UNITED STATES 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 August 31, 1995
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: 0-13330
HUTTON/CONAM REALTY PENSION INVESTORS
(Exact name of registrant as specified in its charter)
New York 11-2673854
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3 World Financial Center, 29th Floor, New York, NY
ATTN: Andre Anderson 10285
(Address of principal executive offices) (Zip Code)
(212) 526-3237
(Registrant's telephone number, including area code)
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
Balance Sheets
August 31, November 30,
Assets 1995 1994
Investments in real estate:
Properties $ 10,450,002 $ 10,450,002
Less accumulated depreciation (1,814,171) (1,536,168)
Mortgage loan investments 9,675,900 9,675,900
Total investments
in real estate 18,311,731 18,589,734
Cash and cash equivalents 1,994,369 2,131,720
Interest receivable - deferred, net
of accumulated provision for losses
of $1,945,176 in 1995 and 1994 1,874,100 1,874,100
Other assets 45,430 54,447
Total Assets $ 22,225,630 $ 22,650,001
Liabilities and Partners' Capital
Liabilities:
Distribution payable $ 507,842 $ 507,842
Accounts payable and accrued expenses 190,256 228,662
Due to general partners and affiliates 38,265 25,675
Deferred income - loan modification fees 45,449 60,842
Security deposits 66,769 59,870
Total Liabilities 848,581 882,891
Partners' Capital:
General Partners 296,762 305,145
Limited Partners 21,080,287 21,461,965
Total Partners' Capital 21,377,049 21,767,110
Total Liabilities and
Partners' Capital $ 22,225,630 $ 22,650,001
Statement of Partners' Capital
For the nine months ended August 31, 1995
General Limited
Partners Partners Total
Balance at December 1, 1994 $ 305,145 $ 21,461,965 $ 21,767,110
Net income 67,793 1,065,672 1,133,465
Cash distributions (76,176) (1,447,350) (1,523,526)
Balance at August 31, 1995 $ 296,762 $ 21,080,287 $ 21,377,049
Statements of Operations
Three months ended Nine months ended
August 31, August 31,
Income 1995 1994 1995 1994
Rental $ 618,336 $ 587,779 $ 1,805,996 $ 1,700,792
Mortgage interest 205,613 205,613 616,839 616,839
Other interest 25,026 16,945 76,615 44,629
Loan origination fees 0 7,252 0 21,766
Loan modification fees 5,131 5,131 15,393 15,393
Total Income 854,106 822,720 2,514,843 2,399,419
Expenses
Property operating 308,443 328,117 990,102 985,320
Depreciation 92,668 100,617 278,003 293,404
General and administrative 52,052 41,793 113,273 103,964
Total Expenses 453,163 470,527 1,381,378 1,382,688
Net Income $ 400,943 $ 352,193 $ 1,133,465 $ 1,016,731
Net Income Allocated:
To the General Partners $ 23,753 $ 22,464 $ 67,793 $ 61,610
To the Limited Partners 377,190 329,729 1,065,672 955,121
$ 400,943 $ 352,193 $ 1,133,465 $ 1,016,731
Per limited partnership unit
(96,490 outstanding) $3.91 $3.42 $11.04 $9.90
Statements of Cash Flows
For the nine months ended August 31, 1995 and 1994
Cash Flows from Operating Activities: 1995 1994
Net income $ 1,133,465 $ 1,016,731
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation 278,003 293,404
Increase (decrease) in cash arising
from changes in operating assets
and liabilities:
Interest receivable - deferred, net 0 12,407
Other assets 9,017 (18,716)
Accounts payable and accrued expenses (38,406) (52,102)
Due to general partners and affiliates 12,590 3,823
Deferred income - loan origination fees 0 (21,766)
Deferred income - loan modification fees (15,393) (15,393)
Security deposits 6,899 5,808
Net cash provided by operating activities 1,386,175 1,224,196
Cash Flows from Investing Activities:
Additions to real estate 0 (400,803)
Net cash used for investing activities 0 (400,803)
Cash Flows from Financing Activities:
Distributions (1,523,526) (1,066,469)
Net cash used for financing activities (1,523,526) (1,066,469)
Net decrease in cash and cash equivalents (137,351) (243,076)
Cash and cash equivalents at beginning of period 2,131,720 2,373,818
Cash and cash equivalents at end of period $ 1,994,369 $ 2,130,742
Notes to Financial Statements
The unaudited interim financial statements should be read in conjunction with
the Partnership's annual 1994 audited financial statements within Form 10-K.
The unaudited financial statements include all adjustments which are, in the
opinion of management, necessary to present a fair statement of financial
position as of August 31, 1995 and the results of operations for the three and
nine months ended August 31, 1995 and 1994 and the statement of cash flows and
changes in partners' capital for the nine months ended August 31, 1995.
