FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For Quarter Ended March 31, 1997
Commission File Number: 0-13559
LDP-III
(Exact name of registrant as specified in its governing instruments)
California 94-2911983
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
P. O. Box 130, Carbondale, Colorado 81623
(Address of principal executive offices)
(970) 963-8007
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 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 [ ]
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
LDP-III
CONSOLIDATED BALANCE SHEET, MARCH 31, 1997 AND DECEMBER 31, 1996
(Unaudited) (Dollars in thousands)
<CAPTION>
March 31, December 31,
1997 1996
<S> <C> <C>
INVESTMENTS IN REAL ESTATE:
Rental properties $10,524 $10,510
Accumulated depreciation (4,153) (4,086)
Rental properties - net 6,371 6,424
CASH AND CASH EQUIVALENTS
(including interest bearing deposits
of $95 in 1997 and $85 in 1996) 95 85
OTHER ASSETS:
Short-term investment 199 298
Accounts receivable 19 17
Prepaid expenses and deposits 4 4
Deferred organization costs, loan costs
and leasing commissions (net of accumulated
amortization of $483 in 1997 and $474 in 1996) 116 126
Total other assets 338 445
TOTAL $ 6,804 $ 6,954
LIABILITIES AND PARTNERS' EQUITY LIABILITIES:
Notes payable $ 6,879 $ 6,891
Accounts payable 36 0
Other liabilities 51 133
Total liabilities 6,966 7,024
PARTNERS' EQUITY (162) (70)
TOTAL $ 6,804 $ 6,954
See Financial Notes.
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<TABLE>
LDP-III
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(Unaudited) (In thousands except per share amounts)
<CAPTION>
1997 1996
<S> <C> <C>
REVENUE:
Rental $ 269 $ 346
Interest 6 5
Total revenue 275 351
EXPENSE:
Interest 151 170
Operating 93 119
Depreciation and amortization 78 114
General and administrative 45 40
Total expense 367 443
NET INCOME (LOSS) $ (92) $ (92)
NET INCOME (LOSS) PER PARTNERSHIP UNIT
Limited Partners (2) (2)
General Partners 0 0
(2) (2)
See Financial Notes.
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<TABLE>
LDP-III
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND
THE YEAR ENDED DECEMBER 31, 1996
(Unaudited) (Dollars in thousands)
<CAPTION>
..LIMITED PARTNERS..
NUMBER OF GENERAL TOTAL
PARTNERSHIP PARTNER PARTNERS'
UNITS AMOUNT AMOUNT EQUITY
<S> <C> <C> <C> <C>
BALANCE, JANUARY 1, 1996 37,136 $ 679 $ 0 $ 679
Net loss - 1996 (193) (193)
Distribution - 1996 (556) (556)
BALANCE, DECEMBER 31, 1996 37,136 (70) 0 (70)
Net loss (92) (92)
BALANCE, MARCH 31, 1997 37,136 $(162) $ 0 $ (162)
See Financial Notes.
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<TABLE>
LDP-III
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(Unaudited) (In thousands)
<CAPTION>
1997 1996
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (92) $ (92)
Adjustments to reconcile net income (loss)
to net cash used in operating activities:
Depreciation 67 96
Change in operating assets and liabilities:
Increase in accounts receivable (2) (59)
Increase in prepaid expenses and deposits 0 (16)
Increase in accounts payable 36 1
Decrease in other liabilities (82) (3)
Net cash used in operating activities (73) (73)
CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease in short term investments 99 0
Capital expenditures and construction (14) 0
Decrease in deferred expenses 10 13
Net cash provided by investing activities 95 13
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on notes payable (12) (14)
Net cash used in financing activities (12) (14)
Increase (decrease) in cash and cash equivalents 10 (74)
Cash and cash equivalents at beginning of period 85 410
Cash and cash equivalents at end of period $ 95 $ 336
See Financial Notes.
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LDP-III
FINANCIAL NOTES
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying unaudited consolidated financial statements should be
read in conjunction with the Partnership's 1996 Annual Report. These
consolidated statements have been prepared in accordance with the
instructions to the Securities and Exchange Commission Form 10-Q and do
not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
In the opinion of the general partner, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair presentation
have been included. The consolidated results of operations for the
three months ended March 31, 1997 and 1996, are not necessarily
indicative of the results that may be expected for the year ending
December 31, 1997.
