UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
FORM 10-Q
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 1999
OR
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from ______ to _______ .
Commission File Number: 0-12087
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 04-2780287
-------- ----------
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
265 Franklin Street, Boston, Massachusetts 02110
- ------------------------------------------ -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 439-8118
--------------
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 |_|.
<PAGE>
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
BALANCE SHEETS
March 31, 1999 and September 30, 1998 (Unaudited)
(In thousands)
ASSETS
March 31 September 30
-------- ------------
Investments in joint ventures, at equity $ 1,305 $ 1,507
Cash and cash equivalents 2,720 13,867
Accounts receivable - affiliates - 345
-------- ---------
$ 4,025 $ 15,719
======== =========
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable - affiliates $ - $ 878
Accounts payable and accrued expenses 784 72
Partners' capital 3,241 14,769
-------- ---------
$ 4,025 $ 15,719
======== =========
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
For the six months ended March 31, 1999 and 1998 (Unaudited)
(In thousands)
General Limited
Partner Partners
------- --------
Balance at September 30, 1997 $ (205) $ (982)
Net income 2 238
------- ---------
Balance at March 31, 1998 $ (203) $ (744)
======= =========
Balance at September 30, 1998 $ (45) $ 14,814
Cash distributions - (11,876)
Net income 3 345
------- ---------
Balance at March 31, 1999 $ (42) $ 3,283
======= =========
See accompanying notes.
<PAGE>
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
STATEMENTS OF INCOME
For the three and six months ended March 31, 1999 and 1998 (Unaudited)
(In thousands, except per Unit data)
Three Months Ended Six Months Ended
March 31, March 31,
-------------------- ------------------
1999 1998 1999 1998
---- ---- ---- ----
Revenues:
Interest and other income $ 137 $ 85 $ 274 $ 119
Expenses:
General and administrative 75 50 171 117
-------- ------- ------- -------
Operating income 62 35 103 2
Partnership's share of
ventures' income 115 183 245 238
-------- ------ ------- -------
Net income $ 177 $ 218 $ 348 $ 240
======== ====== ======= =======
Net income per Limited
Partnership Unit $ 5.00 $ 6.18 $ 9.86 $ 6.80
======== ====== ======= =======
Cash distributions per
Limited Partnership Unit $ 240.00 $ - $340.00 $ -
======== ====== ======= =======
The above net income and cash distributions per Limited Partnership Unit
are based upon the 34,928 Units of Limited Partnership Interest outstanding for
each period.
See accompanying notes.
<PAGE>
<TABLE>
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
For the six months ended March 31, 1999 and 1998 (Unaudited)
Increase (Decrease) in Cash and Cash Equivalents
(In thousands)
<CAPTION>
1999 1998
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 348 $ 240
Adjustments to reconcile net income to
net cash provided by (used in) operating activities:
Partnership's share of ventures' income (245) (238)
Changes in assets and liabilities:
Accounts receivable - affiliates 345 -
Accounts payable - affiliates (878) -
Accounts payable and accrued expenses 712 (9)
-------- ---------
Total adjustments (66) (247)
-------- ---------
Net cash provided by (used in) operating activities 282 (7)
Cash flows from investing activities:
Distributions from joint ventures 447 348
Additional investments in joint ventures - (9)
-------- ---------
Net cash provided by investing activities 447 339
Cash flows from financing activities:
Distributions to partners (11,876) -
-------- ---------
Net (decrease) increase in cash and cash equivalents (11,147) 332
Cash and cash equivalents, beginning of period 13,867 2,165
-------- ---------
Cash and cash equivalents, end of period $ 2,720 $ 2,497
======== =========
See accompanying notes.
</TABLE>
<PAGE>
PAINE WEBBER INCOME PROPERTIES FIVE
LIMITED PARTNERSHIP
Notes to Financial Statements
(Unaudited)
1. General
-------
The accompanying financial statements, footnotes and discussion should be
read in conjunction with the financial statements and footnotes contained in the
Partnership's Annual Report for the year ended September 30, 1998. In the
opinion of management, the accompanying financial statements, which have not
been audited, reflect all adjustments necessary to present fairly the results
for the interim period. All of the accounting adjustments reflected in the
accompanying interim financial statements are of a normal recurring nature.
The accompanying financial statements have been prepared on the accrual
basis of accounting in accordance with generally accepted accounting principles
which requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosures of contingent assets
and liabilities as of March 31, 1999 and September 30, 1998 and revenues and
expenses for the three- and six-month periods ended March 31, 1999 and 1998.
