------------------------------------------------------------------------------------
Net Increase (Decrease) in Cash and Cash Equivalents 1,949,777 (285,550)
Cash and Cash Equivalents - Beginning of Period 2,525,918 4,984,963
- - ---------------------------------------------------------------------------------------------
Cash and Cash Equivalents - End of Period $4,475,695 $4,699,413
=============================================================================================
Supplemental Disclosure of Non-Cash Transactions
Proceeds from Disposition of Assets - Shares of Meridian
Industrial Trust, Inc. (MIT) Common Stock $6,392,145 $0
Mortgages Assumed by MIT 16,334,297 0
Reduction of Investment in Real Estate for Properties Sold (22,343,612) 0
Reduction of Other Assets for Properties Sold (1,402,967) 0
Dividend Paid in Shares of MIT Common Stock (6,392,145) 0
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>
MERIDIAN POINT REALTY TRUST '83
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1996
(Unaudited)
1. General
Meridian Point Realty Trust '83 (the "Company") is a business trust
organized under the laws of the State of California for the purpose of
acquiring, operating, holding for investment and ultimately selling income-
producing commercial and industrial real estate. It is the Company's
intention not to invest net proceeds from sales or refinancing in
additional properties and accordingly, the Company is a self-
liquidating/finite life trust. The Company was formed on June 24, 1982 and
commenced operations on April 12, 1983. On February 23, 1996, the Company
sold all of its real estate properties except for the Charleston Business
Park ("Charleston") (See Note 5). The Company's management is currently
evaluating its ongoing operating strategy.
2. Cash Equivalents
The Company considers all investments with an original maturity of
three months or less to be cash equivalents.
Cash paid for interest was $327,322 and $545,735 for the three months
ended March 31, 1996 and 1995, respectively.
3. Rentals from Real Estate Investments.
Certain of the Company's leases relating to its properties require
lessees to pay all or a portion of real estate taxes, insurance and
operating costs ("Expense Recaptures"). Expense Recaptures of $179,796 and
$141,789 for the three months ended March 31, 1996 and 1995, respectively,
have been included in Rentals from Real Estate Investments.
All leases are classified as operating leases. The Company recognizes
rental income on the straight-line basis over the terms of the leases.
Deferred rent receivable, included in accounts receivable, represents the
excess of rental revenue recognized on a straight-line basis over cash
received under the applicable lease provisions
4. Investments in Real Estate and Depreciation Methods.
Investments in Real Estate are stated at the lower of depreciated cost
or net realizable value. Net realizable value for financial reporting
purposes: (i) is evaluated and identified quarterly by the Company on a
property by property basis using undiscounted cashflows; (ii) is measured
by comparing the Company's estimate of fair value based upon either sales
comparables or the net cash expected to be generated by the property
(comprised of the forecasted operations for the property based upon
historical results, together with management's estimates of the property's
future occupancy, lease rates and capital improvement requirements), less
estimated carrying costs (including interest) throughout the anticipated
holding period, plus the estimated cash proceeds from the ultimate
disposition of the property; and (iii) is not necessarily an indication of
the property's current value of the amount that will be realized upon the
ultimate disposition of the property. To the extent net realizable value
is less than the carrying value of the property, a Provision for Decrease
in Net Realizable Value is recorded in the amount by which the carrying
value exceeds estimated fair value. As of December 31, 1995, the Company's
Investment in Real Estate is stated net of a cumulative Provision for
Decrease in Net Realizable Value of $838,000. As of March 31, 1996, the
Company's Investment in Real Estate is stated at depreciated cost.
Depreciation and Amortization have been calculated under the straight-
line method, based upon the estimated useful lives of the assets. Property
and property additions are depreciated over 35 years. Expenditures for
maintenance, repairs and improvements which do not materially prolong the
normal useful life of an asset are charged to operations as incurred.
Leasing commissions and tenant improvements are amortized under the
straight-line method over the term of the related lease.