For purposes of the consolidated statement of cash flows, the
Partnership considers all highly liquid investments with a maturity of
three months or less from the date of purchase to be cash equivalents.
The Partnership paid interest of $151,000 and $170,000 for the three
months ended March 31, 1997 and 1996, respectively.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
INTRODUCTION
LDP-III is a California limited partnership formed in August 1983. The
Partnership's business consists of a single segment -- equity
investments in leveraged income-producing real estate.
The Partnership's current portfolio consists of fee title ownership of
two properties located in two geographic areas. The Partnership's
property investments are: Jefferson Place Office Building, Boise,
Idaho, and 1201 Cadillac Court Building, Milpitas, California.
LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 1997, the Partnership's consolidated cash balance
totaled $95,000. Cash not required for current operations is placed in
federally insured financial instruments and money market funds which can
be liquidated as needed.
The Partnership has invested $198,000 in short-term federally insured
certificates of deposit which mature on a date in excess of 90 days or 3
months from the date of purchase. Due to this characteristic, these
deposits are classified as "short-term investments" rather than as "cash
and cash equivalents."
During the first quarter of 1997, the Partnership experienced a net
increase in cash of $10,000. Short-term investments decreased $99,000
during the first quarter of 1997. As of March 31, 1997, cash plus
short-term investments totaled $294,000 versus a balance of $383,000 at
December 31, 1996.
Management believes the cash flow from operations of the remaining two
properties, Jefferson Place and 1201 Cadillac, will be sufficient to
cover the operating costs of the Partnership. The Partnership has
successfully negotiated a new lease with the sole tenant at 1201
Cadillac, which will significantly increase revenues for 1997.
Short term investments (cash reserve) of $198,000 should remain in tact
for the balance of 1997.
The Partnership does not plan any cash distributions to its limited
partners in 1997. All sale and loan proceeds realized by the
Partnership will be used primarily to make cash distributions.
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RESULTS OF OPERATIONS
The following represents the operations of those properties held
continuously during the first three months of 1997 and 1996:
<CAPTION>
1997 1996 % Change
<S> <C> <C> <C>
Rental Revenue $ 268 $ 262 + 2%
Operating Expense 93 110 - 15%
Net Operating Income 175 152 + 15%
Interest Expense 151 152 0%
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Overall, revenues increased for the three months ended March 31, 1997
relative to the same period in 1996. The increase in commercial
properties was due to higher occupancy and normal increases in current
lease amounts due.
The Jefferson Place Office Building is currently 94% occupied, while the
1201 Cadillac Court Building is 100% occupied.
Property operating expenses decreased 15% for the three months ended
March 31, 1997 relative to the same period in 1996.
The Partnership general and administrative expense increased $5,000 in
1997 relative to the same period in 1996. The General Partner continues
to exercise general and administrative expense control.
INFLATION
The Partnership's rental revenues in certain overbuilt real estate
markets, including Boise and the San Francisco Bay Area, have not
followed the overall inflationary trends of the economy. In the future,
the General Partner believes market rate rents in those areas will more
closely follow or exceed inflation. Operating costs for properties in
most of the Partnership's markets have continued to follow inflationary
trends. It is not expected that the Partnership will be materially
impacted by inflationary forces in the near term.
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PART II. OTHER INFORMATION
All items in Part II have been omitted since they are inapplicable or
the answer is negative.
<PAGE>
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.
LDP-III
Date: May 12, 1997 /s/ Gary K. Barr
Gary K. Barr, President
Landsing Equities Corporation
Managing Partner of the General Partner
Landsing Partners-III
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<ARTICLE> 5
<MULTIPLIER> 1000
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 95
<SECURITIES> 0
<RECEIVABLES> 19
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 319
<PP&E> 10,524
<DEPRECIATION> (4,153)
<TOTAL-ASSETS> 6,804
<CURRENT-LIABILITIES> 87
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> (162)
<TOTAL-LIABILITY-AND-EQUITY> 6,804
<SALES> 0
<TOTAL-REVENUES> 275
<CGS> 0
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<OTHER-EXPENSES> 216
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 151
<INCOME-PRETAX> 0
<INCOME-TAX> 0
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<DISCONTINUED> 0
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<NET-INCOME> (92)
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</TABLE>