Actual results could differ from the estimates and assumptions used.
The Partnership is currently focusing on potential disposition strategies
for the two remaining investments in its portfolio. Although no assurances can
be given, it is currently contemplated that sales of the Partnership's Seven
Trails and Bell Plaza investments are expected to be completed by the end of
calendar year 1999. The sales of the two remaining properties would be followed
by an orderly liquidation of the Partnership.
2. Related Party Transactions
--------------------------
Included in general and administrative expenses for the six months ended
March 31, 1999 and 1998 is $46,000 and $44,000, respectively, representing
reimbursements to an affiliate of the Managing General Partner for providing
certain financial, accounting and investor communication services to the
Partnership.
Also included in general and administrative expenses for the six months
ended March 31, 1999 and 1998 is $5,000 and $3,000, respectively, representing
fees earned by an affiliate, Mitchell Hutchins Institutional Investors, Inc.,
for managing the Partnership's cash assets.
Accounts receivable - affiliates at September 30, 1998 represented the
Partnership's remaining share of the net sale proceeds and operating cash flow
to be received from Greenbrier Associates subsequent to the sale of the
Greenbrier Apartments (see Note 3). Such amount was received during the quarter
ended December 31, 1998. Accounts payable affiliates at September 30, 1998
represented the co-venturer's remaining share of the net sales proceeds to be
distributed from the sale of the Carriage Hill Village Apartments and adjoining
land. Such amount was distributed during the quarter ended December 31, 1998. 3.
Investments in Joint Ventures
The Partnership has investments in two joint ventures at March 31, 1999
(four at March 31, 1998) which own operating properties as more fully described
in the Partnership's Annual Report. The joint venture investments are accounted
for using the equity method because the Partnership does not have a voting
control interest in the ventures. Under the equity method the assets,
liabilities, revenues and expenses of the joint ventures do not appear in the
Partnership's financial statements. Instead, the investments are carried at cost
adjusted for the Partnership's share of the ventures' earnings and losses and
distributions.
On September 10, 1998, Greenbrier Associates, a joint venture in which the
Partnership had an interest, sold the property known as Greenbrier Apartments
located in Indianapolis, Indiana, to an unrelated third party for $11,850,000.
The Partnership received net proceeds of approximately $5,498,000 after
deducting closing costs of approximately $119,000, closing proration adjustments
of approximately $424,000, the repayment of the existing first mortgage loan of
$5,400,000 and related accrued interest of approximately $26,000 and a payment
of approximately $383,000 to the Partnership's co-venture partner for its share
of the sales proceeds in accordance with the joint venture agreement. As a
result of the sale of the Greenbrier Apartments, the Partnership made a special
distribution of $100 per original $1,000 investment, or approximately
$3,493,000, on October 1, 1998 to unitholders of record as of the September 10,
1998 sale date. The remaining net proceeds from the sale of Greenbrier of
approximately $2,005,000, along with an amount of the Partnership's cash
reserves, were used to help pay off a $4,000,000 demand loan that the
Partnership had obtained from PaineWebber Capital, Inc., an affiliate of the
Managing General Partner, as discussed below.
On September 21, 1998, Randallstown Carriage Hill Associates and Signature
Partners LLC, a joint venture and a limited liability company in which the
Partnership had interests, sold the property known as Carriage Hill Village
Apartments and adjoining land located in Randallstown, Maryland, to unrelated
third parties for an aggregate sale price of $37,350,000. The Partnership
received net proceeds of approximately $8,481,000 after the receipt of a credit
of $1,168,000 for property adjustments and escrows held by the Department of
Housing and Urban Development (HUD) for tenant security deposits, real estate
taxes, property insurance and replacement reserves, and after deducting closing
costs of approximately $757,000, the assumption of the existing first mortgage
loan of $27,298,000 and a payment of approximately $1,982,000 to the
Partnership's co-venture partner for its share of the sales proceeds in
accordance with the joint venture agreement. Of the total proceeds received by
the Partnership, $4 million represented a reimbursement of funds originally
advanced to buy out the selling co-venture partner's interest in the Carriage
Hill joint venture on June 23, 1998. The Partnership had borrowed the $4 million
required to complete the buyout of the selling partner's interest from an
affiliate of the Managing General Partner. The $4 million related party loan was
repaid on September 11, 1998 from a combination of cash reserves and the
Partnership's share of the net proceeds from the sale of the Greenbrier
Apartments. On February 18, 1999, the Partnership received final documentation
from HUD for the assumption of the HUD-insured first mortgage loan by the buyer
of the Carriage Hill property. As a result, a special capital distribution was
sent to the Limited Partners on March 15, 1999 from the sale of the Carriage
Hill Village Apartments in the amount of approximately $8,383,000, or $240 per
original $1,000 investment.
