<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
Commission file number 0-14438
INTEGRATED RESOURCES HIGH EQUITY PARTNERS, SERIES 85
A CALIFORNIA LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
CALIFORNIA 13-3239107
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5 Cambridge Center, 9th Floor, Cambridge, MA 02142
(Address of principal executive offices)
(617) 234-3000
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year, if changed
since last report)
Indicate by check 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>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
INDEX
Page
----
Part I. Financial Information
Item 1. Financial Statements:
Balance Sheets - March 31, 2000 and December 31, 1999............ 1
Statements of Operations - Three Months Ended
March 31, 2000 and 1999........................................ 2
Statement of Partners' Equity - Three Months Ended
March 31, 2000.............................................. 3
Statements of Cash Flows - Three Months Ended
March 31, 2000 and 1999....................................... 4
Notes to Financial Statements.................................... 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations......................... 11
Item 3. Quantitative and Qualitative Disclosure about
Market Risk................................................. 12
Part II. Other Information:
Exhibits and Reports on Form 8-K................................. 13
Signatures.......................................................... 14
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
BALANCE SHEETS
March 31, 2000 December 31, 1999
-------------- -----------------
ASSETS
Real estate - net $32,107,480 $32,352,714
Cash and cash equivalents 10,095,309 8,521,370
Other assets 2,993,796 3,095,251
Receivables - net 202,327 209,418
----------- -----------
$45,398,912 $44,178,753
=========== ===========
LIABILITIES AND PARTNERS' EQUITY
Accounts payable and accrued expenses $ 1,075,726 $ 1,224,373
Due to affiliates 221,216 107,255
----------- -----------
1,296,942 1,331,628
----------- -----------
Commitments and contingencies (Note 6 and 7)
PARTNERS' EQUITY:
Limited partners' equity (400,010 units
issued and outstanding) 41,895,922 40,703,819
General partners' equity 2,206,048 2,143,306
----------- -----------
44,101,970 42,847,125
----------- -----------
$45,398,912 $44,178,753
=========== ===========
See notes to financial statements.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
STATEMENTS OF OPERATIONS
For the Three Months Ended
March 31,
---------------------------
2000 1999
---- ----
Rental Revenue $2,882,227 $2,868,073
---------- ----------
Costs and Expenses:
Operating expenses 828,003 833,350
Depreciation and amortization 345,488 336,096
Partnership management fee 172,519 211,409
Administrative expenses 288,284 703,310
Property management fee 87,744 85,505
---------- ----------
1,722,038 2,169,670
---------- ----------
Income before interest and other income 1,160,189 698,403
Interest income 94,656 61,294
Other income - 82,290
---------- ----------
Net income $1,254,845 $ 841,987
========== ==========
Net income attributable to:
Limited partners $1,192,103 $ 799,888
General partners 62,742 42,099
---------- ----------
Net income $1,254,845 $ 841,987
========== ==========
Net income per unit of limited partnership interest
(400,010 units outstanding) $ 2.98 $ 2.00
========== ==========
See notes to financial statements.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
STATEMENT OF PARTNERS' EQUITY
General Limited
Partners' Partners'
Equity Equity Total
------ ------ -----
Balance, January 1, 2000 $ 2,143,306 $ 40,703,819 $ 42,847,125
Net income for the three months
ended March 31, 2000 62,742 1,192,103 1,254,845
----------- ------------ ------------
Balance, March 31, 2000 $ 2,206,048 $ 41,895,922 $ 44,101,970
=========== ============ ============
See notes to financial statements.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
STATEMENTS OF CASH FLOWS
For the Three Months
Ended March 31,
------------------------
2000 1999
---- ----
Cash Flows From Operating Activities:
Net income $ 1,254,845 $ 841,987
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 345,488 336,096
Straight-line adjustment for stepped
lease rentals 10,837 8,519
Changes in assets and liabilities:
Accounts payable and accrued expenses (148,647) 798,234
Receivables 7,091 19,120
Due to affiliates 113,961 (96,438)
Other assets 27,734 (146,801)
------------ ------------
Net cash provided by operating activities 1,611,309 1,760,717
------------ ------------
Cash Flows From Investing Activities:
Improvements to real estate
(37,370) (95,480)
------------- ------------
Cash Flows From Financing Activities:
Distributions to partners - (395,799)
------------ ------------
Increase In Cash And Cash Equivalents 1,573,939 1,269,438
Cash And Cash Equivalents, Beginning of Year 8,521,370 6,301,641
------------ ------------
Cash And Cash Equivalents, End of Quarter $ 10,095,309 $ 7,571,079
============ ============
See notes to financial statements.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
l. GENERAL
The accompanying financial statements, notes and discussions should be
read in conjunction with the financial statements, related notes and
discussions contained in the Partnership's Annual Report on Form 10-K for
the year ended December 31, 1999.
