<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the period ended June 30, 1994
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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: 0-12945
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FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 2
- - --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 59-2313852
- - ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Two North Riverside Plaza, Suite 950, Chicago, Illinois 60606-2607
- - ------------------------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
(312) 207-0020
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(Registrant's telephone number, including area code)
Not applicable
- - --------------------------------------------------------------------------------
(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
----- -----
DOCUMENTS INCORPORATED BY REFERENCE:
The First Amended and Restated Agreement of Limited Partnership filed as Exhibit
A to the Partnership's Prospectus dated October 19, 1983, included in the
Partnership's Registration Statement on Form S-11, is incorporated herein by
reference in Part I of this report.
<PAGE>
PART I. FINANCIAL INFORMATION
BALANCE SHEETS
(All dollars rounded to nearest 00s)
<TABLE>
<CAPTION>
June 30,
1994 December 31,
(Unaudited) 1993
- - ----------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Investment in commercial rental properties:
Land $10,237,400 $11,177,700
Buildings and improvements 36,631,700 40,226,600
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46,869,100 51,404,300
Accumulated depreciation and amortization (10,518,000) (10,765,000)
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Total investment properties, net of accumulated
depreciation and amortization 36,351,100 40,639,300
Cash and cash equivalents 12,848,700 9,502,400
Marketable securities, at cost which approximates
market 25,000 25,000
Investment in joint venture 5,923,200 6,022,300
Rents receivable 158,500 270,700
Other assets (including amounts due from joint
venture of $742,700 and $790,300, respectively) 766,900 934,600
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$56,073,400 $57,394,300
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LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses $ 396,200 $ 450,900
Due to Affiliates 113,900 102,800
Security deposits 114,800 122,200
Distributions payable 778,100 499,900
Other liabilities 119,600 124,700
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1,522,600 1,300,500
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Partners' (deficit) capital:
General Partner (106,300) (93,500)
Limited Partners (84,886 Units authorized, issued
and outstanding) 54,657,100 56,187,300
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54,550,800 56,093,800
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$56,073,400 $57,394,300
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</TABLE>
STATEMENTS OF PARTNERS' CAPITAL
For the six months ended June 30, 1994
and the year ended December 31, 1993
(Unaudited)
(All dollars rounded to nearest 00s)
<TABLE>
<CAPTION>
General Limited
Partner Partners Total
- - -------------------------------------------------------------------------------
<S> <C> <C> <C>
Partners' (deficit) capital, January 1,
1993 $ (89,800) $54,961,100 $54,871,300
Net income
for the year ended December 31, 1993 196,300 3,025,800 3,222,100
Distributions
for the year ended December 31, 1993 (200,000) (1,799,600) (1,999,600)
- - -------------------------------------------------------------------------------
Partners' (deficit) capital, December 31,
1993 (93,500) 56,187,300 56,093,800
Net income (loss) for the six months
ended June 30, 1994 128,600 (256,900) (128,300)
Distributions for the
six months ended June 30, 1994 (141,400) (1,273,300) (1,414,700)
- - -------------------------------------------------------------------------------
Partners' (deficit) capital, June 30,
1994 $(106,300) $54,657,100 $54,550,800
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</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENTS OF INCOME AND EXPENSES
For the quarters ended June 30, 1994 and 1993
(Unaudited)
(All dollars rounded to nearest 00s except per Unit amounts)
<TABLE>
<CAPTION>
1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Income:
Rental $ 1,502,600 $1,478,700
Interest 102,800 62,900
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1,605,400 1,541,600
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Expenses:
Depreciation and amortization 350,100 354,800
Property operating 338,500 284,700
Real estate taxes and insurance 208,500 193,600
Repairs and maintenance 194,000 138,700
General and administrative 71,100 102,700
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1,162,200 1,074,500
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Income before income from participation in joint
venture 443,200 467,100
Income from participation in joint venture 63,900 34,000
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Income before (loss) on sale of property and
provision for value impairment 507,100 501,100
(Loss) on sale of property (1,275,800)
Provision for value impairment (379,000)
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Net (loss) income $ (768,700) $ 122,100
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Net income allocated to General Partner $ 65,000 $ 46,200