The following condensed combined summary of operations includes the
operating results of the remaining two joint ventures for the three and six
months ended March 31, 1999. The condensed combined summary of operations for
the three and six months ended March 31, 1998 includes the operating results of
the four joint ventures:
CONDENSED COMBINED SUMMARY OF OPERATIONS
For the three and six months ended March 31, 1999 and 1998
(in thousands)
Three Months Ended Six Months Ended
March 31, March 31,
------------------ ----------------
1999 1998 1999 1998
---- ---- ---- ----
Rental revenues and expense
recoveries $ 1,274 $ 3,026 $2,461 $5,878
Interest and other income 137 199 229 339
------- ------- ------ ------
1,411 3,225 2,690 6,217
Property operating expenses 523 1,140 922 2,316
Interest expense 401 1,181 806 2,241
Depreciation and amortization 327 679 652 1,376
------- ------- ------ ------
1,251 3,000 2,380 5,933
------- ------- ------ ------
Net income $ 160 $ 225 $ 310 $ 284
======= ======= ====== ======
Net income:
Partnership's share of
combined income $ 115 $ 183 $ 245 $ 238
Co-venturers' share of
combined income 45 42 65 46
------- ------- ------ ------
$ 160 $ 225 $ 310 $ 284
======= ======= ====== ======
<PAGE>
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Information Relating to Forward-Looking Statements
- --------------------------------------------------
The following discussion of financial condition includes forward-looking
statements which reflect management's current views with respect to future
events and financial performance of the Partnership. These forward-looking
statements are subject to certain risks and uncertainties, including those
identified in Item 7 of the Partnership's Annual Report on Form 10-K for the
year ended September 30, 1998 under the heading "Certain Factors Affecting
Future Operating Results," which could cause actual results to differ materially
from historical results or those anticipated. The words "believe," "expect,"
"anticipate," and similar expressions identify forward-looking statements.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which were made based on facts and conditions as they existed as of
the date of this report. The Partnership undertakes no obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
Liquidity and Capital Resources
- -------------------------------
The Partnership's two remaining investment properties consist of one
multi-family apartment complex and one retail shopping center. As previously
reported, the Partnership has been focusing on potential disposition strategies
for the remaining investments in its portfolio. Although no assurances can be
given, it is currently contemplated that sales of the Partnership's Seven Trails
and Bell Plaza investments could be completed by the end of calendar year 1999.
The sale of the two remaining properties would be followed by an orderly
liquidation of the Partnership.
On September 10, 1998, Greenbrier Associates, a joint venture in which the
Partnership had an interest, sold the property known as Greenbrier Apartments
located in Indianapolis, Indiana, to an unrelated third party for $11,850,000.
The Partnership received net proceeds of approximately $5,498,000 after
deducting closing costs of approximately $119,000, closing proration adjustments
of approximately $424,000, the repayment of the existing first mortgage loan of
$5,400,000 and related accrued interest of approximately $26,000 and a payment
of approximately $383,000 to the Partnership's co-venture partner for its share
of the sales proceeds in accordance with the joint venture agreement. Because
the first mortgage loan secured by the Greenbrier Apartments was scheduled to
mature on June 29, 1998, the Partnership and its joint venture partner had begun
to review both refinancing and sale opportunities during the latter part of
fiscal 1997. During the first quarter of fiscal 1998, the Partnership and the
co-venturer agreed to initiate a marketing program for the possible sale of the
property. During the second quarter, the Partnership and the co-venturer engaged
a national real estate brokerage firm to market Greenbrier for sale. As part of
the formal marketing campaign, which began in early March 1998, the property was
marketed extensively. Sales packages were distributed to national, regional, and
local prospective purchasers. As a result of these sales efforts, several offers
were received. Management then asked the prospective purchasers to submit best
and final offers. Management subsequently received best and final offers from
five of the prospective buyers. After completing an evaluation of the final
offers and the relative strength of the prospective purchasers, the Partnership
and its co-venture partner selected an offer and negotiated a purchase and sale
agreement. As a result of the sale of the Greenbrier Apartments, the Partnership
made a special distribution of $100 per original $1,000 investment, or
approximately $3,493,000, on October 1, 1998 to unitholders of record as of the
September 10, 1998 sale date. The remaining net proceeds from the sale of
Greenbrier, of approximately $2,005,000, along with an amount of the
Partnership's cash reserves, were used to help pay off a $4,000,000 demand loan
that the Partnership had obtained from PaineWebber Capital, Inc., an affiliate
of the Managing General Partner, as discussed below.
