SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
(Mark One)
_X_ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
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OR
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________________to_________________________
Commission file number 0-13241
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NOONEY INCOME FUND LTD., L.P.
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(Exact name of Registrant as specified in its charter)
Missouri 43-1302570
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
500 N. Broadway, Suite 1200, St. Louis, Missouri 63102
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 206-4600
-----------------------------
7701 Forsyth Boulevard, Suite 700, St. Louis, MO 63105
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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 ___.
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes ___ No ___
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding
of each of the issuer's classes of common stock, as of the latest practicable
date _______.
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PART I
Item 1 - Financial Statements:
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NOONEY INCOME FUND LTD., L.P.
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(A LIMITED PARTNERSHIP)
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BALANCE SHEETS
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March 31, December 31,
1998 1997
ASSETS: (Unaudited)
----------- -----------
Cash and Cash Equivalents $ 1,044,749 $ 865,287
Accounts receivable 32,992 115,038
Prepaid expenses and deposits 13,116 10,520
Investment property, at cost:
Land 1,946,169 1,946,169
Buildings and improvements 8,459,569 8,447,027
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10,405,738 10,393,196
Less accumulated depreciation 4,816,351 4,731,841
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5,589,387 5,661,355
Deferred expenses - At amortized cost 63,935 61,295
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$ 6,744,179 $ 6,713,495
=========== ===========
LIABILITIES AND PARTNERS' EQUITY:
Liabilities:
Accounts payable and accrued expenses $ 29,311 $ 108,209
Accrued real estate taxes 249,683 184,936
Mortgage notes payable 1,180,800 1,197,000
Refundable tenant deposits 112,577 120,017
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1,572,371 1,610,162
Partners' Equity 5,171,808 5,103,333
----------- -----------
$ 6,744,179 $ 6,713,495
=========== ===========
SEE NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
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<PAGE>
NOONEY INCOME FUND LTD., L.P.
-----------------------------
(A LIMITED PARTNERSHIP)
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STATEMENTS OF OPERATIONS AND PARTNERS' EQUITY
---------------------------------------------
(UNAUDITED)
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Three Months Ended
March 31, March 31,
1998 1997
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REVENUES:
Rental and other income $ 415,066 $ 451,460
Interest 5,322 5,284
---------- ----------
420,388 456,744
EXPENSES:
Interest 28,111 28,936
Depreciation and amortization 107,277 118,775
Real estate taxes 64,747 61,307
Property management fees paid to
Nooney Inc. 25,181 27,523
Reimbursement to Nooney Inc.
for partnership management services
and indirect expenses 6,250 6,250
Repairs & Maintenance 11,463 24,669
Professional Services 11,701 32,441
Utilities 26,811 17,060
Cleaning 12,330 14,597
Payroll 11,775 9,414
Snow Removal 13,916 21,374
Other operating expenses 31,619 33,627
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351,181 395,973
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NET INCOME $ 68,475 $ 60,771
========== ==========
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 3.52 $ 2.96
========== ==========
PARTNERS' EQUITY:
Beginning of Period $5,103,333 $5,226,492
Net Income 68,475 60,771
---------- ----------
End of Period $5,171,808 $5,287,263
========== ==========
SEE NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
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<PAGE>
NOONEY INCOME FUND LTD., L.P.
-----------------------------
(A LIMITED PARTNERSHIP)
-----------------------
STATEMENTS OF CASH FLOW
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(UNAUDITED)
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Three Months Ended
March 31, March 31,
1998 1997
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 68,475 $ 60,771
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 107,277 118,775
Changes in assets and liabilities:
Decrease (Increase) in accounts receivable 82,046 (6,311)
Increase in prepaid expenses (2,596) (6,035)
Increase in deferred assets (10,696) 0
Decrease in accounts payable (78,898) (31,445)
Increase in accrued real estate taxes 64,747 61,307
Decrease in refundable tenant deposits (7,440) (674)
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Total Adjustments 154,440 135,617
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Net cash provided by operating activities 222,915 196,388
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CASH FLOWS FROM INVESTING ACTIVITIES -
Net additions to investment property (27,253) (27,867)
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CASH FLOWS FROM FINANCING ACTIVITIES -
Payments on mortgage notes payable (16,200) (16,200)
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NET INCREASE IN CASH AND CASH EQUIVALENTS 179,462 152,321
CASH AND CASH EQUIVALENTS, beginning of period 865,287 797,225
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 1,044,749 $ 949,546
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION - Cash paid during period for interest 28,111 28,936
SEE NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
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<PAGE>
NOONEY INCOME FUND LTD., L.P.