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Net (loss) income allocated to Limited Partners $ (833,700) $ 75,900
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Net (loss) income allocated to Limited Partners per
Unit (84,886 Units authorized, issued and
outstanding) $ (9.82) $ 0.89
- - -----------------------------------------------------------------------------
</TABLE>
STATEMENTS OF INCOME AND EXPENSES
For the six months ended June 30, 1994 and 1993
(Unaudited)
(All dollars rounded to nearest 00s except per Unit amounts)
<TABLE>
<CAPTION>
1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Income:
Rental $ 3,164,200 $3,200,600
Interest 201,200 127,200
- - -----------------------------------------------------------------------------
3,365,400 3,327,800
- - -----------------------------------------------------------------------------
Expenses:
Depreciation and amortization 691,600 707,900
Property operating 680,100 579,000
Real estate taxes and insurance 414,100 371,300
Repairs and maintenance 395,600 264,100
General and administrative 150,000 179,100
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2,331,400 2,101,400
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Income before income from participation in joint
venture 1,034,000 1,226,400
Income from participation in joint venture 113,500 26,000
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Income before (loss) on sale of property and
provision for value impairment 1,147,500 1,252,400
(Loss) on sale of property (1,275,800)
Provision for value impairment (379,000)
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Net (loss) income $ (128,300) $ 873,400
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Net income allocated to General Partner $ 128,600 $ 96,200
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Net (loss) income allocated to Limited Partners $ (256,900) $ 777,200
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Net (loss) income allocated to Limited Partners per
Unit (84,886 Units authorized, issued and
outstanding) $ (3.03) $ 9.16
- - -----------------------------------------------------------------------------
</TABLE>
STATEMENTS OF CASH FLOWS
For the six months ended June 30, 1994 and 1993
(Unaudited)
(All dollars rounded to nearest 00s)
<TABLE>
<CAPTION>
1994 1993
- - --------------------------------------------------------------------------------
<S> <C> <C>
Cash flows from operating activities:
Net (loss) income $ (128,300) $ 873,400
Adjustments to reconcile net (loss) income to net cash
provided by operating activities:
Depreciation and amortization 691,600 707,900
Provision for value impairment 379,000
Loss on sale of property 1,275,800
Changes in assets and liabilities:
Decrease in rents receivable 112,200 50,400
Decrease in other assets 121,500 44,100
(Decrease) increase in accounts payable and accrued
expenses (54,700) 23,600
(Decrease) increase in due to Affiliates (3,000) 3,900
(Decrease) increase in other liabilities (5,100) 23,300
- - --------------------------------------------------------------------------------
Net cash provided by operating activities 2,010,000 2,105,600
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Cash flows from investing activities:
Net proceeds from sale of property 3,020,500
Payments for capital and tenant improvements (685,600) (382,200)
Distributions received from joint venture in excess of
income allocated 99,100 174,100
Collection of (funding of) loans to joint venture 46,200 (57,400)
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Net cash provided by (used for) investing activities 2,480,200 (265,500)
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Cash flows from financing activities:
Distributions paid to Partners (1,136,500) (1,325,200)
(Decrease) increase in security deposits (7,400) 1,100
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Net cash (used for) financing activities (1,143,900) (1,324,100)
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Net increase in cash and cash equivalents 3,346,300 516,000
Cash and cash equivalents at the beginning of the
period 9,502,400 6,683,400
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Cash and cash equivalents at the end of the period $12,848,700 $7,199,400
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</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
June 30, 1994
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
DEFINITION OF SPECIAL TERMS:
Capitalized terms used in this report have the same meaning as those terms have
in the Partnership's Registration Statement filed with the Securities and
Exchange Commission on Form S-11. Definitions of these terms are contained in
Article III of the First Amended and Restated Certificate and Agreement of
Limited Partnership, which is incorporated herein by reference.
ACCOUNTING POLICIES:
The financial statements have been prepared in accordance with generally
accepted accounting principles. Under this method of accounting, revenues are
recorded when earned and expenses are recorded when incurred.
The financial information included in these financial statements is unaudited.
However, in management's opinion, all adjustments (consisting of only normal,
recurring accruals) necessary for a fair presentation of the results of
operations for the periods included have been made. Results of operations for
the quarter and six months ended June 30, 1994 are not necessarily indicative
of the operating results for the year ending December 31, 1994.
