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 quarterly period ended June 30, 1998
/___/ Transition report pursuant to Section 13 or 15(d) of the
Securities Act of 1934
for the transition period from ______________ to ________________.
Commission File Number 2-83291
DSI REALTY INCOME FUND VII, A California Limited Partnership
(Exact name of registrant as specified in its charter)
California_______________________________________95-3871044
(State or other jurisdiction of (I.R.S. Employer
incorporation) Identification No.)
6700 E. Pacific Coast Hwy, Long Beach, California 90803
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code-(562)493-8881
_________________________________________________________________
Former name, former address and former fiscal year, if changed
since last report.
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.
The information required by Rule 10-01 of Regulation S-X is
included in the Quarterly Report to the Limited Partners of Registrant for
the period ended June 30, 1998 which is attached hereto as Exhibit "20"
and incorporated herein by this reference.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Registrant incorporates by this reference its Quarterly Report to
Limited Partners for the period ended June 30, 1998.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8K.
(a) Attached hereto as Exhibit "20" is Registrant's Quarterly
Report to Limited Partners for the period ended June 30, 1998.
(B) Registrant did not file any reports on Form 8-K for the
period reported upon.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: July 31, 1998 DSI REALTY INCOME FUND VII
A California Limited Partnership
(Registrant)
By____\s\ Robert J. Conway_____
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial Officer
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: July 31, 1998 DSI REALTY INCOME FUND VII
A California Limited Partnership
(Registrant)
By__\s\ Robert J. Conway________
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial Officer
July 31, 1998
QUARTERLY REPORT TO THE LIMITED PARTNERS
OF DSI REALTY INCOME FUND VII
DEAR LIMITED PARTNERS:
We are pleased to enclose the Partnership's unaudited financial statements
for the period ended June 30, 1998. The following is Management's
discussion and analysis of the Partnership's financial condition and
results of its operations.
For the three month period ended June 30, 1998, and 1997, total revenues
increased 9.1% from $490,974 to $535,517 and total expenses decreased 5.5% from
$398,393 to $376,519. As a result, net income increased 71.7% from $92,581
for the three month period ended June 30, 1997, to $158,998 for the same period
in 1998. Rental revenue increased as a result of higher unit rental rates as
occupancy levels remained relatively constant. Operating expenses decreased
approximately $27,700 (7.8%) as a result of decreases in maintenance and repair
and salaries and wage expenses, partially offset by increases real estate tax
expenses and property management fees. Property management fees, which are
based on rental income, increased as a result of the increase in rental
revenue. General and administrative expenses increased approximately $5,800
(13.8%) primarily as a result of an increase in incentive management fees.
Incentive management fees, which are based on cash available for distribution,
increased as a result of the increase in net income. Occupancy levels for the
Partnership's six mini-storage facilities averaged 89.2% for the three month
period ended June 30, 1998, and 89.4% for the same period in 1997. The
Partnership is continuing its marketing efforts to attract and keep new tenants
in its various mini-storage facilities.
For the six month periods ended June 30, 1998, and 1997, total revenues
increased 10.2% from $962,290 to $1,059,947 and total expenses decreased 0.6%
from $760,188 to $755,768. As a result, net income increased 50.5% from
$202,102 for the six months ended June 30, 1997, to $304,179 for the same
period in 1998. Rental revenue increased primarily as a result of higher unit
rental rates during the six months of the period. Operating expenses decreased
approximately $17,100 (2.6%) primarily due to the same reasons as discussed
above. General and administrative expenses increased approximately $12,700
(12.2%) primarily as a result of an increase in incentive management fees, as
discussed above.
The General Partners will continue their policy of funding improvements
and maintenance of Partnership properties with cash generated from
operations. The Partnership's financial resources appear to be adequate
to meet its needs. The General Partners anticipate distributions to the
Limited Partners to remain at the current level for the foreseeable future.
We are not enclosing a copy of the Partnership Form 10-Q as filed with the
Securities and Exchange Commission since all the information set forth
therein is contained either in this letter or in the attached financial
statements. However, if you wish to receive a copy of said report, please
send a written request to DSI Realty Income Fund VII, P.O. Box 357,
Long Beach, California 90801.
Very truly yours,
DSI REALTY INCOME FUND VII
By: DSI Properties, Inc., as
General Partner
By /s/ Robert J. Conway
____________________________
ROBERT J. CONWAY, President
DSI REALTY INCOME FUND VII
(A California Real Estate Limited Partnership)
BALANCE SHEETS(UNAUDITED)
JUNE 30, 1998 AND DECEMBER 31, 1997
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
<S> <C> <C>
ASSETS
CASH AND CASH EQUIVALENTS $ 546,262 $ 500,294
PROPERTY 2,926,758 3,181,412
OTHER ASSETS 82,242 37,660
TOTAL $3,555,262 $3,719,366
LIABILITIES AND PARTNERS' EQUITY
LIABILITIES $ 560,709 $ 544,144
PARTNERS' EQUITY:
General Partners (77,821) (76,015)
Limited Partners 3,072,374 3,251,237
Total partners' equity 2,994,553 3,175,222
TOTAL $3,555,262 $3,719,366
See accompanying notes to financial statements(unaudited).
