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 the Quarter Ended March 31, 1995 Commission File Number 2-84760
-------------- -------
WINTHROP GROWTH INVESTORS 1 LIMITED PARTNERSHIP
Massachusetts 04-2839837
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
One International Place, Boston, MA 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 330-8600
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>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
STATEMENTS OF OPERATIONS
<TABLE>
For the Three Months Ended March 31,
(Unaudited) (Note 1) 1995 1994
<S> <C> <C>
Rental $ 1,581,788 $ 1,500,551
Interest on short-term investments 12,205 17,669
Other 67,041 60,464
----------- -----------
1,661,034 1,578,684
----------- -----------
Expenses
Leasing 57,868 41,154
General & administrative 89,334 53,902
Management fees 82,046 80,145
Utilities 161,231 147,567
Repairs and maintenance 299,698 270,891
Insurance 67,958 56,961
Taxes 134,002 133,665
----------- -----------
Total operating expenses 892,137 784,285
Other expenses
Depreciation 409,180 407,800
Amortization 25,319 31,003
Interest expense 477,501 522,831
Other expenses 23,361 75,680
----------- -----------
Total expenses 1,827,498 1,821,599
----------- -----------
Net loss $ (166,464) $ (242,915)
=========== ===========
Net loss allocated:
General Partners $ (16,646) $ (24,292)
Limited Partners (149,818) (218,623)
----------- -----------
$ (166,464) $ (242,915)
=========== ===========
Net loss per unit outstanding - L.P. $ (6.47) $ (9.45)
============= =============
</TABLE>
See notes to Financial Statements.
<PAGE>
BALANCE SHEETS
<TABLE>
March 31, December 31,
1995 1994
(Unaudited) (Audited)
- -
ASSETS
Investment in Real Estate
<S> <C> <C>
Land $ 4,015,369 $ 4,015,369
Buildings and improvements 37,350,835 37,218,583
------------ ------------
41,366,204 41,233,952
Less accumulated depreciation 17,193,025 16,783,845
------------ ------------
24,173,179 24,450,107
Cash and cash equivalents 738,798 923,214
Tenant security deposits - funded 198,716 125,295
Accounts receivable and other receivables 22,937 27,542
Escrow accounts 406,802 250,622
Reserve accounts 439,754 413,464
Deferred costs, net of accumulated amortization
of $948,042 and $922,723 1,095,679 1,120,998
Prepaid expenses and other assets 147,656 199,999
------------ ------------
Total Assets $ 27,223,521 $ 27,511,241
============ ============
</TABLE>
LIABILITIES AND PARTNERS' CAPITAL
<TABLE>
<S> <C> <C>
Mortgage payable $ 20,556,788 $ 20,711,814
Other liabilities
Accounts payable 108,581 105,449
Tenant security deposits 143,562 133,245
Accrued expenses and other liabilities 414,259 343,958
------------ ------------
Total Liabilities 21,223,190 21,294,466
Partners' Capital
Limited Partners 7,130,545 7,330,343
General Partners (1,130,214) (1,113,568)
------------ ------------
Total Partners' Capital 6,000,331 6,216,775
Total Liabilities and Partners' Capital $ 27,223,521 $ 27,511,241
============ ============
</TABLE>
See notes to Financial Statements.
<PAGE>
STATEMENTS OF CASH FLOWS
<TABLE>
For the Three Months Ended
March 31, 1995 and 1994 (Unaudited) 1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (166,464) $ (242,915)
Adjustments to reconcile net loss to
net cash provided by operating activities:
Depreciation and amortization 434,499 438,803
Changes in assets and liabilities:
(Increase) decrease in tenant security
deposits - funded (73,421) 67,444
Decrease (increase) in accounts receivable and
other receivables 4,605 (25,102)
Increase in escrow accounts (156,180) (15,246)
Decrease in prepaid expenses and other assets 52,343 151,946
Increase (decrease) in accounts payable 3,132 (33,208)
Increase in tenant security deposits 10,317 3,453
Increase in accrued expenses and other liabilities 70,301 57,260
----------- -----------
Net cash provided by operating activities 179,132 402,435
Cash flows from investing activities:
Additions to buildings and improvements (132,252) (26,800)
Increase in reserve accounts (26,290) (25,975)
----------- -----------
Net cash used in investing activities (158,542) (52,775)
Cash flows from financing activities:
Principal payments on mortgage (155,026) (1,053,783)
Cash distributions paid to partners (49,980) (50,002)
------------ ------------
Net cash used in financing activities (205,006) (1,103,785)
------------ ------------
Net decrease in cash and cash equivalents (184,416) (754,125)
Cash and cash equivalents, beginning 923,214 2,394,552
------------ ------------
Cash and cash equivalents, end $ 738,798 $ 1,640,427
============ ============
Supplemental disclosure of cash flow information:
Cash paid for interest $ 477,501 $ 522,831
============ ============
</TABLE>
See notes to Financial Statements.