Certain reclassifications have been made to the previously reported 1993
statements in order to provide comparability with the 1994 statements. These
reclassifications have not changed the 1993 results.
The financial statements include the Partnership's interest in four joint
ventures with Affiliated partnerships. These joint ventures were formed for the
purpose of acquiring 100% interests in certain real properties and are operated
under the control of the General Partner. Accordingly, the Partnership's pro
rata share of the ventures' revenues, expenses, assets, liabilities and capital
is included in the financial statements.
Property sales are recorded when title transfers and sufficient consideration
has been received by the Partnership. Upon disposition, the related costs and
accumulated depreciation are removed from the respective accounts. Any gain or
loss is recognized in accordance with generally accepted accounting principles.
Cash equivalents are defined as all highly liquid investments purchased with a
maturity of three months or less.
Investment in joint venture represents the recording of the Partnership's
interest, under the equity method of accounting, in a joint venture with an
Affiliated partnership. The joint venture acquired a preferred majority
interest in a joint venture with the seller of the Lansing, Michigan property.
Under the equity method of accounting, the Partnership records its initial
interest at cost and adjusts its investment account for its share of joint
venture income or loss and its distribution of cash flow.
Reference is made to the Partnership's annual report for the year ended
December 31, 1993, for a description of other accounting policies and
additional details of the Partnership's financial condition, results of
operations, changes in Partners' capital and changes in cash balances for the
year then ended. The details provided in the notes thereto have not changed
except as a result of normal transactions in the interim or as disclosed
herein.
2. RELATED PARTY TRANSACTIONS:
Subsequent to October 19, 1984, the Termination of the Offering, the General
Partner is entitled to 10% of Cash Flow as its Partnership Management Fee. In
accordance with the Partnership Agreement, Net Profits (exclusive of Net
Profits from the sale or disposition of Partnership properties) are allocated
first to the General Partner in an amount equal to the greater of the General
Partner's Partnership Management Fee or 1% of such Net Profits. The balance of
Net Profits, if any, is allocated to the Limited Partners. Net Losses from the
sale or disposition of Partnership properties are allocated: first, prior to
giving effect to any distributions of Sale or Financing Proceeds, to the extent
that the balance in the General Partner's or Limited Partners' capital accounts
exceeds the amount of their Capital Investment (the "Excess Balances"), to the
General Partner and Limited Partners pro rata in proportion to such Excess
Balances until such Excess Balances are reduced to zero; second, to the General
Partner and Limited Partners (in a ratio which their respective positive
capital account balances bear to the aggregate of all positive capital account
balances) until the balance in their capital accounts shall be reduced to zero;
third, the balance, if any, 99% to the Limited Partners and 1% to the General
Partner. In all events the General Partner will be allocated at least 1% of Net
Losses from the sale or disposition of a Partnership property. In addition,
provisions for value impairment are allocated 99% to the Limited Partners and
1% to the General Partner. For the quarter and six months ended June 30, 1994,
the General Partner was entitled to cash distributions and, accordingly, was
allocated Net Profits from operations of approximately $77,800 and $141,400,
respectively. For the quarter and six months ended June 30, 1994, the General
Partner was allocated a Net Loss from the sale of a Partnership property of
$12,800.
Fees and reimbursements paid and payable by the Partnership to Affiliates
during the quarter and six months ended June 30, 1994 are as follows:
<TABLE>
<CAPTION>
Paid
Quarter Six Months Payable
- - ------------------------------------------------------------------------------
<S> <C> <C> <C>
Property management and leasing fees $ 85,100 $164,800 $ 54,200
Reimbursement of property insurance premiums, at
cost 17,400 44,600 None
Real estate commissions (a) None None 40,300
Reimbursement of expenses, at cost:
(1) Accounting 10,800 15,200 3,500
(2) Investor communication 4,800 8,300 1,800
(3) Legal 18,000 44,100 14,100
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$136,100 $277,000 $113,900
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</TABLE>
(a) As of June 30, 1994 the Partnership owed $40,300 to the General Partner for
real estate commissions earned in connection with the sales of Partnership
properties. These commissions have been accrued but not paid. Under the
terms of the Partnership Agreement, these commissions will not be paid
until the Limited Partners have received cumulative distributions of Sale
or Refinancing Proceeds equal to 100% of their Original Capital
Contribution plus a cumulative return (including all Cash Flow which has
been distributed to the Limited Partners from the initial date of
investment) of 6% simple interest per annum on their Capital Investment
from the initial date of investment.