The financial information contained herein is unaudited; however, in the
opinion of management, all adjustments (consisting only of normal
recurring adjustments) necessary for a fair presentation of such financial
information have been included. Results of operations for the three months
ended March 31, 2000 are not necessarily indicative of the results to be
expected for the entire year.
2. SIGNIFICANT ACCOUNTING POLICIES
Investment in Joint Ventures
Certain properties were purchased in joint venture ownership with
affiliated partnerships that have the same, or affiliated, general
partners as the Partnership. The Partnership owns an undivided interest
and is severally liable for indebtedness it incurs in connection with its
ownership interest in those properties. Therefore, the Partnership's
financial statements present the assets, liabilities, revenues and
expenses of the joint ventures on a pro rata basis in accordance with the
Partnership's percentage of ownership.
Real Estate
The Partnership evaluates the recoverability of the net carrying value of
its real estate and related assets at least annually, and more often if
circumstances dictate. If this review indicates that the carrying value of
the property may not be recoverable, the Partnership prepares estimates of
the future undiscounted cash flows expected to result from the use of the
property and its eventual disposition, generally over a five-year holding
period. In performing this review, management takes into account, among
other things, the existing occupancy, the expected leasing prospects of
the property and the economic situation in the region where the property
is located.
If the sum of the expected future cash flows, undiscounted, is less than
the carrying amount of the property, the Partnership recognizes an
impairment loss, and reduces the carrying amount of the asset to its
estimated fair value. Fair value is the amount at which the asset could be
bought or sold in a current transaction between willing parties, that is,
other than in a forced or liquidation sale. Management estimates fair
value using discounted cash flows or market comparables, as most
appropriate for each property. Independent certified appraisers are
utilized to assist management, when warranted.
Impairment write-downs recorded by the Partnership do not affect the tax
basis of the assets and are not included in the determination of taxable
income or loss.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
2. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Because the expected cash flows used to evaluate the recoverability of the
assets and their fair values are based upon projections of future economic
events, such as property occupancy rates, rental rates, operating cost
inflation and market capitalization rates, the amounts ultimately realized
at disposition may differ materially from the net carrying values at the
balance sheet dates. The cash flows and market comparables used in this
process are based on good faith estimates and assumptions developed by
management. Unanticipated events and circumstances may occur and some
assumptions may not materialize; therefore, actual results may materially
vary from the estimates and the variances may be material. The Partnership
may in the future provide additional write-downs, which could be material,
if real estate markets or local economic conditions change.
3. RELATED PARTY TRANSACTIONS
The Managing General Partner of the Partnership, Resources High Equity,
Inc. is a wholly-owned subsidiary of Presidio Capital Corp., ("Presidio").
Presidio AGP Corp., which is a wholly-owned subsidiary of Presidio is the
Associate General Partner (together with the Managing General Partner, the
"General Partners"). The General Partners and affiliates of the General
Partners are also engaged in businesses related to the acquisition and
operation of real estate. Presidio is also the parent of other
corporations (and affiliated with other entities) that are or may in the
future be engaged in businesses that may be in competition with the
Partnership. Accordingly, conflicts of interest may arise between the
Partnership and such other businesses. Subject to the right of the limited
partners under the Limited Partnership Agreement, Presidio controls the
Partnership through its indirect ownership of the General Partners.
Effective July 31, 1998, Presidio is indirectly controlled by NorthStar
Capital Investment Corp., a Maryland corporation.
From August 28, 1997 to October 21, 1999, Presidio was party to a
management agreement with NorthStar Presidio Management Company LLC
("NorthStar Presidio"), an affiliate of NorthStar Capital Investment
Corp., pursuant to which NorthStar Presidio provided the day-to-day
management of Presidio and its direct and indirect subsidiaries and
affiliates, including the Partnership. Effective October 21, 1999,
Presidio entered into a Services Agreement with AP-PCC III, L.P. (the
"Agent") pursuant to which the Agent was retained to provide Asset
Management and Investor Relation Services to the Partnership and other
entities affiliated with the Partnership.