Results of operations for the periods are not necessarily indicative of the
results to be expected for the full year.
No significant events have occurred subsequent to fiscal year 1994, which
require disclosure in this interim report per Regulation S-X, Rule 10-01,
Paragraph (a)(5).
Part I, Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
The Partnership's investment portfolio currently consists of: (1) two mortgage
loans funded to Southridge Partners I ("Southridge") which are secured by two
apartment properties, Park View Village and Oaktree Village; and (2) two
apartment properties, Bryn Athyn Apartments and Chaparosa Apartments, which
were acquired by the Partnership on July 14, 1989 and January 31, 1992,
respectively. The General Partners intend to operate the Bryn Athyn and
Chaparosa properties until such time as real estate market conditions indicate
favorable sales conditions.
Liquidity and Capital Resources
At August 31, 1995, the Partnership had cash and cash equivalents of $1,994,369
which were invested in unaffiliated money market funds.
The General Partners have been pursuing a settlement agreement with the
Plumbing Claims Group regarding the polybutelene water pipes used in the
construction of the Bryn Athyn property. The pipes, which were determined to
be defective, have resulted in significant leaks and will require a replumbing
of the entire property. The General Partners signed a settlement agreement
during the third quarter which will require the Plumbing Claims Group to cover
the cost of replumbing the property's interior units, totaling $379,000, and
40% of the expense in replumbing the exterior which is estimated to cost
$25,480. The Partnership has sufficient reserves to fund any repairs which
will not be covered by the Plumbing Claims Group. To date, the Partnership has
incurred expenses totalling approximately $52,000 for plumbing repairs and
associated costs at the property and the General Partners expect to fund an
additional $15,480 in the future. The replumbing of the property will commence
in late October and is expected to be completed in mid-February.
The General Partners declared a cash distribution of $5.00 per Unit for the
quarter ended August 31, 1995 which will be paid to the Limited Partners on or
about October 17, 1995. The level of future distributions will be reviewed and
determined on a quarterly basis.
Results of Operations
Partnership operations for the three and nine months ended August 31, 1995
generated net income of $400,943 and $1,133,465, respectively, compared with
net income of $352,193 and $1,016,731 for the corresponding periods in fiscal
1994. The increases are primarily due to higher rental and interest income,
partially offset by higher general and administrative expenses in the
nine-month period at Bryn Athyn.
Rental income totaled $618,336 and $1,805,996 for the three and nine months
ended August 31, 1995, respectively, compared with $587,779 and $1,700,792 for
the corresponding periods in fiscal 1994. The increases are mainly
attributable to higher rental rates at both wholly-owned properties and an
increase in year-to-date occupancy at Chaparosa. Interest income in 1995 was
higher than 1994 due to an increase in the interest rate earned on the
Partnership's cash balance.
Total expenses for the three and nine months ended August 31, 1995 were
$453,163 and $1,381,378, respectively, compared with $470,527 and $1,382,688
for the corresponding periods in fiscal 1994. Property operating expenses
totaled $308,443 and $990,102 for the three and nine months ended August 31,
1995, respectively, compared with $328,117 and $985,320 for the corresponding
periods in fiscal 1994. The decrease in the three-month period is primarily
attributable to decreases in repairs and maintenance at Chaparosa, due to
repairs to the property's sewer lines in 1994. General and administrative
expenses in 1995 increased from the 1994 periods primarily due to legal fees
relating to the polybutelene pipe settlement negotiations.
For the three and nine months ended August 31, 1995 and 1994, average occupancy
levels at the Partnership's two wholly-owned properties and at the properties
securing the Partnership's equity participating loans were as follows:
Three Months Ended Nine Months Ended
August 31, August 31,
Real Estate Investments 1995 1994 1995 1994
Bryn Athyn Apartments 97% 97% 96% 96%
Chaparosa Apartments 97% 98% 97% 95%
Mortgage Loan Investments
Oaktree Village 94% 95% 95% 95%
Park View Village 95% 95% 95% 95%
PART II OTHER INFORMATION
Items 1-5 Not applicable
Item 6 Exhibits and Reports on Form 8-K.
(a) Exhibits
(27) Financial Data Schedule
(b) Reports on Form 8-K - No reports on Form 8-K were filed
during the three-month period covered by this report.
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.
HUTTON/CONAM REALTY PENSION INVESTORS
BY: RPI REAL ESTATE SERVICES, INC.
General Partner
Date: October 16, 1995
BY: /s/ Paul L. Abbott
Name: Paul L. Abbott
Title: Director, President, Chief Executive Officer and Chief
Financial Officer
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