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, 1994
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 0-11935
Century Properties Fund XIX
(Exact name of registrant as specified in its charter)
California 94-2887133
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
5665 Northside Drive N.W., Ste. 370, Atlanta, Georgia 30328
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (404) 916-9090
N/A
Former name, former address and fiscal year, if changed since last report.
Indicate by check mark whether 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 reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No _____
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 12, 13, or 15(d) of the Securities Exchange Act of 1934
subsequent to the distribution of securities under a plan confirmed by a court.
Yes ______ No ______
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding
of each of the issuer's classes of common stock, as of the latest practicable
date _____________________.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
Consolidated Balance Sheets
March 31, December 31,
1994 1993
(Unaudited) (Audited)
Assets
Cash and cash equivalents $ 419,000 $ 119,000
Restricted cash 1,516,000 1,516,000
Receivables and other assets 887,000 659,000
Real Estate:
Real estate 86,690,000 89,909,000
Furnishings 7,247,000 7,527,000
Accumulated depreciation (29,578,000) (29,874,000)
-------------- --------------
Net real estate 64,359,000 67,562,000
Deferred financing costs - net 843,000 943,000
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Total assets $ 68,024,000 $ 70,799,000
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Liabilities and Partners' Equity
Accrued expenses and other liabilities $ 3,279,000 $ 3,109,000
Notes payable to affiliate of the
general partner - 370,000
Notes payable 57,779,000 59,869,000
-------------- --------------
Total liabilities 61,058,000 63,348,000
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Partners' equity:
General partner (8,249,000) (8,192,000)
Limited partners (89,292 units outstanding at
March 31, 1994 and December 31, 1993) 15,215,000 15,643,000
-------------- --------------
Total partners' equity 6,966,000 7,451,000
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Total liabilities and partners' equity $ 68,024,000 $ 70,799,000
-------------- --------------
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See notes to consolidated financial statements.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
Consolidated Statements of Operations (Unaudited)
For the Three Months Ended
March 31, 1994 March 31, 1993
Revenues:
Rental $ 3,417,000 $ 3,754,000
Interest and other 13,000 10,000
Loss on sale of property (149,000) -
-------------- --------------
Total revenues 3,281,000 3,764,000
-------------- --------------
Expenses:
Operating 1,563,000 1,903,000
Interest 1,381,000 1,802,000
Depreciation 685,000 696,000
General and administrative 137,000 210,000
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Total expenses 3,766,000 4,611,000
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Net loss $ (485,000) $ (847,000)
-------------- --------------
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Net loss per limited partnership unit $ (5) $ (8)
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See notes to consolidated financial statements.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
Consolidated Statements of Cash Flows (Unaudited)
For the Three Months Ended
March 31, 1994 March 31, 1993
Operating Activities:
Net loss $ (485,000) $ (847,000)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization 779,000 771,000
Loss on sale of property 149,000 -
Costs expensed on attempted property
refinancing - 64,000
Changes in operating assets and liabilities:
Receivables and other assets (228,000) 94,000
Accrued expenses and other liabilities 170,000 9,000
-------------- --------------
Net cash provided by operating activities 385,000 91,000
-------------- --------------
Investing Activities:
Additions to rental properties (72,000) (112,000)
Increase in restricted cash - (3,000)
Property sales expenses paid (3,000) (36,000)
Proceeds on sale of property 2,450,000
-------------- --------------
Net cash provided by (used in) investing
activities 2,375,000 (151,000)
-------------- --------------
Financing Activities:
Proceeds from notes payable to affiliate
of the general partner - 241,000
Repayment of notes payable to affiliate of the
general partner (370,000) (386,000)
Notes payable principal payments (125,000) (211,000)
Repayment of note payable on sale of rental
property (1,965,000) -
Financing costs paid - (143,000)
Financing costs refunded - 521,000
-------------- --------------
Net cash (used in) provided by financing
activities (2,460,000) 22,000
-------------- --------------
Increase (Decrease) in Cash and Cash Equivalents 300,000 (38,000)
Cash and Cash Equivalents at Beginning of Period 119,000 147,000
-------------- --------------
Cash and Cash Equivalents at End of Period $ 419,000 $ 109,000
-------------- --------------
-------------- --------------
Supplemental Disclosure of Cash Flow Information:
Interest paid in cash during the period $ 1,345,000 $ 1,549,000
-------------- --------------
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See notes to consolidated financial statements.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. General
The accompanying consolidated financial statements, footnotes and discussions
should be read in conjunction with the consolidated financial statements,
related footnotes and discussions contained in the Partnership's Annual Report
for the year ended December 31, 1993. Certain balance sheet accounts have been
reclassified in order to conform to the current period.