3. SALE OF PROPERTY:
On June 8, 1994, the Partnership sold Norwest Plaza (formerly known as United
Bank of Arizona Building) for a total sale price of approximately $3,225,000.
The Partnership incurred selling expenses of approximately $218,600, including
$14,100 of accrued legal expenses. Proceeds received by the Partnership from
the sale were approximately $3,020,500. The total loss to the Partnership in
connection with this sale was approximately $1,275,000. For tax purposes the
Partnership will record a loss in 1994 of approximately $313,700 on this sale.
The above sale was on all-cash terms with no further involvement on the part of
the Partnership.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reference is made to the Partnership's annual report for the year ended
December 31, 1993 for a discussion of the Partnership's business.
OPERATIONS
The Statements of Cash Flows presented in the financial statements represent a
reconciliation of the changes in cash balances. Cash Flow, as defined in the
Partnership Agreement, is generally not equal to Partnership net income or cash
flows as determined by generally accepted accounting principles, since certain
items are treated differently under the Partnership Agreement than under
generally accepted accounting principles. Management believes that in order to
facilitate a clear understanding of the Partnership's operations, an analysis
of Cash Flow (as defined in the Partnership Agreement) should be examined in
conjunction with an analysis of net income or cash flows as defined by
generally accepted accounting principles. The amount of Cash Flow and the
return on Capital Investment are not indicative of actual distributions and
actual returns on Capital Investment.
<TABLE>
<CAPTION>
Comparative Cash Flow Results
For the Six Months
For the Quarters Ended Ended
6/30/94 6/30/93 6/30/94 6/30/93
- - -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Amount of Cash Flow (as
defined in the Partnership
Agreement) $ 904,400 $ 934,300 $ 1,970,300 $ 2,221,700
Capital Investment $84,886,000 $84,886,000 $84,886,000 $84,886,000
Annualized return on Capital
Investment (Cash Flow/Capital
Investment) 4.26% 4.40% 4.64% 5.23%
- - -------------------------------------------------------------------------------
</TABLE>
As the Partnership enters the disposition phase of its life cycle, comparisons
of Cash Flow results between periods are complicated. Partnership Cash Flow is
generally expected to change as real property interests are sold since the
Partnership no longer receives Cash Flow generated from such real property
interests. Accordingly, rental income, property operating expenses, repairs and
maintenance and real estate taxes are expected to decline, but will continue to
comprise the significant components of Cash Flow and operating results until
the final property sale. Also, during the disposition phase, cash and cash
equivalents increase as sale proceeds are received and decrease as the
Partnership utilizes such proceeds for the purposes of distributions to Limited
Partners or making improvements to the Partnership's remaining properties. Sale
Proceeds are excluded from the determination of Cash Flow.
The decreases in Cash Flow results for the quarter and six months ended June
30, 1994 of approximately $29,900 and $251,400, respectively, when compared to
the quarter and six months ended June 30, 1993 were primarily due to the sale
of the Carlsbad Building in August, 1993. The effect of this sale reduced Cash
Flow by approximately $73,000 for the six months ended June 30, 1994.