<PAGE>
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
<TABLE>
Units of
For the Three Months Ended Limited General Limited
March 31, 1995 and 1994 Partnership Partners' Partners' Total
(Unaudited) (Note 1) Interest Capital Capital Capital
<S> <C> <C> <C> <C>
Balance, December 31, 1994 23,139 (1,113,568) 7,330,343 6,216,775
Net loss (16,646) (149,818) (166,464)
Distributions - (49,980) (49,980)
-------- ---------- ---------- ----------
Balance, March 31, 1995 23,139 (1,130,214) 7,130,545 6,000,331
======== ========== ========== ==========
Balance, December 31, 1993 23,139 $(1,036,192) $ 8,226,672 $ 7,190,480
Net loss (24,292) (218,623) (242,915)
Partner distributions - (50,002) (50,002)
---------- ----------- ----------- -----------
Balance, March 31, 1994 23,139 $(1,060,484) $ 7,958,047 $ 6,897,563
========== =========== =========== ===========
</TABLE>
See notes to Financial Statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1995
(Unaudited)
1. ACCOUNTING AND FINANCIAL REPORTING POLICIES
The condensed consolidated financial statements included herein have been
prepared by the Registrant, without audit, pursuant to the rules and regulations
of the Securities and Exchange Commission. The Registrant's accounting and
financial reporting policies are in conformity with generally accepted
accounting principles and include adjustments in interim periods considered
necessary for a fair presentation of the results of operations. Certain
information and footnote disclosures normally included in consolidated financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and regulations. It is
suggested that these consolidated financial statements be read in conjunction
with the consolidated financial statements and notes thereto included in the
Registrant's latest annual report on Form 10-K.
The accompanying consolidated financial statements reflect the Partnership's
results of operations for an interim period and are not necessarily indicative
of the results of operations for the year ending December 31, 1995.
2. CASH AVAILABLE FOR DISTRIBUTION
The Managing General Partner determined it to be in the best interest of the
Partnership to retain cash available for distribution from July 1, 1987 to
December 31, 1990 in order to increase the Partnership's operating reserves. In
1991, Management began to distribute cash available for distribution. A
distribution of $49,980 was paid in the quarter ended March 31, 1995
representing cash available for distribution from the prior quarter.
3. TAXABLE INCOME
The Partnership's results of operations on a tax basis are expected to differ
from net income for financial reporting purposes primarily due to the accounting
differences in the recognition of depreciation and amortization.
ITEM 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Partnership operated at a net loss of $166,464 for the three months ended
March 31, 1995, compared to a net loss of $242,915 for the three months ended
March 31, 1994. Excluding non-cash items such as depreciation and amortization,
however, the Partnership's properties have, in the aggregate, generated cash
flow, which the Partnership has used to make improvements to the properties,
principal payments on the loans encumbering the properties and cash
distributions to limited partners.
The Partnership's income increased by 5.2% for the first quarter of 1995
compared to the first quarter of 1994, primarily as a result of a 5.4% increase
in rental income. On an aggregate basis, average rents at the Partnership's four
properties have increased by 3.4% since the first quarter of 1994. While overall
average occupancy declined slightly from 92% to 91%, the Partnership was able to
significantly reduce the level of tenant concessions, especially at Stratford
Place Apartments. Occupancy improved at Stratford Place (from90% to 96%) and
Sunflower (from 91% to 93%) but was lower at Meadow Wood (86% compared to 93%)
and Stratford Village (87% compared to 94%).
