UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
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 0-15748
CONNECTICUT GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP
(Exact name of registrant as specified in its charter)
Connecticut 06-1094176
(State of Organization) (I.R.S. Employer Identification
No.)
900 Cottage Grove Road, South Building
Bloomfield, Connecticut 06002
(Address of principal executive offices)
Telephone Number: (203) 726-6000
Indicate by checkmark 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>
Part I - Financial Information
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CONNECTICUT GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP
(a Connecticut limited partnership)
Balance Sheets
<S> <C> <C>
June 30, December 31,
1995 1994
Assets (Unaudited) (Audited)
Property and improvements, at cost:
Land and improvements $ 2,841,633 $ 2,810,237
Buildings 12,641,248 13,002,842
Tenant improvements 3,010,302 2,879,677
18,493,183 18,692,756
Less accumulated depreciation 6,936,414 6,686,953
Net property and improvements 11,556,769 12,005,803
Equity investment in unconsolidated joint venture 2,605,556 3,043,024
Cash and cash equivalents 1,755,021 368,015
Accounts receivable (net of allowance of $4,919
in 1995 and $1,684 in 1994) 44,198 97,349
Prepaid expenses and other assets 76,306 76,872
Deferred charges, net 210,352 295,340
Total $ 16,248,202 $ 15,886,403
Liabilities and Partners' Capital (Deficit)
Liabilities:
Accounts payable (including $78,184 in 1995
and $9,324 in 1994 due to affiliates) $ 339,211 $ 220,449
Tenant security deposits 106,854 102,076
Unearned income 60,342 6,269
Total liabilities 506,407 328,794
Partners' capital (deficit):
General Partner:
Capital contribution 1,000 1,000
Cumulative net income 158,855 143,212
Cumulative cash distributions (160,259) (156,705)
(404) (12,493)
Limited partners (39,236.25 Units):
Capital contributions, net of
offering costs 35,602,279 35,602,279
Cumulative net income 3,040,496 2,549,406
Cumulative cash distributions (22,900,576) (22,581,583)
15,742,199 15,570,102
Total partners' capital 15,741,795 15,557,609
Total $ 16,248,202 $ 15,886,403
The Notes to Consolidated Financial Statements are an integral part of
these statements.
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<TABLE>
<CAPTION>
CONNECTICUT GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP
(a Connecticut limited partnership)
Statements of Operations
(Unaudited)
<S> <C> <C> <C> <C>
Three Months Ended Six Months Ended
June 30, June 30,
1995 1994 1995 1994
Income:
Base rental income $ 759,057 $503,344 $1,301,413 $1,062,913
Other operating income 65,915 41,202 114,345 97,964
Interest income 21,111 17,995 28,976 26,549
846,083 562,541 1,444,734 1,187,426
Expenses:
Property operating expenses 247,961 239,372 488,089 476,269
General and administrative 26,701 30,948 72,503 78,131
Fees and reimbursements to
affiliates 72,611 41,841 131,693 109,091
Depreciation and amortization 225,809 191,551 413,247 387,743
573,082 503,712 1,105,532 1,051,234
Net partnership operating
income 273,001 58,829 339,202 136,192
Gain on sale of property 83,399 245,873 83,399 245,873
Other income:
Equity interest in joint
venture net income 41,994 29,839 84,132 34,786
Net income $ 398,394 $334,541 $ 506,733 $ 416,851
Net income:
General Partner $ 14,560 $ 51,039 $ 15,643 $ 51,862
Limited partners 383,834 283,502 491,090 364,989
$ 398,394 $334,541 $ 506,733 $ 416,851
Net income per Unit $ 9.78 $ 7.22 $ 12.51 $ 9.30
Cash distribution per Unit $ 5.01 $ 7.50 $ 8.13 $ 11.16
The Notes to Consolidated Financial Statements are an integral part of
these statements.
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<TABLE>
<CAPTION>
CONNECTICUT GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP
(a Delaware limited partnership)
Statements of Cash Flows
For the Six Months Ended June 30, 1995 and 1994
(Unaudited)
<S> <C> <C>
1995 1994
Cash flows from operating activities:
Net income $ 506,733 $ 416,851
Adjustments to reconcile net income to net
cash provided by operating activities:
Gain on sale of property (83,399) (245,873)
Deferred rent credits 23,568 25,253
Depreciation and amortization 413,247 387,743
Equity interest in joint venture net income (84,132) (34,786)
Accounts receivable 53,151 69,168
Accounts payable 162,342 139,927
Other, net 59,417 (13,032)
Net cash provided by operating activities 1,050,927 745,251
Cash flows from investing activities:
Purchases of property and improvements (187,462) (153,388)
Payment of leasing commissions (15,979) (28,784)
Proceeds from sale of property 365,400 1,115,100
Payment of closing costs related to sale of
property (24,372) (53,100)
Distribution from joint venture 521,600 --
Net cash used in investing activities 659,187 879,828
Cash flows from financing activities:
Cash distribution to limited partners (319,554) (438,204)
Cash distribution to General Partner (3,554) (1,451)
Net cash used in financing activities (323,108) (439,655)
Net increase in cash and cash equivalents 1,387,006 1,185,424
Cash and cash equivalents, beginning of year 368,015 693,863
Cash and cash equivalents, end of period $ 1,755,021 $ 1,879,287
The Notes to Consolidated Financial Statements are an integral part of
these statements.