On September 21, 1998, Randallstown Carriage Hill Associates and Signature
Partners LLC, a joint venture and a limited liability company in which the
Partnership had interests, sold the property known as Carriage Hill Village
Apartments and adjoining land located in Randallstown, Maryland, to unrelated
third parties for an aggregate sale price of $37,350,000. The Partnership
received net proceeds of approximately $8,481,000 after the receipt of a credit
of $1,168,000 for property adjustments and escrows held by the Department of
Housing and Urban Development (HUD) for tenant security deposits, real estate
taxes, property insurance and replacement reserves, and after deducting closing
costs of approximately $757,000, the assumption of the existing first mortgage
loan of $27,298,000 and a payment of approximately $1,982,000 to the
Partnership's co-venture partner for its share of the sales proceeds in
accordance with the joint venture agreement. Of the total proceeds received by
the Partnership, $4 million represented a reimbursement of funds originally
advanced to buy out the selling co-venture partner's interest in the Carriage
Hill joint venture on June 23, 1998. The Partnership had borrowed the $4 million
required to complete the buyout of the selling partner's interest from an
affiliate of the Managing General Partner. The $4 million related party loan was
repaid on September 11, 1998 from a combination of cash reserves and the
Partnership's share of the net proceeds from the sale of the Greenbrier
Apartments.
On June 23, 1998, the Partnership and its original co-venture partner,
JBG/Carriage Hill Village Limited Partnership, purchased the 50% interest of its
other co-venture partner, Signature Carriage Hill Village Apartments Limited
Partnership, in the Randallstown Carriage Hill Associates Joint Venture. The
Partnership had held a 40% interest and the original co-venture partner had held
a 10% interest in the Joint Venture prior to this transaction. The Partnership
contributed $4,048,000 and the original co-venturer contributed $1,012,000 to
complete the purchase of the other partner's interest. After the purchase, the
Partnership held an 80% interest and the original co-venture partner held a 20%
interest. On March 19, 1998, the Partnership was notified by Signature that it
would be exercising the "buy/sell" provision in the Joint Venture agreement.
Under the terms of this provision, this co-venturer, which was admitted to the
Joint Venture as part of a 1988 restructuring transaction, had to propose a
price at which it would either purchase the other partners' interests in the
Venture or agree to the sale of its interest in the Venture to the other
partners. The Partnership and its original co-venture partner in the Carriage
Hill Joint Venture had 45 days to decide whether to sell their interests to the
exercising partner or acquire the interest of the exercising partner at the
specified gross sale price for the Venture's assets of approximately $33.3
million. At an equivalent gross sale price of $33.3 million, the net proceeds to
the Partnership for the sale of its interest would have been approximately
$700,000 after the assumption of the outstanding first mortgage debt of $27.4
million, the exercising partner's preferred investment return of approximately
$5 million and the original co-venturer's share of the proceeds of $200,000.
After a thorough review and analysis, the Partnership and the original
co-venturer notified the exercising partner on May 1, 1998 of their decision to
buy its interest for approximately $5 million in cash.
Because the Partnership believed that improvements in the apartment
segment of the real estate market would allow the Partnership to achieve a
higher net sale price now than may be possible in the future, the Partnership
and its remaining co-venture partner held discussions concerning the near-term
sale of the Carriage Hill Village Apartments immediately after completing the
purchase of the selling partner's interest in June 1998. Subsequently, the
Partnership and its co-venture partner selected a national real estate firm with
a strong background in selling apartments. Preliminary sale materials were then
finalized and extensive sale efforts began in late June 1998. As a result of
those efforts, ten offers were received. After completing an evaluation of the
offers and the relative strength of the prospective purchasers, the Partnership
and its co-venture partner selected an offer. On July 24, 1998, a purchase and
sale agreement was signed and a non-refundable deposit of $100,000 was made by
the prospective purchasers. The Carriage Hill sale allowed the Partnership to
return approximately $3.7 million more in net sale proceeds and property
escrows, after the repayment of the $4,000,000 buyout advance, than the $700,000
the Partnership would have received had it not acquired the selling co-venture
partner's interest. On February 18, 1999, the Partnership received final
documentation from HUD for the assumption of the HUD-insured first mortgage loan
by the buyer of the Carriage Hill property. As a result, a special capital
distribution was sent to the Limited Partners on March 15, 1999 from the sale of
the Carriage Hill Village Apartments in the amount of approximately $8,383,000,
or $240 per original $1,000 investment.
