FORM 10-QSB--QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
OF THE SECURITIES EXCHANGE ACT OF 1934
(As last amended in Rel. No. 312905, eff. 4/26/93.)
UNITED STATES
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, 1997
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 small business issuer as specified in its charter)
California 94-2887133
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Insignia Financial Plaza
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (864) 239-1000
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 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) CENTURY PROPERTIES FUND XIX
CONSOLIDATED BALANCE SHEET
(in thousands, except unit data)
(Unaudited)
March 31, 1997
Assets
Cash and cash equivalents $ 3,805
Other assets and deferred costs 1,983
Investment properties:
Land $ 11,635
Buildings and related personal property 83,566
95,201
Less accumulated depreciation (37,852) 57,349
$ 63,137
Liabilities and Partners' Capital (Deficit)
Liabilities
Accrued expenses and other liabilities $ 1,830
Mortgage notes payable 61,482
Partners' Capital (Deficit):
General partners $ (9,091)
Limited partners (89,292 units outstanding) 8,916 (175)
$ 63,137
See Accompanying Notes to Consolidated Financial Statements
b) CENTURY PROPERTIES FUND XIX
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except unit data)
(Unaudited)
Three Months Ended
March 31,
1997 1996
Revenues:
Rental income $ 3,780 $ 3,753
Interest income 33 33
Other income 171 124
Total revenues 3,984 3,910
Expenses:
Operating 1,169 1,159
General and administrative 84 133
Maintenance 358 400
Depreciation 706 689
Interest 1,262 1,291
Property taxes 281 276
Total expenses 3,860 3,948
Net income (loss) $ 124 $ (38)
Net income (loss) allocated to general partners $ 15 $ (4)
Net income (loss) allocated to limited partners 109 (34)
Net income (loss) $ 124 $ (38)
Net income (loss) per limited partnership unit $ 1.23 $ (.37)
See Accompanying Notes to Consolidated Financial Statements
c) CENTURY PROPERTIES FUND XIX
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL (DEFICIT)
(in thousands, except unit data)
(Unaudited)
Limited
Partnership General Limited
Units Partners Partners Total
Original capital contributions 89,292 $ -- $ 89,292 $ 89,292
Partners' (deficit) capital
at December 31, 1996 89,292 $(9,106) $ 8,807 $ (299)
Net income for the three
months ended March 31, 1997 15 109 124
Partners' (deficit) capital
at March 31, 1997 89,292 $(9,091) $ 8,916 $ (175)
See Accompanying Notes to Consolidated Financial Statements
d) CENTURY PROPERTIES FUND XIX
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
Three Months Ended
March 31,
1997 1996
Cash flows from operating activities:
Net income (loss) $ 124 $ (38)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation 706 689
Amortization 33 31
Change in accounts:
Other assets and deferred costs (43) (140)
Accrued expenses and other liabilities (41) 323
Net cash provided by operating activities 779 865
Cash flows from investing activities
Property improvements and replacements (192) (328)
Net cash used in investing activities (192) (328)
Cash flows from financing activities
Mortgage principal repayments (186) (190)
Loan costs (15) (62)
Net cash used in financing activities (201) (252)
Net increase in cash and cash equivalents 386 285
Cash and cash equivalents at beginning of period 3,419 2,868
Cash and cash equivalents at end of period $ 3,805 $ 3,153
Supplemental information:
Interest paid $ 1,177 $ 1,214
See Accompanying Notes to Consolidated Financial Statements
e) CENTURY PROPERTIES FUND XIX
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - 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 Fox Capital Management Corporation, the Managing 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, 1997, are not necessarily indicative of the
results that may be expected for the fiscal year ending December 31, 1997. For
further information, refer to the financial statements and footnotes thereto
included in the Partnership's annual report on Form 10-KSB for the year ended
December 31, 1996.
Certain reclassifications have been made to the 1996 information to conform to
the 1997 presentation.
