UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED JUNE 30, 1996
COMMISSION FILE NUMBER 0-13426
GRIFFIN REAL ESTATE FUND-IV, A LIMITED PARTNERSHIP
MINNESOTA 41-1470203
510 MARQUETTE AVENUE, SUITE 300
MINNEAPOLIS, MINNESOTA 55402
REGISTRANT'S TELEPHONE NUMBER (612) 338-2828
WATS NUMBER 800-328-3788
Indicate by check mark whether the registrant (1) has filed reports 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 filing requirements for the
past 90 days.
Yes _x_ No ___
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (229.405 of this chapter) is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-Q
or any amendment to this Form 10-Q.
[ ]
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
INDEX
PART 1. Financial Information
Condensed Balance Sheets
June 30, 1996 and December 31, 1995............................ 1
Condensed Statements of Operations
for the three months and the six months ended
June 30, 1996 and 1995......................................... 2
Condensed Statements of Cash Flows
for the six months ended
June 30, 1996 and 1995......................................... 3
Condensed Statements of Changes
in Partners' Equity for the
six months ended June 30, 1996................................. 4
Notes to Financial Statements..................................... 5
Management's Discussion and Analysis of
Financial Conditions and Results
of Operations..................................................6-7
PART II. Other Information................................................. 8
SIGNATURES .................................................................. 9
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
CONDENSED BALANCE SHEETS
(unaudited)
June 30, December 31,
1996 1995
------------ ------------
ASSETS
Cash and cash equivalents $ 374,479 $ 423,615
Receivables and other assets 902,088 872,515
------------ ------------
Total 1,276,567 1,296,130
------------ ------------
PROPERTY:
Land 1,203,093 1,203,093
Buildings and improvements 14,501,993 14,417,914
Furniture and equipment 1,003,999 1,003,999
------------ ------------
Total 16,709,085 16,625,006
Less accumulated depreciation 7,329,004 7,035,942
------------ ------------
Property - net 9,380,081 9,589,064
------------ ------------
TOTAL ASSETS $ 10,656,648 $ 10,885,194
============ ============
LIABILITIES AND PARTNERSHIP EQUITY
LIABILITIES:
Accounts payable and accrued liabilities $ 618,741 $ 678,629
Security deposits 95,265 92,795
Notes payable 7,088 40,421
Mortgage notes payable 12,315,650 12,363,382
------------ ------------
Total liabilities 13,036,744 13,175,227
------------ ------------
PARTNERS' EQUITY:
General partner (222,129) (221,228)
Limited partners (2,157,967) (2,068,805)
------------ ------------
Total partners' equity (2,380,096) (2,290,033)
------------ ------------
TOTAL LIABILITIES AND PARTNERS' EQUITY $ 10,656,648 $ 10,885,194
============ ============
See notes to condensed financial statements.
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
For the Three Months For the Six Months
Ended June 30, Ended June 30,
1996 1995 1996 1995
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES
Rental income $ 856,767 $ 847,948 $ 1,719,712 $ 1,674,444
Interest income 4,407 1,954 9,201 2,682
Other income 29,538 23,424 54,768 45,555
----------- ----------- ----------- -----------
Total revenues 890,712 873,326 1,783,681 1,722,681
----------- ----------- ----------- -----------
OPERATING EXPENSES
Operating expenses 525,660 460,205 994,788 923,795
Interest expense 282,764 284,796 566,524 570,487
Depreciation and
amortization 156,216 155,249 312,432 310,499
----------- ----------- ----------- -----------
Total operating expenses 964,640 900,250 1,873,744 1,804,781
----------- ----------- ----------- -----------
NET INCOME (LOSS) (73,928) (26,924) (90,063) (82,100)
NET INCOME (LOSS) ALLOCATED
TO GENERAL PARTNER (740) (269) (901) (821)
----------- ----------- ----------- -----------
NET INCOME (LOSS) ALLOCATED
TO LIMITED PARTNERS $ (73,188) $ (26,655) $ (89,162) $ (81,279)
=========== =========== =========== ===========
NET INCOME (LOSS) PER LIMITED
PARTNERSHIP UNIT $ (5.54) $ (2.01) $ (6.75) $ (6.15)
=========== =========== =========== ===========
(weighted average basis)
</TABLE>
See notes to condensed financial statements.