Aside from the sale of Carlsbad, additional factors which contributed to the
decrease in Cash Flow results for the six months ended June 30, 1994 were: 1)
decreased rental revenues at Foxhall Square Building ("Foxhall") and Lakewood
Square Shopping Center ("Lakewood") of approximately $62,900 and $12,200,
respectively; 2) an increase in the Partnership's share of property operating
expenses, real estate taxes and insurance and repairs and maintenance expenses
at the 12621 Featherwood Building ("Featherwood") and Norwest Plaza ("Norwest")
of approximately $146,000 and $95,000, respectively, resulting from the
expiration of the prior tenant's lease at Featherwood and the tenant at Norwest
buying out a portion of its lease in 1993, of which both leases were previously
recorded on a net basis: 3) increased real estate taxes at the Market Place at
Rivergate ("Rivergate") of approximately $29,000 due to the receipt of a refund
in 1993 for 1992 taxes; 4) increased repairs and maintenance and property
operating expenses at Rivergate of approximately $27,200 and $33,700,
respectively; 5) increased repairs and maintenance expenses at Banana River
Square Shopping Center ("Banana River") of approximately $17,800 and 6) a lower
return from the Partnership's investment in the joint venture which owns
Holiday Office Park North and South ("Holiday") due to a decrease in rental
income and an increase in repairs and maintenance. Partially offsetting the
decreases in Cash Flow results were: 1) increased interest income earned on
short-term investments due to an increase in funds available for such
investments; 2) decreased real estate taxes at Foxhall due to a decrease in the
assessed value of the property and 3) decreased property operating expenses at
Foxhall and the Ellis Building ("Ellis").
Rental revenues at Lakewood for the six months ended June 30, 1994 and 1993
were approximately $589,600 and $601,800, respectively, and for the quarters
ended June 30, 1994 and 1993 were approximately $279,900 and $274,700,
respectively. The decrease for the six months ended June 30, 1994 was primarily
due to a slight decrease in the six-month average occupancy rate from 85% in
1993 to 83% in 1994. The quarterly occupancy rate remained relatively stable at
82% during 1994 and 83% during 1993.
Rental revenues at Foxhall for the six months ended June 30, 1994 and 1993 were
approximately $775,400 and $838,300, respectively, and for the quarters ended
June 30, 1994 and 1993 were approximately $353,100 and $375,300, respectively.
This decrease was primarily due to decreased tenant expense reimbursements in
1994. The quarterly and six-month average occupancy rates at Foxhall increased
slightly from 82% during 1993 to 85% during 1994.
Rental revenues at Ellis for the six months ended June 30, 1994 and 1993 were
approximately $535,200 and $525,100, respectively, and for the quarters ended
June 30, 1994 and 1993 were approximately $257,800 and $234,700, respectively.
This increase in rental revenues was primarily due to increased tenant expense
reimbursements in 1994 resulting from an increase in expenses for which the
tenants pay the Partnership their pro-rata share. The quarterly and six-month
average occupancy rates were 94% and 91%, respectively, during 1994 and 90% and
92%, respectively, during 1993.
Rental revenues at Banana River for the six months ended June 30, 1994 and 1993
were approximately $342,300 and $333,900, respectively, and for the quarters
ended June 30, 1994 and 1993 were approximately $175,300 and $168,000,
respectively. The quarterly and six-month average occupancy rate remained
stable at 94% in 1994 and 1993.
Rental revenues at Rivergate for the six months ended June 30, 1994 and 1993
were approximately $411,000 and $325,900, respectively, and for the quarters
ended June 30, 1994 and 1993 were approximately $192,700 and $138,200
respectively. This increase in rental revenues was primarily due to an increase
in the quarterly and six-month average occupancy rates from 77% and 70%,
respectively, during 1993 to 87% and 85%, respectively, during 1994.
Rental revenues at Featherwood for the six months ended June 30, 1994 and 1993
were approximately $229,000 and $227,100, respectively, and for the quarters
ended June 30, 1994 and 1993 were approximately $114,400 and $113,600,
respectively. The property remained 100% occupied during 1993 and 1994. On July
18, 1994, the Partnership purchased a parcel of land adjacent to the
Featherwood building for approximately $8,100 to be used for an expanded
parking facility as required with the sole tenant's lease.
Rental revenues at Norwest for the six months ended June 30, 1994 and 1993 were
approximately $281,800 and $253,000, respectively, and for the quarters ended
June 30, 1994 and 1993 were approximately $129,400 and $126,500, respectively.
This increase was primarily due to an increase in tenant expense reimbursements
in 1994 due to the expiration of the tenant's master/market lease in 1993,
which was on a net basis, partially offset by a decrease in base rents due to
the sale of the property on June 8, 1994. The proceeds from this sale were
added to the Partnership's working capital.