STATEMENTS OF INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED JUNE 30, 1998 AND 1997
June 30, June 30,
1998 1997
REVENUES:
Rental Income $ 531,898 $ 488,690
Interest 3,619 2,284
Total revenues 535,517 490,974
EXPENSES:
Operating Expenses 328,801 356,492
General and administrative 47,718 41,901
Total expenses 376,519 398,393
NET INCOME $ 158,998 $ 92,581
AGGREGATE NET INCOME ALLOCATED TO:
Limited partners $ 157,408 $ 91,655
General partners 1,590 926
TOTAL $ 158,998 $ 92,581
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 6.56 $ 3.82
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 24,000 24,000
See accompanying notes to financial statements(unaudited).
STATEMENTS OF INCOME (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
June 30, June 30,
1998 1997
REVENUES:
Rental Income $1,053,622 $ 957,377
Interest 6,325 4,913
Total revenues 1,059,947 962,290
EXPENSES:
Operating Expenses 638,714 655,862
General and administrative 117,054 104,326
Total expenses 755,768 760,188
NET INCOME $ 304,179 $ 202,102
AGGREGATE NET INCOME ALLOCATED TO:
Limited partners $ 301,137 $ 200,081
General partners 3,042 2,021
TOTAL $ 304,179 $ 202,102
NET INCOME PER LIMITED
PARTNERSHIP UNIT $12.55 $8.34
LIMITED PARTNERSHIP UNITS USED
IN PER UNIT CALCULATION 24,000 24,000
See accompanying notes to financial statements (unaudited)
</TABLE>
STATEMENTS OF CHANGES IN PARTNERS' EQUITY (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
<TABLE>
<CAPTION>
GENERAL LIMITED
PARTNERS PARTNERS TOTAL
<S> <C> <C> <C>
EQUITY AT DECEMBER 31, 1996 ($71,568) $3,691,570 $3,620,002
NET INCOME 2,021 200,081 202,102
DISTRIBUTIONS (4,848) (480,000) (484,848)
EQUITY AT JUNE 30, 1997 ($74,395) $3,411,651 $3,337,256
EQUITY AT DECEMBER 31, 1997 ($76,105) $3,251,237 $3,175,222
NET INCOME 3,042 301,137 304,179
DISTRIBUTIONS (4,848) (480,000) (484,848)
EQUITY AT JUNE 30, 1998 ($77,821) $3,072,374 $2,994,553
See accompanying notes to financial statements(unaudited).
</TABLE>
STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND 1997
<TABLE>
<CAPTION>
June 30, June 30,
1998 1997
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 304,179 $ 202,102
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 254,654 254,654
Changes in assets and
liabilities:
Increase in other assets (44,582) (44,625)
Increase(Decrease)in liabilities 16,565 (9,830)
Net cash provided by
operating activities 530,816 402,301
CASH FLOWS FROM FINANCING ACTIVITIES -
Distributions to partners (484,848) (484,848)
NET INCREASE(DECREASE)IN CASH AND
CASH EQUIVALENTS 45,968 (82,547)
CASH AND CASH EQUIVALENTS:
At beginning of period 500,294 481,301
At end of period $ 546,262 $ 398,754
See accompanying notes to financial statements(unaudited).
</TABLE>
DSI REALTY INCOME FUND VII
(A California Real Estate Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. GENERAL
DSI Realty Income Fund VII (the "Partnership"), has two general partners
(DSI Properties, Inc., and Diversified Investors Agency) and limited
partners owning 24,000 limited partnership units. The Partnership was formed
under the California Uniform Limited Partnership Act for the primary purpose
of acquiring and operating real estate.
The accompanying financial information as of June 30, 1998, and for
the periods ended June 30, 1998, and 1997, is unaudited. Such financial
information includes all adjustments which are considered necessary by the
Partnership's management for a fair presentation of the results for the
periods indicated.
2. PROPERTY
Properties owned by the Partnership are all mini-storage facilities.
Depreciation is calculated using the straight line method over the
estimated useful life of 15 years. The total cost of property and
accumulated depreciation at June 30, 1998, is as follows:
<TABLE>
<S> <C>
Land $ 2,089,800
Buildings and equipment 7,662,434
Equipment 55,058
Total 9,807,292
Less: Accumulated Depreciation ( 6,880,534)
Property - Net $ 2,926,758
</TABLE>
3. NET INCOME PER LIMITED PARTNERSHIP UNIT
Net income per limited partnership unit is calculated by dividing the net
income allocated to the limited partners by the number of limited
partnership units outstanding during the period.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 3-MOS YEAR
<FISCAL-YEAR-END> DEC-31-1998 DEC-31-1998
<PERIOD-END> JUN-30-1998 DEC-31-1998
<CASH> 546262 0
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 9807292 0
<DEPRECIATION> 6880534 0
<TOTAL-ASSETS> 3555262 0
<CURRENT-LIABILITIES> 0 0
<BONDS> 0 0
<COMMON> 0 0
0 0
0 0
<OTHER-SE> 0 0
<TOTAL-LIABILITY-AND-EQUITY> 3555262 0
<SALES> 1053622 0
<TOTAL-REVENUES> 1059947 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 304179 0
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 304179 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 304179 0
<EPS-PRIMARY> 0 0
<EPS-DILUTED> 0 0
</TABLE>