NOTE B - TRANSACTIONS WITH AFFILIATED PARTIES
The Partnership has no employees and is dependent on the Managing General
Partner and its affiliates for the management and administration of all
partnership activities. The Partnership Agreement provides for payments to
affiliates for services and as reimbursement of certain expenses incurred by
affiliates on behalf of the Partnership. Balances and other transactions with
affiliates of the Managing General Partner in 1997 and 1996 are (in thousands):
For the Three Months
Ended
March 31,
1997 1996
Property management fees (included in operating
expenses) $184 $184
Reimbursement for services of affiliates (included
in general and administrative expenses) 44 74
Included in "reimbursements for services of affiliates" for 1997 is
approximately $5,000 in reimbursements for construction oversight costs.
Since January 19, 1996, the Partnership insured its properties under a master
policy through an agency and insurer unaffiliated with the Managing General
Partner. An affiliate of the Managing General Partner acquired, in the
acquisition of a business, certain financial obligations from an insurance
agency which was later acquired by the agent who placed the current year's
master policy. The current agent assumed the financial obligations to the
affiliate of the Managing General Partner who received payments on these
obligations from the agent. The amount of the Partnership's insurance premiums
accruing to the benefit of the affiliate of the Managing General Partner by
virtue of the agent's obligations is not significant.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The Partnership's investment properties consist of eight apartment complexes.
The following table sets forth the average occupancy of the properties for the
three months ended March 31, 1997 and 1996:
Average
Occupancy
Property 1997 1996
Sunrunner Apartments
St. Petersburg, Florida 95% 94%
Misty Woods Apartments
Charlotte, North Carolina 91% 95%
McMillan Place Apartments
Dallas, Texas 97% 95%
Vinings Peak Apartments
(formerly Wood Ridge Apartments)
Atlanta, Georgia 92% 97%
Plantation Crossing
Atlanta, Georgia 89% 94%
Wood Lake Apartments
Atlanta, Georgia 92% 94%
Greenspoint Apartments
Phoenix, Arizona 92% 95%
Sandspoint Apartments
Phoenix, Arizona 93% 96%
The Managing General Partner attributes the decreases in occupancies at
Plantation Crossing, Misty Woods, Vinings Peak, Greenspoint and Sandspoint
Apartments to soft markets caused by increased competition as a result of newly
constructed units, which were in the same market niches as the discussed
investment properties. In addition to the soft market at Plantation Crossing,
some of the residents have taken advantage of favorable interest rates and
purchased homes.
The Partnership's net income for the three months ended March 31, 1997, was
approximately $124,000 versus a net loss of approximately $38,000 for the
corresponding period of 1996. The increase in net income is primarily
attributable to a reduction in general and administrative expenses, and
maintenance expenses, and an increase in other income. The decrease in general
administrative expenses is due to a decrease in expense reimbursements. The
decrease in expense reimbursements during the three months ended March 31, 1997,
is directly attributable to the combined transition efforts of the Greenville,
South Carolina, and Atlanta, Georgia, administrative offices during the 1995
year-end close, preparation of the 1995 10-K and tax return (including the
limited partner K-1's) and transition of asset management responsibilities to
the new administration during the three months ended March 31, 1996. The
decrease in maintenance expenses is attributable to wind damage sustained to
roofs at McMillan Place Apartments which was repaired in 1996. Included in
maintenance expense is approximately $45,000 of major repairs and maintenance
comprised of landscaping, interior and exterior improvements, and golf carts for
the quarter ended March 31, 1997. The increase in other income is due to
increases in lease cancellation fees and application fees as a result of
decreased occupancies at all but two of the investment properties as previously
discussed.
As part of the ongoing business plan of the Partnership, the Managing General
Partner monitors the rental market environment of its investment properties to
assess the feasibility of increasing rents, maintaining or increasing occupancy
levels and protecting the Partnership from increases in expense. As part of
this plan, the Managing General Partner attempts to protect the Partnership from
the burden of inflation-related increases in expenses by increasing rents and
maintaining a high overall occupancy level. However, due to changing market
conditions which can result in the use of rental concessions and rental
reductions to offset softening market conditions, there is no guarantee that the
Managing General Partner will be able to sustain such a plan.