The Partnership has a property management services agreement with
Resources Supervisory Management Corp. ("Resources Supervisory"), an
affiliate of the General Partners, to perform certain functions relating
to the management of the properties of the Partnership. A portion of the
property management fees were paid to unaffiliated management companies
which are engaged for the purpose of performing the management functions
for certain properties.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
3. RELATED PARTY TRANSACTIONS (CONTINUED)
For the quarters ended March 31, 2000 and 1999, Resources Supervisory was
entitled to receive $87,744 and $85,505 respectively, of which 76,548 and
$68,412 was paid to unaffiliated management companies, respectively, for
property management services and the balance was retained by Resources
Supervisory.
For the administration of the Partnership, the Managing General Partner is
entitled to receive reimbursement of expenses up to a maximum of $150,000
per year. For each of the quarters ended March 31, 2000 and 1999, the
Managing General Partner received $37,500.
For managing the affairs of the Partnership, the Managing General Partner
is also entitled to receive an annual partnership management fee. Pursuant
to the amendment to the Partnership Agreement, which became effective on
August 20, 1999, the annual partnership management fee for 1999 was
reduced to $418,769. Further, the Partnership Agreement was amended (for
the year 2000 and beyond) so that the partnership management fee will be
1.25% of the Gross Asset Value of the Partnership, defined as the
appraised value of all the assets of the Partnership based on the most
recent appraisal. For the quarters ended March 31, 2000 and 1999 the
Managing General Partner earned $172,519 and $211,409, respectively.
The General Partners are allocated 5% of the net income of the
Partnership, which amounted to $62,742 and $42,099 for the quarters ended
March 31, 2000 and 1999, respectively. They are also entitled to receive
5% of distributions, which amounted to $19,790 for the quarter ended March
31, 1999.
During the liquidation stage of the Partnership, the Managing General
Partner or an affiliate may be entitled to receive certain fees, which are
subordinated to the limited partners receiving their original invested
capital and certain specified minimum returns on their investment. All
fees received by the General Partners are subject to certain limitations
as set forth in the Partnership Agreement.
From July 1996 through March 12, 1998, Millennium Funding II Corp., a
wholly owned indirect subsidiary of Presidio, purchased 39,123 units of
the Partnership from various limited partners.
In connection with a tender offer for units of the Partnership made on
March 12, 1998 (the "Offer") by Olympia Investors, L.P. ("Olympia"),
Olympia and Presidio entered into an agreement dated March 6, 1998 (the
"Agreement"). Subsequent to the expiration of the offer, Olympia announced
that it had accepted for payment 31,132 units properly tendered pursuant
to the Offer. Pursuant to the Agreement, Presidio purchased 50% of those
units owned by Olympia as a result of the Offer, or 15,566 units, for
$101.81 per unit. In addition, Olympia has the right to cause Presidio to
purchase its remaining units for a price based on procedures set forth in
the agreement. Olympia purported to exercise this right subsequent to
quarter end.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
3. RELATED PARTY TRANSACTIONS (CONTINUED)
Subsequent to the expiration of the tender offer described above,
Millennium Funding II Corp. purchased an additional 18,042 limited
partnership units from August 1998 through July 1999. The total number of
units purchased by Millennium Funding II Corp. represents approximately
18.2% of the outstanding limited partnership units of the Partnership.
Pursuant to the settlement of a class action lawsuit (See Note 7), an
affiliate of the General Partners, Millennium Funding II, LLC, made a
tender offer to limited partners to acquire up to 26,936 Units
(representing approximately 6.7% of the outstanding Units) at a price of
$114.60 per Unit. The offer closed in January 2000 and all 26,936 Units
were acquired in the offer. As a result of these purchases as well as the
other purchases of Units by affiliates of the General Partners, affiliates
of the General Partners own 118,903 Units representing approximately
29.725% of the total outstanding Units.
4. REAL ESTATE
The following table is a summary of the Partnership's real estate as of:
March 31, 2000 December 31, 1999
-------------- -----------------
Land $ 10,370,965 $ 10,370,965
Building and improvements 37,753,448 37,716,078
------------ ------------
48,124,413 48,087,043
Less: Accumulated depreciation (16,016,933) (15,734,329)
------------ ------------
$ 32,107,480 $ 32,352,714
============ ============
5. DUE TO AFFILIATES
March 31, 2000 December 31, 1999
-------------- -----------------
Partnership management fee $ 172,519 $ -
Property management fee 11,197 32,255
Non-accountable expense 37,500 75,000
--------- ---------
$ 221,216 $ 107,255
========= =========
Such amounts were paid in the subsequent quarters.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
6. COMMITMENTS AND CONTINGENCIES
a) 568 Broadway Joint Venture is currently involved in litigation with a
number of present or former tenants who are in default on their lease
obligations. Several of these tenants have asserted claims or counter
claims seeking monetary damages. The plaintiffs' allegations include
but are not limited to claims for breach of contract, failure to
provide certain services, overcharging of expenses and loss of profits
and income. These suits seek total damages in excess of $20 million
plus additional damages of an indeterminable amount. The Broadway
Joint Venture's action for rent against Solo Press was tried in 1992
and resulted in a judgement in favor of the Broadway Joint Venture for
rent owed. The Partnership believes this will result in dismissal of
the action brought by Solo Press against the Broadway Joint Venture.