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
For the Six Months
Ended June 30,
1996 1995
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (90,063) $ (82,100)
Adjustments to reconcile net loss
to net cash provided by operating
activities:
Depreciation and amortization 312,432 310,499
Decrease (Increase) in other assets-net (48,943) 114,288
Decrease in accounts payable
and accrued liabilities (59,888) (42,597)
Increase (decrease) in security deposits 2,470 (1,910)
--------- ---------
Net cash provided by operating activities 116,008 298,180
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property (84,079) (11,112)
--------- ---------
Net cash used by investing activities (84,079) (11,112)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Reduction in notes payable (33,333) (33,333)
Reduction in mortgage payable (47,732) (46,134)
--------- ---------
Net cash used by financing activities (81,065) (79,467)
--------- ---------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (49,136) 207,601
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 423,615 97,469
--------- ---------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 374,479 $ 305,070
========= =========
CASH PAID DURING THE PERIOD FOR INTEREST $ 570,108 $ 560,459
========= =========
See notes to condensed financial statements.
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
CONDENSED STATEMENTS OF CHANGES IN PARTNERS' EQUITY
FOR THE SIX MONTHS ENDED JUNE 30, 1996
(unaudited)
GENERAL LIMITED TOTAL
PARTNER PARTNERS PARTNERSHIP
----------- ----------- -----------
PARTNERS' EQUITY (DEFICIT)
JANUARY 1, 1996 $ (221,228) $(2,068,805) $(2,290,033)
NET LOSS (901) (89,162) (90,063)
----------- ----------- -----------
PARTNERS' EQUITY (DEFICIT)
JUNE 30, 1996 $ (222,129) $(2,157,967) $(2,380,096)
=========== =========== ===========
See notes to condensed financial statements.
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1996
(unaudited)
1. Griffin Real Estate Fund-IV, A Limited Partnership (the Partnership) was
formed by Griffin Associates-IV, A Limited Partnership (the General
Partner) on March 13, 1984 under the laws of the State of Minnesota. The
limited partnership offering terminated on December 22, 1984 at which time
13,220 units had been sold at a value of $1,000 per unit.
In the opinion of management, the accompanying unaudited financial
statements contain all adjustments necessary to present fairly Griffin
Real Estate Fund-IV, A Limited Partnership's financial position as of June
30, 1996 and December 31, 1995 and the results of its operations for the
three months and six months ended June 30, 1996 and 1995 and its cash
flows for the six months ended June 30, 1996 and 1995.
The accounting policies followed by the Partnership are set forth in Note
1 to the Partnership financial statements in the 1995 Griffin Real Estate
Fund-IV, A Limited Partnership Form 10K.
2. RELATED PARTY TRANSACTIONS
The partners of Griffin Associates-IV, A Limited Partnership, the general
partner of the Partnership, are also owners, directors, and officers of
the Griffin Companies, A Minnesota corporation. The following is a summary
of fees incurred for the six months ended June 30, 1996 and 1995 relating
to the Griffin Companies and its affiliates:
1996 1995
---- ----
Management fees $ 96,563 $ 93,404
Supervisory fees $ 20,488 $ 11,394
3. TAXABLE LOSS
The net loss shown on the statement of operations is reconciled to the
taxable loss as follows:
For the Six Months
Ended June 30,
1996 1995
---- ----
Net loss per statement of operations $ 90,063 $ 82,100
Excess of tax depreciation over
book depreciation 78,807 76,633
-------- --------
Taxable loss $168,870 $158,733
======== ========
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1996, the Partnership had cash and cash equivalents of $374,479
which will be used for working capital requirements of the Partnership and its
properties. It is anticipated that the Partnership will be able to meet current
obligations and commitments from cash on hand and from cash generated from
operations during 1996.
Distributions to partners were not made during the first half of 1996. Future
cash distributions will depend on future property operations.
RESULTS OF OPERATIONS
The General Partner, after reasonable inquiry, is not aware of any material
factors relating to any of the Partnership's properties or the operations of the
Partnership that would cause the financial information of the Partnership not to
be indicative of future operating results or of future financial conditions.
Net rental income of the properties was $856,767 and $847,948 and for the second
quarter of 1996 and 1995 respectively. This is an increase of $8,819 or 1%.
