<PAGE>
FORM 10Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarterly Period Ended Commission File
June 30, 1997 No. 0-11980
VENETIAN PARK ASSOCIATES
(Exact name of Registrant as specified in its charter)
California 95-3887496
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
3250 Ocean Park Blvd., Ste. 380
Santa Monica, CA 90405
(Address of Principal Executive Offices, Including Zip Code)
Registrant's telephone number, including area code:
(310) 450-6866
-------------------------------------
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 .
--- ---
Indicate the number of shares (units) outstanding of each of the issuer's
classes of common stock (units) as of the latest practicable date
(applicable only to corporate issuer) 6,041 limited partnership units
issued and outstanding.
<PAGE>
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
REPORT ON FORM 10-Q
For the Quarter Ended June 30, 1997
INDEX
Page No.
--------
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS:
Balance Sheets 3-4
Statements of Operations 5-6
Statements of Changes in Partners' Equity 7
Statements of Cash Flows 8
Notes to Financial Statements 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. 10
PART II. OTHER INFORMATION 11
SIGNATURE 12
2
<PAGE>
PART I. FINANCIAL INFORMATION
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
BALANCE SHEETS
ASSETS
JUNE 30, DECEMBER 31,
1997 1996
------------ ------------
CURRENT ASSETS:
Cash $ 105,231 $ 286,908
Tenants' Rents Receivable 2,778 2,778
Tenants' Security Deposits 104,879 89,460
Prepaid Expenses 8,852 24,886
------------ ------------
TOTAL CURRENT ASSETS 221,740 404,032
------------ ------------
RESTRICTED DEPOSITS & FUNDED RESERVES:
Mortgage Escrow Deposits 78,609 54,633
Reserve for Replacements 128,914 141,237
------------ ------------
TOTAL RESTRICTED DEPOSITS & RESERVES 207,523 195,870
------------ ------------
Fixed Assets, Net 6,996,296 7,136,468
------------ ------------
OTHER ASSETS:
Prepaid Loan Fees 19,244 19,722
Deposits 2,175 939
------------ ------------
TOTAL OTHER ASSETS 21,419 20,661
------------ ------------
TOTAL ASSETS $ 7,446,978 $ 7,757,031
------------ ------------
------------ ------------
The accompanying notes are an intergral part of these Financial Statements. 3
<PAGE>
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
BALANCE SHEETS
LIABILITIES AND PARTNERS' EQUITY
JUNE 30, DECEMBER 31,
1997 1996
------------ ------------
CURRENT LIABILITIES:
Accounts Payable & Accrued Expenses $ 45,973 $ 57,479
Accrued Interest 35,466 35,466
Tenants' Prepaid Rents 7,124 5,184
Tenants' Security Deposits 92,386 101,338
Current Portion of Long Term Debt 115,920 115,920
------------ ------------
TOTAL CURRENT LIABILITIES 296,869 315,387
------------ ------------
OTHER LIABILITIES:
Mortgage Payable - 1st Trust Deed 5,383,181 5,440,034
------------ ------------
TOTAL OTHER LIABILITIES 5,383,181 5,440,034
------------ ------------
Partners Equity 1,766,928 2,001,610
------------ ------------
TOTAL LIABILITIES AND PARTNERS EQUITY $ 7,446,978 $ 7,757,031
------------ ------------
------------ ------------
The accompanying notes are an intergral part of these Financial Statements. 4
<PAGE>
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
THREE MONTHS THREE MONTHS
ENDED ENDED
JUNE 30, JUNE 30,
1997 1996
------------ ------------
OPERATING REVENUE:
Rental Income $ 339,833 $ 379,769
Other Rental and Interest Income 23,436 17,801
------------ ------------
TOTAL OPERATING REVENUE 363,269 397,570
------------ ------------
OPERATING EXPENSES:
Repair and Maintenance 103,922 45,635
Utilities 41,878 41,012
Managers Salaries 45,510 37,966
Mnagement Fees 18,128 19,896
General and Administrative 51,057 27,433
Real Property Taxes and Insurance 33,995 33,141
Financial Expenses 111,145 114,843
Depreciation 70,086 70,587
Amortization 239 238
------------ ------------
TOTAL OPERATING EXPENSES 475,960 390,751
------------ ------------
NET INCOME (LOSS) FROM OPERATIONS $ (112,691) $ 6,819
------------ ------------
------------ ------------
The accompanying notes are an intergral part of these Financial Statements. 5
<PAGE>
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
SIX MONTHS SIX MONTHS
ENDED ENDED
JUNE 30, JUNE 30,
1997 1996
------------ ------------
OPERATING REVENUE:
Rental Income $ 696,928 $ 773,820
Other Rental and Interest Income 41,850 33,868
------------ ------------
TOTAL OPERATING REVENUE 738,778 807,688
------------ ------------
OPERATING EXPENSES:
Repair and Maintenance 159,769 90,650
Utilities 87,647 77,880
Managers Salaries 89,263 78,250
Management Fees 36,903 40,401
General and Administrative 106,840 76,180
Real Property Taxes and Insurance 67,993 66,282
Financial Expenses 223,375 229,349
Depreciation 140,172 141,174
Amortization 478 476
------------ ------------
TOTAL OPERATING EXPENSES 912,440 800,642
------------ ------------
NET INCOME (LOSS) FROM OPERATIONS $ (173,662) $ 7,046
------------ ------------
The accompanying notes are an intergral part of these Financial Statements. 6
<PAGE>
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
STATEMENT OF PARTNER'S EQUITY
SIX MONTHS
ENDED
JUNE 30,
1997
------------
Balance at January 1, 1997 $ 2,001,610
Net Income (loss) (173,662)
Cash Distributions (61,020)
------------
BALANCE AT JUNE 30, 1997 $ 1,766,928
------------
------------
The accompanying notes are an intergral part of these Financial Statements. 7
<PAGE>
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
STATEMENTS OF CASH FLOWS
SIX MONTHS SIX MONTHS
ENDED ENDED
JUNE 30, JUNE 30,
1997 1996
------------ ------------
Cash flows from operating activities:
Net Income/(Loss) $ (173,662) $ 7,046
------------ ------------
Adjustments to reconcile net (loss)
income to net cash provided by
operating activities:
Depreciation and amortization 140,650 141,650
Change in assets - (increase) decrease:
Tenant rents receivable 0 0
Tenants security deposits (15,419) (4,310)
Prepaid expenses 16,034 2,067
Restricted deposits and reserves (11,653) (70,051)
Deposits (1,236) 58
Change in liabilities - increase (decrease):
Accounts payable and accrued expenses (11,506) 55,439
Tenants prepaid rents 1,940 4,948
Tenants security deposit payable (8,952) 4,354
------------ ------------
Total adjustments 109,858 134,155
------------ ------------
Net cash flow provided by (used in)
operating activities: (63,804) 141,201
------------ ------------
Cash flow from financing activities:
Principal reduction of long-term debt (56,853) (53,555)
Capital distributions to partners (61,020) 0
------------ ------------
Net cash used by financing activities (117,873) (53,555)
------------ ------------
Net increase (decrease) in cash (181,677) 87,646
------------ ------------
Cash at beginning of period 286,908 127,972
------------ ------------
Cash at end of period $ 105,231 $ 215,618
------------ ------------
------------ ------------
Supplemental disclosures of cash
flow information:
Cash paid during the year for:
Interest expense $ 215,198 $ 218,192
State franchise tax 800 800
The accompanying notes are an intergral part of these Financial Statements. 8
<PAGE>
Venetian Park Associates, Ltd.
Notes to Financial Statements
Six Months Ended June 30, 1997
1) BASIS OF PRESENTATION
See the Form 10-K for the Year Ended December 31, 1996 for appropriate
disclosure to the Financial Statements. The Financial Statements included
in the 10-Q omit substantially all disclosures.
2) ADJUSTING ENTRIES
All adjustments which are necessary for a fair presentation of the
Financial Statements have been made to the Financial Statements presented.
All such adjustments are of a normal recurring nature.
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
RESULTS OF OPERATIONS
GENERAL
Operating income for the first six months of 1997 was $738,778 vs. $807,688
during the corresponding period last year, a decrease of $68,910 due
primarily to continuing vacancy losses. Because of the vacancies and the
ongoing repair and rehabilitation work, the Property sustained a negative
cash flow of $181,677 this year through June 30th versus a positive cash
flow of $87,646 last year during the corresponding period.
The scheduled monthly rent roll for June 1997, was $148,996 vs. $147,505 at
the same time the year before, an increase of $1,491. Rental losses during
the first half of this year (vacancies, net delinquencies and rental
discounts) amounted to $191,823 vs. $106,816 during the corresponding
period last year, a jump of $85,008. We're frustrated in the sense that
we've rented 69 apartments this year through June 30th; yet, we've had 82
move-outs. We continue to have excellent tenant traffic. At the present
time we have 21 deposits; however, we have 16 notices to vacate. Although
we'll have a net influx of 5 tenants, we will still have 47 apartments
available for rent.
Operating expenses during this year's first half were $912,440 vs. $800,642
during the corresponding period last year, an increase of $111,798. We
have made substantial progress in rehabilitating the Property's vast
landscape areas and correcting exterior deterioration problems. The
partial exterior painting program is proceeding on schedule, as is the
replacement of fencing, rotted wood and the removal of dead trees. We have
had to spend approximately $10,000 this year to correct problems created by
damaged hot water lines in apartment floor slabs. At the same time, we've
had to replace refrigerators, dishwashers and laundry equipment, to say
nothing of $19,155 in carpeting/flooring and $11,494 in window coverings.
On June 30, 1997, the Property's cash accounts amounted to $210,110
including $104,879 in tenant refundable security deposits. Last year on
the same date, the cash accounts contained $376,368 including $89,460 in
refundable deposits. On June 30th of this year, the Property's FHA
replacement reserve account contained $128,914 vs. $141,237 at the same
time last year.
LIQUIDITY AND CAPITAL RESOURCES
The last time cash was distributed to the partners was January, 1997 in the
amount of $61,020 for the 4th Quarter of 1996. Since HUD regulations
restrict distributions to a semi-annual basis, the next distribution if
available, will resume on January, 1998.
10
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not Applicable
ITEM 2. CHANGES IN SECURITIES
Not Applicable
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not Applicable
ITEM 5. OTHER INFORMATION
Not Applicable
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) EXHIBITS
Exhibits other than those listed have been omitted because they
are nonexistent, inapplicable or because the required information
is given in the Financial Statements or notes thereto.
b) REPORTS ON FORM 8-K
Not Applicable
11
<PAGE>
SIGNATURE
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 in the City of Santa Monica of
California.
VENETIAN PARK ASSOCIATES, LTD.
(A California Limited Partnership)
DATED:June 30, 1997 By /s/ Norman Jacobson
----------------------------------------
Norman Jacobson
General Partner
12
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<PAGE>
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<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 417,633
<SECURITIES> 0
<RECEIVABLES> 33,049
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 450,682
<PP&E> 11,015,288
<DEPRECIATION> 4,018,992
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<CURRENT-LIABILITIES> 296,869
<BONDS> 5,383,181
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<INCOME-PRETAX> (173,662)
<INCOME-TAX> 0
<INCOME-CONTINUING> (173,662)
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (173,662)
<EPS-PRIMARY> 0
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