Since the facts of the other actions which involve material claims or
counterclaims are substantially similar, the Partnership believes that
the Broadway Joint Venture will prevail in those actions as well.
b) A former retail tenant of 568 Broadway (Galix Shops, Inc.) and a
related corporation which is a retail tenant of a building adjacent to
568 Broadway filed a lawsuit in the Supreme Court of The State of New
York, County of New York, against the Broadway Joint Venture which
owns 568 Broadway. The action was filed on April 13, 1994. The
Plaintiffs allege that by erecting a sidewalk shed in 1991, 568
Broadway deprived plaintiffs of light, air and visibility to their
customers. The sidewalk shed was erected, as required by local law, in
connection with the inspection and restoration of the Broadway
building facade, which is also required by local law. Plaintiffs
further allege that the erection of the sidewalk shed for a continuous
period of over two years is unreasonable and unjustified and that such
conduct by defendants has deprived plaintiffs of the use and enjoyment
of their property. The suit seeks a judgement requiring removal of the
sidewalk shed (since removed), compensatory damages of $20 million,
and punitive damages of $10 million. The Partnership believes that
this suit is without merit and intends to vigorously defend it.
7. SETTLEMENT OF LAWSUIT
In April 1999, the California Superior Court approved the terms of the
settlement of a class action and derivative litigation involving the
Partnership. Under the terms of the settlement, the General Partners agreed
to take the actions described below subject to first obtaining the consent
of limited partners to amendments to the Agreement of Limited Partnership of
the Partnership summarized below. The settlement became effective in August
1999 following approval of the amendments.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
7. SETTLEMENT OF LAWSUIT (CONTINUED)
As amended, the Partnership Agreement (a) provides for a Partnership
Management Fee equal to 1.25% of the Gross Asset Value of the Partnership
and a fixed 1999 Partnership Management Fee of $418,769 or $426,867 less
than the amount that would have been paid for 1999 under the prior formula
and (b) fixes the amount that the General Partners will be liable to pay
to limited partners upon liquidation of the Partnership as repayment of
fees previously received (the "Fee Give-Back Amount"). As of December 31,
1999, the Fee Give-Back Amount was $8.80 per Unit which amount will be
reduced by approximately $.98 per Unit for each full calendar year after
1999 in which a liquidation does not occur. As amended, the Partnership
Agreement provides that, upon a reorganization of the Partnership into a
real estate investment trust or other public entity, the General Partners
will have no further liability to pay the Fee Give-Back Amount. In
accordance with the terms of the settlement, Presidio Capital Corp., an
affiliate of the General Partners, guaranteed payment of the Fee Give-Back
Amount.
As required by the settlement, an affiliate of the General Partners,
Millennium Funding II, LLC, made a tender offer to limited partners to
acquire up to 26,936 Units (representing approximately 6.7% of the
outstanding Units) at a price of $114.60 per Unit. The offer closed in
January 2000 and all 26,936 Units were acquired in the offer.
The final requirement of the settlement obligated the General Partners to
use their best efforts to reorganize the Partnership into a real estate
investment trust or other entity whose shares were listed on a national
securities exchange or on the NASDAQ National Market System. A
Registration Statement was filed with the Securities and Exchange
Commission on February 11, 2000 with respect to the restructuring of the
Partnership into a publicly-traded real estate investment trust. The
Registration Statement has not yet become effective and the consent of a
majority of limited partners will be needed to effect the restructuring.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
NOTES TO FINANCIAL STATEMENTS
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS
OF OPERATIONS
The matters discussed in this form 10-Q contain certain forward-looking
statements and involve risks and uncertainties (including changing
market conditions, competitive and regulatory matters, etc.) detailed in
the disclosures contained in this Form 10-Q and the other filings with
the Securities and Exchange Commission made by the Partnership from time
to time. The discussion of the Partnership's liquidity, capital
resources and results of operations, including forward-looking
statements pertaining to such matters, does not take into account the
effects of any changes to the Partnership's operations. Accordingly,
actual results could differ materially from those projected in the
forward-looking statements as a result of a number of factors, including
those identified herein.
This item should be read in conjunction with the financial statements
and other items contained elsewhere in the report.
