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 September 30, 2000 Commission file number 0-11578
AMERICAN REPUBLIC REALTY FUND I
(Exact name of registrant as specified in it's 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: (972)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
TABLE OF CONTENTS
Item 1. Financial Statements
The following Unaudited financial statements are filed herewith:
Consolidated Balance Sheet as of September 30, 2000 and
December 31, 1999. Page 3
Consolidated Statements of Operations for the Three and
Nine Months Ended September 30, 2000 and 1999. Page 4
Consolidated Statements of Cash Flows for the Nine months
Ended September 30, 2000 and 1999. Page 5
Item 2. Results of Operations and Management's Discussion and
Analysis of
Financial Condition Page 6
Liquidity and Capital Resources Page 7
Other Information Page 8
Signatures Page 9
The statements, insofar as they relate to the period subsequent to
December 31, 1999, are Unaudited.
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
AMERICAN REPUBLIC REALTY FUND I
Condensed Consolidated Balance Sheets
September 30,2000 December 31,1999
(Unaudited)
ASSETS
Real Estate assets, at cost
Land $1,822,718 $1,822,718
Buildings and improvements 15,656,616 15,656,616
17,479,334 17,479,334
Less: Accumulated depreciation (10,892,557) (10,382,557)
Real Estate, net 6,586,777 7,096,777
Cash including cash investments 353,887 116,649
Escrow deposits 535,819 542,074
Prepaid Expenses 37,507 14,067
Deferred Financing Fees 154,865 172,072
TOTAL ASSETS $7,668,855 $7,941,639
LIABILITIES AND PARTNERS'EQUITY:
LIABILITIES
Mortgage and notes payable $10,480,431 $10,572,372
Note Payable to affiliates 0 165,346
Amounts due affiliates 0 4,490
Real estate taxes payable 207,078 0
Security deposits 79,631 68,610
Accounts payable & accrued expenses 170,592 297,610
Total liabilities 10,937,732 11,108,428
PARTNERS CAPITAL(DEFICIT)
Limited Partners (3,321,883) (3,220,816)
General Partner 53,006 54,027
Total Partners Capital(Deficit) (3,268,877) (3,166,789)
TOTAL LIABILITIES AND PARTNER DEFICIT $7,668,855 $7,941,639
See notes to Condensed Consolidated Financial Statements
AMERICAN REPUBLIC REALTY FUND I
Condensed Consolidated Statement of Operations
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
REVENUES 2000 1999 2000 1999
Rental income 684,484 668,947 2,037,604 $1,990,380
Other property 19,121 14,364 51,288 43,102
Total revenues 703,605 683,311 2,088,892 2,033,482
EXPENSES
Salaries & wages 78,734 71,197 209,424 221,699
Maintenance & repairs 66,576 61,445 168,387 228,698
Utilities 49,529 43,058 140,152 129,635
Real estate taxes 69,582 67,916 207,078 202,916
General administrative 41,372 29,962 95,018 89,746
Contract services 26,634 28,300 81,452 83,416
Insurance 12,389 10,352 34,115 31,173
Interest 206,720 208,850 623,968 629,286
Depreciation and 175,735 179,871 527,207 539,614
amortization
Property management 34,949 34,100 104,180 101,500
fees (a)
Total expenses 762,220 735,051 2,190,981 2,257,683
Net Income ($58,615) ($51,740) (102,089) (224,201)
NET INCOME PER UNIT $(5.33) $(4.70) $(9.28) $(20.38)
See Notes to Condensed Consolidated Financial Statements
AMERICAN REPUBLIC REALTY FUND I
Condensed Consolidated Statement of Cash Flows
See Notes to Condensed Consolidated Financial Statements
Unaudited
Nine Months
Ended September 30,
2000 1999
CASH FLOWS FROM OPERATING ACTIVITY
Net income (loss) ($102,089) ($224,201)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization 510,000 495,000
Net Effect of changes in operating accounts
Escrow deposits 6,255 (100,231)
Prepaid expenses (23,440) (18,244)
Accrued real estate taxes 207,078 202,916
Security deposits 11,021 14,828
Accounts payable (127,018) (102,585)
Other assets 17,207 44,613
Net cash provided by (used for) 499,014 312,096
operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Repayment of mortgage notes payable (91,941) (85,001)
Repayment of notes payable to affiliates (165,346) 0
Proceeds from amounts due affiliates (4,490) (98,931)
Repayment of amounts due affiliates 0 (46,216)
Net cash used for investing activities (261,777) (230,148)
NET INCREASE (DECREASE) IN CASH 237,237 81,948
AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 116,650 146,358
CASH AND CASH EQUIVALENTS, END OF PERIOD $353,887 $228,306
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.
Item 2. RESULTS OF OPERATIONS AND MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION
THIRD QUARTER 2000 COMPARED TO THIRD QUARTER 1999
At September 30, 2000 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 96.4% for
the third quarter of 2000, as compared to 96.2% for the third quarter
of 1999.
Revenue from property operations increased $20,294, or 2.97%, for the third
quarter of 2000, as compared to the 1999 third quarter. The increase in
rental income of $15,537 or 2.32% is primarily due to an increase in
rental rates. The increase in other income of $4,757 or 33.12% is primarily
due to an increase in Late and other fee collections from the properties.