The direct operating costs of the Partnership's properties increased by 13.8%,
primarily as a result of a one-time fee that was paid to a consultant for
reducing the 1994 through 1996 real estate tax liability of some of the
Partnership's properties. This payment is reflected in the Partnership's
"General & Administrative" expense for the quarter. In addition, the
Partnership's utility expense increased by 9.3% and repairs and maintenance
expense increased by 10.6%, primarily as a result of additional carpet
replacements in apartment units. Interest expense declined as a result of the
Partnership's significantly reducing the principal balance of the Sunflower
mortgage loan as part of a restructuring of the loan during 1994. "Other
expenses" were lower primarily because the Partnership had not recognized the
expense of completing the audits for the Partnership and certain lower-tier
partnerships as of March 31, 1995 while these costs had been recognized during
the first quarter of 1994.
The Dallas (Sunflower) and Gaithersburg, Maryland (Stratford Place) markets are
currently stable. The submarket of Jacksonville in which Meadow Wood is located
has weakened somewhat as indicated by the property's lower occupancy for the
quarter. Competition in the Montgomery, Alabama, market in which Stratford
Village is located has increased dramatically with the addition of over 1,000
new apartment units to the market over the last year. The Partnership continues
to make capital improvements to the properties to enhance their competitiveness
within their local markets. The Partnership spent $132,252 on capital
improvements during the first quarter of 1995 compared to $26,800 in the first
quarter of 1994. At two of the properties (Meadow Wood and Stratford Village), a
portion of the capital improvements is funded by replacement reserves held by
the mortgage lenders, with the balance being funded from operations. The balance
of these replacement reserves was $439,754 at March 31, 1995. Capital
improvements from the other two properties are funded entirely from operations.
The results of operations in future quarters may differ from the results of
operations for the quarter ended March 31, 1995, due to inflation and changing
economic conditions which could affect occupancy levels, rental rates and
operating expenses.
<PAGE>
PART II - OTHER INFORMATION
NOT APPLICABLE
SIGNATURE
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.
WINTHROP GROWTH INVESTORS 1
LIMITED PARTNERSHIP
(Registrant)
BY: TWO WINTHROP PROPERTIES, INC.
Managing General Partner
DATED: May 12, 1995 By: /s/ Jonathan W. Wexler
Jonathan W. Wexler
Chief Financial Officer
DATED: May 12, 1995 By: /s/ Richard J. McCready
Richard J. McCready
Vice President
<PAGE>
SUPPLEMENTARY INFORMATION REQUIRED
PURSUANT TO SECTION 9.4 OF THE PARTNERSHIP AGREEMENT
March 31, 1995
(Unaudited)
1. Statement of Cash Available for Distribution for the
three months ended March 31, 1995:
<TABLE>
<S> <C>
Net loss $(166,464)
Add: Amortization charges to income not affecting
cash available for distribution 10,783
Net loss from the Properties 154,760
Cash from reserves 50,901
---------
Cash Available for Distribution $ 49,980
=========
Distributions allocated to Limited Partners $ 49,980
</TABLE>
2. Fees and other compensation paid or accrued by the Partnership to the
General Partners, or their affiliates, during the three months ended
March 31, 1995:
<TABLE>
Entity Receiving Form of
Compensation Compensation Amount
<S> <C> <C>
Winthrop Management Property Management Fee $82,046
</TABLE>
All other information required pursuant to Section 9.4 of the Partnership
Agreement is set forth in the attached Report on Form 10-Q or Partnership
Report.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information
extracted from unaudited financial statements for the
three month period ending March 31, 1995 and is
qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000722565
<NAME> Winthrop Growth Investors 1 L.P.
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<EXCHANGE-RATE> 1.00000
<CASH> 738,798
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,311,544
<PP&E> 41,366,204
<DEPRECIATION> 17,193,025
<TOTAL-ASSETS> 27,223,521
<CURRENT-LIABILITIES> 666,402
<BONDS> 20,556,788
<COMMON> 0
0
0
<OTHER-SE> 6,000,331
<TOTAL-LIABILITY-AND-EQUITY> 27,223,521
<SALES> 0
<TOTAL-REVENUES> 1,661,034
<CGS> 0
<TOTAL-COSTS> 892,137
<OTHER-EXPENSES> 457,860
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 477,501
<INCOME-PRETAX> (166,464)
<INCOME-TAX> 0
<INCOME-CONTINUING> (166,464)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (166,464)
<EPS-PRIMARY> (6.470)
<EPS-DILUTED> 0.000
</TABLE>