The financial information contained herein is unaudited. However, in the
opinion of management, all adjustments necessary for a fair presentation of such
financial information have been included. All adjustments are of a normal
recurring nature, except as disclosed in note 4 below.
The results of operations for the three months ended March 31, 1994 and 1993 are
not necessarily indicative of the results to be expected for the full year.
2. Transactions with Related Parties
(a) An affiliate of the Managing General Partner ("MGP") received
reimbursements of administrative expenses amounting to $27,300 during the period
ended March 31, 1994. These reimbursements are primarily included in general
and administrative expenses.
(b) NPI Property Management Corporation ("NPI Management"), an affiliate of
MGP, is entitled to receive a management fee equal to 5% of the annual gross
receipts from certain properties it manages. For the period ended March 31,
1994, NPI Management received $55,050. These fees are included in operating
expenses.
3. Mortgage Payable
The Partnership has a balloon payment of $10,800,000 on the McMillan Place
Apartments which is due in December, 1994. To meet this obligation the
Partnership is negotiating with the lender for debt modification and an
extension of the loan. If the Partnership is unable to extend or refinance the
loan, or sell the property, the property could be lost through foreclosure.
The Partnership has balloon payments which are due between 1995 and 1998 on all
other remaining properties. The ability to hold and operate these properties is
dependent on the Partnership's ability to obtain refinancing or debt
modifications as required.
4. Disposition of Rental Property
Plantation Forest Apartments located in Atlanta, Georgia, was sold on February
8, 1994 for $2,450,000. After payment of the existing loan of $1,965,000 and
expenses of the sale, the proceeds to the Partnership were approximately
$482,000. The loss on sale was $149,000.
Net proceeds realized from the sale were in partially used to fully repay
$370,000 of the demand notes, including accrued interest, held by an affiliate
of the general partner.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.
This item should be read in conjunction with the Consolidated Financial
Statements and other Items contained elsewhere in this Report.
Fund Liquidity and Capital Resources
The Fund holds investments in and operates eight apartment complexes. The Fund
receives rental income from its properties and is responsible for operating
expenses, capital improvements and debt service payments under mortgage
obligations. As of May 1, 1994, five of the thirteen properties originally
purchased by the Fund were sold or otherwise disposed of.
The Fund uses working capital reserves provided from any undistributed cash flow
from operations, sales and refinancing proceeds as its primary source of
liquidity. There have been no distributions since 1987. It is not currently
anticipated that the Fund will make any distributions from operations in the
near future.
The level of liquidity based upon cash and cash equivalents experienced a
$300,000 increase at March 31, 1994, as compared to December 31, 1993. The
Fund's $385,000 of cash provided by operating activities and $2,447,000 of net
proceeds from the sale of Plantation Forest Apartments (investing activities)
were only partially offset by $72,000 of fixed asset purchases (investing
activities), $2,090,000 of mortgage principal repayments (financing activities)
and $370,000 of repayments of notes held by an affiliate to the general partner
(financing activities). The increase in cash provided by operating activities
is primarily due to the disposition of properties during 1993. All other
increases (decreases) in certain assets and liabilities are the result of the
timing of receipt and payment of various operating activities.
Working capital reserves are being invested in a money market account or
repurchase agreements secured by United States Treasury obligations. It is the
opinion of the Managing General Partner that if market conditions remain
relatively stable, cash flow from operations, when combined with working capital
reserves, will be sufficient to fund required capital improvements and regular
debt service payments in 1994 and the foreseeable future. However, in December
1994, and in 1995 through 1998, the Fund will have to arrange for the
refinancings or debt modifications discussed in Item 1, Note 3. If necessary,
the Fund could dispose of the properties with significant balloon payments, in
order to reduce future cash requirements.
If the December 1994 balloon payment, due with respect to McMillan Place, is not
refinanced or extended, or the property is not sold, the property could be lost
through foreclosure. If the property is lost through foreclosure, the Fund
would not record a loss, since the outstanding non-recourse mortgage liability
exceeds the Fund's depreciated basis in the assets.
At this time, it appears that the investment objective of capital growth will
not be attained and that investors will not receive a return of all of their
invested capital. The extent to which invested capital is returned to investors
is dependent upon the performance of the Fund's properties and the markets in
which such properties are located and on the sales price of the remaining
properties. In this regard, it is anticipated at this time that the remaining
properties will be held longer than originally expected. The ability to hold
and operate these properties is dependent on the Fund's ability to obtain
refinancing or debt modification as required.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.