5. Disposition of Assets
On February 23, 1996, the Company sold all of its real estate assets
except Charleston to Meridian Industrial Trust, Inc. ("MIT") for $3.6
million in cash, 390,360 shares of MIT common stock, and the assumption of
certain mortgage notes and other liabilities by MIT. The MIT common stock
was valued at $6,392,145 (See Note 6). In addition, the Company sold all
of its personal property and its $79,500 investment in common stock of
Meridian Point Properties, Inc. to MIT. The details of these transactions
are as follows:
<TABLE>
Mortgage
Selling Notes Property Other Gain or
Property Price Assumed Basis Costs (Loss)
- - --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Scripps $ 3,472,070 $ 7,965,980 $ 8,254,258 $ 328,805 $2,854,987
Golden Cove 1,814,467 3,195,467 3,364,489 39,278 1,606,167
Airport #14 996,870 813,290 2,129,470 196,496 (515,806)
North Irvine 995,329 2,080,234 2,435,232 136,489 503,842
El Dorado 849,252 1,310,809 2,060,263 117,905 (18,107)
Airport #17 782,313 0 1,972,250 129,636 (1,319,573)
Airport #16A 528,714 648,906 910,384 224,213 43,023
Airport #3 384,071 0 760,232 81,775 (457,936)
Airport #16B 169,059 319,611 457,034 148,370 (116,734)
--------------------------------------------------------------------------
9,992,145 16,334,297 22,343,612 1,402,967 2,579,863
Personal Property
and Investments 93,309 0 90,566 0 2,743
--------------------------------------------------------------------------
Total $10,085,454 $16,334,297 $22,434,178 $1,402,967 $2,582,606
==========================================================================
</TABLE>
In addition to the costs shown above, the Company paid $89,460 in
closing costs related to the sale of the real estate assets.
If the sale of the property and investments had occurred on January 1,
1995, the employee leasing agreement with Meridian Point Properties, Inc.
had been terminated and replaced with the management agreement with E & L
Associates, Inc., the Company's pro forma results of operations for the
three months ended March 31, 1996 and 1995 would have been (in thousands
except per share amounts):
<TABLE>
1996 1995
----------------------------
<S> <C> <C>
Revenues $345 $398
Expenses (378) (474)
----------------------------
Net Loss ($ 33) ($ 76)
============================
Net Loss per Share ($0.01) ($0.03)
============================
</TABLE>
6. Earnings Per Share.
Earnings per share of beneficial interest is determined by dividing
net income by the weighted average number of shares of beneficial interest
outstanding during the period. Weighted average number of shares
outstanding was 3,031,618 for the three months ended March 31, 1996 and
1995, respectively. No distributions were made during the three months
ended March 31, 1995. During the three months ended March 31, 1996, the
Company distributed cash of $1,000,434, or $0.33 per share of beneficial
interest, and all of the 390,360 shares of Meridian Industrial Trust, Inc.
("MIT") common stock (or 0.1287 of a share of MIT common stock per share of
beneficial ownership in the Company) to stockholders of record at the close
of business on March 12, 1996.
7. Mortgage Notes Payable.
The mortgage note securing Charleston has an outstanding principal
balance of $4,711,607 at March 31, 1996. This loan has a maturity date of
March 1, 1999 and calls for monthly principal and interest payments based
on an interest rate of 8.75% per annum and a twenty-year amortization
schedule. In addition, the Company has made monthly payments of $35,000 to
an escrow account which will be available to fund the cost of remediation,
if any (see Note 9). Any funds remaining will be applied to the mortgage
loan as a principal paydown upon the maturity of the loan. As of March 31,
1996, the escrow account has a balance of $1,231,482.
8. Income Taxes
The Company intends to qualify and be treated as a real estate
investment trust under Section 856-860 of the Internal Revenue Code for the
year ending December 31, 1996. Consequently, no provision for federal
income tax has been made in the accompanying Statements of Operations.
9. Commitments and Contingencies.
The San Francisco Bay Region of the California Regional Water Quality
Control Board (the "RWQCB") has requested that the Company investigate and
characterize soil and groundwater contamination at Charleston. In response
to that request, the Company engaged an environmental engineering firm
which discovered the presence of trichloroethylene and other solvent
chemicals in the groundwater below Charleston. Based on the preliminary
report of this environmental firm, it appears that such contamination is
the result of contamination generated by (i) one or more sources located at
properties adjacent to Charleston, and (ii) a former tenant at Charleston.