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<PAGE>
CONNECTICUT GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP
(a Connecticut limited partnership)
Notes to Financial Statements
(Unaudited)
Readers of this quarterly report should refer to the CONNECTICUT
GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP'S ("the Partnership")
audited financial statements for the year ended December 31, 1994 which are
included in the Partnership's 1994 Annual Report, as certain footnote
disclosures which would substantially duplicate those contained in such
audited financial statements have been omitted from this report.
1. Basis of Accounting and Significant Accounting Policies
a) Basis of Presentation: The accompanying financial statements were
prepared in accordance with generally accepted accounting
principles. It is the opinion of management that the financial
statements presented reflect all the adjustments necessary for a
fair presentation of the financial condition and results of
operations. Certain amounts in the 1994 financial statements have
been reclassified to conform with the 1995 presentation.
b) Cash and Cash Equivalents: Short-term investments with a maturity
of three months or less at the time of purchase are reported as
cash equivalents.
2. Unconsolidated Joint Venture - Summary Information
The Partnership owns a 26.08% interest in the Westford Office
Venture which owns the Westford Corporate Center in Westford,
Massachusetts. The remaining equity interest in the venture is held by
CIGNA Income Realty-I Limited Partnership, an affiliated limited
partnership.
Operations information for the Westford Office Venture:
Three Months Ended Six Months Ended
June 30, June 30,
1995 1994 1995 1994
Total income of venture $467,367 417,603 $961,299 $763,776
Net income of venture 161,021 114,412 322,593 133,382
Total assets and liabilities for the Westford Office Venture:
June 30, December 31,
1995 1994
Total assets $ 10,994,887 $ 12,671,892
Total liabilities 749,723 749,320
The Venture paid a distribution to the venturers of $2,000,000 in 1995,
of which the Partnership's share was $521,600.
3. Sale of Investment Property
Westside Industrials consisted of four one-story industrial
warehouse buildings with total square footage of 63,080. On April 27,
1995, the Partnership sold building #6 (totalling 12,600 square feet) for a
gross sales price of $365,400. After deducting closing costs and expenses,
the Partnership netted $341,028. The Partnership recorded a gain on the
sale of $83,399.
4. Deferred Charges
Deferred charges consist of the following:
June 30, December 31,
1995 1994
Deferred leasing commissions $ 896,414 $ 880,435
Accumulated amortization (737,876) (660,477)
158,538 219,958
Deferred rent credits 51,814 75,382
$ 210,352 $ 295,340
5. Transactions with Affiliates
Fees and other expenses incurred by the Partnership related to the
General Partner or its affiliates are as follows:
Three Months Ended Six Months Ended Unpaid at
June 30, June 30, June 30,
1995 1994 1995 1994 1995
Partnership management fee(a) $ 44,329 $14,940 $79,476 $61,418 $44,329
Property management fee (b)(c) 17,646 9,905 30,531 23,260 13,517
Reimbursement (at cost) of
out-of-pocket expenses 10,636 16,996 21,686 24,413 20,338
$ 72,611 $41,841 $131,693 $109,091 $78,184
[FN]
(a) Includes management fees attributable to the Partnership's 26.08%
interest in the Westford Office Venture.
[FN]
(b) Does not include management fees attributable to the Partnership's
26.08% interest in the Westford Office Venture of $7,475 and $6,104
for the three months ended June 30, 1995 and 1994, respectively,
and $14,825 and $11,395 for the six months ended June 30, 1995 and
1994, respectively.
[FN]
(c) Does not include property management fees earned by independent
management companies of $33,246 and $21,552 for the three months
ended June 30, 1995 and 1994, respectively, and $59,801 and $49,038
for the six months ended June 30, 1995 and 1994, respectively.
Certain property management services have been contracted by an
affiliate of the General Partner on behalf of the Partnership and
are paid directly by the Partnership to the third party companies.
6. Subsequent Event
On August 15, 1995, the Partnership paid a distribution of $537,930
to limited partners and $4,482 to the General Partner.