Real Estate Market
The national real estate market has suffered from the effects of the real estate
recession including, but not limited to, a downward trend in market values of
existing residential properties. In addition, the bailout of the savings and
loan associations and sales of foreclosed properties by auction reduced market
values and caused a further restriction on the ability to obtain credit. As a
result, the Fund's ability to refinance or sell its properties may be
restricted. These factors caused a decline in market property values and serve
to reduce market rental rates and/or sales prices. Compounding these
difficulties are relatively low interest rates, which encourage existing and
potential tenants to purchase homes. In addition, there has been a significant
decline nationally in new household formation. Despite the above, the rental
market appears to be experiencing a gradual strengthening and management
anticipates that increases in revenue will generally exceed increases in
expenses during 1994. Furthermore, management believes that the emergence of
new institutional purchasers, including real estate investment trusts and
insurance companies, should create a more favorable market value for the Fund's
properties in the future.
Results of Operations
Three Months Ended March 31, 1994 vs. March 31, 1993
Operating results increased by $362,000 for the three months ended March 31,
1994, as compared to 1993, due to a decrease in expenses of $845,000, which was
only partially offset by a decrease in revenues of $483,000.
Revenues decreased by $483,000 for the three months ended March 31, 1994, as
compared to 1993, due to the disposition of Parkside Village Apartments in May
1993 and Plantation Forest Apartments in February 1994. With respect to the
remaining properties, revenues increased by $240,000 due to an increase in
rental income of $237,000, and interest and other income of $3,000. Rental
revenue increased primarily due to an increase in occupancy at Sandpoint
Apartments and McMillan Place Apartments. The increase in interest income is
due to an increase in average working capital reserves available for investment.
Expenses decreased by $845,000 for the three months ended March 31, 1994 as
compared to 1993, due to the disposition of Parkside Village Apartments and
Plantation Forest Apartments. With respect to the remaining properties,
expenses decreased by $213,000 as the decline in interest of $226,000 and
general and administrative expenses of $57,000 were partially offset by
increases in operating expenses of $61,000 and depreciation of $9,000.
The decrease in interest expense is primarily attributable to the lower interest
rates on the June 1993 replacement financing on Wood Lakes, Wood Ridge and
Plantation Crossing Apartments. The decrease in general and administrative
expenses is primarily attributable to expenses in the first quarter of 1993
attributable to the attempted refinancing of mortgages on Wood Lake, Wood Ridge
and Plantation Crossing Apartments.
The increase in operating expenses is primarily attributable to repairs on
Plantation Crossing Apartments. Depreciation expense increased due to the
effect of fixed asset additions.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations.
Properties
A description of the properties in which the Fund has an ownership interest in
the period covered by this Report, along with the occupancy data, follows:
CENTURY PROPERTIES FUND XIX
OCCUPANCY SUMMARY
For the Quarters Ended March 31, 1994 and 1993
Number Average
of Date of Occupancy Rate (%)
Name and Location Units Purchase 1994 1993
----- -------- ---- ----
Parkside Village Apartments (1) 383 11/83 - 95
Aurora, Colorado
Wood Lake Apartments 220 12/83 95 90
Atlanta, Georgia
Greenspoint Apartments 336 02/84 98 96
Phoenix, Arizona
Sandspoint Apartments 432 02/84 96 90
Phoenix, Arizona
Wood Ridge Apartments 280 04/84 95 94
Atlanta, Georgia
Plantation Crossing Apartments 180 06/84 98 97
Atlanta, Georgia
Plantation Forest Apartments (2) 64 06/84 99 90
Atlanta, Georgia
Sunrunner Apartments 200 07/84 92 92
St. Petersburg, Florida
McMillan Place Apartments 402 06/85 95 90
Dallas, Texas
Misty Woods Apartments 228 06/85 90 91
Charlotte, North Carolina
The Cove Apartments (3) 689 12/84 - -
Tampa, Florida
(1) Property was sold in May 1993.
(2) Property was sold in February 1994. 1994 average occupancy rate covers
period through date of sale.
(3) Property was placed into receivership in 1992 and acquired by lender
through foreclosure in July 1993.
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
The following report on Form 8-K was required to be filed during the period
covered by this Report:
Item
Date Number
of Report Reported Description
2/8/94 2 & 7 Disposition of property
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CENTURY PROPERTIES FUND XIX - FORM 10-Q - MARCH 31, 1994
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.
CENTURY PROPERTIES FUND XIX
By: FOX PARTNERS II,
A California General Partnership,
its general partner
By: FOX CAPITAL MANAGEMENT CORPORATION,
A California Corporation,
its general partner
___________________________________
ARTHUR N. QUELER
Executive Vice President (Principal
Financial and Accounting Officer)
and Director of Fox
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