Liquidity and Capital Resources
The Partnership had $10,095,309 in cash and cash equivalents at March
31, 2000. Cash and cash equivalents are temporarily invested in
short-term instruments and, together with cash flow from operations, are
expected to be sufficient to fund future capital improvements to the
Partnership's properties.
The Partnership's level of liquidity based upon cash and cash
equivalents increased by $1,573,939 for the three months ended March 31,
2000 as compared to December 31, 1999. The increase is due to $1,611,309
of cash provided by operating activities which was partially offset by
$37,370 of cash used in investing activities for capital expenditures.
The Partnership's primary source of funds is cash flow from the
operation of its properties, principally rents received from the tenants
less property operating expenses.
The Partnership expects to continue to utilize a portion of its cash
flow from operations to pay for various capital and tenant improvements
to the properties and leasing commissions. Capital and tenant
improvements and leasing commissions may in the future exceed the
Partnership's cash flow from operations. In that event, the Partnership
would utilize its remaining working capital reserves, reduce
distributions, or sell one or more properties. Except as discussed
above, management is not aware of any other trends, events, commitments
or uncertainties that will have a significant impact on liquidity.
As discussed in "Item 1. Financial Statements-Note 7", the Partnership
entered into a settlement agreement relating to a class action lawsuit.
In light of the current implementation of the settlement and the filing
of the Registration Statement pursuant to which the General Partners are
using their best efforts to reorganize the Partnership into a real
estate investment trust, the General Partners have suspended any
distributions until such reorganization is either approved or
disapproved.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS
OF OPERATIONS (CONTINUED)
Results of Operations
The Partnership experienced an increase in net income of $412,858 for
the three months ended March 31, 2000 as compared to the same period in
the prior year.
The increase was due to a decrease in costs and expenses of $447,632 and
an increase in rental revenues of $14,154 which were partially offset by
a decrease in interest and other income of $48,928 during the three
months ended March 31, 2000 compared to the three months ended March 31,
1999.
Rental revenues increased during the three months ended March 31, 2000
compared to 1999 at Southport and Seattle Tower due to higher overall
rental rates at the properties.
Costs and expenses decreased by $447,632 during the three months ended
March 31, 2000 compared to the same period in 1999, primarily due to an
decrease in administrative expenses of $415,026 as legal fees related to
the class action litigation were incurred in 1999 with no similar
charges in 2000. In addition the Partnership management fees paid during
the first quarter of 2000 decreased by $38,890 as compared to the first
quarter of 1999. See, Item 1. Financial Statements, Note 3. Property
operating expenses and property management fees remained relatively
stable. The Partnership experienced higher depreciation expense due to
real estate improvements in 1999.
Interest income increased during the three months ended March 31, 2000
due to higher cash balances during the first three months of 2000 as
compared to the comparable period in 1999. Other income decreased during
the three ended March 31, 2000 as compared to the same period in due to
decreased investor transfer fee.
Inflation is not expected to have a material impact on the Partnership's
operations or financial position.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Partnership is not subject to market risk as its cash and cash
equivalents are invested in short term money market mutual funds. The
Partnership has no loans outstanding.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
Part II. Other Information
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits: There were no exhibits filed.
27. Financial data schedule is filed as an Exhibit to this report
(a) Reports on Form 8-K:
No report of Form 8-K was filed during the period.
<PAGE>
INTEGRATED RESOURCES HIGH EQUITY PARTNERS - SERIES 85
FORM 10-Q - MARCH 31, 2000
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.
Integrated Resources High Equity Partners,
Series 85, A California Limited Partnership
By: Resources High Equity, Inc.,
Managing General Partner
Dated: May 12, 2000 By: /S/ Michael L. Ashner
---------------------
Michael L. Ashner
President and Director
(Principal Executive Officer)
Dated: May 12, 2000 By: /S/ Carolyn B. Tiffany
----------------------
Carolyn B. Tiffany
Vice President and Treasurer
(Principal Financial and
Accounting Officer)
<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, 2000 and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<EXCHANGE-RATE> 1
<CASH> 10,095,309
<SECURITIES> 0
<RECEIVABLES> 428,827
<ALLOWANCES> (226,500)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 48,101,970
<DEPRECIATION> (16,016,933)
<TOTAL-ASSETS> 45,398,912
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 44,101,970
<TOTAL-LIABILITY-AND-EQUITY> 45,398,912
<SALES> 0
<TOTAL-REVENUES> 2,882,227
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,433,754
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,254,845
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,254,845
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,254,845
<EPS-BASIC> 2.98
<EPS-DILUTED> 2.98
</TABLE>