-----------------------------
(A LIMITED PARTNERSHIP)
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NOTES TO UNAUDITED FINANCIAL STATEMENTS
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THREE MONTHS ENDED MARCH 31, 1998 AND 1997
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NOTE A:
Refer to the Registrant's financial statements for the fiscal year ended
December 31, 1997, which are contained in the Registrant's Annual report on Form
10-K, for a description of the accounting policies which have been continued
without change. Also, refer to the footnotes to those statements for additional
details of the Registrant's financial condition. The details in those notes have
not changed except as a result of normal transactions in the interim or as noted
below.
NOTE B:
The financial statements include only those assets, liabilities, and results of
operations of the partners which relate to the business of Nooney Income Fund.,
L.P. The statements do not include assets, liabilities, revenues or expenses
attributable to the partners' individual activities. No provision has been made
for federal and state income taxes since these taxes are the responsibilities of
the partners. In the opinion of the general partners, all adjustments (which
include only normal recurring adjustments) necessary to present fairly the
financial position, results of operations and changes in financial position at
March 31, 1998 and for all periods presented have been made. The results of
operations for the three-month period ended March 31, 1998 are not necessarily
indicative of the results which may be expected for the entire year.
NOTE C:
The Registrant's properties are managed by Nooney, Inc., a wholly-owned
subsidiary of CGS Real Estate Company. Nooney Income Investments, Inc., a
general partner, is a 75% owned subsidiary of S-P Properties, Inc. S-P
Properties, Inc. is a wholly-owned subsidiary of CGS Real Estate Company.
NOTE D:
The earnings per limited partnership unit for the three months ended March 31,
1998 and 1997 was computed on 15,180 units, the number of units outstanding
during the periods.
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<PAGE>
ITEM 7: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
It should be noted that this 10-Q contains forward-looking information (as
defined in the Private Securities Litigation Reform Act of 1995) that involves
risk and uncertainty, including trends in the real estate investment market,
projected leasing and sales, and the future prospects for the Registrant. Actual
results could differ materially from those contemplated by such statements.
Liquidity and Capital Resources
- -------------------------------
Cash on hand as of March 31, 1998 is $1,044,749 an increase of $179,462 from
year end December 31, 1997. During the first quarter, net cash provided by
operating activities was $222,915. Cash was used for tenant improvements in the
amount of $27,253 and payments on mortgage notes payable of $16,200. With the
positive operating results, the Registrant expects the properties to adequately
fund anticipated capital expenditures for the remainder of 1998. The anticipated
capital expenditures are as follows:
Leasing Capital Other Capital Total
--------------- ------------- -----
Oak Grove Commons $276,533 $ 13,965 $290,498
Leawood Fountain Plaza (76%) 129,517 19,304 148,821
-------- -------- --------
$406,050 $ 33,269 $439,319
======== ======== ========
Oak Grove Commons' and Leawood Fountain Plaza's Leasing Capital includes funds
for tenant alterations and lease commissions for new and renewal tenants. Other
Capital expenditures at Leawood Fountain Plaza include the replacement of
carpeting in three building hallways, sidewalk replacement, and exterior
re-lighting. At Oak Grove Commons, Other Capital includes the repavement of
exterior loading docks.
Results of Operations by Property
- ---------------------------------
The results of operations for the Registrant's properties for the quarters ended
March 31, 1998 and 1997 are detailed in the schedule below. Expenses and
revenues of the Registrant are excluded.
Oak Grove Leawood Fountain
Commons Plaza (76%)
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1998
----
Revenues $208,822 $210,867
Expenses 158,102 200,774
-------- --------
Net Income $ 50,720 $ 10,093
======== ========
1997
----
Revenues $223,595 $235,123
Expenses 175,613 202,606
-------- --------
Net Income $ 47,982 $ 32,517
======== ========
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<PAGE>
Revenues for the quarters ended March 31, 1998 and 1997 at Oak Grove Commons
were $208,822 and $223,595 respectively. The decrease in income is attributable
to the loss of rental income due to the vacancy of one tenant in the fourth
quarter of 1997 that previously occupied 13,650 square feet. This decrease was
partially offset by slight increases in miscellaneous income, common area
maintenance and tax income. Expenses at Oak Grove Commons decreased $17,511 or
10% from the quarter ended March 31, 1998 as compared to the quarter ended March
31, 1997. The decrease in expenses is primarily attributable to decreases in
snow removal costs ($5,681) and amortization expense ($11,162). The decrease in
amortization is due to the amount of fully-amortized assets increasing over the
past year.
At Leawood Fountain Plaza, revenues decreased $24,256 when comparing the quarter
ended 1998 to 1997. The decrease in revenue can be attributed to a decrease in
escalation income ($24,895). This decrease is due to refunds issued to tenants
during 1st quarter 1998 for over payments of escalation made in 1997. Expenses
decreased a nominal amount when comparing 1997 to 1998. Operating expenses
decreased in the areas of cleaning, security, repairs and maintenance, fuel/gas
and snow removal, offset by an increase in electric expense.