The exact location of the off-site sources has not yet been determined.
During 1993, a further investigation of the on-site contamination was
conducted by the environmental engineering firm and a firm of environmental
health and safety specialists. The information gathered suggests that the
on-site groundwater contamination resulted from an incident which occurred
sometime before 1986 and may have migrated off-site. It has not been
determined whether the contamination occurred before or after the Company
acquired Charleston in 1983. The Company has requested that the RWQCB
pursue the responsible parties for the remediation costs. The RWQCB has
not yet responded to the Company's request. Charleston has not been
classified as a superfund site by the Environmental Protection Agency.
The RWQCB has taken jurisdiction as the "lead agency" with regard to
the environmental conditions at Charleston. Generally, the RWQCB
approaches remediation of such sites by designating "potentially
responsible parties" in two categories: (i) primarily responsible parties
that are jointly and severally obligated to perform and pay for all of the
necessary remedial or clean up work, and (ii) secondarily responsible
parties that are jointly and severally obligated to perform and pay for the
remedial work only if the primarily responsible parties have failed or
refused to comply with the agency's orders. Parties that have directly
caused environmental contamination are generally included in the class of
primarily responsible parties while landowners and property occupants that
have not directly caused the contamination are generally included in the
category of secondarily responsible parties. The Company believes there
are multiple parties that will be identified as primarily and secondarily
liable parties with respect to the contamination at Charleston.
The Company owns Charleston but never conducted operations there that
contributed to soil and groundwater conditions. Based on this fact and
other facts that are currently known, the Company believes the most likely
scenario, once the RWQCB takes action, is that the Company: (i) will be
named as a secondarily responsible party with respect to the contamination
that originated on Charleston, and (ii) should not be named as a
potentially responsible party with respect to contamination that migrated
onto Charleston from offsite origins. Accordingly, management believes
that, under current RWQCB policies, only if all the primarily responsible
parties fail or refuse to comply with the agency's orders will the Company
be required to take any remedial action with respect to contamination that
originated on Charleston. However, there is always a risk that the Company
might be named as a secondarily responsible party for all the soil and
groundwater conditions at the site, particularly if it becomes impossible
to distinguish between contamination that originated at Charleston and
contamination that migrated onto Charleston. There is also a risk that
enforcement policies may change, in which case the Company and all other
parties involved could be named as jointly and severally liable parties
with no distinction between primary and secondary liability. If the
Company were ordered to remediate the property under those circumstances,
however, it would have statutory and common law rights to contribution and
indemnity for the remediation costs against the parties that actually
caused the contamination.
Based on very preliminary investigation and on current policies of the
RWQCB, the estimated present value of the ultimate amount of remedial costs
and other losses associated with all of the soil and groundwater conditions
in the vicinity of Charleston ranges from $1 million to $5.4 million. It
should be noted, however, (i) that under current RWQCB policies, the RWQCB
would seek to charge those parties that actually contributed to the
contamination with the entire remediation cost before seeking to charge the
Company or any other non-contributing party; (ii) that the range of
remediation costs takes into account the possibility that more than one
type of treatment method might be acceptable to the RWQCB; (iii) that there
is a high degree of uncertainty associated with remedial cost estimates at
this relatively early stage of the environmental investigation; and (iv)
that due to the relatively limited soil and groundwater data available at
this early investigative stage, it is not feasible to provide a more
precise estimate of these costs. In addition, there are uncertainties
generated by: (i) the lack of information concerning the identity and
financial condition of the potentially responsible parties who would be
expected to be charged with the entire cost of remediation and (ii) the
possibility of changes in regulatory enforcement policies. As a result, it
is not feasible at this time to estimate either the Company's risk of
actually incurring any remedial costs or the amount of those costs that the
Company might actually incur.
