SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
-----------------------------
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
------------------------------------------
For Quarter Ended March 31, 1997 Commission file number 0-11578
AMERICAN REPUBLIC REALTY FUND I
(Exact name of registrant as specified in its charter)
WISCONSIN 39-1421936
--------------- --------------
(State or other jurisdiction of (IRS Employer
incorporation or organization Identification Number)
6210 Campbell Road Suite 140
Dallas, Texas 75248
---------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (214) 380-8000.
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: Y No:
REGISTRANT IS A LIMITED PARTNERSHIP
<PAGE>
TABLE OF CONTENTS
Item 1. Financial Statements
The following Unaudited financial statements are filed herewith:
Consolidated Balance Sheet as of March 31, 1997 and
December 31, 1996 Page 3
Consolidated Statements of Operations for the Three
Months Ended March 31, 1997and 1996 Page 4
Consolidated Statements of Cash Flows for the Three
Months Ended March 31, 1997 and 1996 Page 5
Notes to Consolidated Financial Statement Page 6
Item 2. Results of Operations and Management's Discussion
and Analysis of Financial Condition Page 7
Liquidity and Capital Resources Page 8
Other Information Page 9
Signatures Page 10
The statements, insofar as they relate to the period subsequent to
December 31, 1996, are Unaudited.
<PAGE>
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
------------------------------------
AMERICAN REPUBLIC REALTY FUND I
Condensed Consolidated Balance Sheets
March 31, December 31,
1997 1996
(Unaudited)
ASSETS
Real Estate assets, at cost
Land $1,822,718 $1,822,718
Buildings and improvements 14,994,509 14,994,509
------------ -------------
16,817,227 16,817,227
Less: Accumulated (8,548,635) (8,397,635)
depreciation ------------ -------------
Real Estate, net 8,268,592 8,419,592
Cash including cash 56,480 23,211
investments
Escrow deposits 243,065 182,966
Prepaid Expenses 13,462 19,614
Other assets 0 0
------------ -------------
TOTAL ASSETS $8,581,599 $8,645,383
============ =============
LIABILITIES AND PARTNERS' EQUITY:
LIABILITES
Mortgage and notes payable $7,018,832 $7,239,679
Note Payable to affiliates 2,935,310 2,935,310
Amounts due affiliates 1,259,441 1,282,696
Real estate taxes payable 66,900 0
Security deposits 45,257 45,746
Accounts payable & accrued 148,092 117,202
expenses ------------- -------------
Total liabilities 11,473,832 11,620,633
------------- -------------
PARTNERS CAPITAL (DEFICIT)
Limited Partners (2,949,005) (3,031,192)
General Partner 56,772 55,942
------------- -------------
Total Partners Capital (Deficit) (2,892,233) (2,975,250)
TOTAL LIABILITES AND PARTNER $8,581,599 $8,645,383
DEFICIT ============= =============
See notes to Condensed Consolidated Financial Statements
<PAGE>
AMERICAN REPUBLIC REALTY FUND I
Condensed Consolidated Statement of Operations
(Unaudited)
Three Months Ended
March 31,
---------------------
REVENUES 1997 1996
Rental income $599,779 $595,630
Other property 8,984 6,687
---------- ----------
Total revenues 608,763 602,317
EXPENSES
Salaries & wages 63,277 62,823
Maintenance & repairs 52,731 34,239
Utilities 51,936 44,591
Real estate taxes 66,900 60,900
General administrative 7,532 20,443
Contract services 28,126 20,214
Insurance 12,098 11,321
Interest 61,727 68,480
Depreciation and 151,000 155,000
amortization
Property management 30,419 30,420
fees (a) ---------- -----------
Total expenses 525,746 508,431
NET INCOME (LOSS) $83,017 $93,886
========= =========
NET INCOME PER UNITS $ 7.55 $ 8.54
=========== ===========
See Notes to Condensed Consolidated Financial Statements
<PAGE>
AMERICAN REPUBLIC REALTY FUND I
Condensed Consolidated Statement of Cash Flows
Three Months Ended
March 31,
1997 1996
-------- --------
CASH FLOWS FROM OPERATING ACITIVTY
Net income (loss) $83,017 $93,886
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization 151,000 155,000
Net Effect of changes in operating accounts
Escrow deposits (60,099) (89,904)
Prepaid expenses 6,152 10,282
Accrued real estate taxes 66,900 46,900
Security deposits (489) (267)
Accounts payable 30,890 101,181
Other assets 0 (8,000)
-------- ---------
Net cash provided by (used for) operating activities
277,371 309,078
-------- ---------
CASH FLOWS FROM INVESTING ACTIVITES
Repayment of mortgage notes payable (220,847) (199,551)
Repayment of notes payable to affiliates 0
Proceeds from amounts due affiliates (23,255) (125,556)
Repayment of amounts due affiliates 33,262
-------- --------
Net cash used for investing activities (244,102) (291,845)
-------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUVILENTS 33,269 17,233
CASH AND CASH EQUIVELNTS, BEGINNING OF PERIOD 23,211 19,047
------- --------
CASH AND CASH EQUIVELNTS, END OF PERIOD $56,480 $36,280
======== =========
See Notes to Condensed Consolidated Financial Statements
Basis of Presentation:
- ----------------------
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, although the Partnership believes that the
disclosures are adequate to make the information presented not misleading.
It is suggested that these condensed financial statements be read in
conjunction with the financial statements and notes thereto included in
the Partnership's latest annual report on Form 10-K.