Operating expenses were $525,660 and $460,205 for the second quarter of 1996 and
1995 respectively. This is an increase in operating expenses of $65,455
attributable primarily to increases in replacement of carpet and appliances. The
combination of increased revenue and a greater increase in expenses resulted in
a loss from operations of $73,928 for the second quarter of 1996 as compared to
a net loss of $26,924 for the second quarter of 1995. Overall, operations of the
Partnership and its properties resulted in negative cash flow for the second
quarter of $49,136 compared to a positive cash flow of $207,601 during the
second quarter of 1995.
Ravenwood Apartments is currently being marketed for sale. A contract for the
sale of the property was executed on July 1, 1996. The agreement for the sale is
contingent upon the satisfactory inspection and acceptance of the property at
the sole discretion of the buyer.
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
OCCUPANCY TABLE
Approximate occupancy levels of the Partnership's investment property by
quarter.
<TABLE>
<CAPTION>
1995 1996
at at
------------------------------- ------------------------------
3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1. Presidential
Estates Apts.
Indianapolis, IN 89% 95% 93% 90% 92% 88%
2. Brooklane Apts.
Brown Deer, WI 95% 99% 98% 96% 92% 98%
3. Ravenwood Apts.
Cincinnati, OH 86% 91% 91% 86% 87% 87%
</TABLE>
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
On September 20, 1995 Everest Investors, LLC ("Everest")
filed a lawsuit in Hennepin County Minnesota's Fourth Judicial
District Court against Griffin Associates IV ("General Partner"),
the general partner of Griffin Real Estate Fund-IV, A Limited
Partnership ("Partnership"). The lawsuit alleged that the General
Partner had wrongfully denied Everest access to the books and
records of the Partnership. The court granted, in part, Everest's
request for access to the books and records and ordered the
General Partner to provide Everest access to these records. The
General Partner complied with this court order. Everest continued
to seek access to additional books and records of the Partnership
beyond the scope of the court order. The General Partner
vigorously defended the Partnership's right to keep its
proprietary records from being reviewed by Everest, who has not
been admitted as a limited partner of the Partnership despite
having been assigned a financial interest in 649 units by some
original limited partners. The General Partner filed for a
dismissal of the matter. The court heard arguments on September
29, 1995, October 26, 1995 and November 17, 1995. On November 27,
1995 the court dismissed Everest's lawsuit. Everest appealed the
dismissal in the Minnesota Court of Appeals on March 12, 1996.
Briefs were filed and oral arguments were heard by the court on
July 1, 1996. A decision is pending.
Also, as of June 30, 1996, an individual was pursuing a legal
action against the Partnership for injuries sustained in a fall.
The individual is attempting to recover monetary damages and to
receive reimbursement for medical costs. Any judgement against the
Partnership would be covered by insurance.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule
(b) No reports on Form 8-K have been filed during the quarter
for which this report is filed.
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.
GRIFFIN REAL ESTATE FUND-IV,
A LIMITED PARTNERSHIP
Date: August 15, 1996 By /s/ Larry D. Fransen
--------------------
Larry D. Fransen, for the
General Partner, Griffin
Associates-IV, A Limited
Partnership
Date: August 15, 1996 By /s/ Larry D. Fransen
--------------------
Larry D. Fransen, for the
General Partner, Griffin
Associates-IV, A Limited
Partnership
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 374,479
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 902,088
<PP&E> 16,709,085
<DEPRECIATION> 7,329,004
<TOTAL-ASSETS> 10,656,648
<CURRENT-LIABILITIES> 721,094
<BONDS> 12,315,650
0
0
<COMMON> 0
<OTHER-SE> (2,380,096)<F1>
<TOTAL-LIABILITY-AND-EQUITY> 10,656,648
<SALES> 0
<TOTAL-REVENUES> 1,774,480
<CGS> 0
<TOTAL-COSTS> 1,307,220
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 557,323
<INCOME-PRETAX> (90,063)
<INCOME-TAX> 0
<INCOME-CONTINUING> (90,063)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (90,063)
<EPS-PRIMARY> (6.75)<F2>
<EPS-DILUTED> 0
<FN>
<F1>This entity is a limited partnership. The Other Stockholders Equity line
represents total Partnership equity.
<F2>The EPS-Primary line represents net loss per limited partnership unit.
</FN>
</TABLE>