At March 31, 1997, the Partnership had unrestricted cash of approximately
$3,805,000 as compared to approximately $3,153,000 at March 31, 1996. Net cash
provided by operating activities decreased due to a decrease in accrued expenses
and other liabilities which was due to timing differences of prepaid rental
income from tenants and the payments to vendors. This decrease was offset by
the increase in net income as discussed above. Net cash used in investing
activities decreased due to a reduction in property improvements and
replacements. Net cash used in financing activities decreased due to a decrease
in loan costs as a result of the refinancings at the end of 1995 and 1996, which
were paid during the three months ended March 31, 1996 and 1997.
The Partnership has no material capital programs scheduled to be performed in
1997, although certain routine capital expenditures and maintenance expenses
have been budgeted. These capital expenditures and maintenance expenses will be
incurred only if cash is available from operations or is received from the
capital reserve account.
An affiliate of the Managing General partner has made available to the
Registrant a credit line of up to $150,000 per property owned by the Registrant.
The Partnership has no outstanding amounts due under this line of credit. Based
on present plans, management does not anticipate the need to borrow in the near
future. Other than cash and cash equivalents, the line of credit is the
Partnership's only unused source of liquidity.
The sufficiency of existing liquid assets to meet future liquidity and capital
expenditure requirements is directly related to the level of capital
expenditures required at the properties to adequately maintain the physical
assets and other operating needs of the Partnership. Such assets are currently
thought to be sufficient for any near-term needs of the partnership. Mortgage
indebtedness of approximately $49,026,000 is amortized over varying periods with
required balloon payments ranging from January 2003 to January 2006, at which
time the properties will either be refinanced or sold. Additional mortgage
indebtedness of approximately $12,456,000, secured by McMillan Place Apartments,
is currently in default. The accrued interest on the above indebtedness which
is in default is approximately $577,000. The Managing General Partner is
currently negotiating with the lender for a three year extension, however, there
is no assurance that an extension will be obtained. If an extension is not
obtained, the lender may foreclose on the property. The Partnership is
prohibited from making distributions from operations until the mortgages
encumbering McMillan Place Apartments are satisfied. No cash distributions were
paid in 1996 or during the first quarter of 1997. Future cash distributions
will depend on the levels of cash generated from operations, a property sale,
and the availability of cash reserves.
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, 1997.
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned thereunto, duly
authorized.
CENTURY PROPERTIES FUND XIX
By: FOX PARTNERS II,
Its General Partner
By: FOX CAPITAL MANAGEMENT CORPORATION,
A General Partner
By: /s/William H. Jarrard, Jr.
William H. Jarrard, Jr.
President and Director
By: /s/Ronald Uretta
Ronald Uretta
Principal Financial Officer and
Principal Accounting Officer
Date: April 21, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Century
Properties Fund XIX 1997 first quarter 10-QSB and is qualified in its entirety
by reference to such 10-QSB filing.
</LEGEND>
<CIK> 0000705752
<NAME> CENTURY PROPERTIES FUND XIX
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 3,805
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F2>
<PP&E> 95,201
<DEPRECIATION> (37,852)
<TOTAL-ASSETS> 63,137
<CURRENT-LIABILITIES> 0<F2>
<BONDS> 61,482
0
0
<COMMON> 0
<OTHER-SE> (175)
<TOTAL-LIABILITY-AND-EQUITY> 63,137
<SALES> 0
<TOTAL-REVENUES> 3,984
<CGS> 0
<TOTAL-COSTS> 3,860
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,262
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 124
<EPS-PRIMARY> 1.23<F1>
<EPS-DILUTED> 0
<FN>
<F2>Registrant has an unclassified balance sheet.
<F1>Multiplier is 1.
</FN>
</TABLE>