Therefore, the Company is not presently able to reasonably estimate
the amount or range of remediation costs, if any, or the amount or range of
further costs that may be required to be expended by it to resolve this
matter. Accordingly, the accompanying consolidated financial statements do
not reflect any adjustments for this matter. The Company has retained
legal counsel to assist in determining its legal obligations with respect
to remediating the contamination and in determining its legal right vis-a-
vis the party or parties directly responsible for the contamination.
In March 1994 the mortgage note secured by Charleston was restructured
providing for, among other things, a maturity date of March 1, 1999. In
connection with the restructuring, the Company will make monthly payments
of $35,000 to a restricted cash account through December 1995. From
December 1995 until the maturity of the loan, the Company will make monthly
payments to the restricted cash account equal to ninety percent (90%) of
the property's net cash flow. The escrow account will be available to fund
the cost of remediation, if any. Any funds remaining will be applied to
the mortgage loan as a principal paydown upon the maturity of the loan.
Prior to the restructuring of the loan, the Company had been making
deposits to the restricted cash account equal to the net cash flow of the
property. As part of the restructuring, the Company made a cash
disbursement totaling $209,829 to cover closing costs and a required cash
deposit into the restricted cash account. As of March 31, 1996, the
restricted cash account has a balance of $1,231,482.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The Company was formed and currently operates as a self-liquidating,
finite-life REIT. The following discussion should be read in conjunction
with the Company's Consolidated Balance Sheets and Consolidated Statements
of Operations, Shareholders' Equity, and Cash Flows and the notes thereto
included on pages 2 through 10 of this report. Unless otherwise defined in
this report, or unless the context otherwise requires, the capitalized
words or phrases referred to in this section either: (a) describe
accounting terms that are used as line items in such financial statements,
or (b) have the meanings ascribed to them in such financial statements and
the notes thereto.
Before February 23, 1996, the Company's principal asset and source of
revenue was its portfolio of ten industrial and commercial properties. On
February 23, 1996, the Company: (1) sold nine of the ten properties in its
portfolio to MIT for $3.6 million in cash, 390,360 shares of MIT common
stock, and the assumption of certain mortgage notes and other liabilities
by MIT; (2) announced a dividend which was paid March 22, 1996 of
approximately $1 million in cash (or $0.33 per share of beneficial interest
in the Company) and all of the 390,360 shares of MIT common stock (or
0.1287 of a share of MIT common stock per share of beneficial interest in
the Company) to stockholders of record at the close of business on March
12, 1996; and (3) appointed E & L Associates, Inc. to provide property
management and certain other administrative services to the Company,
effective February 24, 1996.
The Company's future sources of liquidity will be significantly
influenced by the operations at Charleston, the Company's only remaining
real estate investment. Leases covering approximately 90% of the space at
Charleston will expire over the next 24 months. There can be no assurances
that the current tenants will renew of that they will not renew on less
favorable terms. Furthermore, the mortgage loan agreement requires that
90% of Charleston's cash flow be escrowed into a restricted cash account to
fund future retenanting costs and/or any environmental remediation work
(see Note 9 to the Company's financial statements). Finally, before the
property can be sold, management must first quantify the cost to remediate
the ground water contamination situation at Charleston. Accordingly, the
Company's future cash flow and results of operations remain uncertain in
light of the above operating challenges at Charleston.
Liquidity and Capital Resources
- - -------------------------------
The Company's liquidity and capital resources have been dramatically
changed as a result of the February 23, 1996 asset sale. The Company's
primary source of near-term liquidity is its unrestricted cash which, at
March 31, 1996, totaled $4,475,695. Secondary sources of liquidity include
cash flow from Charleston, 90% of which is required to be escrowed, and net
proceeds from the eventual sale of Charleston. Given the environmental
situation at Charleston, management believes it is unlikely the property
could be refinanced at interest rates or terms more favorable than those in
the existing first mortgage loan (which loan bears an annual fixed interest
rate of 8.75% and matures on March 1, 1999). Furthermore, management
believes the relatively low total capitalization of the Company makes it
remote that it could sell either debt or equity securities in the public
markets.