The occupancy levels at the Registrant's properties during the first quarter of
1998 remained high. These high levels can be attributed to the Registrant's
ability to lease space as it becomes available. The occupancy levels at the
Registrant's properties are listed below.
Occupancy levels as of March 31,
--------------------------------
Property 1998 1997 1996
-------- ---- ---- ----
Oak Grove Commons 89% 100% 100%
Leawood Fountain Plaza (76%) 90% 88% 91%
Occupancy at Oak Grove Commons increased to 89% during the first quarter of
1998. Leasing activity consisted of three new tenants occupying 15,365 square
feet. One tenant renewing its lease for 3,395 square feet and one tenant
vacating 11,049 square feet. Oak Grove Commons has no tenant occupying more than
10% of the available space.
During the first quarter of 1998, occupancy at Leawood Fountain Plaza increased
to 90%. Leasing activity consisted of two tenants occupying 1,140 square feet.
There was no other leasing activity. Interest in leasing space at Leawood
Fountain Plaza has been strong and the Registrant anticipates occupancy
increasing during the second quarter. The property has two major tenants, one
who occupies approximately 11% of the available space whose lease expires in
July 1998 and a second major tenant who occupies approximately 10% of the
available space whose lease expires in July 1999. The Registrant has been in
ongoing negotiations with the tenant whose lease expires in July 1998 and
anticipates executing a renewal document during the second quarter.
Results of consolidated Operations 1998
- ---------------------------------------
As of March 31, 1998, the Registrant's consolidated revenues are $420,388, a
decrease of $36,356 when compared to quarter ended March 31, 1997. This 8%
decrease in revenues can be attributed to decreases in base rent at Oak Grove
Commons and decreases in escalation at Leawood Fountain Plaza, partially offset
by increases in miscellaneous, common area maintenance and tax income.
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<PAGE>
Consolidated expenses for the quarters ending March 31, 1998 and 1997 are
$351,181 and $395,973 respectively. This 11% decrease in expenses can be
attributed to decreases in snow removal and amortization expense at Oak Grove
Commons and decreases in cleaning, security, repairs & maintenance, gas and snow
removal at Leawood Fountain Plaza, which were partially offset by an increase in
electrical expense.
Results of Consolidated Operations 1997
- ---------------------------------------
As of March 31, 1997, the Registrant's consolidated revenues are $456,744, an
increase of $35,295 when compared to quarter ended March 31, 1996. This 8%
increase in revenues can be attributable to increases in base rent at both Oak
Grove Commons and Leawood Fountain Plaza, an increase in escalation income at
Leawood Fountain Plaza and as well an increase in miscellaneous income at
Leawood Fountain Plaza.
Consolidated expenses for the quarters ending March 31, 1997 and 1996 are
$395,973 and $396,622, respectively. The overall level of expenses remained
extremely stable when comparing the two years.
Inflation
- ---------
The effects of inflation did not have a material impact upon the Registrant's
operation in fiscal l997 and are not expected to materially affect the
Registrant's operation in l998.
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<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
See Exhibit Index on Page 10
(b) Reports on Form 8-K
None
SIGNATURES
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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.
NOONEY INCOME FUND LTD., L.P.
Dated: May 15, 1998 By: Nooney Income Investments, Inc.
General Partner
By: /s/ Gregory J. Nooney, Jr.
-----------------------------------
Gregory J. Nooney, Jr. - Director
Chairman of the Board
and Chief Executive Officer
By: /s/ Patricia A. Nooney
-----------------------------------
Patricia A. Nooney - Director
Senior Vice President and Secretary
BEING A MAJORITY OF THE DIRECTORS
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<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------- -----------
3 Amended and Restated Agreement and Certificate of Limited
Partnership, dated November 7, 1983, is incorporated by reference to
the Prospectus contained in Post-Effective Amendment No. 1 to the
Registration Statement on Form S-11 under the Securities Act of
1933 (File No. 2-85683)
27 Financial Data Schedule (provided for the information of U.S.
Securities and Exchange Commission only)
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<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS FOR NOONEY INCOME FUND LTD., L.P. AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000725266
<NAME> NOONEY INCOME FUND LTD., L.P.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 1,044,749
<SECURITIES> 0
<RECEIVABLES> 32,992
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,090,857
<PP&E> 10,405,738
<DEPRECIATION> 4,816,351
<TOTAL-ASSETS> 6,744,179
<CURRENT-LIABILITIES> 278,994
<BONDS> 1,180,800
<COMMON> 0
0
0
<OTHER-SE> 5,171,808
<TOTAL-LIABILITY-AND-EQUITY> 6,744,179
<SALES> 415,066
<TOTAL-REVENUES> 420,388
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 323,070
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 28,111
<INCOME-PRETAX> 68,475
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 68,475
<EPS-PRIMARY> 3.52
<EPS-DILUTED> 0
</TABLE>