<PAGE>
Item 2. RESULTS OF OPERATIONS AND MANAGEMENT'S DISCUSSION AND
- --------------------------------------------------------------
ANALYSIS OF FINANCIAL CONDITION
- -------------------------------
FIRST QUARTER 1997 COMPARED TO FIRST QUARTER 1996
- --------------------------------------------------
At March 31, 1997 the Partnership owned two properties with
approximately 416,623 net rentable square feet. Both properties are
apartment communities. The portfolio had an average occupancy of 90.25%
for the first three months of 1997, as compared to 93.35% for the first
three months of 1996.
Revenue from property operations increased $10,640, or 1.80%, for the
first quarter of 1997, as compared to the 1996 first quarter. The
decrease in other income of $4,726 or 41.41% is primarily due to a
reduction in late and returned check charges from the prior year. The
following table illustrates the components:
Increase
(Decrease)
--------
Rental income 4,149
Other property 2,297
--------
Net Increase (Decrease) 6,446
=========
Property operating expenses increased $17,315, or 3.41%, for the first
quarter of 1997, as compared to the same period in 1996, primarily due
to increases in maintenance & repairs, offset by decreases in interest
expense and general and administrative expense. The increase in
maintenance and repairs of $18,492 or 54.01% is due to make ready
expenses for additional units to be leased. Interest expenses declined
by $or 15.81% as a result of normal amortization of the self-amortizing
mortgage debt. Contract service expense was reduced by $3,806 or 15.85%
primarily by utilizing vendors offering a more competitive price. The
following table illustrates the components by category:
Increase
(Decrease)
----------
Salaries & wages 454
Maintenance & repairs 18,492
Utilities 7,345
Real estate taxes 6,000
General administrative (12,911)
Contract services 7,912
Insurance 777
Interest (6,753)
Depreciation and amortization (4,000)
Property management fees (a) (1)
-----------
Net Increase (Decrease) 17,315
===========
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
While it is the General Partners primary intention to operate and
manage the existing real estate investments, the General Partner also
continually evaluates this investment in light of current economic
conditions and trends to determine if this asset should be considered
for disposal. At this time, there is no plan to dispose of either property.
As of March 31, 1997, the Partnership had $56,480 in cash and cash
equivalents as compared to $33,269 as of December 31, 1996 . The net
increase in cash of $23,211 is principally due to positive cash flow from
operations and decreases in accounts payable offset by repayments on
mortgages and notes payable.
The properties are encumbered by two non-recourse mortgage notes as of
December 31, 1996. These mortgages payable have a carrying value of
$7,239,679 at December 31, 1996. The mortgage notes were entered into
during 1993 and 1992 to refinance certain mortgage notes which were in
default. The Partnership accounted for these transactions as troubled
debt restructuring, and accordingly, are being carried at the total
future cash outflows for principal and interest. Accordingly, no interest
expense was or will be recorded on these notes.
Additionally, the general partner has provided funding to the Partnership
in the form of notes payable with balances at December 31,1996 totaling
$2,35,310 which accrue interest at prime plus 2% and are due on
June 30, 2001, or upon demand. Additional funds have been provided by the
general partner in the form of advances which totaled $1,282,696 at
December 31, 1996. The general partner is not obligated to provide
additional funding to the Partnership.
For the foreseeable future, the Partnership anticipates that mortgage
principal payments (excluding any balloon mortgage payments),
improvements and capital expenditures will be funded by net cash from
operations. The primary source of capital to fund future Partnership
acquisitions and balloon mortgage payments will be proceeds from the
sale, financing or refinancing of the Properties.
The Partnership's required principal payments due under the stated terms
of the Partnership's mortgage notes payable and notes payable to
affiliates are $124,505, $2,580,216 and $4,021,625 for each of the next
three years. The Partnership is not generating sufficient cash flows to
meet these obligations. Management believes it will be able to refinance
these debt obligations; however, at this time, there can be no assurance
this refinancing will occur.
<PAGE>
Other Information
Item 1. Legal Proceedings
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibit and Reports on Form 8-K
(A)The following documents are filed herewith
or incorporated herein by reference as
indicated as Exhibits:
Exhibit Designation Document Description
- ------------------- --------------------
2 Certificate of Limited partnership, as
amended, incorporated by reference to
Registration Statement No.2-81074
effective May 2, 1983.
Limited Partnership Agreement,
incorporated by reference
to Registration
Statement No.2-81074effective May 2,1983.
11 Not Applicable
15 Not Applicable
18 Not Applicable
19 Not Applicable
20 Not Applicable
23 Not Applicable
24 Not Applicable
25 Power of Attorney, incorporated by
reference to Registration Statement
No. 2-81074 effective May 2, 1983.
28 None
(B) Reports on Form 8-K for the quarter ended March 31, 1997.
1 None
<PAGE>
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.
AMERICAN REPUBLIC REALTY FUND I
a Wisconsin limited partnership
By: /s/ Robert J. Werra
Robert J. Werra,
General Partner
Date: May 17, 1997
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM BOTH
THE MARCH 31, 1997 BALANCE SHEET AND STATEMENT OF INCOME AND EXPENSES
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000711512
<NAME> AMERICAN REPUBLIC REALTY FUND I
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 56,480
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<RECEIVABLES> 0
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<INVENTORY> 0
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<PP&E> 16,817,227
<DEPRECIATION> 8,548,635
<TOTAL-ASSETS> 8,581,599
<CURRENT-LIABILITIES> 0
<BONDS> 7,018,832
0
0
<COMMON> 0
<OTHER-SE> (2,892,233)
<TOTAL-LIABILITY-AND-EQUITY> 8,581,599
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<TOTAL-REVENUES> 599,779
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 464,019
<LOSS-PROVISION> 0
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<CHANGES> 0
<NET-INCOME> 83,017
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</TABLE>