The Company's principal application of its resources are: (a)
property operating costs, property taxes, general and administrative
expenses, interest expense and legal costs; (b) environmental remediation,
tenant leasing and capital improvements at Charleston, (c) principal
payments on the Charleston mortgage note, (d) the escrowing of 90% of the
cash flow from Charleston as required under its mortgage loan agreements,
and (e) dividends.
During the three months ended March 31, 1996, Funds from Operations
were insufficient to fully meet the cash needs of the Company. The Company
anticipates this trend to continue which would result in further declines
in its unrestricted cash of approximately $4.5 million at March 31, 1996.
Management is actively preparing the Charleston property for sale. At
the present time, however, there are no commitments for capital
improvements to the property and there can be no assurances that the
Company will be able to find a qualified buyer for the property.
Capital expenditures for the three months ended March 31, 1996 and
1995 were $48,322 and $199,265, respectively.
The Company paid a cash dividend of $0.33 and 0.1287 of a share of MIT
common stock per share of beneficial interest.
Material Changes in Results of Operations
- - -----------------------------------------
Rentals from Real Estate Investments totaled $1,081,447 and $1,448,447
for the three months ended March 31, 1996 and 1995, respectively. The 1996
rentals were less than 1995 because of the sale of nine of the Company's
ten properties in its real estate portfolio on February 23, 1996. In the
three months ended March 31, 1996, rentals from Charleston were $297,116
which approximates the rental income to be expected in future quarters.
Interest and other revenues declined by $20,385 to $58,436 in the
three months ended March 31, 1996 because of decreases in the Company's
average cash balances available for investment.
Property taxes and depreciation and amortization also declined from
period to period because of the February 23, 1996 property sale. However,
property operating costs increased in 1996 because of the write-off of
uncollectible receivables and legal and professional fees related to the
Charleston environmental situation. See Note 5 to the consolidated
financial statements for pro forma results of operations from the ongoing
operations.
General and administrative expense was $137,353 and $230,666 in the
three months ended March 31, 1996 and 1995, respectively. The decline
resulted from the lower level of allocated expense following the
termination of the MPP Employee Leasing Agreement and the payment of
$38,865 of state income taxes in 1995. No comparable amounts were payable
in 1996.
__________________________________________________________________________
PART II: OTHER INFORMATION
__________________________________________________________________________
ITEM 1. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Company
is a party or to which any of the assets of the Company is subject.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits: None.
(b) Reports on Form 8-K. The following Form 8-K was filed during the
quarter ended March 31, 1996:
Current Report on Form 8-K under Item 2 - Acquisition or Disposition
of Assets, dated February 23, 1996, concerning the Company's sale of
nine properties to Meridian Industrial Trust, Inc., the month-to-month
management agreement with E & L Associates, Inc., and the distribution
of $0.33 and 0.1287 of a share of MIT common stock per share of
beneficial ownership.
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.
REGISTRANT
MERIDIAN POINT REALTY TRUST '83
Date: May 14, 1996 By: /s/ Lorraine O. Legg
----------------------
Lorraine O. Legg, President and
Chief Executive Officer
(Principal Executive Officer)
Date: May 14, 1996 By: /s/ John E. Castello
----------------------
John E. Castello,
Senior Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE CONDENSED CONSOLIDATED BALANCE SHEET AS
OF MARCH 31, 1996 AND THE CONDENSED CONSOLIDATED STATEMENT
OF INCOME FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 5,707,177
<SECURITIES> 0
<RECEIVABLES> 558,846
<ALLOWANCES> 216,185
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 8,701,564
<DEPRECIATION> 2,455,196
<TOTAL-ASSETS> 12,524,628
<CURRENT-LIABILITIES> 468,900
<BONDS> 0
<COMMON> 3,031,618
0
0
<OTHER-SE> 4,312,503
<TOTAL-LIABILITY-AND-EQUITY> 12,524,628
<SALES> 0
<TOTAL-REVENUES> 3,722,489
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 873,821
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 338,121
<INCOME-PRETAX> 2,510,547
<INCOME-TAX> 0
<INCOME-CONTINUING> 2,510,547
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,510,547
<EPS-PRIMARY> .83
<EPS-DILUTED> .83
</TABLE>