The following table illustrates the components:
Increase Percent
(Decrease) Change
Rental income 15,537 2.32%
Other property 4,757 33.12%
Net Increase(Decrease) 20,294 2.97%
Property operating expenses increased $27,169, or 3.70%, for the third
quarter of 2000, as compared to the same period in 1999, primarily due to
increases in general and administrative expense. The increase in general
and administrative expense is due to legal expenses incurred with regard
to a tender offer on the fund. Salaries and wages increased $7,537 or
10.59% primarily due to increased staffing. Utilities increased $6,471 or
15.03% primarily due to increased consumption. Insurance increased $2,037
or 19.68% in connection with the annual policy renewal. The following
table illustrates the components by category:
Increase Percent
(Decrease) Change
Salaries & wages 7,537 10.59%
Maintenance & repairs 5,131 8.35%
Utilities 6,471 15.03%
Real estate taxes 1,666 2.45%
General administrative 11,410 38.08%
Contract services (1,666) 5.89%
Insurance 2,037 19.68%
Interest (2,130) 1.02%
Depreciation and amortization (4,136) 2.30%
Property management fees 849 2.49%
Net Increase 27,169 3.70%
(Decrease)
FIRST NINE MONTHS 2000 COMPARED TO FIRST NINE MONTHS 1999
Revenue from property operations increased $55,410, or 2.72%, for the first
nine months of 2000, as compared to the 1999 first nine months . The
increase in rental income of $47,224 or 2.37 is primarily due to an
increase in rental rates. The increase in other income of $8,186 or 18.99%
is primarily due to an increase in Late and other fee collections from the
properties. The following table illustrates the components:
Increase Percent
(Decrease) Change
Rental income 47,224 2.37%
Other property 8,186 18.99%
Net Increase (Decrease) 55,410 2.72%
Property operating expenses decreased $66,702, or 2.95%, for the first nine
months of 2000, as compared to the same period in 1999, primarily due to
decreases in maintenance and repairs expense. The decrease in maintenance
and repairs expense is due to a one time charge in 1999 for resurfacing the
parking lots. Salaries and wages decreased $12,275 or 5.54% primarily due to
staffing shortages. Utilities rose $10,517 or 8.11% primarily due to
increases in usage and rates of water and wastewater charges. Insurance
increased $2,942 or 9.44% in connection with the annual policy renewal
General and Administrative increased $5,272 or 5.87% primarily due to legal
expenses incurred with regard to a tender offer on the Fund. The following
table illustrates the components by category:
Increase Percent
(Decrease) Change
Salaries & wages (12,275) 5.54%
Maintenance & repairs (60,311) 26.37%
Utilities 10,517 8.11%
Real estate taxes 4,162 2.05%
General administrative 5,272 5.87%
Contract services (1,964) 2.35%
Insurance 2,942 9.44%
Interest (5,318) 0.85%
Depreciation and amortization (12,407 2.30%
Property management fees 2,680 2.64%
Net Increase (Decrease) (66,702) 2.95%
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 September 30, 2000, the Partnership had $353,887 in cash and
cash equivalents as compared to $116,649 as of December 31, 1999. The net
increase in cash of $237,238 is principally due to cash flow from operations.
During the first quarter of 2000 ending March 31, the partnership paid
off the remaining balance owned to the general partner of $165,346. The
payment was made with operating cash flow from the partnership.
Each asset of the fund refinanced its debt during July 1997. The fund
retired debt with a face value of $6,500,000 and replaced with debt of
$10,800,000. The new mortgages in the amounts of $4,000,000, $6,800,000
carry interest rates of 7.8% and 7.92% respectively. The notes come due
August, 2007. The Partnership's required principal payments due under the
stated terms of the Partnership's mortgage notes payable and notes payable
to affiliates are $111,063, $120,132 and $129,941, for each of the next
three years.
Net proceeds from the refinancing were used to reduce the notes payable
to affiliates. During July, 1997 payments of $3,500,000 were made to reduce
the debt to affiliates. This together with interest on the debt reduced the
amounts due affiliates to $300,461 at March 31, 1999.
A gain on retirement of debt arose with the note refinancing being
triggered by the early retirement of the debt. The recognized gain of
$348,836, was the difference between the carrying value of the debt and the
funds necessary to retire the debt.
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 are $102,678, $111,063
and $120,131 for each of the next three years.
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.2-81074
effective 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 September 30, 2000
1 None
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: November 1, 2000
[ARTICLE] 5
[LEGEND]
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM BOTH
THE September 30, 2000 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
<TABLE>
<S> <C>
[PERIOD-TYPE] 3-MOS
[FISCAL-YEAR-END] DEC-31-2000
[PERIOD-END] SEP-30-2000
[CASH] 353,887
[SECURITIES] 0
[RECEIVABLES] 0
[ALLOWANCES] 0
[INVENTORY] 0
[CURRENT-ASSETS] 0
[PP&E] 17,479,334
[DEPRECIATION] 10,892,557
[TOTAL-ASSETS] 7,668,855
[CURRENT-LIABILITIES] 0
[BONDS] 10,480,431
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 0
[OTHER-SE] (3,268,877)
[TOTAL-LIABILITY-AND-EQUITY] 7,668,855
[SALES] 0
[TOTAL-REVENUES] 703,605
[CGS] 0
[TOTAL-COSTS] 0
[OTHER-EXPENSES] 555,500
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 206,720
[INCOME-PRETAX] 0
[INCOME-TAX] 0
[INCOME-CONTINUING] 0
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (58,615)
[EPS-BASIC] (5.33)
[EPS-DILUTED] 0
</TABLE>