To increase occupancy levels at the Partnership's properties, the General
Partner, through its Affiliated asset and property management groups, continues
to take the necessary actions deemed appropriate for the properties discussed
above. Some of these actions include: 1) implementation of marketing programs,
including hiring of third-party leasing agents or providing on-site leasing
personnel, advertising, direct mail campaigns and development of building
brochures; 2) early renewal of existing tenants and addressing any expansion
needs these tenants may have; 3) promotion of local broker events and
networking with local brokers; 4) networking with national level retailers; 5)
cold-calling other businesses and tenants in the market area and 6) providing
rental concessions or competitively pricing rental rates depending on market
conditions.
LIQUIDITY AND CAPITAL RESOURCES
The increase in the Partnership's cash position as of June 30, 1994 when
compared to December 31, 1993 was primarily the result of the receipt of net
Sale Proceeds on the sale of Norwest and amounts being retained from Cash Flow
to supplement working capital reserves reduced by expenditures made for capital
and tenant improvements for the Partnership's properties. Liquid assets of the
Partnership at June 30, 1994 were comprised of amounts held for working capital
purposes and undistributed Sale Proceeds.
Net cash provided by operating activities decreased $95,600 during the six
months ended June 30, 1994 when compared to the six months ended June 30, 1993.
The decrease was primarily due to the decrease in Cash Flow as discussed above
and the timing of payment of certain Partnership expenses, partially offset by
the collection of past due receivables.
Net cash (used for) provided by investing activities changed from $(265,500)
for the six months ended June 30, 1993 to $2,480,200 for the six months ended
June 30, 1994. The change was due to the receipt of $3,020,500 from the sale of
Norwest in 1994, partially offset by an increase in payments made in 1994 for
capital and tenant improvements.
On June 8, 1994, the Partnership sold Norwest for a total sale price of
approximately $3,225,000. The Partnership incurred selling expenses of
approximately $218,600, including $14,100 of accrued legal expenses. Net
proceeds received by the Partnership from the sale were approximately
$3,020,500.
During the six months ended June 30, 1994, the Partnership spent approximately
$685,600 for building and tenant improvements and has budgeted to spend an
additional $990,000 during the remainder of 1994. Of the remaining budgeted
amount, approximately $400,000 and $320,000 relates to anticipated capital and
tenant improvements and leasing costs expected to be incurred at Holiday and
Foxhall. The General Partner believes these expenditures are necessary to
maintain occupancy levels in very competitive markets and ready the remaining
properties for disposition.
Net cash used for financing activities decreased approximately $180,200 for the
six months ended June 30, 1994 when compared to the six months ended June 30,
1993. This change was primarily due to a decrease in distributions paid to
Partners in 1994 when compared to 1993.
The General Partner continues to take a conservative approach to projections of
future rental income and to maintain higher levels of cash reserves for the
Partnership. The higher levels of cash reserves are needed due to the
anticipated capital and tenant improvements necessary to be made to the
Partnership's properties during the next several years. As a result of this,
the Partnership continues to reserve amounts from Cash Flow to supplement
working capital reserves. For the quarter and six months ended June 30, 1994,
Cash Flow retained to supplement working capital reserves approximated $126,300
and $555,600, respectively.
Distributions to Limited Partners for the quarter ended June 30, 1994 were
declared at an annualized rate of 3.3% on total Capital Investment. Cash
distributions are made 60 days after the quarter-end. The amount of future
distributions to the Limited Partners will ultimately be dependent upon the
performance of the Partnership's investments as well as the amount of Cash Flow
retained for future cash requirements. Therefore, there can be no assurance of
the availability or the amount of future Cash Flow for distribution to
Partners.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K:
- - ------- ---------------------------------
(a) Exhibits: None
(b) Reports on Form 8-K:
There were no reports filed on Form 8-K during the quarter ended June
30, 1994.
<PAGE>
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.
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 2
BY: FIRST CAPITAL FINANCIAL CORPORATION
GENERAL PARTNER
Date: August 12, 1994 By: /s/ DOUGLAS CROCKER II
--------------- --------------------------------------------
DOUGLAS CROCKER II
President and Chief Executive Officer
Date: August 12, 1994 By: /s/ MICHAEL J. MCHUGH
--------------- ---------------------------------------------
MICHAEL J. MCHUGH
Senior Vice President and
Chief Financial Officer