Bell Plaza Shopping Center in Amarillo, Texas, was 98% leased as of March
31, 1999. During the quarter ended March 31, 1999, a video store tenant that
occupied 10,487 square feet ceased operations at Bell Plaza and vacated the
property. The space was subsequently released to a new video store tenant that
agreed to lease a total of 12,000 square feet. The new video store tenant is
expected to take occupancy during the third quarter of fiscal 1999. In addition,
a new lease was signed for a previously vacant 1,590 square foot space. While
Bell Plaza is 98% leased, the property's leasing team is actively pursuing
prospective retailers for the 3,460 square feet of currently vacant space as
well as for the 37,068 square feet under the six leases that expire over the
next twelve months. The largest of the six, a local theatre operator, has a June
1999 lease expiration and represents 15,050 square feet of this total.
Subsequent to the end of the current quarter, the cinema tenant gave formal
notice that they would not be renewing their lease. The property's leasing team
is pursuing lease renewals with the other five tenants. The Partnership and its
co-venture partner held discussions during fiscal 1998 concerning potential sale
opportunities for the Bell Plaza property. After extensive discussions, it was
agreed that marketing efforts would begin during fiscal 1999 and would focus on
regional buyers of specialty retail centers like Bell Plaza. These marketing
efforts commenced during the quarter ended December 31, 1998. During the current
quarter, an offer was received to purchase the Bell Plaza Shopping Center from a
prospective third-party buyer that met the Partnership's and co-venture
partner's sale criteria. Subsequent to the quarter-end, a purchase and sale
agreement was signed with this prospective buyer and they have undertaken their
due diligence work. The sale remains contingent upon, among other things, the
satisfactory completion of the buyer's due diligence. Accordingly, there are no
assurances that this sale transaction will be completed.
The occupancy level for the Seven Trails West Apartments, located in St.
Louis, Missouri, averaged 95% for the quarter ended March 31, 1999. The
Partnership and its Seven Trails co-venture partner held discussions during the
fourth quarter of fiscal 1998 concerning potential opportunities for a near-term
sale of this 532-unit multi-family apartment complex, and agreed to market the
property for sale. During the first quarter of fiscal 1999, the Partnership and
its joint venture partner selected a local brokerage firm with a strong
background in selling apartment properties in the St. Louis area. Preliminary
sales materials were prepared and extensive sale efforts began in late November
1998. The property was marketed to national, regional and local buyers of
apartment properties. As a result of those efforts, over 20 offers were received
and 13 prospective purchasers were then requested to submit best and final
offers. These prospective buyers submitted best and final offers, all of which
were in excess of the property's 1997 year-end appraised value. After completing
an evaluation of these offers and the relative strength of the prospective
purchasers, the Partnership and its co-venture partner selected an offer. A
purchase and sale agreement was signed with this prospective buyer on March 21,
1999. However, a sale transaction could not be completed as the prospective
buyer could not obtain the necessary financing to complete the purchase. The
Partnership and its co-venture partner subsequently renewed discussions with the
other interested bidders and, in April 1999, negotiated a purchase and sale
agreement with one of these parties. However, since this sale remains contingent
upon, among other things, satisfactory completion of the prospective buyer's due
diligence, there are no assurances that a sale transaction will be completed.
At March 31, 1999, the Partnership had cash and cash equivalents of
$2,720,000. Such cash and cash equivalents will be utilized for the working
capital requirements of the Partnership, distributions to the Limited Partners
and for future capital contributions, if necessary, related to the Partnership's
remaining joint ventures. The source of future liquidity and distributions to
the partners is expected to be from cash generated by the Partnership's
income-producing properties and from the proceeds received from the sale or
refinancing of such properties or from the sale of the Partnership's interests
in the joint ventures. These sources of liquidity are expected to be sufficient
to meet the Partnership's needs on both a short-term and long-term basis.
As noted above, the Partnership expects to be liquidated prior to the end
of calendar year 1999. Notwithstanding this, the Partnership believes that it
has made all necessary modifications to its existing systems to make them year
2000 compliant and does not expect that additional costs associated with year
2000 compliance, if any, will be material to the Partnership's results of
operations or financial position.