<PAGE>
CONNECTICUT GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP
(a Connecticut limited partnership)
Management's Discussion and Analysis of Financial
Condition and Results of Operations
Liquidity and Capital Resources
At June 30, 1995, the Partnership's cash and cash equivalents and
the Partnership's share of cash and cash equivalents from the Westford
Office Venture totalled $1,755,021 and $136,104, respectively, which will
be used to fund liabilities, Partnership reserves and a distribution to
partners. The Partnership paid the first quarter 1995 cash distribution of
$196,576 or $5.01 per Unit on May 15, 1995, representative of the
quarter's adjusted cash from operations, including adjustments to reserves.
The Partnership paid the second quarter 1995 distribution of $537,930 or
$13.71 per Unit on August 15, 1995, consisting of $341,354 or $8.70 per
Unit from the sale of a building at the Westside property and $196,576 or
$5.01 per Unit representative of the second quarter's adjusted cash from
operations. The Partnership's distributions from operations for the
remainder of the year should reflect actual operating results subject to
changes in reserves for liabilities or leasing risk.
Early in 1995, a user/owner approached the manager for the Westside
property and offered to buy vacant building #6 (12,600 square feet,
representing 100% of the vacant space at March 31, 1995) at a gross price
of $29 per square foot. On April 27, 1995, the Partnership sold building
#6 to JACLS Holding Company for a gross sales price of $365,400. After
closing costs and expenses, the Partnership netted approximately $341,000.
The sale, reflecting an above market sales price, has allowed the
Partnership to convert a vacancy and potential leasing problem into
distributable cash to the partners. The net proceeds have been distributed
to partners along with the second quarter distribution on August 15, 1995.
Operations at Westside for the second quarter of 1995 produced
$18,600 of adjusted cash from operations after tenant improvements and
leasing commissions of $6,700. After the sale of building #6, the property
is 100% occupied. Leasing exposure at the start of 1995, exclusive of
building #6, totalled 35,120 square feet. During the first quarter, one
lease for 4,000 square feet was renewed and during the second quarter a
3,120 square foot lease renewal was executed. An additional 14,000 is
expected to be renewed during the remainder of the year. A lease for a
tenant currently occupying 14,000 square feet (not included in the expected
to be renewed numbers) expired on January 31, 1995. The tenant, previously
held over as a month to month, requested to stay provided additional
parking is provided. As a result of positive discussions with an adjacent
property owner to purchase a 20,000 square foot land parcel, the tenant
executed a lease with the ability to terminate if the land purchase does
not close. The land owner withdrew its interest to sell the parcel, which
will likely lead to the tenant vacating the 14,000 square foot space.
As a result of strong growth in the Phoenix area and an increase in
interest of all property types in the general Phoenix market, however, the
Partnership has received inquires to purchase the remainder of the Westside
project. The Partnership may pursue a possible sale if the gross per foot
sales values are close to the values received in the two prior sales.
Lake Point's adjusted cash from operations for the second quarter
of 1995 totalled approximately $108,000 after $116,000 of capital
improvements. The property was 100% occupied at June 30, 1995. The 1995
leasing plan for the property includes renewals representing 27,102 square
feet and new leases representing 22,644 square feet. By the second
quarter, the renewals planned at the start of the year had not been
completed but negotiations began for an early renewal with a tenant
occupying 27,360 square feet expiring in 1997. New leases representing
10,740 square feet were executed during the first quarter. In addition, an
existing tenant (7,296 square feet) expanded by an additional 4,224 square
feet for a period of five months and extended the existing lease to
coincide. Although this tenant's lease is still set to expire during 1995,
a three year renewal has been negotiated and is expected to be signed in
the short term. Based on the leasing activity through the second quarter,
tenant leasing costs could be substantially less than those planned at the
start of the year.
Woodlands Plaza generated $301,000 of adjusted cash from operations
for the second quarter of 1995. Results for the second quarter include two
termination fees for early terminations totalling $210,000. Leasing
exposure for 1995 is 24,168 square feet, or 34% of net rentable area,
including an early termination of a 10,319 square foot tenant. During the
first quarter, an existing tenant expanded by 1,804 square feet for an
eight month period. During the second quarter, the 10,319 square foot
space vacated in April was leased for occupancy as of June 30, 1995. The
costs associated with the new lease will be funded from the termination fee
collected from the early termination. In addition a 2,990 square foot
tenant was replaced and two tenants with space totalling 2,822 did not
renew and vacated. Tenant finish and leasing costs for leasing planned in
1995 has been estimated to be in the $13 to $15 per square foot range.
At Westford Corporate Center, adjusted cash from operations for the
second quarter was $317,000 ($82,700 attributable to the Partnership's
interest) with no tenant improvements or leasing commissions for the
quarter. The property remains 100% occupied. Capital expenditures for the
year have been planned at approximately $140,000.