Results of Operations
Three Months Ended March 31, 1999
- ---------------------------------
The Partnership reported net income of $177,000 for the three months ended
March 31, 1999, as compared to net income of $218,000 for the same period in the
prior year. This decrease in net income of $41,000 was due to a decrease of
$68,000 in the Partnership's share of ventures' income which was partially
offset by an increase of $27,000 in the Partnership's operating income. The
decrease in the Partnership's share of ventures' income was mainly due to
increases in repairs and maintenance expense at the Bell Plaza and Seven Trails
joint ventures. Repairs and maintenance expense increased at both properties in
order to prepare the properties to be marketed for sale. The increases in
repairs and maintenance expense were partially offset by an increase in interest
and other income at the Seven Trails joint venture and an increase in rental
income and expense reimbursements at Bell Plaza for the current three-month
period. The increase in interest and other income at Seven Trails was mainly due
to new management policies implemented at the property during the current period
which resulted in additional service fee income. In addition, income increased
at Bell Plaza due to additional common area maintenance reimbursements received
in the current three-month period.
The increase of $26,000 in the Partnership's operating income was the
result of an increase in interest and other income of $52,000. Interest income
for the current three-month period was higher due to an increase in the
Partnership's average outstanding cash reserve balances as a result of the sale
of the Carriage Hill property in September 1998. As discussed above, the
Partnership had been holding $8.4 million of Carriage Hill sale proceeds pending
the receipt of formal approval from HUD for the assumption of the HUD-insured
mortgage loan secured by the Carriage Hill property, which was obtained on
February 18, 1999. The distribution of the net sale proceeds was made to the
Limited Partners on March 15, 1999. The increase in interest and other income
was partially offset by an increase in general and administrative expenses of
$25,000. The increase in general and administrative expenses was primarily due
to an increase in certain required professional fees.
Six Months Ended March 31, 1999
- -------------------------------
The Partnership reported net income of $348,000 for the six months ended
March 31, 1999, as compared to net income of $240,000 for the same period in the
prior year. This increase in net income of $108,000 was due to an increase of
$101,000 in the Partnership's operating income and an increase of $7,000 in the
Partnership's share of ventures' income. The increase in the Partnership's
operating income was mainly due to an increase in interest and other income of
$155,000. Interest income was higher due to an increase in the Partnership's
average outstanding cash reserve balances as a result of the sale of the
Carriage Hill property in September 1998. As discussed above, the Partnership
had been holding $8.4 million of Carriage Hill sale proceeds pending the receipt
of formal approval from HUD for the assumption of the HUD-insured mortgage loan
secured by the Carriage Hill property, which was obtained on February 18, 1999.
The distribution of the net sale proceeds was made to the Limited Partners on
March 15, 1999. The increase in interest and other income was partially offset
by an increase in general and administrative expenses of $54,000. The increase
in general and administrative expenses was primarily due to an increase in
certain required professional fees.
The increase in the Partnership's share of ventures' income was mainly due
to an increase in rental income at the Seven Trails joint venture and an
increase in rental income and expense reimbursements at Bell Plaza for the
current six-month period. The increase in rental income at Seven Trails was
mainly due to an increase in the average occupancy level at the property during
the current period. In addition, income increased at Bell Plaza due to
additional common area maintenance reimbursements received in the current
six-month period.
<PAGE>
PART II
Other Information
Item 1. Legal Proceedings NONE
Item 2. through 5. NONE
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits: NONE
(b) Reports on Form 8-K: NONE
<PAGE>
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
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.
PAINE WEBBER INCOME PROPERTIES FIVE
LIMITED PARTNERSHIP
By: FIFTH INCOME PROPERTIES FUND, INC.
----------------------------------
Managing General Partner
By: /s/ Walter V. Arnold
--------------------
Walter V. Arnold
Senior Vice President and Chief
Financial Officer
Date: May 10, 1999
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Partnership's unaudited financial statements for the quarter ended March 31,
1999 and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> Sep-30-1999
<PERIOD-END> Mar-31-1999
<CASH> 2,720
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,720
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 4,025
<CURRENT-LIABILITIES> 784
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 3,241
<TOTAL-LIABILITY-AND-EQUITY> 4,025
<SALES> 0
<TOTAL-REVENUES> 519
<CGS> 0
<TOTAL-COSTS> 171
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 348
<INCOME-TAX> 0
<INCOME-CONTINUING> 348
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 348
<EPS-PRIMARY> 9.86
<EPS-DILUTED> 9.86
</TABLE>