Results of Operations
Rental income increased by approximately $256,000 and $239,000 for
the three and six months ended June 30, 1995, respectively, as compared
with the same periods in 1994, as a result of the tenant changes at each of
the Partnership's properties. Rental income at Woodlands increased
approximately $245,000 and $296,000 due to extensive leasing activity at
the property during 1994 and two lease termination fees totalling $210,000
recorded in the second quarter of 1995. At Westside, rental income
decreased approximately $27,000 and $84,000 for the three and six months
due to the loss of 7,560 occupied square feet from the sale of buildings #1
and #2 in April 1994 and the loss of tenants occupying 12,600 square feet
in the latter half of 1994. In addition, 1994 included the residual of a
lease termination fee from 1993. Rental income at Lake Point increased
approximately $37,000 and $26,000 due to increased average occupancy. A
tenant's 4,224 square foot expansion in February 1995 and the addition of
two tenants occupying 8,940 square feet in March 1995 offset the first
quarter decrease in rental income due to the renewal of several tenants at
lower rates in the second quarter of 1994.
The increase in other income for the three and six months ended
June 30, 1995, as compared with the same periods of 1994, was primarily the
result of expense charge-back billings relating to the newly leased space
at Lake Point.
Property operating expenses increased as a result of increased
repairs and maintenance expenses at Westside, Lake Point and Woodlands for
the three and six months ended June 30, 1995, as compared with the same
periods in 1994. The increase was the result of the painting of the
vending lounge at Woodlands, roof repairs at Westside and HVAC repairs at
both Westside and Lake Point. The increases were partially offset by lower
property tax costs at Westside due to the sale of buildings #1 and #2 in
April 1994 and building #6 in April 1995.
The increase in fees and reimbursements to affiliates for the three
and six months ended June 30, 1995, as compared to the same periods of
1994, was due to increased partnership management fees as a result of
increased adjusted cash from operations.
Depreciation and amortization increased for the three and six
months ended June 30, 1995, as compared with the same periods in 1994, due
primarily to accelerated depreciation and amortization of assets associated
with vacated tenants at Woodlands and as a result of new tenant
improvements at Lake Point. Partially offsetting the increase was a
decrease in depreciation and amortization expense at Westside due to the
sale of buildings #1 and #2 in April 1994 and building #6 in April 1995.
The gains on sale were the result of the sale of building #6 in
April 1995 and the sale of buildings #1 and #2 in April 1994 of the
Westside property.
The joint venture operations improved for the three and six months
ended June 30, 1995, as compared with the same periods in 1994, due to a
tenant's expansions in the second and third quarters of 1994.
Occupancy
The following is a listing of approximate physical occupancy levels
by quarter for the Partnership's investment properties:
1994 1995
At 3/31 At 6/30 At 9/30 At 12/31 At 3/31 At 6/30
1. Woodlands Plaza II
Office Building
St. Louis, Missouri 81% 78% 84% 92% 94% 90%
2. Westside Industrials
(formerly Interpark)
Phoenix, Arizona (a) 67% 100% 85% 80% 80% 100%
3. Lake Point I, II, III
Service Center
Orlando, Florida 90% 83% 89% 89% 100% 100%
4. Westford Corporate
Center Westford,
Massachusetts (b) 75% 85% 100% 100% 100% 100%
[FN]
(a) On April 15, 1994, Westside Industrials sold two buildings,
reducing square footage from 105,560 to 63,080.
On April 27, 1995, Westside Industrials sold building #6, reducing
square footage from 63,080 to 50,480.
[FN]
(b) The partnership owns a 26.08% interest in the Westford Office
Venture which owns the Westford Corporate Center.
<PAGE>
CONNECTICUT GENERAL EQUITY PROPERTIES-I LIMITED PARTNERSHIP
(a Connecticut limited partnership)
Part II - Other Information
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
27 Financial Data Schedules
(b) No Form 8-Ks were filed during the three months ended
June 30, 1995.
<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.
CONNECTICUT GENERAL EQUITY PROPERTIES-I
LIMITED PARTNERSHIP
By: Connecticut General Realty Resources,
Inc. - Third, General Partner
Date: August 10, 1995 By: /s/ John D. Carey
John D. Carey, President and Controller
(Principal Executive Officer)
(Principal Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<PERIOD-TYPE> 6-MOS
<CASH> 1755021
<SECURITIES> 0
<RECEIVABLES> 44198
<ALLOWANCES> 4919
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 18493183
<DEPRECIATION> 6936414
<TOTAL-ASSETS> 16248202
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 16248202
<SALES> 0
<TOTAL-REVENUES> 1444734
<CGS> 0
<TOTAL-COSTS> 692285
<OTHER-EXPENSES> 245716
<LOSS-PROVISION> 5594
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 506733
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 506733
<EPS-PRIMARY> 0
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</TABLE>
